Technology innovation in the mining industry

(edited)

I'm this week in Geneva at the UN for the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development. This year one of the main topics is technology innovation in the mining industry. The trend seems to be leading towards cleaner and safer mines but automation could also drastically reduce the number of jobs in mining or shift them from the mine site to a remote location even abroad (remote operated robots or vehicles) . The delegates from the countries heavily depending on the extractive industry seem to be very concerned by the potential impacts on jobs and tax revenues (robots don't pay taxes). A top manager from a major mining company explained that some majors are really considering fully autonomous mines with zero jobs onsite. Another one admitted that humans were viewed as obstacles to a higher profitability...

Some technologies are clearly bringing some positive changes. The shift to electric vehicles in underground mines will improve the air quality and reduce the cost of mine ventilation. Automation putting the people away from the dangerous spots will reduce the safety risks. Technology will improve the traceability of the production from the mine to the end user.

But the disruptive vision of robot operated fully autonomous mines is still somewhat frightening. The miners could be constrained to leave the high profitable fully autonomous major mines  and switch to  artisanal and small scale mining, low tech but labor intensive. And what will be the level of acceptance by the local population if the local mine is not providing local jobs ?

How do you think technology will shape the future of mining ?

 

 

 

Edited by Guillaume Albasini
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Automation will happen.  If local populations fight it, they'll watch the mines go elsewhere and be left with nothing.  If local government raises taxes to compensate, it will watch the mines go elsewhere, and the locals will still be left with nothing.  They might be able to tax a little, but not to the point where other mines become competitive.  Such is the free market.

That leaves people one option: get educated on the new technology.  "Automated" technology still requires factories to build equipment, remote operators, local skilled trades, scientists & engineers to improve the technology, etc.  If the jobs truly can be done remotely, developed nations with educated populations should benefit. 

It would also be interesting if automation made mining more attractive in developed nations.  When labor costs and safety problems are removed, mining in the US becomes more attractive.  That also allows us to avoid the gaggle of costs associated with foreign mining: local political risks, logistical costs, inventory costs, quality issues, lack of education, etc.  When mining automation takes off, it will be interesting to see where the mines are placed. 

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Very interesting topic. I read the other day a survey by KPMG, if I remember correctly, about Big Oil and tech, and it turned out most execs in the industry actually expected automation and digitalisation to create more jobs than they will eliminate. Of course, these would be different jobs...

@mthebold, not sure mines can be moved so easily. :) Look at how Freeport bowed the knee to Indonesia to keep its operations at Grasberg. I suppose some sort of compromise will need to be forged.

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Agree. Automation will happen. But it will be a slow development. Mining is a capital intensive industry and there are a lot of money sunk into infrastructure etc, miners will not abandon this if they have a choice. 

It is like a the returning renewables discussion here - our societies is built around an infrastructure / technology. It takes a long time to change this. 

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On 10/28/2018 at 12:35 AM, Marina Schwarz said:

Very interesting topic. I read the other day a survey by KPMG, if I remember correctly, about Big Oil and tech, and it turned out most execs in the industry actually expected automation and digitalisation to create more jobs than they will eliminate. Of course, these would be different jobs...

@mthebold, not sure mines can be moved so easily. :) Look at how Freeport bowed the knee to Indonesia to keep its operations at Grasberg. I suppose some sort of compromise will need to be forged.

Possibly. I should take my own words with a grain of salt given that I haven't run the numbers. 

One important question though: when Freeport bent the knee, did they do so: 

1)  With new automation technology available? 

2)  With domestic tax cuts in place? 

3)  With the Trump administration pushing for domestic industry?

4)  While making a decision to build a new mine, or in an attempt to salvage existing assets? 

I.e., under what conditions did they make that decision? 

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They probably do have new tech, I haven't checked. I think they did want to keep operating Grasberg -- there aren't many new copper mines coming online. i also don't recall any tax incentives in Indonesia, rather the opposite: they demanded that miners make more local investments. I may very well be missing a lot, though, I haven't followed evens particularly closely.

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