Mining Equipment, Technology and Services

A Roadmap for unlocking future growth opportunities for Australia

Executive summary

MAY 2017

CSIRO FUTURES
CSIRO Futures is the strategic advisory and foresight arm of Australia’s national science agency.

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Executive Summary

Australia’s Mining Equipment, Technology and Services (METS) sector has an important role to play in the continued success of Australia’s mining industry.

However, the mining industry’s increasing dependence on specialist technologies, combined with a changing global landscape is creating new opportunities and threats for the future of Australia’s METS sector.

This Industry Roadmap, through a process of sector consultation and analysis, aims to support this decision making process. It explores global mining megatrends and Australia’s comparative advantages and identifies five opportunities where Australian METS companies can be internationally competitive. These opportunities are supported by a discussion of the underlying science and technology investments and management skills, culture, processes and business models required to unlock them.

Global mining megatrends are reshaping the METS sector, requiring Australian companies to re-evaluate their role in the industry’s future.

The changes are challenging the viability of conventional practices and technologies, creating opportunities for new business models and reducing barriers to entry for new players. Australian METS companies need to ensure that their strategy is aligned with the trends that are set to drive change in the industry over the next 20 years.

Figure 1: Global mining megatrends

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The innovation imperative

A drop in commodity prices, along with rising costs, declining ore grades and concerns about decreasing productivity are compelling the mining industry to focus on operational costs. The mining industry requires creative and innovative solutions to become more productive, sustainable and achieve financial growth.

Plugged in and switched on

Digital technologies, data analytics and automation along with greater mobility and increasing connectivity are creating exciting opportunities for the mining industry. These connected technologies are improving safety and environmental outcomes, increasing productivity and driving disruptions across the mining value chain and life cycle.

The era of accountability

Mining companies will move forward as good corporate citizens, where accountability and environmental success exceeds expectations, strengthening community engagement and support for existing and new projects into the future.

New supply, new demand

Increasing urbanisation and rapid development of emerging economies will continue to spur demand for mineral resources, which will be supplied from developing nations and new geographic domains through technology advancements. Rapid adoption of new consumer technologies is also changing demand for high value, low volume metals and minerals.

The knowledge economy

As emerging economies continue to develop their mining sectors, support in developing applicable skills, services and technologies will be required for efficient and sustainable exploitation of mineral reserves. In advanced economies, increased adoption of specialised digital technologies are resulting in greater collaboration, new business models and fierce competition for talent.

Rethinking our reserves

Rates of discovery for high-quality and accessible ores are declining and not keeping up with depletion. Solutions that help exploration under cover, extend the life of a mine and optimise recovery, combined with social expectations for recycling, re-use and urban (or above ground) mining are all playing a role in changing what is deemed economic.

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The METS sector has comparative advantages that can be lost if not nurtured, and disadvantages that can become advantages if prioritised.

Australia’s METS sector is underpinned by a number of unique comparative advantages that help improve its competitiveness on a world stage. These advantages have related disadvantages that the sector needs to be cognisant of because, despite not being uniquely Australian, they will impact the future competitiveness of the sector if not addressed.

Continued success for Australian METS companies is not guaranteed, as high rates of digital and technological change in the mining sector no longer create a strong barrier to entry. Observations of change and disruption from other industries, such as automotive and aerospace, are hard to ignore. As such, METS companies must prepare for increased competition from within and outside of the sector and focus on innovative and creative solutions to provide greater value and ensure continued success and future growth.

Figure 2: Australia’s comparative advantages and related disadvantages

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Comparative advantages

Related disadvantages

Advantages can be easily lost if not continually invested in

Disadvantages can become advantages by being prioritised and addressed

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There are many opportunities, however Australian METS companies need to prioritise the right solutions to be internationally competitive.

The culmination of the Roadmap process is the identification of five opportunities to support the continued growth of the Australian METS sector. These opportunities span the mining value chain with the Data Driven Mining Decisions and Social and Environmental Sustainability opportunities playing a pivotal and enabling role across the other opportunities. Each opportunity is supported by example METS solutions that could be taken to market, which aim to help businesses identify and prioritise potential areas of specialisation and differentiation within each opportunity.

Figure 3: Identified opportunities for the Australian METS sector

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DATA DRIVEN MINING DECISIONS

Rapidly evolving digital technologies are providing opportunities to enable both better and faster decisions by making relevant data available anywhere and just-in-time.

Example METS Solutions

SOCIAL AND ENVIRONMENTAL SUSTAINABILITY

Growing societal concern about the impacts of mining will drive the development of new processes and technologies to improve social wellbeing, environmental performance and economic prosperity.

Example METS Solutions

EXPLORATION UNDER COVER

Worldwide the majority of near-surface, high quality mineral deposits have already been identified and developed, requiring new technologies to identify new reserves deeper under cover.

Example METS Solutions

ADVANCED EXTRACTION 

Deeper, more complex and lower grade orebodies combined with the need for a lower environmental footprint will drive the development of advanced methods of extraction.

Example METS Solutions

MINING AUTOMATION AND ROBOTICS

Recent technology cost and performance breakthroughs in robotics, automation, artificial intelligence, data communications and vision systems are enabling safer and more efficient operations.

Example METS Solutions

*The five opportunities for growth are not considered to be an exhaustive list of opportunities available to the METS sector.

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Businesses must take action to unlock opportunities, investing in business transformation and new science and technology capabilities.

In order to unlock the various growth opportunities, Australian METS companies should consider the following actions:

Figure 4: Summary of changes per growth opportunity

 

Business Enablers

Enabling Science and Technology

People
and skills

Culture and collaboration

Process and standards

Data driven mining decisions

Foster skills to improve interpretation, modelling and decision making using big and small datasets.

Improve how the business uses and responds to data, moving from reactive to proactive.

Address interoperability and integration issues, working with industry and research to implement appropriate data standards.

  • Sensors and the Internet of Things
  • Analytics and optimisation
  • Visualisation
  • Cyber security

Social and environmental sustainability

 

Establish cross-disciplinary skills – engineering, financial, social, environmental and economic – to better demonstrate the long-term value proposition of triple bottom line solutions.

Connect miner, government, social and environmental groups to support and improve technical and regulatory decision making processes.

Assess operational and regulatory barriers that may limit social and environmental monitoring and reporting, and the associated liabilities.

  • Monitoring and sensing
  • Decision support and stakeholder engagement
  • Site and equipment design

Exploration under cover

Develop geophysical and geochemical knowledge, data analysis, modelling and geographic information system (GIS) skills.

Increase multidisciplinary collaboration and support activities that improve decision making and resource governance.

Identify and promote best practice in data acquisition, processing, sharing and integration to improve data quality and reduce issues with integrating large exploration datasets.

  • Next generation drilling technologies
  • Expanding exploration knowledge and processes

Advanced extraction

Develop skills in installing, operating and manufacturing advanced extraction technologies as well as advanced drilling, sensing, sorting and processing technologies.

Improve alignment of performance drivers and foster interdisciplinary collaboration across mining, metallurgical and geological personnel.

Support development of regulatory frameworks for advanced extraction technologies, including standards for interoperability of technologies.

  • Advanced drilling and cutting technologies
  • Sensors and ore sorting
  • Integrated beneficiation technologies

Mining automation and robotics

Foster skills in the operation and maintenance of autonomous and robotic equipment; develop technical expertise in material sciences and nanotechnology.

Challenge the role of automation and robotics in mining, and use change management to address cultural acceptance of technologies.

Support sector wide actions to address interoperability issues, leveraging existing initiatives – e.g. AMIRA (P1025), EMESRT and GMSG projects.

  • Machine vision, materials and robotics
  • Control systems and algorithms
  • Virtual and augmented reality

A changing business environment and evolving market creates support for a range of new business models within the METS sector.

Each opportunity identified within this report is supported by example business models that may be leveraged across a range of solutions and opportunities.

Figure 5: Business model examples per growth opportunity

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Data Driven Mining Decisions

Social and Environmental Sustainability

Exploration Under Cover

Advanced Extraction

Mining Automation and Robotics

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Long term success will be achieved by increasing collaboration across the entire Australian mining and METS innovation ecosystem.

While the identified growth opportunities and enablers largely focus on actions for individual METS businesses, long-term success requires collaboration across the entire Australian innovation ecosystem – including miners, METS, government, investors, educators and the research community.

From a science and technology perspective, the research community will need to ensure projects are well aligned to industry needs and that technologies are developed from market pull rather than technology push. This includes streamlining and improving the approach to industry partnership, ensuring the research engagement process is efficient and not overly complicated or onerous on industry.

METS SECTOR VISION

The Australian METS industry is an aligned, efficient and agile industry ecosystem with a high degree of collaboration, global leadership in innovation, and a growing share of the global market.1

A key vehicle for achieving this is the METS Ignited 10 Year Sector Competitiveness Plan (SCP) and the key programs of work and industry knowledge priorities (IKPs) that have been identified. This Roadmap seeks to complement the SCP and the sector’s broader vision providing input into current and future IKPs. Given the cyclical nature of the industry, the report structure also provides a narrative and key questions that can be continuously applied at a company level to inform the strategic decision making process.

Call to action

Working together, the Australian METS sector is well placed to succeed. METS businesses will need to take calculated risks and invest in the future, and can use this Roadmap and the SCP as a tool for sustained competitive advantage (Figure 6).

Figure 6: Using the METS Roadmap

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Collaborate and leverage the mining and METS innovation ecosystem

1. Evaluate and accept the implications of the changing global mining sector

2. Explore strengths and weaknesses in the context of the global landscape

3. Identify opportunities for growth and prioritise areas of specialisation

4. Develop the right skills, culture, processes and business models

5. Gain practical experiences in emerging science and technology areas

6. Redefine strategy based on new information and experiences

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1 METS Ignited (2016). Industry-led Growth Centre for METS. [Online] Available from: http://www.metsignited.org/Category?Action=View&Category_id=72 Accessed 19/12/2016