Australian miners spearheading disruptive technology movement – Fitch
Australia’s strong information communications technology and energy infrastructure, highly skilled labour force and government support ensures that its miners will continue to be the frontrunners in implementing technology to cut costs, enhance efficiency and increase mine safety, the latest report by Fitch Solutions states.
The report notes that major players will stay ahead of the race, while the high cost of expensive technology will keep smaller companies from implementing these technologies, thereby increasing the disparity between major and juniors.
Operations that are already well-governed, low-cost and economically-sound stand to benefit most from the added technology, but technology applied on an inefficient operation will only magnify the inefficiency, employing technology in mining does not guarantee increased efficiency.
Fitch highlights Rio Tinto as the pioneer in technological integration in mining and says that the major will remain ahead of its league. Fortescue Metals Group (FMG) is following close behind and Fitch sees strong potential in BHP.
In 2008, Rio Tinto pioneered the use of automation in the mining sector, globally, and currently has the largest fleet of autonomous trucks in the industry. The trucks, made by Komatsu, have reduced fuel consumption by 13%. At the end of 2017, Rio announced a more than 50% expansion of its autonomous fleet to more than 130 trucks by 2019.
The report also notes that the global miner is establishing the world's first fully-autonomous heavy haul, long distance rail network, set for full commissioning toward the end of the year. In recent trials, the autonomous trains delivered products to the port nearly 20% faster than a manned train.
Rio was also the first mining company to achieve fully automated hole pattern drilling without human intervention. The Autonomous Drill System enables a single operator from a remote location to operate up to four autonomous drill rigs simultaneously, a solution that s safer and enables improved precision and equipment utilisation.
The proprietary Mine Automation System – a fusion database, with artificial intelligence and machine learning capabilities embedded – enables operational insights in real-time to step up productivity performance.
The Rio Tinto Centre for Mine Automation has been in partnership with the University of Sydney for ten years. Partnering has been mutually beneficial, allowing students to take theoretical models and test them in the field while giving Rio access to some of the “brightest minds in mining”.
Rio claims that while automation has brought a reduction in some traditional mining roles, it has also created new, skilled jobs.
Nevertheless, the report notes that the number of people employed by Rio Tinto has decreased drastically from 106 000 in 2008, when the first autonomous trucks were launched, to 38 044 in 2017.
Fitch adds that FMG will remain a technology giant in the mining arena leading closely behind Rio. The company intends to become the first iron-ore operation in the world to have a fully autonomous fleet through the expansion of its autonomous haulage system (AHS) fleet.
AHS technology was first introduced at the firm's Solomon hub in 2013, resulting in a productivity hike of more than 30% according to the company. FMG is also the first in
Western Australia to control a railway from outside the region of operation.
As of late 2017, drilling machines are also driverless at Solomon Hub, with two drill controllers monitoring three rigs each using remote cameras and a wall of screens. In April 2018, FMG introduced the first trucks from its autonomous haul fleet fitted with AHS into operation at Christmas Creek in Australia’s Pilbara region.
The expansion of the company’s autonomous haul fleet is slated to involve the conversion of around 100 haul trucks at the Chichester Hub.
The new Eliwana iron-ore mine and railway project will also use the latest technology, including autonomous trucks.
FMG also maintains that the company's approach to autonomy does not translate to a smaller workforce, and that a significant portion of the planning for the automation expansion project included the development of workforce skills.
The report notes that FMG employees have either been upskilled, relocated to other operations, or given opportunities for new jobs within the company.
BHP is another leader of integrating technology in mining operations. The firm's autonomous drills at Yandi and Mining Area C have increased productivity and reduced wear and tear maintenance costs.
Its fleet of self-driving trucks at Jimblebar has reduced potential safety incidents involving vehicles, increased truck utilisation and reduced haulage costs by about 20%. BHP also uses artificial intelligence to improve decision-making in supply chains, dramatically reducing cancellations due to congestion, while enabling the company to run more trains.
Fitch notes, however, that despite mining companies retraining their employees and re-employing them in higher-skilled positions, the number of traditional roles lost to technological integration will not be offset by modern ones.
The organisation also does not believe that advanced technologies will gain traction in mines outside Australia or developed nations in the near future, owing to the multiple supportive infrastructure and the availability of skilled labour that is required.
Given the large proportion of mining operations in less developed regions like Africa and South America, Fitch states that technological disparity will persist in mining operations for years to come.
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