The mining and metals industry is facing a paradigm shift, as it incorporates greater sustainability, absorbs technical innovation from other sectors, and seeks a way forward in the midst of a pandemic. By focussing on modernization, digitalization, and transparency, the industry can strengthen its foundational role in a rapidly evolving global economy. However, effectively managing related changes will require greater adaptability, transformative thinking, and building stronger relationships in a global context.
Increasing energy demand and low-carbon technologies will boost mineral and metal needs
Increased global energy demand resulting from industrialization and electrification will most likely be met by the increased use of low-carbon technologies. Renewables are the fastest growing source of energy, but are also more material-intensive than other energy sources. As technological development progresses it has become easier to identify which materials will be most necessary for the energy transition - electric vehicles, solar photovoltaics, and wind energy have all demonstrated significant and diverse needs that go beyond base metals and common minerals. Even industrial minerals and metals such as copper, aluminium, and steel will see substantial increases in cumulative demand for use in wind turbines, solar panel frames, copper connectors, and vehicles. Meanwhile lithium, cobalt, graphite, indium, vanadium, nickel, silver, and rare earths will see significant demand increases that may exceed current reserves. Though forecasts vary, and creative market responses to this demand are likely, a steadily growing body of research examining the materials necessary for the energy transition shows that an unprepared extractive industry could struggle to meet these needs - and possibly slow the integration of renewables.
It is therefore important to remember that the key factors governing mineral extraction are not physical limitations, but rather the social, environmental, and economic problems within the industry. The fact that a low-carbon energy environment is intrinsically linked to mining development should not be overlooked; according to the United Nations’ Global Resources Outlook 2019, metals and non-metallic minerals account for as much as 20% of global emissions. Rebalancing mineral portfolios and developing environmentally sustainable processes will be essential for the industry to operate in a low-carbon environment. The shift towards renewables will require significant changes to operations, and companies will not be able to provide minerals for a low-carbon environment while simultaneously polluting the very same environment. Ultimately, such changes will benefit the industry, as public perception of the industry as environmentally destructive limits its ability to grow. Particularly in light of volatile commodity prices, geopolitical considerations, and other shifting variables, the clearest path forward is a healthy, environmentally friendly mining industry that is flexible enough to adapt and facilitate renewable technologies.
New technologies can enable sustainable investment, protect workers, and help re-evaluate long-standing methods
Data analytics and machine learning have helped the mining and metals industry maximize productivity and efficiency. In terms of extraction, for example, the use of “LHD” (load, haul, dump) data has aided the identification of bottlenecks in variable processing. The collection and evaluation of data is an essential first step in building a technical foundation for more complex applications. It also serves as the basis for a positive feedback loop, as newly-collected data and insights can be used to influence operational models, risk assessment, mining planning, the integration of new technologies, and virtually every aspect of mining and metals. As a result, technical integration will be a key enabler of the mining industry’s more sustainable and responsible future. Many data-aided improvements are at an early stage, but have already begun to highlight new developmental pathways for mining and metals companies. The use of artificial intelligence in the exploration process, for example, has helped combat a declining rate of discovery, and has identified deposits that would have otherwise been difficult to locate. It can also be used to analyse the relative benefits of extraction sites, leading to greater production and profit.
Predictive analytics through machine learning can meanwhile be used to better understand behavioural patterns and supplier trends - which can lead to better mine planning and risk assessment. The life cycle of a mine lasts decades, as it is subjected to increasingly common price fluctuations; predictive analytics can therefore help justify related capital expenditures that would have once been considered unfeasible. One example is the deployment of renewable energy sources at mine sites. The adoption of solar panels and use of renewable energy sources has been hindered by concerns about initial capital costs, price volatility, and the possibility of mine closures - but with a better understanding of market changes and supplier demand, these types of variabilities can be quantified. Even environmental, social and governance (ESG) concerns can be addressed through automation and blockchain technology; the verification of environmental data and the automation of dangerous processes mean that workers can be less exposed to potential harm. Ultimately, these developments and uses can optimize and revitalize aspects of the mining and metals industry, as they spur a re-evaluation of approaches and methods that have remained stagnant for decades.
A greater focus on sustainability and innovation could help the mining and metals sector compete for talent
The mining and metals industry must tap the workforce necessary to fuel its transition to greater sustainability and digitalization. Negative public perception has limited the industry’s ability to replace its ageing workforce; concerns about its future are especially prominent during mining’s boom cycles, when enrolment in and graduation from mining-related fields lag behind demand. Commodity price volatility has further complicated this cycle, by making it harder to predict needs. Companies must re-evaluate both their governance structures, and what employment with them means for the communities where they operate. The industry’s role in renewable technologies has not substantially increased its attractiveness to potential employees - it is still perceived as creating high levels of social and environmental risk, despite its links to low-carbon technology. Renewable technology policy efforts often overlook the materials necessary for this transition, and the workforce needed to supply them. The US, Canada, and the European Union have all discussed plans to increase enrolment in mining engineering, minerals, and economic geology programs. Yet, the mining industry’s reputation as dated and not technically innovative continues to diminish interest from graduates in science, technology, engineering, and mathematics (STEM) fields.
Fields related to analytics and computer science are generating zettabytes of new data for analysis and use across an array of industries that did not exist 50 years ago. So, while government workforce incentives and a commitment to environmental, social, and governance (ESG) transparency can help the mining and metals industry, it needs to consider more fundamental change. For companies, this means considering what a truly interdisciplinary, technical workforce that incorporates machine learning and predictive analytics looks like. Once this internal modernization and restructuring takes place, and ESG concerns are addressed, there is no reason the industry should not be able to compete for talent with other technical industries. At the same time, ignorance of sourcing or safety concerns will no longer a viable defence for inaction. Miners and international employees should not be working in hazardous conditions, and they should be provided with the necessary tools to help their communities. Whether this is accomplished through workforce education, infrastructure, or equality targets, sustainable development needs to be fully incorporated into the mix. Ultimately, a well-educated, well-supported workforce will be required to navigate a rapidly changing industry.
Source - World Economic Forum
Related articles:
