By Bas Mutsaers – MMID Director ISA.org
Melbourne 18 July 2020
Welcome to the MMID home page
Welcome to “ISA CONNECT” our new member platform. It’s great you managed to find it and we hope you make good use of this recent investment by the ISA board. It has an option to meet with your peers, an area for skills development and so much more. The MMID team really appreciates this development.
As the world is getting used to the new normal, Mining and Metals companies are trying to move on and keep their volumes up and their supply chains running. This is needed just to keep their position or when trying to gain a couple percentage points of their market share; a market share that might have shrunk in these difficult times.
Agile companies are the best positioned to respond to the infrastructure growth our sector is expecting now that governments are investing over 1 trillion dollars worldwide to keep people in jobs and stimulate both the local and global economy.
ISA expertise never been more relevant
The ISA organisation has long been recognised for the value they can bring in both good and challenging times. Examples are:
-ISA their focus and expertise in security, adding resilience to our customers operations or;
-ISA their focus on interoperability standards leading to solutions that help us see what IT and OT decisions have the biggest impact overall on the business enabling decision automation throughout the value chain.
-Still underestimated are some of the standards that help enable factors like productivity, safety, traceability or even display design, alarm management or how to bring the best of multi discipline engineering together reducing risks early into your design.
ISA always has had many deep subject matter experts focussed on these factors of adjusting processes and activities to ever changing customer expectations for a more integrated and interoperable world which really sets this organisation apart from any other standard body.
It has proven hard for ISA to keep member interest in some of their various subjects but under the current COVID-19 circumstances, the urgency of Digitisation, Remote and Integrated Central Control Rooms and concepts like Edge Devices and Security by Design are coming back in strong demand.
We also hope that this modern membership platform will help by exchanging knowledge with our membership better than ever before. Please try it and provide us with your feedback.
Metals and Mining Industry
Let’s now have a closer look at the Metals and Mining industry. It has been clear during COVID-19 that companies with strong safety cultures can go longer and stronger. Also companies that already provide regular training and have employees that are digitally savvy are just quicker to respond to key changes as their staff is already open to change and more naturally can see and react to cause-and-effect scenarios.
It is not just “lucky” for mining companies that invested heavily in Technology and Diversification of their staff that they are more resilient in these times. The technology investment into the sector that they performed after the GFC to perform at a lower cost per ton is now paying dividends.
Their technology investment from recent times is allowing remote monitoring and control of activities at a level that can keep their pit running with autonomous drilling and hauling and their plants and logistics running with only a hand full of people in the field. Even maintenance in many cases can be prepared and performed remotely or least prioritised based on having the right KPI’s, alarm management, and an adjusted healthy maintenance mix to the revised OPEX and CAPEX scenarios different commodity producers are finding for themselves.
Their integrated planning will point out constraints that will appear either after expected or unexpected changes in their value chain.
Metals companies also have made some initial steps in safety, augmented reality and mobility but have a longer way to go as their automation levels are a step behind the mining sector challenged by large complex production areas that are less integrated by nature.
The ISA team also has not seen Metals clients push as hard for interoperability as their Mining peers recently. We think this is going to change in the next couple years ahead.
Sustainability Pressure
Both mining and metals sectors are under additional pressure to respond to growing calls for increasing their sustainability from many stakeholders like investors, governments, local communities but also environmental and climate change activists and various lobby groups.
The sectors both make significant contributions towards the global economy but have a hard time shaking off the image towards investors, the public and even their own employees that were job-hopping to High Tech companies after the GFC despite of their impressive employee diversity programs and technology investments.
The staff that it has attracted it cannot afford to lose during the next 12-18 months to help them get back to positive financial growth at levels pre-COVID.
This is why most companies are now progressing a wide portfolio of Automation and Sustainability initiatives to keep their top-talent engaged. We also see sustainability initiatives like Microgrid and Decarbonisation initiatives that help both uptime and power quality and provide further independency from the grid. A grid that has been destabilised during the last decade as other industries and households have reacted to the cost increases and changes in the market the privatisation of a large part of the global utilities sector has caused with resilience being the theme of the year.
Public Trust
With these investments and additional cyber programs, the sector makes sure it does not lose the public trust whilst it does what it can to promote good citizenship within their local communities. Investments in Water Management, Environmental Management and Hydrogen are some of the more recent changes that go beyond the sometimes initial visual projects that do not target their base loads but more show an intend to local stakeholders than simply by putting solar cells visually on roofs of their facilities.
We only see client’s true intent when they work tirelessly “behind the meter” to make many smaller changes everywhere in their operation by making their processes more efficient.
Part of Public trust is also making sure that staff can go home safely and a reason we see investment in Integrated Control Rooms within tier-2 companies that are increasing safety and flexibility knowing it will make them more competitive over time and an easier take-over target. Above all, it provides them access to new talent as these control rooms are positioned in the heart of our cities or at airports where networks are at their best and with minimal latency.
Trending Up
One thing is clear, mining and metals long term trends are looking good underpinned by the significant global Infrastructure investments post-COVID of levels over 1T USD just for the US alone with an additional 2-4TUSD for all other regions combined, based on various government references pointing to stimulus packages in the 100s of Billion USD for most larger countries.
Also we see increased sustainability demands of other sectors like the Electric Vehicle industry that will increase the demand of many commodities to levels not seen before. The rates of production will have to go up as grades are reducing steadily for precious metals like gold and platinum but also other key commodities that are enabling global initiatives in sustainability like copper, lithium, cobalt, graphite, aluminium or just nickel that finally has gained after a challenging period as it enables the storage of ever more energy aiming to stabilise our grid.
With the growing demands and competitive pressure, the need for sustainable production is only increasing so we think this trend is going to continue for some time.
Circular Economy
A final point that we believe is relevant for our readership are clients that are looking how to invest in a more circular value chain and need to overcome the technology and innovation challenges that this comes with. The circular direction is happening relatively slowly as more recyclable materials are becoming available and ingenuity is increasing in how we can re-use and process our various waste streams. The growing price of the commodities and the increasing price of carbon-tax is accelerating this direction as well as circular processes are typically much less energy intensive.
Also the global community much better understands the long term climate effects pushing companies and their governments to use our resources effectively. Until this balance is there, it is likely we will see the adjustments in Brownfield environments first before seeing larger big step-change Greenfield investments.
Even though glass and metals already find frequent re-use, there are going to be more elements like copper and battery metals we are going to have to be re-using instead of producing from various precious ores. Just as the increased volumes will make it more viable to do this whilst the grades readily and economically available on earth will keep reducing and our alignment with sustainability drivers will mean we will not disrupt nature and topsoil where we can prevent this.
This might also mean as a consequence that underground mining has not seen its best time yet – currently only good for less than 20% of global mining production and might have the potential to double in the next couple decades under growing pressure not to create large open pits.
Good time to be an engineer
As a final point we believe that many technologies will play a key role going forward to make all of this happen without significant disruption. It is a good time to be a METS or (Data) Engineer. It is a good time to be a member of the ISA community. We thank you for your interest and contributions.
Bas Mutsaers, Director MMID Division
https://www.linkedin.com/in/mesconsultant/