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- 02 Dec
Mining the Magenta Line
[excerpts] From the perspective of major commodity price cycles, there is arguably no better time than right now to be considering productivity and efficiency. Mining company balance sheets have been repaired, and companies can think about replacing the short-term expedient cost measures adopted in the previous few years with technology or alternative processes whose cost savings are more enduring.
Automation: Automation and AI can make great contributions to cost reduction, and over time will be able to do even more things reliably, but this contribution is second order. The main job, the most important job, the one that adds the greatest value is in envisaging choices to examine in the first place. This requires the considered input of someone who has spent time “at the coal face.” Technology has to be a complement to, not a substitute for, experience.
Risk: Risk choices have to be made by someone with the right experience to understand them; someone with sufficient time “at the coal face.” That someone also has to be at the most senior levels of management in the company. This is where the mining industry is not being well served at the most senior levels of management. Ever since management started treating mining just like any other industry, under-rating the importance of time “at the coal face” as an essential requirement, these kinds of decisions have failed us.
Division of Labour. The efficiency of using outsourced supply is nowhere more important than with technology. Many technology products cost very little to produce once developed – all the effort is in developing the product in the first place. Spreading technology development costs over a world-wide market will yield far better economics than an individual mining company can achieve developing the technology itself.
About the Author
IanRunge
https://ianrunge.com
