Excellence in Mining and Mine Management

Transcription

1 Excellence in Mining and Mine Management Tuesday 23 September am pm SPEAKER S Presented by: Silver Sponsor

2 9.00 am am Plenary Keynotes Session 1 The Role of Mining in Global Sustainable Development am am Morning coffee and networking International Mining and Resources Conference IMARC Program Outline - Day 2, Tuesday 23 September 2014 **Delegates to divide into three different stream options** Excellence in Mining and Mine Management Hosted by The AusIMM The minerals industry around the world has been facing difficult times, irrespective of the quality of the operations and their management. It needs to understand and adapt to the new circumstances and to position itself to survive in difficult times, or alternatively to thrive in the "good times". The AusIMM is one of the global societies that embraces the professionals working in the minerals industry and as such we want our members to be at the forefront of industry best practice, and indeed to be leading and driving it. With this in mind we present three diverse yet complimentary streams, each of which the AusIMM sees as key to both our retaining technical excellence but also to maximise our assets am pm Session 1: Technology The application of leading edge and new technologies; the pathway to a sustainable future. Technology in the minerals industry in the 21st century - embracing tech savvy people to lead the way in developing new cutting edge technologies Where do we look to Technology to value add? High tech mines of the future: what will they look like? Excellence in Mining and Mine Management Stream Welcome and Opening - Geoff Sharrock FAusIMM(CP), President am am AusIMM Minerals and Energy in 2025 Minerals in 2025 The Incoming Revolution - Dr Megan Clark FAusIMM, Chief Executive, am am CSIRO The Application of Leading Edge Technologies and Pathway to a Sustainable Future Through Collaboration - Joe Cucuzza, am pm Managing Director, AMIRA A Solutions Approach to Blasting Enabling a Step Change in Overall Mining Productivity - Ron Douglas MAusIMM, pm pm Executive Global Head Projects and Technology, Orica PANEL DISCUSSION Dr Megan Clark FAusIMM, Chief Executive, CSIRO pm pm Joe Cucuzza, Managing Director, AMIRA Ron Douglas MAusIMM, Executive Global Head Projects and Technology, Orica 1.00 pm pm Lunch and networking Session 2: Mine Automation 2.00 pm pm Automation, challenges, lessons learnt and where to next? The evolution of automation projects over the years and their varying success Measuring success: How is it implemented and being measured? Mining automation going forward Six Challenges to Successful Realization of Automation in Mining - Professor Ross McAree, Program Leader, Automation 2.00 pm 2.25 pm Program, CRC Mining Mine Automation as the Ultimate Lever in Process Control - Denise Goldsworthy, Owner and Managing Principal, Alternate 2.25 pm 2.50 pm Futures The safe, efficient, effective deployment and operation of autonomy in the mining industry landscape - John McGagh, Head 2.50 pm 3.15 pm of Innovation, Rio Tinto PANEL DISCUSSION Denise Goldsworthy, Owner and Managing Principal, Alternate Futures 3.15 pm 3.40 pm Rob Hattingh, General Manager Innovation Technology and Sustainability, Iluka Resources Professor Ross McAree, Program Leader, Automation Program, CRC Mining John McGagh, Head of Innovation, Rio Tinto 3.40 pm 4.00 pm Afternoon tea and networking Session 3: Tomorrow's Mine Manager 4:00 pm 5:30 pm Implementation of operating best practice to meet corporate strategic goals. The Mine Manager takes the owner/board directions and translates them into strategy and deliverables. This session will address: Implementation of corporate goals of excellence into the real world (existing operations versus new ones) What is excellence from a company perspective? Miners of the future and the skillsets required. How will we get them and keep them? A view of the industry in the future what will operations look like? Technical expertise Getting the Right Mix - Patrick Smith MAusIMM(CP), Chief Executive Officer, AMC Consultants Pty 4.00 pm 4.25 pm Ltd 4.25 pm 4.50 pm It s Not The Way We ve Always Done It - Terry Burgess FAusIMM, Managing Director & CEO, OZ Minerals Ltd 4.50 pm 5.15 pm Tomorrow s Mine Manager What do we think they need? - Matthew Gill MAusIMM PANEL DISCUSSION Terry Burgess FAusIMM, Managing Director & CEO, OZ Minerals Ltd 5.15 pm 5.30 pm Matthew Gill MAusIMM Patrick Smith MAusIMM(CP), Chief Executive Officer, AMC Consultants Pty Ltd 5.30 pm Social Function - Networking Drinks

3 Minerals in 2025 The Incoming Revolution Dr Megan Clark AC FAusIMM, FTSE Chief Executive, CSIRO The mining boom of the past decade has seen strong growth and investment fuelled by rising overseas demand and high commodities prices. Following a decade of increased capital investment in expansions and new production capacity, the recent softening in prices has led to an increased focus on the twin business drivers of increasing productivity and reducing costs across the whole value chain. A key driver for reducing costs has been the focus on economies of scale that have stretched the boundaries of engineering and driven the development of large disseminated orebodies. The next step of productivity increases will be associated with a raft of new technologies that have already made their mark in other sectors and are now poised to lift the mining sector. This talk summarises these cross-disciplinary enablers from the broader perspective of international innovation together these build a framework for new mining innovation: 1. Sensors - new sensors are providing an ever-growing range of information to inform end-to-end business planning. From insect-borne sensors monitoring the environment through to remote Martian sensors delivering information back to earth, robust and relevant sensors can and will provide real-time information at an unprecedented rate. This data revolution is driven by global development that link companies like Google with strategic national initiatives like NASA to drive change. 2. The cloud and automated knowledge mining - measurement is simply a means to an end the real game starts as distributed data is delivered seamlessly to drive knowledge and decision making. As these data volumes far surpass human processing ability, we can again look to other industries and adopt innovation. For example, the international Square Kilometre Array (SKA) will generate the same amount of data in a day as the entire planet does in a year. In the global market companies are developing systems to make data universally available and to generate knowledge from that data through machine learning to solve specific challenges. 3. The internet of things - mining is a physical business and so great decisions in mining operations mean nothing if they can not be implemented information and knowledge are useless without the ability to drive action in the real world. The internet of things is now commonplace in industries like manufacturing where the real and physical worlds collide in a seamless delivery mechanism. In this world, equipment and people (including their health and state of readiness) is immediately transparent. This is the enabling architecture that will implement actions in the real world to drive mechanised mining operations that are progressively more autonomous. 4. Automation - autonomous vehicles are already changing the way people interact with the mine environment. Through the internet of things, the real and virtual worlds are connected and two discrete options emerge both are likely over time. The industry players can use these technologies to: improve the efficiency of the current mining paradigm, or drive completely different mining platforms that use variability rather than work against it by focusing on bulk averages and one size fits all processes. 5. Materials and 3D printing beyond the mining systems themselves, technology will also change how we build and maintain mining systems. For example, 3D printing of high tolerance turbine blades is now a reality. On-site part printing and maintenance planning will underpin the new mechanical mining world. 6. Alternative distributed energy and storage solutions energy solutions are always an issue for mining in remote areas and new technologies in generation and storage will increasingly complement traditional solutions. This provides an opportunity for Government and industry to show leadership in the mining area rather than wait for spillover effects from other industries. 7. Social science - in this brave new world, our impact on the environment, people and social systems will be fundamentally different and a new level of transparency will be required. Opportunities for changing the way we do things will abound but we will need the tools and culture to respond. This may well be the greatest challenge. These enabling technologies ensure that systems are at the cutting edge of innovation and technology delivery of the global mining industry by 2025

4 The Application of Leading Edge Technologies and Pathway to a Sustainable Future Through Collaboration Joe Cucuzza Managing Director, AMIRA International As mining companies hasten to cut costs, they risk missing the opportunities and value of collaborative technology development, which has been the source of sustained productivity improvements in other industries. The mining industry is facing both shortterm and long-term challenges. In the short term companies are facing pressure to cut costs, effectively doing more with less. Although it s perilous to generalise, as the industry is not homogeneous, it s clear that some of the longer term issues that shape business sustainability will affect all companies, irrespective of size and commodity profile. Ernst and Young recently published their report on the top business risks facing the mining and metals sector for They identified ten items, which in my view encompass both short-term and some longer-term issues that companies continue to struggle with, including capital access and allocation, rising costs, commodity price and currency volatility, resource nationalism and skills and talent challenges. Deloitte in their Tracking the trends for 2014 report point out that the mining business is becoming more challenging, this is not only just because of our increasing difficulty in finding new tier one deposits, but as grades decline and ore bodies are depleted, companies continue to move into increasingly remote locations with correspondingly harsh conditions, pushing costs to unsustainable levels. They contend that the only way to overcome these challenges and ensure a sustainable future is through innovation. Many majors are pursuing innovation in automation and some are doing so in partnership with METS suppliers, although using different collaborative models. These technologies combined with remote centre operations will no doubt deliver significant efficiency gains and cost reductions. But not all companies have the economies of scale that can justify the necessary investment to develop and implement these technologies. Indeed at the macro-economic level it is a waste of resources for each company to re-invent the wheel. In order to remain competitive, these other companies must rely on MET suppliers to provide turn-key solutions they can implement in their smaller number of operations. Those companies that have high quality orebodies will no doubt continue to enjoy good returns but as Deloitte and others have pointed out, grades will continue to decline and thus more innovative approaches will be required to make such operations cost effective. So where does collaboration come in? It beggars belief that with all the in-house (and one-on-one) research activity going on that there are no common threads that companies can potentially collaborate on and thus leverage their precious R&D dollars. Collaboration between competitors on such common issues would work well within the co-opetition framework described by Adam M. Brandenburger and Barry J. Nalebuff back in 1996; cooperation and competition is possible. Indeed cooperation amongst some majors is not unheard of but perhaps there is not enough of it. Bidault and Costello reported that a survey by Kelly et al showed that 94 per cent of technology executives from across many industries (including mining) believed that alliances were becoming critical to their (research) strategy. But setting up collaboration takes effort and identifying the right peer, or peers to trust as partner(s) is a challenge. Fear of losing competitive advantage or giving your competitor a leg-up are also two obvious impediments. Bidault and Costello (op cit) argue that when companies collaborate, (a) low (level of) trust is detrimental to innovation. But so (too) is a very high (level of) trust. The optimal level, yielding maximum impact, lies in between. The future of our industry will mean mining only the economic material, not waste, being invisible and benign to the environment, intelligent and robotic, run by highly skilled operators in the context of new business models that will allow risks to be taken and rewarded, and benefits to be shared with all key stakeholders. Looking towards 2050, innovation and collaboration is going to be critical to developing the leading edge technologies that will ensure that the industry is going to be sustainable and companies remain competitive. Many of these technologies, or at least the underlying enabling technologies that are required to make them happen, can be co-created through collaboration. Does the industry have the will to make this happen? In a recent publication PwC reported that 91% of Australia s CEOs believe that technology will be the biggest transforming trend for their businesses. Admittedly they were referring largely to IT and social media but I think the sentiment would apply to all technologies. These issues will be discussed and the role of AMIRA International in facilitating collaboration will be outlined. 1. Co-opetition - Adam Brandenburger and Barry Nalebuff; HarperCollinsBusiness, Why Too Much Trust is Death to Innovation - Francis Bidault and Alessio Castello, MIT Review, Summer 2010, vol.51, no 4 3. Managing Alliance Relationships: Key Challenges in the Early Stages of Collaboration - M.J. Kelly, J.-L. Schaan & H. Joncas, R&D Management 32, no. 1 (2002) 4. Securing Australia's future capitalising on global trends - PwC Jan 2014

5 New Horizons in Blasting Technology The Innovation Imperative Ron Douglas MAusIMM Executive Global Head Projects and Technology, Orica In the pursuit of providing value-creating solutions for its customers, Orica has long been committed to the development of new technology for the mining industry. To be successful, new technology must address the specific needs of the mining industry (not technology for its own sake) as unless solving a problem or improving efficiencies it will not create value for both customers and Orica. The mining industry is cyclical around commodity supply and demand. Despite the unprecedented ten year growth profile the resources industry has just experienced, the current phase of mining is characterised by cost reduction and productivity, whilst recognising constants such as safety performance and a need to improve social licence to operate. Thus the technology Orica delivers must address these current issues as well as create value throughout the commodity cycle. The themes that drive Orica technology are those that drive business value: safety in operational performance and logistics speed of access to orebodies improved blasting practices and efficiencies reduction of ore dilution lowest energy (and carbon) costs utilising data (big data). Whilst these themes may be broadly classified as productivity or cost initiatives, the underlying approach to adopt new technology is to create value for the industry. Orica enables innovation (as opposed to invention) by creating the internal environment, collaborating with renowned institutions, working with customer teams and providing the requisite funding to achieve its outcomes. This presentation will illustrate the developments that Orica has enabled through its innovation to address the industry challenges and provide insight into the opportunities to create value by improving blasting practices.

6 Six Challenges to Successful Realisation of Automation in Mining Prof Ross McAree Program Leader, Automation Program, CRC Mining Australia s resource industry is being transformed by the increasing use of automation technologies that target productivity improvement through better control of mining processes. At one end of the scale, this revolution is happening organically through the innovative technologies of small-to-medium enterprises. At the other end are some strikingly bold initiatives to implement highly automated mines. Between these extremes is a spectrum of innovation that stands to profoundly change the industry over the next 15 years. However, there s no guarantee that technology will be able to deliver on its promise. I see six key challenges that can only be solved by collaboration: 1. The double burden of immaturity. The successful implementation of automation technology is profoundly challenged by both the lack of maturity in the technology and of implementation efforts. We need to create ways of lifting the bar. 2. The need for a common interoperability plan.: The automation of mining processes will necessarily be realised using building blocks from original equipment manufacturers (OEMs) and technology providers that are independently designed, independently implemented, independently managed and will evolve independently over time. A holistic framework for integration is an essential prerequisite for the mine of the future but this won t happen by accident. We need to agree and invest in a common plan. 3. Operational technology and information technology must integrate. Automation is not the prize, it s just a means for optimising business processes. There is a compelling need to have common ways of efficiently delivering information about operational processes to guide performance improvement interventions. The complexity of this task is not to be underestimated, nor is the value that can be derived from achieving it. 4. Where will we find the people? The design, development and deployment of automation technologies for mining necessarily draws on skills that are proving to be a scarce commodity across the industry. We need sustainable ways of developing people with the right skills and career opportunities. 5. Altered responsibilities. New technologies have the potential to disrupt organisational structures and shift responsibilities in subtle ways. Understanding and managing both the seen and unseen impact of technology is critical to its success. 6. Equivalent levels of safety. New technologies change the risk profile of operations. How do we ensure these risks are properly understood and addressed so that automation delivers equivalent or better levels of safety whilst still adhering to the business case on which it is founded? The talk will draw on specific case studies from various projects in mining to give clarity to these challenges and provide thoughts on how to invest in collaborative efforts for mutual benefit without compromising competitive advantage.

7 Mine Automation as the Ultimate Lever in Process Control Denise Goldsworthy Owner and Managing Principal, Alternate Futures When many companies look at the option of automating aspects of their processes, the business case is typically based on eliminating exposure of people to hazardous tasks and reducing the cost of labour. When you balance these against the capital costs and the cost of the more highly skilled support personnel that are required to keep the technologies operational, the business case can look marginal and therefore many companies are not choosing to make the investment, especially while the technologies are considered new and risky. If you only look at these business case components, significant potential value improvements from automation can be missed. From experience gained working on technology specific, cultural and system innovation, advice will be provided on how companies should think differently if they are going to extract the maximum value potential from investments in automation. As the geology of every mine is different, the optimal configuration for automation of each mine will also be different. The best way to identify the opportunities for changing the way the mine, the plant and the associated infrastructure are designed is to think about the change to automation as the ultimate lever in process control. Automation eliminates many of the sources of variability by taking out the human factor. As a result, many design practices and standards that have become common in the industry can be changed as they are only required to mitigate the effects of human variability, allowing more flexibility in how the designs, flow sheet and equipment are optimised for the specifics of any given orebody and financial assumptions. Ensuring maximum advantage is taken of the automation opportunity requires a different way of thinking. There are three core pieces to successful application of automation the technical content, the business systems and the business culture. The business systems need to adapt to manage the risk of aspects of the business that are usually not explicitly dealt with in risk management processes. For example, while variability of processes may be significantly improved, obsolescence management may become a critical new risk. Traditional tendering processes or contractual terms and conditions may need to be changed to satisfactorily deal with the reduced life cycles of technology. Supportive cultural change is required to achieve different levels of engagement with the whole workforce to ensure inter-disciplinary opportunities are explored and improved from the exploration geologists, through the equipment operators and maintainers, to the ICT team. Culture change is also required to alter the relationships and methods of engagement with suppliers not only the suppliers of the autonomous equipment, but also the engineering, procurement, construction managers (EPCMs), the consumables suppliers and others, all of whom may need to make changes to their product and service offerings to lock in the value opportunities from automation. Eliminating waste through process control has been identified as a huge source of value for business, and integrating system and culture change throughout the whole business in parallel with automation should be considered as the ultimate opportunity to improve process control, fundamentally changing the business case for automation.

8 The Safe, Efficient, Effective Deployment and Operation of Autonomy in the Mining Industry Landscape John McGagh Head of Innovation, Rio Tinto In 1997 Rio Tinto entered into a work program with Komatsu, a Japanese/American mining machinery manufacturer, to investigate the use of autonomous haulage vehicles within the mining industry. At that time computing chip power was orders of magnitude less than today, network connectivity was extremely limited, global positioning system (GPS) satellite tracking was in its infancy for the commercial operator, forcing the emerging system to augment with the use of inertial navigation as a terrain finding platform. Wind the clock forward to 2007 where Rio Tinto and Komatsu re-engaged to examine the introduction of autonomous haulage vehicles within the mining context. Computing power had increased, network connectivity had come of age, GPS was ubiquitous and the mining industry, given the demand for minerals from emerging nations, had (perhaps) a new value proposition for autonomous haulage vehicles. Today Rio Tinto owns and operates the world s largest collection of mining-application-specific autonomous haulage vehicles, having successfully and safely moved over 200 Mt using autonomy since trials began in late At the same time actively deploying autonomous drills and trialling autonomous trains, all of which are supported by an operations centre thousands of kilometres remote from the site. Rio Tinto is taking accountability for the safe and effective deployment and management of these technologies and has assembled an experience base of over 1000 years in the management science of exploiting autonomy in mining. This presentation is about the science of change management and the duty of care obligation that the owner/operator must take when introducing complex and step change technology into the traditional mining landscape. Rio Tinto has taken upon itself this change management obligation and has assumed leadership in driving the complex human/machine interactions that need to take place if one is to effectively exploit this new and exciting value adding opportunity. This is our owner/operator story.

9 It s Not the Way We ve Always Done It Terry Burgess FAusIMM Managing Director and CEO, OZ Minerals There has been a proliferation of recent reports highlighting that productivity in mining has been declining on a volume and costs basis over the last decade. At the same time, mining has become more complex with deeper mines, grades often lower and ore bodies more complicated. Effectively addressing the productivity issue requires a whole of business or end to end focus, driving a multifunctional response to problems. This is not as easy as it sounds as most productivity initiatives rely on good data to understand what good performance and productivity looks like. At OZ Minerals Prominent Hill mine, we implemented a suite of efficiency improvement programs aimed at obtaining better productivity from our mining equipment. An automated fleet management system was implemented as part of our mine control process to manage and supervise mining activity in the open pit. We have also implemented one of Australia s most developed underground mine control dispatch system at our Ankata underground mine. A modern mining company focuses on continuous improvement and developing new ways of doing things rather than relying on the ways that we have always done things before.

10 Tomorrow s Mine Manager What Do We Think They Need? Matthew Gill MAusIMM The role of today s and tomorrow s mine manager has never been more complex and challenging. The role is pivotal to the successful delivery of stakeholders expectations, but who are these stakeholders, and are some more important than others? What are their expectations, is there a clearly enunciated business strategy, and are these aligned? What and who defines success? How does the mine manager acquire this critical knowledge, and the associated skill sets, in order to understand, manage and deliver on these expectations to satisfactorily discharge their role? There is no silver bullet answer to these questions, and no definitive text book on the subject; businesses and stakeholder expectations are varied and evolving over time, and the mining industry continues to innovate and community expectations increase. Simplistically, going back a century, mining could be argued as just a hole in the ground where the objective was to return dividends back to the owners of the company, and where the concept of sustainable development was not in the consciousness of the day. Today, returns on investment are becoming an important requirement again, if not more so now as margins decrease due to declining ore grades, and with capital and operating costs rising, owners are still rightfully expecting an economic return on their investment. But the role of other stakeholders is now more prevalent and relevant, and so the mine manager must also be sensitive to the communities in which the operation impacts; local, regional and national government expectations; as well as the core working groups they will interact with employees, suppliers, regulators, unions, the Board of the company and the many, many shareholders they represent. How can all this be rationalised so that the corporate strategic goals of the business can be delivered safely, on time and on budget, with appropriate consideration also given to environmental and social responsibility obligations? So, where to start? This presentation will look across the broad landscape that confronts the mine manager. It will encourage the listener to consider their own self, their strengths, weaknesses, leadership traits and emotional intelligence. It will challenge the listener to consider whether they truly understand the business the mine manager is in, it s technical complexities, the key safety and environmental issues, and what the core business drivers are. It is offered that this could best be uncovered, then understood and managed from a risk management viewpoint. This risk management process helps quantify the qualitative, and be a tool to focus the business and its players on delivering, all the while being able to define and communicate the risks and returns. Finally, the mine manager must also have empathy for the people they lead, an understanding of the culture of the organisation they are a part of, and the culture and aspirations of the communities in which they operate. The mine manager must understand what the deliverables to be expected are across this varied and diverse landscape. It is here that the role of the Board of the company is critical in overseeing that execution of its corporate strategy (if indeed there is one), by displaying good corporate governance, strong leadership and clear strategic direction, communication and mentoring, and in so doing, assist the mine manager of tomorrow to deliver. Matt Gill does not profess to know all that tomorrow s mine manager will need to know, despite being a recipient of the AusIMM leadership Award in 2008, and three-time winner of Australian Mine Manager of the Year Award. But what Matt can offer in this presentation is a collection of his experiences and insights from over three decades in the mining industry, ranging from an underground miner, through to a managing director, working across many mineral commodities, and on four continents.