Going digital: why innovation is critical for the mining industry
Just like any struggling industry,innovationcontinues to be a critical element to the mining sectors recovery and future success. Heres why:
Just like any struggling industry, innovation continues to be a critical element to the mining sector’s recovery and future success. Here’s why:
A recent IDC Energy Insights research survey of 190 miners globally reveals the top strategic objectives of mining operations in 2015 are: safety improvements, automation of assets, mine operations management and control.
From these objectives, the IDC research shows that 69 percent of mining companies globally are looking at remote operations and monitoring centers, 56 percent at new mine methods, 29 percent at robotics and 27 percent at unmanned drones. In fact, 83 percent of global mining companies say their technology budgets will increase or stay the same in 2015.
Whole new world
As prices across commodities continues to fall, impacting everything from cost, asset and debt settings mining companies need to have, the industry is in the midst of a technology transformation. Companies are aligning their focus on new technologies in order to efficiently manage a mine through integrated technologies such as robotics, Internet of Things (IoT), sensors and mobility.
• Related content: [VIDEO] Joy Global and the Internet of Things
According to IDC, these technologies can assist companies with their top priority--saving costs. “Mining companies are under more pressure than ever to get more materials from the ground at the lowest possible cost and the highest possible grade. Hence, mining companies are looking for new ways of doing things as profit maximization is the top business concern of mining companies as they work to change the cost and efficiency settings of their operations. This is an environment of change and within that one where the role of technology and its importance to the core activity of mining is becoming a critical enabler for the mining operations – that consistently meet leading financial and production performance metrics.”
The IDC perspective on digital transformation consist of five parts: experience transformation, work source transformation, operating model transformation, information transformation and leadership transformation.
According to IDC, the three of most critical importance for mining companies are Operation Model Transformation, Information Transformation and Work Source Transformation.
The Operating Model Transformation “is a critical focus of investment we are seeing across the mining sector now. Asset management – particularly employing more predictive maintenance approaches to minimize equipment outages and its impact on production performance. Dynamic planning and scheduling is another area that we are expecting to see a lot of movement in the way operating model transformation takes place in mining,” said the report.
• Related content: Why did Alcoa just invest $60 million in 3D printing?
“Second is Information Transformation – to enable utilization of data across operations to create greater value and ultimately to treat data as an asset. Third is Work Source Transformation – not just about having the right skills in place to support the transformation but also engaging and connecting with external stakeholders. This is a process that is starting for many mining companies as we see the importance of innovation and collaboration across senior leadership, IT and operational technology as mining companies seek more effective ways to utilize knowledge across the organization.”
The IDC report states mining companies that have successfully transformed their digital capabilities showcase the following characteristics, and outlines their recommendations associated with each area:
• A willingness to openly experiment with new technology. Work across your organization to create research insights with internal and external stakeholders. Look externally, collect examples and look to other industries for examples of successful approaches across process innovation and technology initiatives.
• A willingness to change the norms of their business model. Data-led insights and automation will only deliver value if there is a culture of change. Be willing to change the established ways of doing things, change work practices and approaches.
• A willingness to make bold bets when the time is right. Mining companies have significant legacy data investments in place already. The investments required to create visibility and control are often challenging and have an associated level of risk. To achieve a significant improvement in productivity, there will ultimately need to be a willingness to take on measured risk. Start with short sharp examples to demonstrate value, and as you work towards larger investments, demonstrate value to stakeholders at each stage. Remember the critical importance of marketing internally to drive support across all stakeholder groups.
Rio Tinto partners with ARENA for green hydrogen research
Rio Tinto has partnered with the Australian Renewable Energy Agency (ARENA) to study whether hydrogen can replace natural gas in alumina refineries to reduce emissions.
Rio Tinto and ARENA partnering for green energy push
Rio Tinto will conduct a $1.2mn feasibility study, equally funded with ARENA through a $580,000 grant, into using clean hydrogen to replace natural gas in the calcination process of refining at the Yarwun alumina refinery in Gladstone.
The study program includes work to be done at Rio Tinto’s Bundoora Technical Development Centre in Melbourne, where Rio Tinto’s in-house development capability has now been extended to hydrogen.
ARENA CEO Darren Miller commented: “If we can replace fossil fuels with clean hydrogen in the refining process for alumina, this will reduce emissions in the energy and emissions intensive refining stage of the aluminium supply chain. Exploring these new clean energy technologies and methods is a crucial step towards producing green aluminium.
“This study will investigate a potential technology that can contribute to the decarbonisation of the Australian alumina industry. If successful, the technical and commercial lessons from Rio Tinto’s study could lead to the implementation of hydrogen calcination technology, not only in Australia, but also internationally.”
Rio Tinto Aluminium Pacific Operations acting managing director Daniel van der Westhuizen added: “We see the ARENA and Rio Tinto-funded study as a step towards reducing refinery emissions and one that has the potential to play an important part in Rio Tinto’s commitment to decarbonisation.
“We’re investing in work that needs to be done, not only to decarbonise one of our sites, but also to help provide a lower-emissions pathway for Rio Tinto and the global aluminium industry.
“We recognise we are on a long road towards reducing emissions across our operations and there is clearly more work to be done. But projects such as this are an important part of helping us get there.”
Can hydrogen replace natural gas in alumina refineries?
The study comprises two distinct work packages:
- Preliminary engineering and design study conducted to understand the construction and operational requirements of a potential demonstration project at the Yarwun alumina refinery.
- Simulating the calcination process using a lab scale reactor at the Bundoora Technical Development Centre.
Once complete, the study will inform the viability of a potential demonstration project. Rio Tinto has lodged patents for the hydrogen calcination process.
Rio Tinto aiming for net zero by 2050
Rio Tinto is aiming to reach net zero emissions across its operations by 2050. Across the company, it is targeting a 15% reduction in absolute emissions and a 30% reduction in emissions intensity by 2030, from a 2018 baseline.
Aluminium is found in everything from cars to phones. But one of the challenges of producing this essential material responsibly is finding ways to decarbonise the process.
Part of the reason is creating alumina – the main ingredient in aluminium – takes a lot of energy, which in turn creates greenhouse gas emissions. New technologies will be essential to helping reduce emissions, but many haven’t been proven. And some not yet even discovered. Rio Tinto's transformation is being driven by innovation and its partnership with ARENA is a positive step towards these goals.