The future of mining: more digging through data than strata
The evolution of the industry, its opportunities and how best to equip the energy and resources sector of tomorrow
The natural resources industry has long been a dominant player in Australia’s economy. Mining and related services employ more than 380 000 people. The industry accounts for 50 per cent of the nation’s export earnings, with the top 40 sector companies alone producing more than $400 billion in annual revenues (ABS, 2016).
However, we have entered an era of extreme volatility in commodity markets, coupled with increased operating costs, leading to huge demands on efficiency measures within organisations.
On top of this, the sector is facing more than $425 billion in economic impact from digital transformation for the industry, customers, society and environment over the next decade (to 2025). This is the equivalent of 3-4 per cent of industry revenue during the same period. It will also see a reduction of 610 million tonnes of CO2 emissions, with an estimated value to society and environment of $30 billion, and an improvement in safety, with around 1000 lives saved and 44 000 injuries avoided. This equates approximately to a ten per cent decrease in lives lost and a 20 per cent decrease in injuries in the industry (World Economic Forum, 2017).
The mining sector has experienced declines in productivity of more than 33 per cent over the past ten years. In order to cut costs, many companies have reduced staff numbers, maintenance and capital expenditure, all of which are short-term solutions. Future gains in efficiency and competitiveness will be driven by adoption of innovative technologies and processes.
More recently, there has been a degree of cautious optimism within the industry.
In their Tracking the trends 2017 report, Deloitte noted that:
Commodity prices, while volatile, are on the rise, and financing, while still not widely available, is picking up. To position themselves for sustainable growth, miners must be willing to explore and invest in strategies to help them continually improve operations and enhance shareholder value. (Deloitte, 2017)
As they say, necessity is the mother of invention. And the Australian mining industry is rising to the occasion, since it has no choice, and is becoming increasingly adaptive and resilient.
At the Sydney Mining Club luncheon in June 2017, Newcrest Mining Managing Director and CEO Sandeep Biswas said:
In Australia, the mining industry is three times bigger today than it was a decade ago. Employment is nearly three times higher. And resources exports are expected to reach record levels in this financial year. (Newcrest, 2017)
So, considering the significant change facing the industry, what does the resources sector of tomorrow look like, and where do the employment opportunities lie?
Find out what we think by reading the full article in the AusIMM Bulletin here.