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How COVID-19 could change mining for the better

The mining industry was deemed an essential service by the Government, which has enabled it to continue to operate during the COVID-19 pandemic. However, this hasn’t been without its challenges. New processes and procedures were required to address safety and social distancing and issues of supply and worker mobility have impacted how the industry operates. But with adversity comes opportunity and the mining industry has thrived and realised the potential for new improvements amidst the pandemic.

Technological transformation has accelerated

The need to leverage technology has always been important to the industry, but it is now a necessity that is driving increased investment. For some organisations this has meant accelerating digital projects that were in progress, while others have looked at their existing technology and operationalised new use cases. This has been facilitated in part by the introduction of agile working methods that have enabled mining companies to bring new projects into existence much quicker than in the past. Extended feasibility studies, evaluations and bureaucracy have given way to trialling new methods out of necessity. 

Some of the technologies increasing in use include automated and connected technologies. For example, Fortescue is now working towards an entirely automated vehicle fleet in the Pilbara. They are also upskilling 3,000 workers to master automation technology for the future. 

 

The changing face of the workforce

Traditionally, mining has relied on mobile workforces that can fly-in and fly-out (FIFO) when required. With mobility restricted as a result of the pandemic, organisations have had to be innovative in their approach. For some this has involved reviewing how to retrain staff to operate remotely, while others have looked to technology to enable and in somes cases replace staff. 

Where there is a hard border close, like that instigated in Western Australia, FIFO models aren’t possible. As a result companies have had to review hiring patterns and models to maintain and support workforces. For example, mining towns started to disappear with FIFO business models, but they may soon be rejuvenated to enable proximity to workplaces. 

Other organisations are leveraging technology to enable remote work to continue. For example, BHP has introduced remote-in, remote-out (RiRo) arrangements. Using wearable mixed reality devices, teams can provide assistance to auto electricians and mechanical fitters based thousands of kilometres away. This not only provides the immediate benefit of skills being accessible to fix equipment immediately when needed, but also potentially saves the organisation significant costs associated with FIFO arrangements with engineers able to see what’s happening in the field in real-time without leaving their home or office. 


The shift to remote working has also extended to senior management. While previously flying from site to site across the world was commonplace, most are now running their business from home thanks to digital technology. Like other industries, this has highlighted potential efficiencies that could continue seamlessly in a post-COVID-19 world. 

For Australian manufacturers supplying to the industry, they’ve also needed to protect their workforce to ensure production can continue. For example, Fenner Dunlop, who produces conveyor products, has gone beyond the required protocols of distancing and hygiene, to monitor and support the mental health of their staff and families by providing hampers and play packs for children.  
 

Strengthening supply chains

With international borders closing and supply of some critical materials at a premium, the importance of supply chain relationships has come to the fore. Some organisations have looked at how they can partner with communities to build relationships. For example, BHP has established a Vital Resources Fund to support local businesses and communities in Australia. Other organisations have contributed PPE and worked with governments to establish health facilities and testing centres. By increasing their social capital, mining companies are cementing their position in communities. A strategy that will no doubt work in their favour when they need to compete for resources and labour in the future.

For local producers, COVID-19 has provided an opportunity for them to ramp up production but changes have also had to be made. Flexco is an Australian manufacturer who has had to plan for the closure of its two warehouses in Sydney and Perth. It managed this by moving containers of materials to remote locations so they could be left there if needed and enable mining activities to continue even if they have to shutdown.
 

New opportunities exist

While many industries are suffering, demand for certain commodities like iron ore, copper and nickel are likely to increase due to significant infrastructure spending by governments across the globe. This increases the opportunity for businesses in the industry who can either expand production or pivot to increase their exposure to high-demand commodities. 

According to PwC the world’s top 40 mining companies have fared better through COVID-19 then many other sectors and organisations. They’re taking what they’ve learnt through this difficult time and leveraging it to improve their operations permanently. This is a trend that we hope to see continue even once we’re through the pandemic, as innovation will only continue to strengthen the industry

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