Holistic approach to modernisation

Modernisation of the mining industry is not only about automation and mechanisation, writes Leon Louw.  

The fourth industrial revolution has arrived, and it demands change. The mining industry has historically been lacklustre in its approach to affect meaningful transformation, especially in jurisdictions where deep level mining is ingrained in the DNA of that country, like Ghana or South Africa, for example. However, over the past two years or so, the pace of change has accelerated at a breakneck speed. Access to more data, and new technology and innovation, has enabled mining companies to look at operations more holistically, and the results have been astounding. While older underground mines are grappling to come to terms with the rapid changing new world, open cast mines and brand-new underground operations are fast becoming trailblazers in the new digital and data driven frontier. Resolute Mining’s Syama mine in Mali, for example, is the first fully mechanised mine in Africa, and others will follow. But modernisation is not only about mechanisation and automation.

Modernisation is the total transformation of mining operations. It should encompass the entire landscape and traditional non-core activities like community and social engagement, and environmental management and mine rehabilitation will have to be elevated to core activities alongside mining, if a company is to remain sustainable. The modernisation of mines as a concept would thus include, amongst others, mechanisation and automation, leadership, research and development, local manufacturing and the development of efficient and environmentally friendly equipment. All these changes will demand new methods of mining, unearthing new minerals and innovative thinking.

Mechanisation not new

Mechanisation is not a brand-new idea. South African underground mines have been grappling with its implementation since the early 80s, and they are still not close to an acceptable solution. Great strides have been made, nevertheless, and there are several examples that can serve as case studies for making mining in deep underground environments safer and improving efficiencies and productivity by introducing mechanised methods.

Consulting engineer Roger Dixon has spent more than 47 years in the South African mining industry, many of those on projects aimed at introducing mechanised methods. Dixon was one of the guest speakers at the recent African Mining Network, of which African Mining is one of the sponsors. Dixon says a mine needs a clear vision and strategy to successfully introduce mechanised mining into platinum or gold mines in South Africa.

“In 1994, when I worked at Anglovaal, we had a long-term vision and asked ourselves where we would get an individual rock drill operator from in 20 years,” says Dixon. At that stage, he adds, the average age of all rock drill operators in South African mines was older than 40. “No matter what we did, using non-mechanised methods was not going to be sustainable, so we introduced mechanised equipment, mostly on the Elsburg Reefs in the Witwatersrand Basin.”

The problem at that stage, and it still is today, is that machines don’t work that effectively on inclines steeper than nine degrees. Mechanising thus often requires a mining company to redesign the entire infrastructure. It is difficult to adapt existing infrastructure to suit these big machines, and then it’s very challenging to prevent dilution. Part of the mechanisation process, says Dixon, is to involve all stakeholders, including communities and the labour unions.

“More importantly, you have to pick the right team. The greatest soccer teams in the world appoint the best managers, who in turn buy the best players to suit their game plan. And in most cases, they never use old players. It should be the same in a mining operation.”         

Dixon emphasises the need to be adaptable to change. “If the geology becomes complex, for example, you have to be willing and able to change the original design. If there is too much dilution, the design needs to change, bearing in mind that these machines are large and they don’t like inclinations above nine degrees.

“For the Target project we redesigned the infrastructure at Anglovaal’s Loraine mine in the Free State because the mine initially had a vertical shaft and a sub-vertical shaft, and all these new machines had to be cut up in 1.5m x 1.5m pieces to get them down the shaft. Eventually we replaced the sub-vertical shaft with a decline, and introduced a man-riding conveyor (the first in South Africa) and a monorail system,” says Dixon.

He adds that the mine also redesigned the organisational structure. “Everything was centred around the drill rig operator, who worked alongside a Load Haul Dump (LHD) driver who did the cleaning, somebody responsible for the support and a charger-up. We did away with the seven supervisory levels in the traditional mine. This requires a total change in mindset, and it was maybe a step too far for the older, traditional miners.”

Lonmin, under then CEO Brad Mills, had a great vision to mechanise their platinum operations in the late 1990s. They redesigned the infrastructure; new shafts were sunk, and they did away with the footwall development. Furthermore, they entered into partnership with Sandvik Tamrock and travelled the world to observe best practice. Importantly, they spent money on research and introduced low-profile and extra low-profile equipment. Dixon says that one reason for its failure, in his opinion, was that there was no alignment in the organisation, particularly with the board of directors, and Mills paid the ultimate price.

For Dixon, Impala Platinum’s Zimplats operation in Zimbabwe, is the best example of a mechanised operation. “I was involved with four feasibility studies for their portals and their redesigned infrastructure in which they stuck to less than nine degrees. Furthermore, they had the whole team on board and understood the orebody,” he says.

A holistic view

According to mine specialist and CEO of advisory firm Eunomix, Claude Baissac, modernisation is not only about what happens inside the mine, but also what happens around the mine. Baissac was the other guest speaker at the African Mines Network. “We need to start thinking about how everything connects and stop thinking that the environment, communities, unsafe roads and HIV is somebody else’s responsibility,” says Baissac. “We have to start creating intelligent systems around a mining operation. If a mine wants to move ahead, it needs to be aware of its past and where they are today. There is a need for people with vision to see where we are going in the future,” says Baissac.

According to Professor Fred Cawood, director at the Wits Mining Institute at Wits University, effective leadership is crucial to achieve this vision. “The need for growing talent and leadership for the South African economy – and the mining sector in particular – is greater than ever before,” says Cawood.

“The disruption as a result of the fourth industrial revolution is affecting twenty-first century mining, employment and skills. Organisational success and sustainability begins or ends with leadership. A leader is inextricably linked to an organisation’s culture and shapes the leadership team, which in turn filters this influence through every area of an organisation, including the performance and productivity of the workforce,” Cawood adds.

Driving a circular economy

For Kevin Reynders, managing director at South African equipment manufacturer, Rham, modernisation of the mining industry is also about creating a circular economy. He says that if mines support local organisations, more jobs will be created, and the mines will be more productive. “Mines need to collaborate and work with local organisations to develop equipment that will meet their specific demands. A circular economy thus happens when mines buy and use locally-manufactured equipment. Rham specialises in the manufacture of underground mining equipment and has recently launched the first battery operated LHD.

There are only a handful of underground mining equipment manufacturers in South Africa, and they have to compete with well-known global brands. But Reynders believes that new regulations in Mining Charter III, whereby mining companies are required to procure a minimum of 70% from local manufacturers, will give the local economy a major boost. “Using locally manufactured equipment will increase productivity and employment, and will drive down cost,” Reynders tells me.

Reynders and Rham carefully study trends and current operations before implementing new technology. And it has worked for them. Mining companies that are currently using Rham LHD machines have made significant cost savings, and their productivity has increased. In one study, three conventional LHD machines were compared with a Rham machine and, according to Reynders, the fuel saving was so much on a fleet of 20, that the mine could buy an additional two machines with the savings in one year. The Rham LHD machines run off a hydrostatic system. According to Reynders, the Rham machine consumed, during the study, 17 litres of fuel compared with its closest competitor, which used more than 24 litres. Another machine used close to 28 litres of fuel per hour. “The sad thing is that most mines don’t even measure their fuel consumption. Our study has proved without a doubt that fuel and tyres are by far the most expensive cost on any mine,” says Reynders.

Reynders is a big proponent of modernisation, but he believes that mining companies will have to adapt to changes and that will require a mind shift. “Mining companies still design mines according to what equipment is available, and then they get to a point where it is not profitable to mine because the equipment available and the mining conditions don’t talk to each other. Reynders adds that many underground mines in South Africa need to use battery-operated machines as they don’t have the necessary ventilation in place to ensure a safe and sustainable operation. “One of the biggest challenges in underground mines is the high level of diesel particulate matter, and by using battery driven equipment, the underground environment becomes a lot cleaner and safer,” he says. 

“Modernisation means we all need to work together, including the banks, financial institutions and research institutions like the CSIR and universities. The main aim should be to create sustainable jobs. South African mines have become so deep that the mining companies are not always sure how to mine these deposits. What better way to modernise than to use local companies that are familiar with South African conditions, and who know what the mines need, and are able to produce equipment specific to South African conditions” says Reynders.

Technology drives the future

Technology and modernisation are not only affecting how we mine, but also what we mine. According to Joe Keenan, CEO of blasting company BME, technological disruption is replacing the need for copper infrastructure, for example. Digital and renewable technology has provided a path to development that requires fewer of the traditional minerals on which many nations industrialised – and more of others. While copper cables carried voice communication and television signal to millions of homes in the northern hemisphere during the 20th century, many developing countries have jumped straight to cellular phones and satellites.

Keenan says further that strategic economic and political decisions are also being driven by the need to reduce carbon emissions. “After more than a century of hydrocarbon-powered cars and vehicles, there has begun a drastic shift towards battery power. Minerals like lithium, cobalt and rare earths – some of the constituents of the batteries and fuel cells that will drive vehicles – are increasingly becoming where the mining industry’s interest will lie. Even the lubricants for these vehicles will need to change. The oils we use for today’s internal combustion engines, as advanced as they are, are still not refined enough to suit an electric motor,” says Keenan.

Keenan says that the known deposits of many of these new ‘battery minerals’ tend to be located in non-traditional mining areas. Rare earths, for example, are mainly in Asia, including China and Japan. Lithium deposits are highly sought-after. The growing demand for cobalt – once a little-appreciated by-product of copper mining – has now led to mines that focus on the mineral itself. This will be to the benefit of countries like the Democratic Republic of Congo, which hosts many of these rich deposits.

“This is likely to affect the strategic geopolitical status of certain countries – in the same way that the presence of oil or coal reserves has done in the past. At the very least, the shift in mineral demand will bring the opportunity for economic development to new areas, where gross domestic product could be substantially boosted by this turn of fortune. For the mining industry, players are needing to look beyond their traditional geographic horizons,” says Keenan.

Education and research

In all of this, the importance of education and research should not be understated. According to Professor Cuthbert Musingwini, head of the School of Mining Engineering at the University of the Witwatersrand (Wits), the University and gold mining company Gold Fields have recognised that South Africa lacks sufficient skills and expertise to run deep-level mechanised operations. The School has been a pioneer in conducting research and developing solutions in the field of digital technology and mechanised mining systems in partnership with the Wits Mining Institute.

According to Musingwini, young researchers play an important role in finding economically viable strategies to mine South Africa’s deep deposits. “These partnerships between academia and industry can make our deep-level mines safer and sustainable, continuing their vital contribution to the economy,” says Musingwini. Gold Fields CEO Nick Holland emphasises that deep-level mining in South Africa will only be sustainable in the long run if it’s done in a mechanised manner. The School of Mining’s new focus on deep-level, mechanised mining research points the way,” says Holland.

Modernisation and innovation have for many years taken the back seat to profit and increased margins, at the expense of the South African mining industry, and the people of the country. Trying to revive and modernise its ailing mines is almost like flogging a dead horse, although it is not too late. But the experience gained are ideal case studies for other African countries pinning their hopes on a sustainable mining industry.

Leon Louw is a specialist in African affairs and mining. For more about doing business in Africa, mining and mining operations in Africa, and the political risk of operating in Africa, contact Leon or follow him on Twitter, Linkedin and Facebook.