Title: Mining industry automation panel: doing more with less

Sub-title: With human and financial capital in short supply these days, companies are increasingly expected to generate better results using fewer resources. For many, increased use of automation seems like a natural fit. To learn more about this trend, CIM Magazine assembled some of the industry’s top thinkers, to get a feel for where things are, and where they are going. The participants were Greg Baiden, chairman and CTO of Penguin Automated Systems, John Gagh,  head of innovation at Rio Tinto, Charles Jackson, CEO of Quadrem and Christopher Curfman, president of Caterpillar’s Global Mining Division.

 

Technology is not often the first word that comes to mind in discussions regarding commodities extraction. Digging stuff out of the ground and then crushing or otherwise transforming it, seems more like an old-economy type of thing.

 

However those who visit mining sites regularly are noticing significant changes in recent years. Automation, bought on by increasingly sophisticated technologies and shifting industry economics, is increasingly creeping in to many operations. Productivity enhancing initiatives that are now regularly seen in mining operations range from remotely operated mining equipment to new information technology advances.

 

Increased efficiency and flexibility

One such expert is Greg Baiden, a professor at Laurentian University’s School of Engineering who specializes in robotics and automation and on the side acts as chief technology officer at Penguin Automated Systems. Prior to holding those posts, Baiden worked at Inco’s Mines Research Division. In short, he has watched developments in the sector closely for many years.

 

“When looking at automation opportunities within the mining industry, it is crucial to distinguish between the short and the long term,” said Baiden. “Right now with motor vehicle production in a freefall, financing tight and the overall economy slowing, mining companies are hesitant regarding new capital investments. But over the medium and longer terms we are going to see an explosion in the use of devices and machinery that can replace human labour.”

 

Charles Jackson, CEO of Quadrem, agrees. “Because many minerals and resources are commodities that have determinant prices which are established daily by global exchanges, the more efficiently that you can extract them and move them to market, the more profitable your company will be,” says Jackson. “Furthermore over the longer term, demand levels are projected to grow so quickly that innovation on an advanced level will be needed to help meet them.”

 

Jackson has a point. As a ravenous world marketplace consumes the output of more accessible ore bodies, miners will need to look for resources in increasingly inaccessible places. The trouble is, says Baiden, you can’t easily send people to a lot of those places.

 

“One example is the bottom of the Creighton nickel mine in Sudbury,” says Baiden. “The mine extends 8,500 feet underground. Down there the temperature is extremely hot, maybe 140 degrees Fahrenheit and the humidity level is close to 100%,” says Baiden. “When conditions get that rough, the temptations to find automation solutions in which mine personnel can operate equipment from remote locations, are quite high.”

 

Of course challenges such as those that miners face at the Creighton operation will seem minor, when compared with those on the horizon. Among the more promising ore bodies that companies will eventually want to develop, many are located in even deeper mines and others are under the ocean floor, a huge, undeveloped area thought to contain massive potential. “Don’t forget that 71 percent of our planet is basically unexplored,” says Baiden. “There is one company (Nautilus) that is thinking about mining cooper and gold a few miles under the ocean. But if you do that, you will have to automate.”

 

Automation and labour accessibility challenges

One big argument for the increased use of automation solutions says John McGagh, Head of Technology and Innovation at Rio Tinto, is that they help to deal with a recurring industry challenge: labour accessibility. Given recent rising unemployment in both Canada and the United States this may seem unusual, but many commodity extraction players report having a hard time finding the right people at the right price, with the correct skill sets to fill certain posts.

 

“The increased urbanization of a good chunk of the world’s population, particularly in the developing world has been driving demand growth three of our main products: copper, iron ore and aluminium,” says McGagh. According to research commissioned by the Minerals Council of Australia, the country’s mining industry will require an additional 87,000 workers during the next ten years, which represents a 68 percent increase in the sector’s current workforce. The biggest increase is projected to be in the trades and semi-skilled workers categories.

 

The problem is that Rio Tinto will have to compete hard to get those workers. “It is hard to attract the right people,” admits McGagh. “That’s particularly true in the highly technical functions, a problem that is expected to worsen when the economy starts to pick up again. In normal circumstances, when good jobs are available in the city, people don’t want to work in the bush, or in other remote areas where many mines are located.”

 

However McGagh is adamant about one thing: though mining sector automation does compensate somewhat for tough labour accessibility, that isn’t its main benefit. “You cannot justify this just from getting rid of manpower,” says McGagh. “You have to look at all of the combined benefits, such as quality of output, lower waste, higher levels of machine operability, lower levels of maintenance and the fact that machines run 24/7, before you can do an effective cost-benefit assessment regarding automation investments.”

 

Boosting mine safety through increased automation  

Christopher Curfman president of Caterpillar Global Mining has a slightly different take on the situation. While conceding that automation has a great future, he is a fervent advocate of speeding the process by starting right now. Worker safety is one of his primary concerns. “It is our customers’ number one priority,” says Curfman. “As a result, (safety) is also the number one priority of our autonomy program.”

 

In fact according to Curfman, automation often solves labour accessibility and safety concerns simultaneously. “The more that our customers are able to implement automation solutions, the more the safety performance of mine sites will be enhanced,” explains Curfman. “Because not only will we be reducing the number of humans who will be operating machinery, but those who will be engaged in the operations will be working from much safer environments.”

 

In fact if you were looking for people who have the greatest stake in extraction sector automation adoption and implementation, you’d have to say Curfman, would be one. As part of his overall responsibilities Curfman oversees worldwide engineering and development of large mining trucks, tractors, boring machines and other mining equipment. Curfman has been increasingly seeing the writing on the wall: if commodities extraction companies are going to automate, they are going to need new or upgraded equipment. And if they buy equipment, he wants Caterpillar to be the company who sells it to them.

 

But first the new machines have to be designed and built. “Caterpillar is striving to be a leader in automation at mine sites,” says the seasoned executive. “We are currently in the middle of our largest ever R&D programs on autonomous trucks, dozers, drills and underground machinery and are currently collaborating with key customers around the world on both surface and underground autonomy projects.”

 

However while worker safety is Caterpillar’s primary concern when the company addresses automation issues, it is by far from the only one. Increased efficiency and productivity, derived in part from the elimination of the “human element” is another major factor. “All autonomous machines will be operating precisely as they were designed and will not be subject to inappropriate manoeuvres such as over-speed, operating against warnings, overloads and so on,” says Curfman. “This will drive lower operating costs and reduced costs per ton, as well as increase life expectancy.”

 

Furthermore, machines don’t take coffee breaks. “An additional expectation of autonomy is greater machine availability,” admits Curfman. “Autonomous machines will be operating without the inefficiencies and interruptions associated with human operators.”

 

Yet Curfman combines his sense of immediacy regarding automation issues with a decidedly longer-term view. “Without question 2009 will be tighter,” says Curfman. “However R&D, innovation and automation are at the top of our list for Caterpillar Global Mining. Our new electric drive truck models, our upgraded mechanical trucks, our automation programs, the new C175 engine family and the R&D to support these initiatives are still in place and progressing along our projected time lines.”

 

Rio Tinto’s Mine of the Future

One of the most innovative mining sector automation initiatives underway is Rio Tinto’s “Mine of the Future,” which was announced by the company’s CEO Tom Albanese early last year. The move, which will help alleviate some of the company’s main worker availability challenges, is a bid to maintain what it describes as “its position as Australia’s leading iron ore producer.”

 

Several building blocks for Rio Tinto’s automated mine-to-poor iron-ore operations have been commissioned and will be phased into operations as they become ready. For example mine operations at Rio Tinto’s Pilbara site will be controlled 1,300 kilometres away at a new Remote Operations Center (ROC) in Perth. Diver-less trains will carry iron ore along most of a 1,200 kilometre track and the company will also operate “intelligent” drills and trucks.

 

According to McGagh, when Rio Tinto’s Remote Operations Center is completed later this year, it will house at least 320 employees who will work hand in hand with their Pilbara-based colleagues, to oversee, operate and optimise the use of key assets and processes, including all mines, processing plants, the rail network, ports and power plants. Operational planning and scheduling functions are also slated to be based in Perth.

 

However according to McGagh, the Pilbara/Perth operations represent only the tip of the iceberg as far as innovation at Rio Tinto is concerned. “Many of the world’s best ore bodies are maturing and fewer tier one surface deposits are being discovered, as a result we will almost certainly see continued migration from surface to underground operations,” says McGagh. “This combined with the fact that many of the new developments will encompass lower grade minerals that need to be hauled longer distances, at a time when carbon constraints will deepen, means that the demands for increased mine productivity will be almost relentless.”

 

Automation within the office

According to Charles Jackson, surprising efficiencies for companies in the mining industries can stem be generated through automating their supply management processes. One obvious solution: “replacing manual paper driven processes, with automated paperless (ones) is simply smart business,” says Jackson.

 

Jackson should know. The company he heads, Quadrem, operates a transaction delivery network that includes more than 55,000 suppliers and 1,100 buyers, among them many mining and metals sector players such as BHP Billiton, Alcoa and Rio Tinto. According to Jackson, companies that join its eMarketplace benefit from an enhanced database and tools that allow mining sector professionals to better source items and suppliers. Even better: they get paid faster, because their paperwork will be processed faster.

 

On the transaction side, increased automation means fewer errors and thus results in increased accuracy. Furthermore, processing times tend to be shorter. “As mining companies look out towards the increased productivity demands of the future, they will need to increase the accuracy and speed of information exchanged all through their supply chains,” says Jackson. “The combination of precision coordinates between processes, functions and companies create an environment that can produce more tonnage, with less resource requirements.”

 

A solid future

As you might expect from someone charged with looking into future, given the rapid technology advances of recent years, Baiden is optimistic. At the time we spoke, the professor/entrepreneur was working on a mandate with the Canadian Space Agency that involved planning how one would construct and operate a lunar mining facility remotely from a location here on earth.

 

That’s good news for Baiden, because among his pet projects at Penguin Automated System, are the communications systems that his company sells, which enable remote operators to exchange information with machinery that they are operating off-site. “If you think it’s hard to find people that are willing to go to Northern Canada to do mining work, just imagine how hard it would be to find volunteers to go work on the moon,” says Baiden with a laugh. “Seriously though, automation is the future. Better get ready for it.”

 

Peter Diekmeyer is CIM Magazine’s Quebec correspondent.

 

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