Transformation of the Australian mining industry and future prospects

Hyongdoo Jang and Erkan Topal

Western Australian School of Mines: Minerals, Energy and Chemical Engineering, Science and Engineering, Curtin University, Kalgoorlie, WA, Australia
Australia is a resource-rich country that produces 36% of the world’s iron ore, 63% of the world’s lithium, 30% of the world’s bauxite and 10% of the world’s gold as of December 2018 (Geoscience Australia 2020a). Mining is a major industry in Australia that accounts for approximately 8.7% of GDP in 2019, and its export values are forecast to reach AUD $300 billion in 2019–2020, which is more than the combined exports of other industries during the same period (Thurtell 2020).
Since the early 2000s, major mining companies began to apply advanced ICTs (information and communications technologies) to their entire mining processes, expecting great improvements in both safety and productivity. Indeed, ‘digitalization’ is the biggest driver of change in the current mining ecosystem and will revolutionize the traditional mining value chain. According to the 2017 World Economic Forum’s mining sector report, the improved mining industry through smart sensors, automated equipment and automated operations centres will produce US $321 billion in value from 2016 to 2025 and reduce approximately 600 million tonnes of CO2 (World Economic Forum® 2017).
What changes will automation and digitalization, which are distinguished as Mining 4.0, bring to the mining ecosystem? According to a report in 2015 by McKinsey Global Institute (MGI), mining companies will save 5- to 10% of the operating costs of mining equipment by 2025 through information processing and analysis. Furthermore, it is also estimated that the Internet of Things (IoT) will bring worldwide economic benefits of US $160-930 billion per year in the energy and resources industry (Manyika et al. 2015). According to the study from Price (2017), the initial cost of operating 10 autonomous haulage trucks was approximately AUD $18.5 million but would increase productivity by a total of AUD $22.5 million, including an annual wage of AUD $2.7 million and a reduction in tyre costs of AUD $1.2 million. Pareira and Meech’s study is limited to automatic haulage systems, but the socio economic benefits will be tremendous if the inte- grated smart mine management system is established. The impact of automation and digitalization of mining ecosystems can be gauged by the policy changes of major mining companies.

Rio Tinto Australia

Rio Tinto established the Centre for the Mine Automation at the University of Sydney in 2007 in conjunction with Komatsu Japan. Rio’s Mine of the FutureTM programme is considered the most ambitious plan in mining history.
The Mine of the FutureTM programme strives to optimize not only the centralized remote operations but also every element of the entire mine process through the introduction of many innovative information and communication technologies and automation technologies. According to the report from Salisbury (2018), autonomous haulage system (AHS) and autonomous drilling system (ADS) operated in iron ore mines in Pilbara improve the operating rates by 11% and 26%, respectively.

BHP

BHP has also continued to invest in mining automation and digitalization. BHP reported that ADS increases productivity by 25% and decreases drilling costs by 40%. In addition, the Jimblebar iron mine in Pilbara WA reported that the operation of AHS decreases 80% of safety accidents that have been caused by conventional haulage trucks (BHP 2019). BHP opened the Maintenance Centre of Excellence (MCoE) in Adelaide, Brisbane and Perth as part of its integrated mining management system. The latest information and communication, information processing and soft computing technologies have been used to analyse real-time information at mining sites and provide a decision- making system. It is also predicted that the mine management standardization of more than 40 mines worldwide will reduce costs by US $1.2 billion/year by 2022, which is approximately 20% of the total mine management cost of US $3.5 billion per year where those mines have been managed with their own respective know-how (BHP 2017).

Fortescue Metals Group

In 2009, the FMG opened the Integrated Operation Centre (IOC) at the headquarters of the FMG in Perth. After the pilot operation of the AHS based on Caterpillar’s MineStarTM in the Solomon Hub mine in 2012, the FMG has operated 128 AHS trucks in four iron ore mines in Pilbara, which is the largest number of AHS operations in Australia as of 2019. The FMG’s steady eforts to automate and digitize mines have reduced the cost of iron ore production (C1 cost1) to US $13.11/wmt2 in 2019, which is only 50% of their C1 cost (US $27.15/wmt) in 2015.

Development of mine communication technology

Mining is a traditionally human power- and machine- driven industry, and eforts for automation have advanced in processes where the risk is high. However, automation in the mining industry is progressing slower than in other industries due to the limitations of communication technologies in the rough environment in mine sites. Mine communication systems are very important not only for production management but also for safety reasons. Furthermore, the establish- ment of a stable and efcient communication network platform should be a priority to achieve mining optimization through automation and digitalization. Based on the stable mine communication backbone, it is possible to prevent accidents and maximize productivity by establishing systematic mine operational technologies (OT) and information technologies (IT).
A surface mine that operates with AHS should have a local network that can reliably maintain a constant data transfer rate. The operating system installed on the AHS truck communicates with the operation centre of the site and mine integrated operation centre in real time about AHS trucks’ location and data generated from various sensors installed for vehicle management, daily updated terrain and route of the mine information and information of other equipment operations of the entire mine. For this purpose, most open mine area networks use high-speed communication systems such as Wi-Fi (802.11 bands) that can maintain data transmission speeds above a certain level. Recently, it also started commercializing private long-term evolution (LTE) communication technology for the operation of Komatsu’s FrontRunner AHS (Australian Mining 2019).

Development of ICTs and big data-based mining technology

Mining is an industry with inherent uncertainties. Even cannot identify the exact shape and grade of a mineral deposit. Even if a three-dimensional resource model is constructed and evaluated through analysing drilling samples obtained from exploration drilling, it is noth- ing more than a statistical model using geostatistical methods. In mining, it is inevitable to have a certain amount of planned dilution in the mine planning stage and unplanned dilution that can occur at the production stage. Proper production management and adequate ore classification processes can increase the mill head grade. Otherwise, significant losses will occur due to processing low-grade ore or waste. Various sensors and the latest ICT technologies applied to modern mining produce enormous amounts of data every day. These data are analysed through var- ious advanced data processing technologies and enable a reasonable reconciliation in each part or the entire mining process. In addition, establishing various data-based decision support systems facilitates more integrated and rational decision-making beyond the conventional management system that relies on the know-how of each site or the empirical intuition of expert engineers.modern high-tech mineral exploration technologies

Autonomous haulage system in surface mine

A study on AHSs started in the mid-2000s and was led by world-class mining manufacturing companies, such as the MINESTARTM system from Caterpillar and FrontRunner AHS trucks system from Komatsu. For safe operation of AHS trucks, the location of the truck, information on adjacent objects, the route to the destination, and the location information of other equipment should be updated in real time. These data are transmitted to AHS trucks, on-site operations centres, and remote integrated operation centres via local networks.
The AHS truck system is perceived as an icon of mine automation, leading mining companies to scramble to increase the number of AHS trucks despite huge initial costs. According to years of on-site verifications, the AHS truck system is invigorating the mining industry by improving the productivity and safety of mines and expanding new business areas related to mine automation and digitalization.

Electric vehicles for the mining industry

The trend of preferring electric cars as a means of daily transportation is increasing with rapid technological evolution, such as battery performance and inverters, as well as increasing price competitiveness compared with internal combustion engine vehicles that have been blamed for air pollution. This trend can also be found in the mining industry. In the case of under- ground mines, severe air pollution caused by the operation of internal combustion engines is directly related to miner safety. Furthermore, the energy required to operate the ventilation system to remove toxic gases (NOx, SO2, CH4, CO2, and CO) and particle matter accounts for nearly 40% of the total energy use of underground mines (Kocsis and Hardcastle 2003). To overcome the problems caused by the use of internal combustion engines in underground mines, research on underground mine battery electric vehicles (BEVs) has recently been actively carried out.
Atlas Copco announced that it would steadily increase the production of electric-powered mining equipment. Epiroc, a mining equipment company separated in 2017 from Atlas Copco, is gradually expanding its scope of mine electric vehicles to loaders, jumbo drills and underground trucks with the catchphrase of ‘zero-emission and battery-driven machinery’ (Epiroc 2017). Figure 9 shows the second generation of electric-powered underground mining equipment fleet and the ability to swap batteries.
Sandvik began development by acquiring Artisan, an electric power equipment maker, and Caterpillar is also increasing its investment in electric power equipment on its own. As an example, in 2019, the Caterpillar developed an electric LHD (R1300GLHD) equipped with batteries and compared experiments with conventional diesel engine LHDs to identify their performance and applicability. In particular, the comparison of energy costs showed that the electric LHD was US $3.66/run, approximately one-tenth of the US $37.50/run of the diesel engine LHD (Gleeson 2018). These electric powered mining equipment are being commercialized through on-site verification. The first underground mine operating the electric-powered equipment was the Macca gold mine located in Ontario, Canada, in 2013. The mine reported that electric-powered equipment contributes 70% of the mine’s production (Jones 2018). In 2019, Glencore, Canada, announced that a new deposit named’Onaping Depth’ found at the bottom of Craig’s underground mine 2600 metres below ground will be fully operated with electric-powered equipment. The mine is expecting to reduce energy costs by 41% and ventilation costs by 40% (Boissonneault 2019). In addition, Goldcrop Inc. along with Sandvik announced that they will only run electric-powered equipment at the Borden Lake gold mine in Ontario, Canada (Taylor and Lewis 2018). In Australia, Caterpillar conducted a test run of an R1700 electric loader at the Tanami mine operated by Newmont in the Northern Territory. Given these trends in the mining industry, the use of electric-powered equipment in underground mines is expected to increase steadily in the future. More information on electric vehicles in mining can be found in the publication from Global Mining Standards and Guidelines (GMG 2018).

Conclusions

Humans have been collecting minerals for thousands of years and the demand for minerals is steadily increasing with the growth of the population, industrialization, and technological development. Now, high-grade ore near the surface is almost depleted, and the mines are becoming deeper and more challenging. In fact, modern mining should be produced at extremely deep underground or low-grade ore with minimal environmental damage. Many mining companies are trying to overcome these difculties by improving productivity through the automation and digitalization of mines.
The recent rapid development of ICTs and soft computing technologies has created a new paradigm: Mining 4.0 with mine automation and digitalization, which means:
  • Changes in mining hardware through automation of robots or equipment.
  • Changes in mining software that can build advanced decision-making systems through advances in information processing technology for data accumulation and real-time analysis through various sensors.
  • The establishment of an integrated management system that manages all hardware and software in a high-speed communications environment with augmented 3D visualization.
given the rapidly revolutionizing ICTs, soft computing and big data technologies, the Australian mining industry considers the coming few years to be a significant turning point for the mining industry. During this period, many mining-related new technologies based on information communication and data analysis will be introduced and deployed. In fact, the mining industry is already in the transition period from conventional mining to the new era of mining, which has become a melting pot of new technologies from many other engineering disciplines. Now is the most dynamic moment in the history of the mining industry because of the adoption of various advanced technologies from various engineering disciplines. As the Australian mining industry has been leading the industry for centuries, now is the time to strengthen the Australian mining industry for the next centuries again by liberally introducing advanced technologies to the mines with high priority and enthusiasm.
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