Can technology dig mining out of its slump?

Capital expenditure in local mining was down almost 10% in 2024, and profits decreased for a second consecutive year, falling 18.5% in 2023 and a further 1% in 2024, according to Stats SA. Describing the situation as a “horror show”, Hugo Pienaar, chief economist at Minerals Council South Africa, says current rates of exploration and the mining pipeline are also cause for concern.

The local mining sector should be able to capitalise on the demand for critical minerals such as Platinum Group Metals, used in catalytic converters and fuel cells for electric vehicles. But Pienaar says the local sector is no longer seen as globally competitive, and should harness more data to improve efficiencies and safety, as well as extend the lifespan of mines.

Mining has always been a very labour-intensive endeavour, says Puso Thahane, a partner at Boston Consulting Group (BCG). There’s been a shift away from labour intensity to what he calls “data intensity”. And while industry players may see the value in digital innovations and data, he says mining is not marketing. “It would be quite difficult for a miner to ChatGPT its way into improved results or greater productivity and throughput because the industry is highly complex.”

To produce minerals that will eventually be used, for example, in a drive-train of a vehicle, is a multi-step process, says Alex Fenn, VP of innovation and technology at Sibanye-Stillwater. “We have to find and source the metal, dig it out of the ground, process it and then convert it into a saleable format. And across these processes, there are so many different iterations with complex issues. You can have two operating areas right next to each other in the same mine, with two completely different sets of challenges,” he says.

What is promising, though, is the emergence of new tools that make mining innovation easier. This means that you can simulate a product in a sandbox environment for a month, running different models to assess if it has any relevance and, if not, you scrap it. “Back in the day, it was a lot harder to find the right technologies and we would often struggle to find a solution to a problem,” he says. “Today, the adverse is true. We’re able to experiment with tech more, in a much shorter timeframe and with people involved.” He explains that this reduces the costs associated with innovation and testing.

Too many options may also mean a miner finds themselves in what Thahane calls “pilot purgatory”. “In the last five or so years, we’ve seen many different mining companies running small pilots. Some have been a success, while others have not, but many haven’t delivered any real value or made any impact because they never left the pilot phase and they were never really scaled up.”

To ensure that its tech efforts bear fruit, Exxaro has formed a standalone technology department to plan, test, and deploy technologies. This department, says Exxaro’s CTO Johan Meyer, looks to identify technologies that solve Exxaro’s challenges and enhance growth, while also finding the right partners.

The department is currently trialling several technologies, such as deploying 5G to solve connectivity challenges in remote areas. At its Matla mine, it’s in the process of rolling out underground WiFi, and has fitted its continuous miner machines and shuttle cars with Power Line Modems to enable underground connectivity. Megan Smith, technology strategist at Microsoft, says the mining industry is trying to automate as many processes as possible, while scaling down manual operations.

Puso Thahane, BCG

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These conversations usually elicit fears around job losses, she adds, but the goal is not to remove people from the process. “Rather, it’s about removing and mitigating the safety concerns your workers face by allowing them to make more informed, data-driven decisions.” She says Exxaro is using drones for geological surveying, recording, and analysing pre- and post-blasting mapping and estimating stockpile volumes.

Exxaro is also exploring the use of safety wearables at several of its mines, Meyer says, which means the company can monitor employees’ vital signs and flag potential problems. At its underground Matla coal mine in Mpumalanga, operators are tracked in real-time by their cap lamps, which are connected via WiFi nodes.

Mines are also using remote operations centres, says Smith, which are safer as they’re located outside of the mining activity zone.

Mining is not marketing.

Puso Thahane, BCG

BCG’s Thahane says De Beers is using advanced analytics for prescriptive maintenance at a mine in Botswana, and reports a 15% reduction in unplanned downtime. Unlike predictive maintenance, which forecasts when equipment is likely to fail, prescriptive maintenance uses real-time and historical data and machine learning to predict and then suggest actions to address an issue before it occurs.

Kumba Iron Ore, meanwhile, is using Passport 360, from the Azure Marketplace, to automate its compliance management and speed up its contractor onboarding process, says Colin Baumgart, CTO for Microsoft South Africa. In the past, a staff member would need to sift through piles of applications to find the best candidate for the job.

Fenn, from Sibanye-Stillwater, says mine modernisation is broader than just technology and innovation. “Obviously tech will be key, but these solutions should be seen as enablers as opposed to the focus.”

INHIBITORS TO INNOVATION

According to Johan Meyer, Exxaro’s CTO, some of the challenges around tech and innovation in the local mining sector include:

• Risk aversion: The industry often prioritises operational stability and safety over experimenting with disruptive and unproven technologies, leading to slower adoption rates.

• Legacy systems: Many mining operations rely on outdated infrastructure that is costly to upgrade or replace.

• High upfront costs: Investments in technologies like automation, AI, and renewable solutions requires significant capital, which some miners find prohibitive.

• Fragmented collaboration: While progress has been made, there is still a lack of widespread, cohesive collaboration between companies to drive technological innovation.

• Skills gaps: The industry faces a shortage of skilled professionals who can implement and manage new technologies. The war for talent is one where mining is losing to safer, more innovative companies with more attractive employee value propositions.

• Connectivity: Poor infrastructure across mines hinders the industry’s ability to gather meaningful data.

• Regulatory barriers: Strict regulations and slow permitting processes hinder testing and the rapid deployment of innovative solutions.