A new survey of the world's miners revealed that environmental concerns will drive innovation out to 2035 more than commodity prices, but some technologies that may improve the industry's image in that regard face negative perception.
Australian management consultancy VCI's survey of 800 senior respondents across 399 companies issued Sept. 16 said increased social expectations, regulatory scrutiny and investor pressure come as technology's evolution creates "unprecedented" transparency in the industry.
A long-term energy shift is also underway, which will transform the design and operation of industrial processes for industry, the survey said.
Environmental concerns will be the top driver of innovation over the next 15 years, while operating costs were the main source of value from innovation followed by risk reduction and throughput, according to the survey.
Remote operations will become more self-sufficient with local renewable energy and storage capability. This enables miners to tie in environmental concerns with a way to drive operating costs down, given Wood Mackenzie said energy accounts for up to 40% of miners' costs.
VCI founding partner Graeme Stanway said in an interview that he expects to see much more progress in hydrogen research and development in the next decade given the considerable "prize" of cost benefits that can be used for storing energy and powering trucks.
"The intermittency of renewables can potentially be overcome through a combination of operational flexibility to vary consumption loads, and storage through batteries or hydrogen conversion — both technologies that are rapidly becoming cheaper," the report said.
The report cited U.S. government data, which showed that miners use, by far, the most amount of energy in grinding. While the data was from 2007, Stanway said VCI's interviews with miners revealed that the relative energy use rates in mining operations have "barely changed over the past few decades."
"Energy use has got more efficient, but the relative rates of use are broadly the same," Stanway said.
While Fortescue Metals Group Ltd. and Mineral Resources Ltd. have invested in hydrogen research, VCI's report warned that "off the shelf" hydrogen solutions for mining are not yet available, and mining workforces are not sufficiently trained to deal with hydrogen fuel or technologies. Public perception around hydrogen safety is also poor, and water available for electrolysis is scarce.
VCI's report also called emerging in situ extraction technology a "game changing" new approach that requires less disturbance, waste and water usage, with cheaper operating models including no need for tailings dams. Yet it also faces "significant skepticism," not only due to technology requirements but also environmental concerns because of its use of acids and chemicals.
"Many in the industry assume in-situ is a non-starter with the community given its experiences with shale and coal seam gas," the report said, citing the latter two's use of hydraulic fracturing, which involves pumping chemicals underground to extract gas and has faced severe activist backlash.
|VCI founding partner Graeme
While those concerns have merit, given environmental concerns are the biggest driver of negative perceptions of the mining industry, the report said the shale and coal seam gas industries prolific in the U.S. and Australia, respectively, are thriving after having outcompeted capital-intensive incumbents despite the skepticism.
Similarly, new research using inert enzymes could help in situ metals extraction provide a "step-change reduction in environmental footprint," the report said.
Case study: New Century's zinc mine in Queensland, Australia
With over 1 million abandoned mine sites globally with legacy infrastructure and rehabilitation requirements that still offer stranded value within new and residual mineral deposits, the report looked at New Century Resources Ltd.'s innovative strategy at the Century open pit zinc mine in Queensland, Australia.
The deposit has reemerged as the world's fifth-largest source of zinc in 2018 through reprocessing residual mineralized tailings.
After the tailings at the Century tailings deposit are reprocessed and zinc is extracted, the remaining material is planned to be moved back into the existing open pit and permanently covered in water.
New Century Managing Director Patrick Walta said in an email that the company had developed an innovative revenue-generating method for rehabilitation, thereby incentivizing the swift recovery of mine sites as their economic lives as operating mines draw to a close.
Walta said starting economic rehabilitation at the Century mine in 2018 also eliminates the need for infrastructure dismantling and final closure activities, and since the start of mining, the company has already reprocessed 4 tonnes of the tailings waste stream the previous owners left behind.
This represents 5% of the total tailings waste at Century, which will now be reprocessed and removed over 6.5 years.