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For this 3-part series, we're joined by Joe Carr from Axora, a B2B digital solutions marketplace and community for industrial innovators to discuss what manufacturers can learn from the metals and mining industry.
In the first episode of this series, we discussed the key challenges facing the metals and mining industry, how COVID and Brexit has made an impact and the benefits of remote operation centres.
Key topics covered (click to jump to the section)
- The main challenges in the metals and mining industry
- Attracting talent to the metals and mining industry
- The benefits of remote operation centers
- The biggest opportunities for metals and mining companies in 2022
- Case study: Alcoa
Niall Sullivan, Senseye: So welcome to this episode of the Trend Detection podcast. Usually, we are talking to manufacturers and getting insights from that side, but I'm really pleased that we're going to actually look at different industry, say metals and mining, which is certainly an interest from Senseye's side.
We have a lot of customers in that area. So I'd like to welcome Joe Carr from Axora. How are you doing today Joe?
Joe Carr, Axora: Yeah, very well. Thank you. For the audience, my name's Joe Carr. I'm the industry innovation director for mining at Axora, but to shorten that, I'm a mining engineer. So the mining world is where I've spent my whole career and from building mines to consulting on mines to working on sort of everything in and around mines and underground and open to.
Niall Sullivan, Senseye: Great. Could you give just little bit background about who Axora are and what they do?
Joe Carr, Axora: Yeah, so Axora, in essence, it's an innovation company and we have a digital marketplace that's focused on the energy sectors and metals and mining. So what we do is we hunt down the latest, most innovative products. We vet those products and then we take them out to the mining industry and to the energy industry. And we say, here are solutions to solve some of your cutting edges and cutting problems.
And for instance, Senseye is one of those solutions that we take to our mining customers, and we say, here is a solution for helping you do your maintenance in your smelter or your refining operation and wherever, you can do it better using AI and machine learning techniques.
Niall Sullivan, Senseye: Fantastic. Yeah, that's definitely really bit. So what I wanted to first of all and it's quite a wide ranging question. Really, a very, well, very open questions, good one to start with. So what are the main challenges that are currently faced in the metals and mining industry?
Joe Carr, Axora: Yeah, it's an interesting one because the mining industry is a bit of an odd space. It's not like oil and gas. Well, people tend to lump mining into a space, right, similar to oil and gas, but actually mining is many commodities. It's not simply copper or coal or gold. It has a big range of commodities. And so they each have their individual challenges, right?
For instance, coal today is not a particularly investible space. And yet coal is at one of its highest prices of all time. We have a range of challenges that range from things like corporate social responsibility, around things like coal to production of critical minerals that go into the most important supply chains in the world, right? When you hold up your phone, you don't think about the fact there's probably 20 to 50 separate minerals that have been mined that have gone into that phone, right.
And if we don't mine it, we grow it. So you look around you. If it wasn't grown out the earth, it was probably mined out the earth. And currently, I guess there are a few challenges.
Obviously, the global supply chain is somewhat of a challenge, although it's actually helped the mining industry quite a lot, prices are very good. We have constant issues around skills. It's a very difficult industry ironically to resource.
So we've had skills shortage for as long as I've been in the industry. I mean, it's a perennial problem. And we have all the other problems you would associate with a very, very large industrial kind of business, right, and that it's a slow moving industry, potentially. It has lots of big players and then, and a massive tail of smaller players. And it can be a difficult industry to working in, in that it's very global.
So you have lots of operations all over the world. It's existed for a very long time. So we're finding that the easy stuff with in brackets (easy), has been found and we are now moving to some more difficult jurisdictions to operate where we have concerns about things like resource nationalism and how do we mine responsibly in a modern world, right?
A hundred years ago, people weren't concerned necessarily about the way they did mining, whereas today how we support local communities and the impact of mining on those communities and the environment is taken incredibly seriously. So there's lots to talk about in the mining and what it's up to.
Niall Sullivan, Senseye: Yeah, no, it sounds... I mean, there's one thing that jumped at me straightaway, because we recently had a conversation with Make UK who sort of represented manufacturers in the UK and the one of the big key pot topics this year is around skills and attracting people to manufacturing.
But it sounds like that's very much the case in metals and mining as well. I know, particularly, they're looking to get more women into manufacturing roles. Is that an issue in metals and mining as well, more specifically?
Joe Carr, Axora: Yeah, I think it's more of an issue of the past, but it's also very location-dependent. So for instance, if you look at jurisdictions like Australia, actually women in the workforce, although they are less prevalent than men, it is far more common. And it also has to do with the A, the type of business. It doesn't necessarily attract women into the workforce and the way the industry is structured.
So for instance, I used to work on a mine in Saudi. You wouldn't get a job there as a woman anyway, just pointing that out. The job was four weeks on, two weeks off. And so you'd fly there for four weeks and you fly home for two. And so a lot of the way the mining industry is structured with the nature of mines don't tend to be right next to a city where everybody lives, they tend to be very remote, and that has an impact on people and family life.
I don't work fly in fly out operations anymore because I've got two small children. And so you have to think about the way the industry is structured and that's something actually where technology is having a major impact. Because now we are getting to the point in the world where we're using more remote operation centers.
And for instance, if you go to a big company and one of their remote operation centers will be placed in the middle of a city. And yet you'll be using that remote operation center to drive trucks a thousand miles away. And so suddenly you don't have to fly in and out your workforce, right.
Your workforce can actually live and work in a city, which is far more conducive to having a better gendered workforce, but also a more diverse workforce in terms of people are available to do things they wouldn't necessarily be able to do things.
There is a sort of counter-side to that though that many small communities in and around mines rely on those mines for jobs. And so by taking the jobs back to a city, there is the potential impact that actually you are taking valuable money and diversity and skills and workforce, which would be remote in a town that is near a mine, and you're actually taking them away. So there is a double edge sword to, for instance, teleremote operations or mining mindsets.
Niall Sullivan, Senseye: What sort of roles would be based in a sort of remote operation center even?
Joe Carr, Axora: Yeah. I mean, planning, operations, drilling, trucks, trains. I mean a lot of the bums in seats type things can be done remotely, right. You still have maintenance and you still have people like explosives guys who have to go and put the explosions in the hole and that sort of thing. So it's not that nobody will work on a mine. You will probably always have somebody in and around a mine.
It's just that for instance, by going teleremote, the mine saves a lot of cost because we're not putting people on planes, we're not flying them places, we're not putting them up in accommodation and feeding them and all of those kind of things and having roster bonuses. And we don't have the employee turnover. There's a very high turnover when you're working remotely, right, because people only sustain it for so long.
So there are a lot of benefits to the mining company, and there are a lot of benefits to the individual, that they can go home at the end of the day and see their family, right, and pick their kids up from school.
And they can do that on an incredibly flexible basis. Whereas if you're on a mine, you work a 12 hour shift. If you're in a teleremote operation center, there's no reason why I couldn't work for two hours, and then somebody else just sits in the seat and drives the same 10 trucks that I've just been driving with zero shift change or handover or anything like that.
Niall Sullivan, Senseye: I think that's interesting. So if we just consider an office environment or an office job, like such as myself or home office or any office, I'm not... I mean, it's not office job in the traditional sense, but it's actually, I guess it gives more flexibility for a start. So people who did want to work in the mine themselves, they could do that, but then they could also work from these remote operations centers as well. So, and I guess that is a part of attracting people to roles is they've got the flexibility to work how they want to.
Joe Carr, Axora: Yeah, definitely diversity is an interesting piece, right? Not everyone wants to sit on a plane and fly out and go work somewhere in the middle of nowhere. In fact, judging by the skill shortage, you see quite a lot of people don't because the mining industry is a very good paying industry. It's a very attractive industry in terms of compensation to work in. And yet it struggles.
It has struggled historically and it continues to do so because when you are 18 and you are choosing your university, do you want to go study mining or do you want to go study computer science or AI or something and get a job at Google or some machine learning startup in London, right? What's the more exciting, more attractive option? And yeah, a lot of people look at the mining industry and they say, oh, that's an irrelevant industry.
You get that viewpoint. But people don't realize how many things around them are built on critical minerals, right? The green energy transition. The amount of copper, for instance, just an electric car. An electric car uses four times more copper than a conventional car, and yet we want to ban conventional internal combustion engines by 2030 in the UK, I think, or 2035 for hybrids. So where are we going to get all the copper to build all these cars.
A wind turbine, the average size wind turbine uses like six tons of copper, just in the wind turbine construction, let alone the wiring and substations and transmission cables and all that kind of thing. The rare earth elements that go into solar panels, this all has to be mined from somewhere. The mining industry is more critical than ever because if we want a green energy transition, we're going to have to get the minerals from somewhere.
Niall Sullivan, Senseye: Yeah, no, exactly. The other thing a lot of people, probably myself included do underestimate exactly how much is mined and where it's used. You gave the example early on about in the mobile phone. I mean, does anyone really think about what's actually in what creates a mobile phone, not just the surface stuff, but actually powered it as well. So that's, even on that level, that's quite mind blowing.
Joe Carr, Axora: I still get people, I tell them I'm in the mining industry and my more often than not, the response is, oh, cool, Bitcoin. It's not even a surprising response to me anymore. I expect people to talk about Bitcoin and Ethereum before they talk about gold or copper or something else.
Niall Sullivan, Senseye: Yeah. I think manufacturers probably have a similar effect. Well, I think, and if we talked about being employable, I think there's obstacles to overcome for metal mining companies, but it's about changing the perception of it, I guess, because not many people would think about these remote operation centers and this kind of thing. They just think metal mining. They probably think you'd be down a mine at the minute. That'd be your role. There's no way you could work remotely.
So I guess like manufacturers is it's about really educating people into... It's a lot more than that and there's a lot more you can do than... I mean, it's great being down the mine and doing that side of thing, but also there's just so much more opportunity, especially on the digital side, which will obviously come to in our conversation too. I just wanted to touch on and I've, it pretty much is in every podcast I ever do, it seems at the minute, but I've got to ask about the impact of Brexit and COVID. Maybe that's two separate questions, but I know, especially in manufacturing, those tend to overlap together very much so. But what's your sort of view on that, Joe?
Joe Carr, Axora: Yeah. I mean Brexit, utterly relevant to the mining industry. I cannot think of anything that would have come out of us leaving the EU that may potentially... In fact, I can only probably think of positives to come out of it.
Because the way the trade deal is structured with the EU means that the UK has to build its own battery infrastructure and by building our own battery infrastructure and giga factories, we now need to source elements for those, which is for things like lithium, right?
So there's actually two lithium miners in Congo who are busy at the moment trying to build lithium mines down there. One is a hard rock mine and one is a salt, a brine salt to extract lithium from them. And they were basically supply between them. All the production of lithium will go to those battery factories. In fact, well, they won't be able to produce enough to fulfill those battery factory orders.
In one sense, it can't be in any way construed to have had any particular negative for Brexit because we're an international industry. And actually the UK as a whole does very little mining. Historically, it was a huge mining center. And funnily, I've spoken to many people across the years and they said if Congo was in Canada or Australia, it would be full of mines.
It's funny that because it's in the UK, we seem to have just forgotten that we have this mining history and we've forgotten that there's actually an incredibly rich area of metals in our country. And when someone tries to build a mine, nobody wants them to build a mine.
Niall Sullivan, Senseye: Yeah, I was about to say, so is that the reason there's a... Obviously, it's a protective and loved area called... Well, isn't it by... Is that the simple answer is that people just don't want mines.
Joe Carr, Axora: I think it's just a time thing that in the '60s through to the '90s, a lot of those mines closed because there was a depressed metals' price and they couldn't compete in a global market. And once a mine shuts, reopening it becomes far more difficult. And they are reopening mines down in Cornwall and people do want them and there's a gold mine. It's just been built in Scotland, that's producing.
Anglo American is building a potash mine in Yorkshire, the world's biggest potash project at the moment. So it's not like we don't have a mining industry here, but certainly it's not as big as potentially it should be. And it's ironic that a lot of the mining projects being built here are initially anyway, having started from foreign nationals coming here and understanding the value of what we have, whereas UK companies have ignored it.
There's a mine down in Cornwall, strong by minerals. They're an Australian company or initially Australian company, who came here and said, "Yeah, this is an amazing property and has been sat under our feet forever, and nobody in the UK saw to invest in that." And I think it's probably, it's just a mindset thing.
Given now we have left the EU, suddenly there's a question of what minerals do we have and how does that fit into our own supply chain. And supply chain security and COVID to come onto your second point has really highlighted supply chain constraints, right?
The fact that China controls 98% of the rare earth trade in the world, people have kind of slept walked into that. And now all of a sudden we've realized that having one country control 98% of the critical minerals that are needed to build a phone, for instance may not be the best thing for national security when you're trying to build super computers or even something as basic as a missile, if you are a military and you can't get it to work because you can't buy any rare earth minerals because China won't sell them to you.
So we see that with projects going on within the EU and in the US and Australia and other countries where they've said, actually we're happy to build our own supply chain of critical minerals because we understand the problems that we may potentially have.
Niall Sullivan, Senseye: Yeah. So that's a COVID-related issue, you said?
Joe Carr, Axora: Yeah. The supply chain stuff is a COVID related issue and partly Brexit. So in the UK, we see that suddenly supply chain, I think it wasn't an issue until COVID came along and then suddenly everyone said, actually supply chains are a real big issue, sort of PPE, right, and vaccines. That we didn't have our own supply chain. And now we can see it with electric cars.
So suddenly people are like, oh, how do you build electric cars? Well, you need all your battery metals. Where are all the batteries made, they're all made in China. So the industrial revolution 4.0 the battery is the new steam engine. So where do you want your technology? Do you want your technology in another country or do you want it in your own country? And so all the minerals that go into those batteries, which is legion, it's just all minerals.
We suddenly have to think about where are we getting our cobalt from and where are we getting our nickel from and how secure is that supply?
If it's a Chinese company, it's essentially the Chinese state has that, and that's not necessarily an issue, but people who think about these kind of things, think about worst case scenarios or they think about how do I build that so that 50% of my vehicle is manufactured inside the EU and UK with that trade deal. Well, if I can't get my minerals to manufacture the battery and I have to get the battery made in China, how much of my vehicle is now has to be manufactured in the UK. And if the battery makes up 50%, I've now got a bigger problem, right.
Then the fact that we don't have the skills and expertise to make that. And that's an interesting thing that probably, if you'd have talked to someone five years ago, it wouldn't have even come up.
Niall Sullivan, Senseye: It just shows what a seismic, obviously both seismic events that have just shaken all areas of life, I guess. But yeah, that just shows with the supply chain that diverse in lots of different countries, just the problems of keeping that running must be. I mean the forms you must have fill in start with sounds like pretty an enviable task, I'd say.
Joe Carr, Axora: Yeah. Say metals is a pretty global business. It's part, goes part and parcel. Generally the material is mined somewhere and smelted somewhere else. So we crossed a lot of borders, but COVID is certainly... I guess it's been interesting.
The mining industry struggled at the beginning with COVID because everyone couldn't get anywhere. And I think very quickly the mining industry got a hand on it. And after I think sort of six months into the pandemic, nobody was really bothered about COVID.
No, it wasn't we were running. In fact, many mines had the best years in 2021. 2021 was a fantastic year for minerals, prices were very, very high. So yeah, COVID probably had a pretty negligible impact on the mining industry as well. It's a pretty resilient industry. It tends to shrug off a lot of problems because if people need the metal, they tend to find a way.
Niall Sullivan, Senseye: Yeah. And I guess none of that really stops because of... Yeah, I can imagine there's not a lot that would stop there. There'll still be demands despite the bumps in the road, let's call them such as that.
Joe Carr, Axora: And COVID is a bit turbocharging, right, because everyone's come out with infrastructure spending and what does infrastructure need? Metal.
So yeah, Joe Biden wants to spend one point something trillion dollars revitalizing American infrastructure, bridges and roads and railways. Well, where's he going to get all the steel to make that, right? There's all your iron ore and all your substations and your green energy revolution, it's all minerals. So COVID has had a negative and possibly a positive impact on the mining industry.
Niall Sullivan, Senseye: Yeah. I mean, actually that links quite well with my next question, which was actually going to look at the wider sort of opportunities for metals and mining. Yeah. And it sounds like because they're resilient, they can sort of... They're not recovering as much.
As such, they're actually looking to build and go further. But what areas do you see the biggest opportunities for metals and mining sort of companies?
Joe Carr, Axora: Yeah, it's an interesting one. In 2022, I feel like it's going to be more business as usual in the mining industry. I certainly believe, and a lot of people believe that COVID has been beneficial to the mining industry because suddenly the mining industry has had to do what it's put off for a long time, in terms of the digital revolution.
This approach of remote operation centers, for instance, and people not being able to fly to sites or having to work remotely using drones. 10 years ago, you would've never even... that would've been very few mining companies.
Now, it's a good bulk of the industry is using that kind of systems. So I think the opportunities in the mining industry really are to change the way we work and adopt better technologies in 2022 and leverage the effects of COVID in turbocharging the business.
Because it was interesting, I had a conversation with on our podcast actually, and we were talking about risk and the inherent... The mining industry is risk averse. We build a mine, we might spend $2 billion, we spend $8 billion building a mine, right? So we spend a lot of money building mines because they're around for a long time. And we were talking about risk and it was a great example, came up.
It was the risk of using electric vehicles versus internal combustion engine. And the standard thinking would be that there's no risk for using internal combustion because I already use it and moving to electric is risky because it's not proven in a mining environment. And the conversation we had actually was very interesting in that the mining industry doesn't think about the risk of not moving to electric.
So by not moving to electric vehicles as an example, what is it available to us that would be available if we did move? And for instance, a good example of that would be if I was in an underground mine, I spend roughly 50% of my power moving air around so that people can run internal combustion engines, basically. I used to work on a mine where we had a 2.5 megawatt fan and that was what pushed the air around the mine to get the diesel particulates out so people could breathe, right.
But if you didn't have any diesel particulates, because you had electric vehicles, what would be the impact financially on the mine design in terms of, well, I don't need all these ventilation raises and all these kind of things that I'm, infrastructure wise.
So as an example, by getting rid of electric vehicles, even though you no longer have the technology, which has been around for a hundred years, suddenly I don't need to spend $50 million or $100 million on infrastructure that I would need to keep my diesel vehicles.
And the mining industry today doesn't think in that terms. And I think that's going to be an interesting takeaway is how quickly can we move to new technology isn't a risk, the status quo is a risk.
Case Study: Alcoa
Alcoa Corporation is a global leader in bauxite, alumina, and aluminum products, built on a foundation of strong values and operation excellence dating back more than 130 years to the world-changing discovery that made aluminum an affordable and vital part of modern life.
Alcoa operates production plants worldwide and have applied breakthrough innovations and implemented best practices that have led to increased efficiency, safety, sustainability, and stronger communities wherever they operate.
Discover why Alcoa partnered with Senseye to achieve best-in-class technology and operational practices for Predictive Maintenance.