A new report says South African mining companies are increasingly leaning on technology as a result of the COVID-19 pandemic, which has accelerated the application of fourth industrial revolution (4IR) technologies.
It says SA’s mining sector is now making use of innovative and cutting-edge technologies to run more efficient operations.
The report, jointly produced by consulting firm PwC and the Minerals Council SA – The state of digital transformation in the South African mining industry – was compiled with the aim of gaining an understanding of how the mining industry visualises the impact of the 4IR on its people, processes and technologies.
It also looked at how they perceive the evolution of 4IR on the sector in the years to come, and what steps mining operations are taking to transform in anticipation of these changes.
It says the COVID-19 pandemic has further accelerated the digitisation of the work process, as well as the adoption of automation and other innovative tools in the mining industry.
The launch of the report this week comes on the back of growing production and operational challenges that have engulfed the sector.
According to the Minerals Council of SA, over the last decade, multi-factor productivity in the country has fallen by 7.6%. Mining cost inflation was 2%-3% higher annually than general inflation, leading to two-thirds of SA’s output being on the upper half of the global mining cost curve.
Mining output declined by 10% and minerals sales contracted by 11%.
Game-changer
The sector is now increasingly turning to technology, with PwC saying advances in technology and innovation will drive changes in the mining industry.
“Digital is a pivotal game-changer in the mining industry. It is disrupting mining operations and business models and, in some instances, changing the entire fabric of the mining industry,” says Andries Rossouw, PwC Africa energy utilities and resources leader.
“South Africa’s mining industry is set to undergo significant transformation in the next decade. Advances in technology and innovation will drive a lot of what we currently see in the mining industry going forward.
“With the digital world presenting so much opportunity and disruption, mining companies will need to be more agile when thinking about how to align technology with their business needs, as well as making the right choices on partnership and implementation. Mining companies that genuinely understand technology and leverage it strategically will be the winners.”
Commenting on the report, Minerals Council CEO Roger Baxter says: “Adoption of innovations emerging out of the 4IR did not go into lockdown during the COVID-19 pandemic. In fact, the pandemic accelerated the application of 4IR technologies, helping Minerals Council members and others to manage the pandemic more effectively.
“South African mining needs 4IR. We need to be globally competitive on costs and on environmental, social and governance issues. The Minerals Council advocates a people-centric, 4IR-enabled approach to modernisation of the sector.
“With the high levels of unemployment, poverty and inequality, a pure technology-focused approach will not be socially acceptable. It is hence encouraging that this report does not only focus on technological issues, but also on issues related to culture and the upskilling and/or reskilling of the workforce.”
Digital advocates
According to the research, some mining companies consider themselves as digital champions and innovators that will pilot new technologies without waiting for others to prove it first.
“New technologies such as artificial intelligence (AI), the Internet of things (IOT), robotic process automation, smart sensors, big data analytics, 3D printing and machine learning will all boost productivity in the mining industry,” says Pieter Theron, PwC partner advisory services and head of Industry 4.0 SA.
“In the process, mining companies will need to look at ways to upskill their workforces to work in this new world as it will require new skills in order to unlock the benefits of digital transformation.”
The report surveyed 23 executives across 19 Minerals Council members, with the authors noting that although not representative of the entire mining industry in SA, they had identified 10 emerging trends they believe are consistent with other international studies and can be used by local mining executives.
The trends include how industrial IOT will get the biggest share of the budgets. It says the sector outlook for industry-wide adoption is bright as mining organisations are reporting successful deployments of IOT and the positive impact it has on their bottom line.
The report says SA’s mining community was asked to what extent it was using or planning to use 11 4IR technologies over the next five years, with the most implemented technologies found to be condition monitoring at nearly 80% across all respondents, and connectivity and IOT at almost 60%.
“Nearly 50% of respondents had piloted AI programmes recently and we expect the implementation numbers to increase significantly over the next five years. 35% of respondents were using robotic process automation, with another 10% planning to implement it within five years. Nearly a third of all respondents already use virtual reality (VR) to train staff, while 20% were currently piloting and a further 28% intended to implement VR training within five years,” reads the report.
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