In their drive to minimise operating costs, maximise production and gain full transparency of key financial indicators, best-of-breed software solutions and emerging technologies have a lot to offer the mining industry.
Over the coming years, it is predicted that: “…advanced technology in mining operations will accelerate; increasingly becoming a necessity for firms to remain competitive.” Source: Mining Review.
Each stage of mining operations from extraction through crushing and onto processing comes with its challenges. Based on our experience working with the industry, Progressive TSL have developed finance, asset management and supply chain solutions that address the specific operational needs of a mine. Here we provide our insights into this sector.
Critical Challenges for Mining
- Ensure all stages of the mining process are running at optimum levels with no hold-ups between stages. This may require stockpiling of essential inventory materials necessary to feed a specific stage of the process, e.g. arsenic and sodium cyanide for gold processing, zinc dust used as reducing agent during smelting at metals plants, and hydrogen peroxide to enhance leach discovery at gold and silver mines.
- Keep track of all inventory levels and locations, to avoid unnecessary purchases, materials (e.g. chemical) obsolescence or material shortages.
- Develop robust maintenance strategies for both static and mobile assets to prolong life, and avoid where possible, making additional capital expenditure during the life of the mine.
- Ensure stages downstream of extraction, e.g. processing of the extracted raw materials, are kept running at optimised levels. These processes need to be balanced against maximising the payload of the trucks carrying these raw materials, minimising the total number of trips over the life of the mine. Every journey will take its toll on the wear and tear of the vehicle as well as incurring extra fuel costs.
- Correctly depreciate critical assets including mobile (trucks, loaders, dozers) and static plant (ball mills, conveyors, etc.) over the mine’s lifetime in-line with applicable financial regulators.
- Guarantee maintenance activities are scheduled as efficiently as possible to minimise Mean Time to Repair (MTTR) while being mindful also to minimise Mean Time to Breakdown (MTTB). Make reactive maintenance decisions so that when an asset is offline, the downtime is as short as possible.
- Mines can be dangerous places to work and are often located in remote, inhospitable areas. For HSE reasons, as well as efficient allocation of jobs, it is imperative to have full visibility of workforce status and availability, both Operations and essential support staff (i.e. Medics, Security and Welfare.)
- Budgets for a mining project will be tight, so it’s always essential to have accurate reporting of costs across all stages (in some cases including discovery costs), as well as standard G&A costs, to identify inefficiencies and manage profit margins.
Manage the full asset lifecycle from commissioning to end of life: Though effective asset management will always look to prolong an assets life, towards the end, tough decisions need to be made. For example, if machines are underperforming, but the site has less than a year’s worth of extraction, should a significant amount of outlay be spent on a new mill, truck or other expensive assets?
How Systems Can Address these Challenges
Effective Enterprise Asset Management and Financial Management systems can work together to deliver a full end-to-end picture of your mining business.
- Data Harvesting
Robust systems solutions assist in the efficient operation of a mine by simultaneously harvesting data. Such data can provide a rich analysis of your operations allowing informed decision-making and driving global reporting, in near real-time to all levels of the business.
- Maintenance Management
Our mining clients have used maintenance modules of their asset management solution to track the status and performance of critical equipment for mobile and fixed plants including trucks, pumps, lift shafts etc.
In mining, as a rule, 80% of your maintenance should be planned or predictive, and 20% should be corrective or reactive. Asset management can help you to keep this balance so that you aren’t over or under maintaining any of your assets. Operators can take action when equipment starts to underperform before it breaks down - if something needs to go offline to be repaired, it can plan and track your corrective maintenance down to the hour. For more information maintenance management, see our blog. - Fleet Management
Some asset management systems offer integrations with IoT sensor technology which can record many variables about the health and performance of the fleet of trucks, including temperature, fuel consumption, tyre pressure, tyre wear, the weight of trucks and their average speed. They also facilitate the use of industry standards such as the VMRS maintenance classification system. For more information on the capabilities of IoT, read our recent article on digitalisation. - Workforce Management and security
Workforce modules provide visibility of operatives and their availability for work. Work Orders can be allocated to operatives, matching skill requirements to Tasks, equipment requirements (e.g. PPE like; harnesses, breathing apparatus and other specialist equipment) and tools. Asset management modules such as this provide visibility of resource utilisation and will enable work to be allocated appropriately to meet the objectives.
Inventory Management - Procurement and Inventory Management modules of full asset management solutions provide transparency from purchase requests right the way through the entire asset life cycle. You will gain visibility across all your warehouses and sites. This clarity enables you to make the right procurement decisions at the right time and in the right quantities, to keep your mining processes flowing while retaining a handle on expenditure. For more information on asset management and inventory, read this blog.
- Financial Management and Depreciation of Assets
Some best-of-breed asset management solutions can work with your finance system, providing flexibility in financial models used to depreciate key assets. Example of models used includes depreciation based on distance travelled (for your mobile fleet) or production quantities (for your mobile and fixed plants). A total finance system often supports a wide range of financial regulations to reflect the requirements of different geographical locations across the globe, including Syscohada and IFRS. Multiple rule sets can be implemented at the same time.
Progressive TSL in action
Endeavour Mining is an African Gold Producer with mines in Burkina Faso, The Ivory Coast and Mali. Over recent years Progressive TSL have successfully implemented Asset Management and Finance Systems into a number of their mines and London Head Office.
Progressive TSL would welcome the opportunity to talk to you about your finance, asset management and supply chain challenges and requirements. Learn more about our mining focus on our website.
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