DENVER DREYER The biggest challenge that junior miners face is access to funding
Recovering commodity prices, renewed optimism in the mining sector, and diversified ownership of Tier 1 mining companies are opening up opportunities for emerging and junior miners to enter the industry, says engineering consultancy company WorleyParsons RSA CEO Denver Dreyer.
He explains that the professional services company can assist Tier 2 and Tier 3 miners to address some of the challenges they face in “getting their projects off the ground and attracting funding”.
“The biggest challenge that junior miners face is access to funding. Mining is emerging from a recession into a cautiously optimistic incline. Against this backdrop, investors are more likely to back reputable companies and projects in known orebodies.”
Dreyer says, as the market starts turning on the back of Tier 1 projects and investors, Tier 2 and 3 miners will benefit from the upswing as market confidence returns. These companies will require solid feasibility studies to make sure their projects are bankable and attract the right level of investment, he asserts.
WorleyParsons RSA offers a range of appropriate solutions and can offer junior miners fit-for-purpose, cost-effective solutions and tools.
“WorleyParsons RSA will partner with Tier 2 and 3 clients along the project journey, laying solid foundations at the start of the project to gain investor confidence and to ensure success across the life of the project. If the work at study phase is not done correctly, the cost of changing at the execution phase is very high and could have serious consequences further along the life of the project,” he adds.
Innovation
“Engineering is facing an onslaught of unstoppable trends, from artificial intelligence that automates many of the standard design processes, which, in turn, reduces the cost of design, to integrated digital modelling processes, such as Building Information Modelling that has also been proven to greatly reduce design costs.”
Dreyer enthuses that WorleyParsons RSA “is at the forefront of innovation” in the engineering sector and has a range of tools that can help Tier 2 and 3 miners to build a strong business case, from modelling tools to enable potential investors to visualise the projects, to tools, such as the StepWise process which evaluates the viability of a project, and identifies risks and optimisations in a low-cost, quick and effective way.
He adds that, along with the challenge of access to funds at the start of the project, junior miners need their projects to release value and put runs on the board quickly. “Our mine planners are experienced in sequencing and designing a mine to first access the parts of the orebody, which can be quickly beneficiated to get cash on board, while simultaneously starting on mining the more complex parts of the mine for longer-term returns.”
Energy Efficiency
In addition to the need for solid studies backed by a reputable global brand, junior miners have to take note that there is a growing environmental consciousness among investors, Dreyer points out.
He explains that global investors are steering clear of projects that will damage the environment, and are increasingly aligning their portfolios with projects that reduce greenhouse-gas emissions across their value chains, consistent with the Paris Agreement’s goal of limiting the global average temperature increase to well below 2 ºC above pre-industrial levels.
“WorleyParsons RSA can help Tier 2 and 3 miners to meet this challenge and create a more sustainable future by helping them adopt the right technologies to create cleaner power. We can partner with them to offer ethical, sustainable and clean solutions that will align with investors’ objectives so that they can get their projects off the ground.”
Dreyer asserts that the company is at the forefront of ‘clean’ technologies, such as fluidised gas desulphurisation in power plants and other processes that reduce or eliminate certain types of emissions.
He, however, emphasises that the unstoppable trends such as localisation, environmental consciousness and technology will continue to pose challenges to Tier 1, 2 and 3 companies alike.
“WorleyParsons RSA is staying ahead of these trends and we are positioning ourselves to provide services that are relevant, appropriate and responsible, whether they are high-tech solutions for Tier 1 clients, or fit-for-purpose, cost-effective solutions for junior miners,” Dreyer concludes.