Despite the pervasive commodity price slump negatively affecting the global mining industry, there are signs that the industry is moving towards improvement, delegates heard at the SRK Consulting 360° Mining perspective seminar, which took place in Johannesburg earlier this month.
SRK Cardiff chairperson Mike Armitage suggested commodity prices might finally be heading towards the long-awaited up-cycle, highlighting that gold had been performing particularly well, having improved to its highest rate in two years, stabilising at the $1 340/oz mark.
He added that the improved gold price resulted in significantly more gold exploration projects being undertaken globally by junior mining companies, particularly since gold projects were cheaper to develop than other commodities such as iron-ore.
Further, Armitage noted that the UK, in particular, had showed signs of an industry upturn, having received the Country of the Year award at last years Mines and Money Conference, held in London. The UK received the award largely because of the development of several projects, such as a tungsten mine in Devon, a polyhalite mine in Yorkshire and a gold mine in Northern Ireland, he said.
He also highlighted that a significant amount of gold exploration had been taking place across Wales and Scotland.
“Even though the industry in general is down, it is quite nice to be working in the UK,” Armitage quipped.
Meanwhile, SRK South Africa principal consultant Andrew van Zyl noted that while the lack of project investment during commodity down-cycles were common, it was during these periods that mining companies should consider the environments in which they operated.
“In many parts of the world, Africa included, mining-related agreements take longer to negotiate due to the lack of established regulations or codes. [Therefore], issues of infrastructure, power, water and land need detailed discussions among stakeholders,” he explained.
Van Zyl asserted that when capital investment was limited, it was important for mining houses to attain a firm understanding of the challenges in the industry and the requirements of all mining stakeholders.
SRK South Africa corporate consultant Roger Dixon highlighted that productivity levels globally had decreased by almost 30% in the past decade.
He asserted that South African mines, particularly gold and platinum mines, “need to move away from a dated management model if we want to address productivity in the longer term while winning the hearts and minds of employees and other stakeholders”.
Africa’s mining industry was in a challenging position, as developed nations continued to employ mechanisation strategies to boost productivity levels; however, if deployed in Africa, it would result in severe job losses, Dixon pointed out.
He suggested that technology would offer the best solutions to the productivity challenges worldwide. “Much of the value creation in mining will shift from how well the operation moves material to how well it collects, analyses and acts on information to become more productive.”