Surface Mining: Challenges (2)
Four of the current and most important challenges facing the global surface mining industry are the problems with geopolitical market uncertainty, license to operate, the threat of disruption, and the possible depletion of critical mineral deposits.
Market instability and geopolitical tension
- The geopolitical and international security landscape continues to evolve rapidly. The global economy and investment patterns are constantly changing. Understanding these transformations, the driving forces behind them and the long-term implications are crucial for companies to determine where to focus and do business, and for governments considering trade, diplomacy and the security of their citizens. The mining and metals sector is at the core of the systems and value chains that shape the current geopolitical reality.
- Due to the trade disputes with China, US companies have looked for new sources of minerals, rather than double down on domestic production. The US military has worked with Malawi’s Mkango Resources to provide rare earth minerals, while Texas-based Blue Line Mining aims to develop a rare earth production facility in the US, however, one reliant on support from Australian miner Lynas, and raw materials from Malaysia.
- Market volatility and a downturn in commodity prices, industry-specific issues related to regulation, geopolitical risk, legal limits on natural resource use, shareholder activism and public scrutiny have created challenges for the global surface mining industry.
License to operate
- CEO's worldwide state that license to operate is the key risk they are presently facing because the current approach is not broad enough. It has progressed beyond social and environmental issues. One mistake can affect the ability to access capital or even result in a total loss of license.
- The surface mining industry is also grappling with the need to also have a social license to operate. Because globalism is advancing nationally, digital transformation highlights the need for a stronger license to operate. Jimena Blanco, head of Latin America research at Verisk Maplecroft says, “Mining companies are now recognising that this is a strategic concern and an operational one, too; it’s not just about having some corporate social responsibility programs and investing in the local community; there is a recognition this affects the bottom line.”
- Miners face potential disruption from the tech sector. Apple recently moved to stop using newly mined materials in its products which will disrupt the global mining sector, according to Barrick Gold Corp chief innovation officer Michelle Ash.
- The global mining industry, like so many other economic sectors, is battling a technological revolution. The industry is going through a wave of technology-driven disruption. So transformational are the changes that there is not even useful language to capture the scope of what is taking place.
- In 2020, activist hackers are expected to launch at least five cyberattacks on mines around the world in Permanent Denial of Service attacks aimed at eliminating the environmental and social threats they pose. They’ll use workers’ connected devices to initiate the attacks.
Shortages and depleted resources
- In some areas, resources have become scarce or depleted, forcing companies to push new frontiers of exploration. Depending on what is being mined, this has the potential to be more expensive than traditional mining and could leave companies more reliant on rental power solutions.
- The question being asked these days is, "Do we need mining quotas?"
- Is the world running out of critical minerals? This question was asked in an article published in 2017 by Mining Technology. The article states that China is running out of rare earth metals, but zinc, tin, copper, and iron ore seem to be available. The USGS has developed a methodology for identifying such critical minerals, tracking the change in their ‘criticality’, and forecasting potential trouble spots in the future.
Your research team conducted a thorough search of sources connected to surface mining which included websites, news releases, educational publications, and third party sources. Although there were numerous challenges found, we elected to focus on the top four, which were referenced in most of our discoveries. We also confined our research to global topics and tried to focus on recent information available.