The view from above
The mining industry spans from The Americas to Indonesia, with each region specializing in different commodities. Below are a few key updates from some of our top performing regions.
Indonesia has an abundance of world-class deposits including coal. Coal is 9% of exports globally and 95% of exports from ASEAN. Indonesia’s coal repository is equivalent to that of the USA.
Mining has been a key sector supporting Indonesia’s economic growth for a number of years. The mining industry makes a significant contribution to Indonesian GDP, exports, government revenues,
employment – and perhaps most importantly – the local economic development of the remote regions where mining operations are located.
Indonesia has a proven track record in world-class operations, with more than 500 mining projects and operating properties – it is the most important mining country in the region. Significant international mining companies with long-term operating experience in Indonesia are Vale, Newmont and Freeport McMoRan. Canada’s Redpath has spent the past 32 years contracting at Freeport’s Grasberg mine and presently have 1,200 workers at site. Redpath is developing a major underground expansion plan which will double UG production from 100K tpd to 200K tpd. It will be one of the largest underground mines in the world.
Outlook: Positive. The recent inauguration of a business-friendly government is likely to encourage investment in the region, and will lead to significant growth in the mining industry.
The Australian mining industry is currently running strongly. The high value of global iron ore, coal and gold is driving strong and consistent commodity prices. Companies with active operations are looking to ramp up additional production. Projects that were mothballed due to un-profitability have been dusted off.
Companies are now prepared to spend capital investment to grow their businesses. Exploration companies are once again registering deposits of minerals. Smaller mining companies are now able to establish operational mines, when previously they were holding steady in a state of capital raising.
Outlook: This has had several impacts in a region that is seeing growth.
Companies have begun to employ labour directly rather than rely on 3rd party supply. During the years of the mining downturn, career prospects in mining appeared limited. Mining engineering schools closed and trade apprenticeships fell out of favour. This has led to a serious shortage of skilled labour and a reduced pool of experienced professionals. Companies are trying to fast-track training initiatives. There has been huge pressure for people to reach high levels of skill very quickly. It is therefore no surprise that there have been several tragic deaths on Australian mine sites due to the frenzy of activity now in play. Safety is a major focus once again.
Our mining market has continued to thrive as commodity prices strengthen. Projects that were sat idle are now ramping up. Companies are upgrading their facilities to increase profitability in processing, and new players are entering the market. We are seeing the most growth in gold, copper, lithium, and potash.
Brunel’s mining clients are growing their staff teams, as well as their project teams. We’ve seen an interest in our industrial and maintenance services, due to a shortage of suppliers that can meet the need for these services. Clients are seeking suppliers that can provide all levels of service in all the geographical areas where they do business.
For the USA, the labor shortage is becoming critical. Clients are seeking creative ways to attract new talent that can be developed quickly to fill gaps. The mining industry is competing with other industries for similar skill sets, as the economy in general has been doing well. General construction, infrastructure, oil and gas, and commercial are all booming sectors seeking skilled construction and project management professionals. Brunel is investing in training programs, understanding competitive salary packages, and identifying candidates with transferable skills in order to meet high demand.
Canada, with its vast territories and huge resource assets, is a top performer in global mining industry country rankings. Canada is the largest producer of potash in the world, the second-largest uranium producer, and the third-largest producer of aluminum, nickel, platinum and cobalt. For gold, Canada is the world’s fifth largest producer.
Growing demand for resources that serve as key raw materials, coupled with rising commodity prices, has lifted revenues for most Global Mining companies.
Outlook: Some challenges in the market. The recent passing of Bill C-69 in June 2019 has led to some uncertainty. The new bill has given the ‘Impact Assessment Agency’ full authority and responsibility for the assessment of major projects’ environmental, health, social, and economic effects. With the introduction of this new, and un-quantified, process there has been some uncertainty on timing for major projects awaiting FID.
Canada is known for being on the forefront of political and social movements to improve the environmental footprint and reduce carbon outputs from oil and gas major projects. This is trending through mining too, where the Canadian Minister of Natural Resources invested $2M in an initiative to develop energy-efficient mining technology.
At Brunel Canada we have seen our clients begin to invest in developing these new technologies. Actions range from pulling together a technology team specifically to focus on development, through to investing in the latest equipment in purpose-built shop facilities. The global skills shortage is also impacting Canada. Nearly 100,000 workers are estimated to retire from critical mining, exploration and geological positions over the next decade Brunel’s clients foresee the earliest challenges to be in skilled labor verticals, such as heavy machinery operators and field service technicians, particularly in rural areas. In response we have seen a push to attract increasing numbers of women and Indigenous Canadians.
For more information on the latest mining news, trends and developments shaping the Canadian mineral exploration and development sector, please visit PDAC.
Hopes of growth and investment in Indian Mining have been positively impacted by events in 2019.
The mandate that the Indian Central Government received in the 2019 General Elections combined with efforts by the National Institution for Reforming India* in consultation with various sector stakeholders, has led to renewed optimism that much-needed industry reforms will be
In addition, The National Mineral Policy, 2019, emphasizes the need for foreign participation that will improve the adoption of technology, enhance mining operation productivity and raise standards for both safety and sustainability.
Outlook: Conditions are favourable for robust growth. India has seen US$16.6 bn. mineral production in 2017-2018, growth of 13% over the previous period. The total mining sector, including metals
and minerals, is expected to reach US$126 bn. by 2025.
The Geological Survey of India has identified potentially 100 blocks for exploration. Of these five projects have commenced (two private and three government) with a total value of US$2.25 bn.. Major investments have come from POSCO, Baosteel, De Beers, NLMK and Thyssenkrupp. Indian mining is commanding further attention with NALCO, Hindustan
copper and MELL initiating acquisition of lithium and cobalt mines overseas.
Brunel India’s clients are benefiting from our partnership with Mynesight (a certified mining training organization) that is developing courses to improve the skills of local workmen. The focus is on raising productivity and improving safety standards.
*NITI Aayog, an Indian Government policy think-tank with the aim to achieve Sustainable Development Goals