Schneider Electric : How to Optimize the Mining Value Chain with Digitally Integrated Power and Process Operations

The mining, minerals, and metals industry can do little about many factors that often squeeze cash flows. Dynamics like commodity prices, utility energy costs, labor rates, and geopolitical events are all random variables that can impact enterprise value.

However, thanks to advanced digital capabilities, mining organizations can take more control over how they respond and adapt to the business challenges and market volatility they all face. Items such as CapEx and OpEx, energy usage, workforce productivity, supply chain management, and others can be actively managed and improved with the right tools.

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The topic of optimizing the mining value chain by leveraging the synergies of converged operations was recently explored in depth by industry experts during a dynamic innovation talk entitled, "Rethink Mining with Digitally Integrated Power and Process." A few of the key takeaways from the session are asked and answered below:

Q. What are the current drivers spurring mining companies to consider converging their operations to increase business value?

A. Thanks to technological advances and digitization, mining companies now have access to much more potentially valuable data than before. To drive predictable outcomes and turn information into a business advantage, organizations need to maximize their digitization investment by integrating and digitalizing their operations so that data-driven insights can be shared and made actionable across the entire mining value chain. The primary challenges facing MMM enterprises today even goes beyond digitalization and into full digital transformation. Ergo, such a paradigm shift in a digitalized operating model should consider:

1. Value chain responsiveness - today's mining market is much more volatile, and companies need to be able to dial-up or down quickly, change optimization objectives and manage the entire mining chain as a single entity, a job that's much more difficult when organizations make decisions from departmental silos.
2. CapEx & OpEx constraints - optimizing recurring costs is critical to improving financial performance, particularly maintenance expenses, representing a substantial percentage of many mines' total operating costs.
3. Workforce shift - 75% of the workforce will be millennials by 2025, and they are reshaping the world of work. Tech-savvy, plugged-in, and more collaborative than past workforces, companies looking to engage and retain new talent need to consider new ways of working and call for a complete digital transformation journey to be envisioned.
4. Culture of innovation - though digitization has occurred and technology-driven changes are only accelerating, many business leaders still don't have a digitalization plan to leverage and combine their digital technology investments with driving increased profitability through grassroots innovation.
5. License to operate - obtaining a social license is critical to mining industry growth. Activities such as safety initiatives, sustainability reporting, corporate citizenship, and environmental improvement efforts, amongst others, need to be made more visible and managed across the whole organization.

Q. What are the potential benefits of converged operations for mining companies?

A. In an increasingly complex and unpredictable environment, integrating operations and functions are all about enabling everyone across an organization to leverage data and information better so they are empowered to make business decisions that optimize the productive value chain. Developing the agility to respond to internal and external events effectively is key to transforming any mining enterprise into one that can proactively mitigate risk and gain a competitive advantage.

Q. How can an Integrated Operations Center enable the benefits of convergence and leverage new digital technologies to improve outcomes?

A. An Integrated Operations Center (IOC) is an updated version of the old control room, "digitally transformed" for today's mining operations. It can be designed to deliver a new way of working, examining the whole operation rather than focusing on separate (often siloed) functional areas. It can be a consolidated, centralized hub to present unified information from multiple sites and any stage along the value chain. A properly configured IOC fosters collaboration across functional teams, promotes operational benchmarking and communication of best practices through data sharing, and increases transparency enterprise-wide.

Q. Why are process automation and power system data integrated within an IOC a game-changer for the MMM industry?

A. Because of natural interdependencies, plus the advent of new digital technologies, electrical and process automation systems are now impossible to decouple. Amalgamating data from both systems in a single location is one of the best ways to dramatically improve the productivity, reliability, and safety of mining processes and plant assets. And the integrated, collaborative digital environment of an IOC is an effective operational environment for personnel to convert the information into actionable innovation. Marrying energy management capabilities with existing automation tools provides a range of substantial benefits, including:

• Lower asset maintenance costs
• Reduced project risk
• Improved enterprise transparency, interoperability, and resilience
• Enhanced energy efficiency, resource usage, and sustainability
• Increase process visibility
• Decreased cost per ton

Q. How can mining companies leverage grassroots innovation from within their business using IOC?

A. Mining companies can leverage their increasingly digitally-savvy workforce to cultivate a more innovative culture across their business through the democratization of their data and information across the value chain. This can be achieved by making data easily and securely accessible for experimentation and then rolling out those proven innovations across the enterprise through an IOC.

Q. What kind of improvements can mining operations anticipate?

A. The most effective IOC deployments are built around ensuring all employees are multiskilled and embrace interdepartmental collaboration to drive improved productivity. With the right tools and training in place to fully optimize an integrated network, Schneider Electric project results show that mining enterprises can reap substantial benefits, including:

• 20% improved process performance
• Up to 30% reduced maintenance costs
• Up to 11% improved throughput

To learn more from the experts about how digitally integrated power and process and an IOC can help MMM companies transform operations, watch the "Rethink Mining with Digitally Integrated Power & Process" Innovation Talk today.