4. Climate change
Climate change is a complex issue for miners: They must both provide minerals for the energy transition, while also reducing greenhouse gas (GHG) emissions.
Net-zero initiatives are progressing across the sector, though some survey respondents admitted challenges in meeting interim targets. Many miners are forming ecosystems and partnerships to develop the technological innovation that can fast-track decarbonization. Government support and the falling cost of renewables are driving growth in renewable energy contracts and investment in solar or wind generation. Many miners are sourcing green electricity to decarbonize Scope 2 GHG emissions but find it hard to get green energy at scale.
Miners must also prepare and provision for the growing impact of climatic events on day-to-day productivity and health and safety. One Canadian miner affected by recent bushfires told us they are considering better preparations for future events: “We are asking, ‘Do we allocate two-day stoppages per annum to cater for climate change?’ It might not be a bad idea going forward.”
5. Digital and innovation
Leaders anticipate a surge of investment in data and technology, driven by demand across the business for digital solutions to reduce costs and improve productivity, safety and ESG outcomes. Survey respondents are excited by the potential of generative AI and are exploring other new technologies, particularly those that can optimize mineral recovery. Many are seeking greater collaboration and partnerships to help speed up transformation and drive innovation in the sector.
Miners are data rich, but many struggle to manage and capture insights from this wealth of information. And many lack an integrated approach to technology implementation, limiting the value it can bring to the business. As one CIO said, “As CIOs, we need to fall in love with the problem, not the solution. We need to put ourselves in the operator’s shoes, to truly understand their real situation, and be able to transform various aspects of their routine.” Technology adoption, and its success, differs between miners, with our research revealing that organizations that champion new technology at an operational level do best.
6. Costs and productivity
Inflation is easing but costs remain high, particularly energy and labor. Until recently, higher commodity prices have supported margins, but these now sit closer to 2019 figures, and we are seeing some evidence of stress.