Securing critical minerals and metals is becoming a top priority for economies both large and small. As governments seek to boost domestic provisions, supply chains are being renegotiated to accommodate new demands, trade matters and emerging relationships.

For companies that are working to deliver the mines and metals of the future while balancing rising operational costs, growing stakeholder expectations and sustainability standards, market volatility creates both challenges and opportunities. In fact, research has shown that market fragmentation due to geopolitics is the strongest trend driving mining and metals activity through 2025.

To manage objectives, build resilience and increase their agility, many mining and metals providers are creating smart operations based on digital technologies.

Incorporating artificial intelligence (AI), digital twins (virtual replicas of physical assets or processes) and predictive analytics into assets, both new and old, can make them more cost effective and deliver measurable gains in efficiency, safety and sustainability; which could hinder or improve a company’s competitiveness in the eyes of future investors, clients and employees.

What makes operations ‘smart’?

Mining and metals companies are no strangers to smart operations. Some have been working for decades to break down the siloes between the operational technologies (OT) that run their mines and the information technology (IT) systems that run their businesses.

Combining technology, data and human expertise helps businesses to work smarter, resulting in optimized processes, increased productivity and better decision making.

However, today’s definition of a smart operations has expanded, referring to an organization that harnesses these capabilities at an enterprise scale. To achieve this takes more than technology, it may require an integrated approach to digital, process and talent-based transformation across the company and its value chain.

The resulting operations can tailor their inputs (resources and energy) and outputs (product quality and quantity) to changing market conditions and customer requirements. At the enterprise level, this approach allows for increased application of data-driven insights, cloud-enabled benefits, and the centralization and outsourcing of functions, such as marketing and finance.

Simulate the value

For new projects, there’s a strong business case for optimizing operations using digital technologies from day one, and some mines are already designed this way.

For example, Anglo American uses digital twin technology in its Quellaveco mineral processing plant. The operation is the first 100% digital mine in Peru and uses twins of its grinding, water control and electrical systems to help avoid failures and optimize costs.

Meanwhile, for longstanding assets, reconfiguration for smart operations will likely be on a case-by-case basis, although the benefits can be significant.

For instance, BHP uses a digital twin of its value chain and Generative AI to inform the Escondida copper mine’s ore blasting and blending strategies. This has reduced the mine’s monthly losses by 70%, and BHP is now using the same approach at its Copper South Australia and Spence mines.

Steps towards smart enterprises

As governments and consumers reorganize their supply chains to lock in future-critical minerals, the ability of mining and metals organizations to evolve their business models and operations could be a turning point for their competitiveness.

The following steps could help to lay foundations for smart, resilient operations and, eventually, enterprises.

1. Set a clear strategy: Smart transformations are multi-year journeys that help drive significant changes. A clear strategy is essential to help ensure alignment across the business.
2. Embrace innovative design tools: Many solutions required to design smart mining and metals operations already exist. Where industry-specific solutions aren’t available, consider collaborating to develop them.
3. Adopt integrated working: Smart operations can require new operating models and ways of working based on data-driven insights. Integrated governance is important to manage OT-IT convergence.
4. Strengthen data management: Consider appointing a senior leader and team to oversee enterprise data and help ensure the company is working from a single source of the truth.
5. Consider leadership’s transformative potential: Invest to develop and support the transformative capabilities of both the board and C-suite. Their championship is important to success.

Act now to stay ahead

Market volatility due to geopolitical matters is unlikely to abate anytime soon. Smart enterprises could hold the key to thriving in this uncertain environment.