With the COVID-19 pandemic affecting the mining industry in a variety of ways, we asked our experts what their views were on how COVID-19 was likely to unfold and to answer some key questions from customers, including how they can minimise disruption to their operations.
The answers below are combined responses from Mark Clifford, President of Regions, Group Executive Management, Mark Fielder, Head of Service Line Management and Greg Weaver, Global Product Line Director, Digital Solutions.
Q. We’re seeing COVID-19 starting to have a big impact on the mining industry. What are the affects you are seeing already?
A. The COVID-19 pandemic has had an immediate impact on the global economy and that impact goes across all industries, including mining. Some industry players in mining will be more affected than others by the new set of challenges facing the industry.
Straight away, we saw our mining customers doing their part to stop the spread of this pandemic: it is great to see the real sense of togetherness in the face of the immediate challenge, which is stopping the spread of COVID-19 and ensuring staff are safe and healthy.
Initially the impact is on day-to-day operations and ways of working. As well as measures such as social distancing, we have seen customers close access to their sites and trying to maintain operations with minimal staff. We are also seeing some defer non-critical maintenance and other non-prioritised activities.
The clear majority of customers are trying to carry on with business as usual. The indirect impacts of COVID-19 are likely to be wide-ranging, so we are looking to support them in whatever manner we can and we are closely monitoring our open orders and our global supply chain so we can deliver to our customers’ requirements. Customers are also appreciating our localised service ability, which allows us to advise and troubleshoot even if our staff are no longer allowed on site.
Q. What about longer-term or more macro-economic effects for the mining industry?
A. The longer-term economic effects are difficult to predict this early on. The million-dollar question obviously is, how long will this last? How long will lockdown periods go on for? Will they need to reoccur? And how quickly will the market recover? Will government stimulus packages be adequate and implemented correctly enough to avoid, say, a deep recession? This is an unprecedented event, which means we are dealing with a lot of unknowns from both an economic and societal standpoint.
Obviously, there will be an impact. But even within mining this is likely to vary from commodity to commodity. You could see a picture where gold will remain buoyant as will thermal coal and uranium but iron ore, for instance, might come under more pressure as it is more fully exposed to consumer demand.
Q. Some mine operators have closed sites temporarily. Do you see that developing into a larger trend?
A. Again, it depends on the spread of the COVID-19 virus. We may see direct mine site closures due to the virus or lack of personnel. Sites may go into care, which will require some support. A significant percentage of mine sites are in remote locations, so closure is not imminent unless of course there is a case on the mine site.
In such situations, we are ready to support customers: for example, if equipment needs to be shut-down and cleaned and prepared for suspended use and storage. In this situation, there are protocols for certain products that need to be adhered to – this will ensure a trouble-free start up. If site activity is reduced and access limited, our Global Field Service team will remain available to provide troubleshooting via Digital methods for the entire range of FLSmidth equipment.
Q. On the topic of support that customers can avail of; how can FLSmidth support fewer employees on mine sites should operators need to isolate workers and reduce numbers to just essential employees?
A. Many customers are seeing direct benefits from our remote monitoring tools and are in regular contact with our remote technical support people. These experts are available 24/7 - our customer strategy has always been to maintain a global network of local service and distribution centres so we can be close to customers. As a result, we can continue to provide reliable delivery of inventory and easy-to-contact service personnel and product experts that know the local environment, local sites and specific customer needs.
In these times, digital is also coming into its own. There have been questions for a while in the industry over how digital can deliver tangible benefits and we are seeing these questions being answered. Some of our solutions are really proving extra useful; take SiteConnect, for instance, which allows customers to monitor and review the performance and data from their equipment on their phone getting alerts and other information without having to be on site or in the control room. Or our remote condition monitoring service, which allows remote experts to monitor and often predict failure before it occurs.
Ensuring that our supply chain is functioning well is key. If customers need spare or wear parts, we know we can deliver on this so any downtime is minimised. The goals are the same for us now as they are under normal circumstances – that is to maximise customer productivity and minimise any downtime and maintenance.
Q. Remote monitoring, remote maintenance, remote support and remote upkeep – what does this look like and how can customers instigate or ramp up in these areas with FLSmidth as a partner?
A. Solutions are available to facilitate all of the above on the customer side, especially remote monitoring, remote maintenance, and remote support. In many cases, we are in dialogue with customers exploring how we can best support them through this pandemic and these areas are part of that conversation. Any customer can also reach out to their account managers, and contacts and FLSmidth and we will work with them to meet the needs of their operations.
Q. When the situation normalises, how can FLSmidth help customers get their operations back to full speed or back online if a shutdown was instigated?
A. As things normalise, FLSmidth will be fully engaged with each of our customers, working with them to ensure we support their safe return to operations. We will work with them to ensure both supplies and manpower are available to achieve full operational levels and continue to increase their productivity enabled with digital tools and services. FLSmidth can assist all forms of start-up procedures similar to assisting in shut down procedures - they can be on-site audits before re-start up so equipment is tested fully before they go back online.