mining equipment, technology and services (mets) … docs... · •commenced september 2016...

MINING EQUIPMENT, TECHNOLOGY AND SERVICES

(METS) SECTOR DEVELOPMENT PROJECTREPORT FINDINGS – JUNE 2017

Christine Gibbs Stewart, CEO, Austmine

AGENDA

2

• Project Overview

• METS Profiles

• Supply Chain Snapshot

• Miners’ Interview Insights

• Supplier Attributes

• Digital capability

• Competitive Advantage

• Innovation

• Collaboration

• Opportunities

• Challenges

• Training and Skills

Development Priorities

• How Government can Help

• Development Priorities

ABOUT THE PROJECT

• Commenced September 2016

• Argentina joined January 2017

• 4 phases:

1. Planning

2. Secondary Research

3. Primary Field Research

4. Analysis

• METS Survey February – April 2017

• Miner interviews February – April

2017

3

4

WHO PARTICIPATED IN THE SURVEYNUMBER OF METS PER ECONOMY

Argentina 80

Chile 100

PNG 50

Peru 80

Number

5

Glencore – Minera

Alumbrera Ltd

Troy Resources Argentina

Austral Gold

Barrick Argentina

Cerro Vanguardia S.A.

Hochschild Mining - Minera

Santa Cruz S.A

Mina Pirquitas LLC

Minera Don Nicolas

Minera Santa Rita S.R.L.

Panamerican Silver

Argentina SA

Carlos Yacimientos

Carboníferos - Rio Turbio

Yaman Gold Argentina

Codelco, Chuquicamata

Codelco, Division Andina

Codelco, Teniente

Codelco, Corporate

CAP SA

Guanaco Compania Minera

S.P.A.

Kinross Minera Chile

BHP Billiton, Escondida

Glencore

Anglo American, Los

Bronces

Harmony Gold, Hidden Valley

Ok Tedi Mining Limited

Kainantu Gold Mine, K92

Newcrest Mining, Lihir

Barrick (Niugini) Limited,

Porgera

St Barbara Limited, Simbiri

Harmony Gold/Newcrest,

Wafi Golpu

PNG Chamber of Mines &

Petroleum

PNG Mineral Resources

Authority

Kumul Holdings

Barrick Gold, Libertad and

Ancach

Barrick Gold, Huaras

Antamina, Corporate

Antamina, Corporate

Southern Peru Copper

Corporation

Anglo American, Corporate

Anglo American, Corporate

Anglo American,

Quellaveco

Glencore, Los Quenales

Hochschild Mining, ARES

Argentina Chile PNG Peru

WHO PARTICIPATED IN THE INTERVIEWSMINERS

DEFINITION OF METS

METS companies provide specialised support and

solutions to global miners and have a specialist knowledge and core

competency in the mining and minerals industry.

6

METS PROFILE ARGENTINA

7

Manufacturer of

Spare parts,

chemicals, etc.

EPCM

Copper, gold,

industrial

minerals -

open-pit and

underground

1-50

59%

export

Exploration

30%

Feasibility

14%Design &

Construction

54%

Operations

78%

Closure & Remediation

28%

Lifecycle

Safety,

maintenance,

productivity

improvement

Under US$20 million,

39% from miningAge: 33 years

89% work in other

industries

Competitive Advantage:

Quality

METS PROFILE CHILE

8

EPCM/EPC,

Manufacturer of

Spare parts,

chemicals etc.

Copper -

open-pit and

underground

1-50

36%

export

Exploration

26%

Feasibility

18%Design &

Construction

54%

Operations

78%


25%

Lifecycle

Innovation,

materials

handling,

maintenance



84% work in other

industries


Quality

METS PROFILE PAPUA NEW GUINEA

9

Dealer/

distributor,

EPC/EPCM

Industrial

minerals,

copper, gold -

open-pit and

underground

100-50027%

export

Exploration

27%

Feasibility

10%Design &

Construction

53%

Operations

82%


12%

Lifecycle

Minerals

processing,

productivity

improvement

Over US$100 million,


82% work in other

industries


Quality, Highly skilled staff

METS PROFILE PERU

10

Consulting,

Contract

miner

Copper, gold,

industrial

minerals -

open-pit and

underground

1-5043%

export

Exploration

26%

Feasibility

16%Design &

Construction

56%

Operations

73%


10%

Lifecycle

Materials

handling,

minerals

processing,

productivity

improvement



85% work in other

industries


Quality

11

Argentina Manufacturer

Spare parts,

EPCM

Operations

78%

33 Copper,

gold,

industrial

minerals

Safety,

maintenance,

productivity

improvement

<US$20m,

39% from

mining

1-50 59% Quality

Chile EPCM,

Manufacturer

Spare parts,

Operations

78%

29 Copper Innovation,

materials handling,

maintenance

<US$20m,

51% from

mining

1-50 36% Quality

PNG Dealer/dist,

EPC/EPCM

Operations

82%

30 Industrial

miners,

Copper,

gold,

Minerals

processing,

productivity

improvement

>US$100m

40% from

mining

100-

500

27% Quality,

highly

skilled

staff

Peru Consulting,

Contract

miners

Operations

73%

26 Copper,

gold,

industrial

minerals

Materials handling,

minerals

processing,

productivity

improvement

<US$10m,

51% from

mining

1-50 43% Quality

METS PROFILE - COMPARISON BY ECONOMY

Business

Activity

Life

Cycle Age Mineral SpecializationRevenue

+ % from

mining

Staff

#

Export

%Comp

Ad

METS PROFILE AUSTRALIA

12

Manufacturer,

EPCM, EPC

Coal, iron -

open-pit and

underground

1-100

66%

export

Exploration

25%

Feasibility

30%Design &

Construction

58%

Operations

75%


25%

Lifecycle



79% work in other

industries


Quality

SUPPLY CHAIN SNAPSHOT

13

METS (69%)

TIER 1 Contractor (20%)

OEM (17%)

Contract Mining (23%)

Sub-Contractor

(12%)

Sub-Contractor

(8%)

TIER 1 Contractor

(4%)

Sub-Contractor

(3%)

R&D

Provider

(5%)

MINER – CRITICAL CHALLENGES

14

Cost reduction

Import restrictions

Inventory shortages

Quality

Cost reduction

Energy efficiency

Leveraging automation

Zero harm

Quality

Cost reduction

Leveraging

technology/ innovation

Integration issues

Infrastructure

Quality

Business management

15

In which ways

do your

suppliers add

the most value?

• Providing quality

products and

services

• Problem solving

• Understanding

needs

• Technical support

• Delivering what they

promised

• Executing

competently

• Proactive problem

solving

• Establishing common

goals

• Delivering what

they promised

• Quality, cost, safety

• Understanding

needs

• Work as a business

partner

• Consistent high

quality

• Environment and

CSR

• Good

communication

• On-time delivery

How can

suppliers be

more relevant to

you?

• On-time delivery

• Quality

management

• Being proactive

• Sustainability

• Understand business

needs

• Proactive problem

solving

• Innovative solutions

• Strategic partnering

• Establishing

common goals

• Better risk/ reward

sharing

• Better business

skills

• Collaboration

• Being proactive

• Innovation

• Alignment

• Collaboration


MINER - SUPPLIER VALUE ADD AND RELEVANCE

MINER – WHERE SUPPLIERS CAN IMPROVE

16

Delivery

Leadership

Long-term

planning

HSE

FY19Argentina Chile PNG Peru

• Delivery

• Productivity

• Quality

• Cost

• Delivery

• Innovation

• Long-term

thinking

• Cost

• Business Skills

• Quality

• After sales

service

• Technology

• Delivery

• Leadership

• Long-term

planning

• HSE

Delivers a high quality of

product/ service

9.2 9.1-0.1

Has a safety management

system in place

9.2 9.30.1

Understands my needs 9.1 8.7 -0.4

Is responsive to my needs 9.1 8.7 -0.4

Delivers on-time 9.0 8.7 -0.3

Has an environmental

management system in place

8.8 8.90.1

Attributes Importance to miners Supplier rating Difference

MINER – SUPPLIER ATTRIBUTE RATINGS

Understands my needs 9.0 8.7 -0.3

Is responsive to my needs 9.0 8.7 -0.3

Delivers a high quality

product or service

8.9 9.1 0.2

Provides value for money 8.9 8.7 -0.2

Is proactive in providing

solutions to my problems

8.8 8.7 -0.1

Attributes Importance to miners Supplier rating Difference

METS – SUPPLIER ATTRIBUTE RATINGS

19

Website* 68 71 68 73

LAN 56 51 36 49

ERP System 14 41 23 4

IT Strategy 40 32 43 37

On-line purchasing 14 29 5 10

Electronic sales or marketing 35 29 14 16

Electronic interface with client 6 28 13 6

On-line financial system 11 27 8


METS – DIGITAL CAPABILITY

*Most effective marketing tool

COMPETITIVE ADVANTAGE

20

Quality 50%

Quality (AS) 36%

Problem solving 36%

Customer 68%

Innovation 48%

Product/service update 38%

Quality 58%

Quality (AS) 32%

On-time delivery 31%

Customer 64%

Innovation 53%


Quality 41%

Skilled staff 41%

Problem solving 27%

Customer 51%

Training 51%

R&D 39%

Innovation 29%

Quality 54%

Skilled staff 34%

Customer 33%

Customer 51%

Innovation 43%


ARGENTINA

CHILE PERU

PNGMaintain

Maintain Maintain

Maintain

21

Argentina 66% Industry trends 46%

Chile 66% Internal 60%

PNG 78% Internal 78%

Peru 70% Internal 50%

INNOVATION

R&D Drivers Product

Development

COLLABORATION - METS

22

Chile PNG

METS 16%

Other industries

11%

Miners 10%

Argentina Peru

METS 58%

Other industries

53%

Miners 38%

Miners 86%

Other industries

71%

METS 43%

METS 42%

Miners 42%

Other industries

39%

25%

Collaborate

41%

Collaborate

14%

Collaborate

40%

Collaborate

COLLABORATION - MINERS

23

Problem solving

Innovative ways of

doing things

Planning for the future

24

Argentina Improved mining

market – 44%

Improve/expand

current range – 33%

Innovation & technology

– 20%

Operational

improvements – 20%

Chile Improve/expand

current range –

28%

Innovation &

technology – 24%

Expanding internationally

– 20%

PNG Improved mining

market – 70%

Innovation &

technology – 32%

Improve/expand current

range – 18%

Peru Improved mining

market – 49%

Improve/expand

current range – 29%

Innovation & technology

– 23%

OPPORTUNITIES

ONE TWO THREE

25

Argentina Increased

competition – 33%

Innovation and

productivity


Customer relationships –

25%

Resource management –

25%

Chile Financial stability

and growth – 25%

Innovation and

productivity


Increased competition –

15%

PNG Increased

competition – 56%

Macro-economic

environment – 28%

Innovation – 19%

Peru Increased

competition – 40%

Macro-economic

environment – 31%

Financial stability and

growth – 25%

CHALLENGES

ONE TWO THREE

TRAINING AND SKILLS DEVELOPMENT PRIORITIES

26

• Quality management, on-time delivery, project management, problem solving, more efficient operations

Operational

•Information technology, technology and innovation trends, new technologies, data management/analysis, automation

Innovation

• Leadership, human resources, financial and cost management, Strategic partnering, collaboration, planning

Management

• Product and service training, safety, engineering, HSE

Technical

Understand Needs and the Business of Mining

27

HOW GOVERNMENT CAN HELP

Improve business

environmentImprove the tax

structure

Support R&D,

innovation and

growth

• Minimize regulations

• Free up currency

• Improve infrastructure

• Promote small

business

• Encourage more

projects

• Make good policies

which support

business

• Reduce tax

percentage

• Modify tax structure

• Offer more tax

benefits / incentives

• Lower import taxes

• Funds for innovation

• Capital diffusion

• Provide support for

growing businesses

• Funding for start-ups

• Provide more

resources for R&D

• Export support

DEVELOPMENT PRIORITIES

28

Customer Relationship Management

Strengthen Capacity to Grow

Foster Innovation and Collaboration

Arg

en

tin

a

Strengthen Business Fundamentals

Encourage ExportsFoster Innovation and CollaborationC

hil

e

DEVELOPMENT PRIORITIES

29

Strengthen Business Management

Build METS NetworksFoster Innovation and

CollaborationPN

G

Strengthen Business Fundaments

Focus on Footprint Reduction

Foster Innovation and CollaborationP

eru

mining equipment, technology and services (mets) … docs... · •commenced september 2016...

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