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July 27, 2016
Mining: IT-OT Convergence and the Innovation Connection
By: Constantino Seixas

As my previous blog post pointed out, having a single governance framework for both information technology (IT) and operational technology (OT) is key to reaping the potential rewards promised by the convergence of these two areas. For miners, one of the major benefits of having that single governance umbrella is the ability to focus the combined strengths of both domains on innovation and the use of digital technology in driving new approaches.

Innovation is increasingly important in mining—especially innovation that is focused on improving operations, as opposed to creating new products. This is because miners are facing threats and challenges on several fronts, from volatile pricing and rising energy costs, to the need to contend with lower mineral grades, high extraction costs, water scarcity and low operating efficiency. These are issues that are having a significant impact. In the last 10 years, for example, high energy prices have prompted several electro-intensive metallurgical companies in Latin America to simply close up shop. At the same time, new smelters have been created in areas where lower-cost energy is available, such as the Middle East.

Altogether, the challenges facing the industry mean that becoming cost efficient, energy efficient, production asset efficient, and sensitive to environmental and social issues is both mandatory and urgent.

Re-thinking operations with digital technology
Today’s digital technology—such as robotics, data analytics, mobility, cloud computing, wireless and Industrial Internet of Things—can help miners meet these challenges. In dealing with high energy costs, for example, miners not only need to draw on new sources of energy—such as solar, wind and geothermal generation—but they also need to manage and reduce energy usage. This means tackling a range of operational issues, such as: How many over-specified and non-efficient motors are in use in the company? Are plants making the most of frequency inverters? Are the mines running motor-pumps at their best efficiency point? Are furnaces burning fuel efficiently, at the stoichiometric air-fuel ratio? Are the burner control loops tuned and operating in automatic mode?

For mining companies, digital technology offers the potential to find clear answers to these types of questions. With digital technology and the convergence of IT and OT, the dream of monitoring the full range of operations in real time is now a reality. For example, to improve their ability to manage energy, companies can collect utilization information from operations and feed it into a centralized energy-management system. They can also manage control in a centralized way. This allows them to monitor control loops and advanced process controls continuously, and thus manage energy demand more effectively. Today, not many mining companies are doing these things, but this kind of digitally enabled approach is likely to be the norm before long.

More broadly, digital technology-driven innovation has the potential to bring some truly disruptive changes to operations that go beyond incremental improvements. For example, using image processing to measure ore-size distribution in a belt conveyor is a new and useful improvement. However, using radar technology to measure stockpile geometry in real time and operate a bucket-wheel reclaimer in autonomous mode is a disruptive change. This radar-enabled approach could increase throughput and allow automated operation with a low rate of variability.

In another example, companies could use the radar technology to monitor the type of ore going to the crusher and notify the concentration plant about the quality of the ore that will be coming in the next 10 hours. This kind of approach can bring revolutionary gains to an industry that has tended to regard imprecise or missing information in that area as a given.

Today, cloud computing is one of the more visible enablers of innovation. Traditional IT groups have been using the cloud for some time, with various IT processes and functions being delivered “as-a-service” from remote centers or external partners. Now, with the convergence of IT and OT, some companies are applying the as-a-service approach to operational activities such as alarm management, production accounting, advanced process control, and even Supervisory Control and Data Acquisition (SCADA), Distributed Control System (DCS), and Programmable Logic Controller (PLC) support services. Cloud computing has already delivered significant increases in efficiency in a number of industries, and it promises to do the same in mining operations. Indeed, some leading mining companies are now aggressively exploring the as-a-service approach.

Innovation-focused governance
The good news is that the digital technologies needed to enable greater innovation in operations are available, and many are already in place and working well in other industries. This means that innovation in mining will depend largely on changing the industry’s traditional practices and mindset.

The right approach to unified IT and OT governance can help with that change, while encouraging the exploration and exploitation of digital technologies. To drive innovation, mining companies should consider actions such as creating innovation centers like the Accenture Internet of Things Center of Excellence for Resources; proactively learning from other industries’ use of technology in operations; and working with an ecosystem of partners, such as universities, technology suppliers and digitally oriented startups. As they pursue innovation, mining companies should also approach it as an ongoing program, rather than a single project since evolving technology will continue to create new opportunities for innovation in mining.

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