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Rio Tinto’s Sam Walsh: How technology has changed mining

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More than seven years ago, Australia’s first commercial use self-driving vehicle began operating in a remote corner of Western Australia. An advanced computer-system started the engine, activated sensors, engaged the accelerator and drove the vehicle around a winding roadway avoiding obstacles and other traffic.

It all happened with little of the fanfare we see today as Google, Apple, Volvo, General Motors and others race to roll out fully autonomous vehicles for our streets.

The self-driving vehicle in Australia began operating at a Rio Tinto iron ore mine about 1500 kilometres north of Perth. It was a world first and to this day remains the most technologically advanced autonomous haulage system on the planet. It has changed the way Rio Tinto does business – significantly improving productivity and safety and reinforced Australia’s reputation as a world leader in the mining and metals sector.

Prime Minister Malcolm Turnbull told a Business Council of Australia dinner earlier this month that in order for Australia to remain “a high-wage generous social welfare net, first world economy” we had to be “more innovative, more technologically advanced, more enterprising, more competitive, and more productive”.

He couldn’t be more right. I have seen first-hand the transformative power of technology. It is a message I will be delivering to the B20 in Turkey.

Innovation requires us to keep looking outward – continually looking beyond our boundaries and borders – mental and geographical; it requires being open to new ideas; and it requires the guts to do new things.

For businesses and governments, these are easy prescriptions to hear, but often hard ones to execute, especially in times of uncertainty.

For any single country to thrive from innovation, it needs to project itself not as an island of inventiveness, but as a networked partner within the global community. Policy aimed at encouraging the wholesale innovation has to encourage breadth of connection, the bridging of distances; not a retreat behind walls.

At Rio Tinto we have broken down the walls of conventional mining through the embrace of innovation. We spend as much time mining big data as we do iron ore.

We have more than 70 giant trucks, two-kilometre trains and drilling machines all moving themselves around our Pilbara operations. Drones are replacing unproductive and inefficient visual inspections.

There are teams of people pouring over complex 3D data to pinpoint rich ore bodies. And we can now predict precisely when and where a piece of equipment will fail by analysing billions of bytes of data from equipment sensors.

These new systems have seen us hire a new breed of miner – technologically savvy people with breathtaking computer and analytical skills – and transformed the productivity our operations.

Many of our ‘miners’ now spend their shifts in the air-conditioned comfort of offices monitoring autonomous vehicles, supervising ship-loading, sharing expertise and developing mine plans thousands of kilometres from an active mine site.

As a result of this technological embrace our equipment is running longer, faster, greener and further. Our iron ore business – which celebrates 50 year of exports from Australia next year – is very different from its 1960s origins.

As chief executive of the iron ore business when we began embracing technological disruption, it is clear to me that only agile businesses will survive and thrive in the decades ahead.

While mining is one of the oldest industries, I recognised that we needed to be every bit as innovative as Google to maintain our position in the global economy and business world.

This is a black and white proposition for all businesses. You either embrace technological change and adapt your practices to suit the brave new world – or you will wither on the vine.

Of course, it is worth re-stating the simple truth that without mining there would be no digital revolution.

Mining may be one of the world’s oldest industries – but without the raw materials we produce, there would be no smart phones, no digital disruption and no energy to power the future. We are providing the building blocks for the modern world.

Whether it’s steel for self-driving cars and wind turbines, lithium for batteries, rare earth minerals for touch screens or copper for circuitry – it all starts with a business like mine.

In this sense, the business community has much to offer governments as they plan for a digital future. At the G20 summit, business leaders will provide a range of recommendations to help governments map out the way ahead. I hope they are embraced.

Governments need to act now to convert digital potential into growth, across all sectors of the economy, by having clear digital strategy and priorities. The Australian Government is sending all the right messages that it is serious about positioning Australia as a leader in innovation.

Improving digital infrastructure will allow companies like Rio Tinto to share more knowledge across boundaries, develop the capabilities of our global workforces and create more prosperity for our host countries.

Similarly, focussing on STEM education in collaboration with the business community will ensure that there are future generations of highly skilled workers appropriately trained to join our companies and become the innovators of tomorrow.

Collaboration between governments and the business community on this will help everyone to continue to share in rising prosperity – right across the planet.

Sam Walsh is Rio Tinto chief executive and a member of the business delegation participating in the 2015 G20 summit in Turkey.

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