Industry Q&A: Assessing the challenges and trends evident in the mining industry

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Mining IQ spent some time talking with Stephen Davis, Chief Materials Handling Engineer at Bechtel Mining and Metals Global Business Unit. In this interview he shares his perspective and commentary on the current and future state of the mining industry.

In a nutshell, what’s your role and what responsibilities are involved?

I am the Chief Materials Handling Engineer at Bechtel Mining and Metals Global Business Unit. I also head up Bechtel M&M’s Centre of Excellence for Materials Handling. My role is to support our project design and construction teams in all aspects of materials handling. This involves managing our resources and standardizing procedures, implementing latest knowledge, reviewing and coordinating outputs and generally ensuring consistent application of good materials handling practice across all projects.

At Bechtel, everyone has the role of managing health, safety and environment as it impacts our business and our lives. In this respect, I am dedicated to achieving safety in our materials handling design and construction.
 

What is your take on mining globally right now? Which regions have the most interest for you at the moment?

Ignoring the current political unrest in the Middle East, I see mining in a growth phase. Many, although not all, of our resource products are at or close to record price levels in US Dollar terms, and increasing demand for these products is likely to continue.

Bechtel M&M has a global interest in developing large resource projects. Key resources at this time are the developments in coal in Eastern Australia and Asia, copper in South America and Asia and bauxite, alumina, aluminium worldwide. Other Bechtel business units including Oil and Gas, are also seeing increasing development globally.
 

Copper and gold prices are reaching record highs. Which are the resources you feel stand to get even more exciting in 2011?

A difficult pick, but silver is also at record highs. For Bechtel the large projects are most applicable and I see continuing development in copper, coal and iron ore with some potentially large aluminium related projects also possible. I expect the recently increased price of oil to return some focus on oil sands projects in Canada. We may see some developments in uranium.
 

What are the key challenges faced by the resource industry?

The real challenge is the industry trend towards larger throughputs as this is stretching some of our technologies to their limits and beyond. Our lack of skilled people has to see a trend towards more automation and larger specific outputs.

The biggest challenge by far is finding suitably qualified people to design, build and operate these resource projects. Other challenges resulting from this to a fair extent are extended delivery times and an anticipated creep in the cost of development.
 

What trends are you seeing in the industry and how does that affect your role?

The biggest trend I have seen in my career is the move away from engineering driven resource development to our current management system driven base. Systems have been introduced through computer and software availability and because this is seen as a better way to manage risk.

The systems concept is fundamentally good, but has lead to the emergence of a generation of engineers that are focused on feeding the system and avoiding risk rather than seeking good engineering solutions. We are gradually moving away from engineers being truly hands on and practical. I see this trend making it increasingly difficult to find fully rounded engineering leaders in the design development stage of projects.

The other main trend is to bigger plant and higher throughput. We are entering an era of megamachines. The big issue here is that we tend to focus on the finer points of these machines and can forget that the other components of the system still need to be engineered to a high standard.
 

What impacts have industry skills shortages had on your operations? What are you doing to combat this?

Like many in our industry we are noticing the shortage of skills. We recruit heavily, and with success, however a price war is developing in certain areas, particularly materials handling and this has meant key people leaving and potential recruits having expectations outside our comfort zone.

We are heavily engaged in developing our next generation engineers in most disciplines and at all levels. Currently in Australia we employ over 50 recent graduates, and many more with some experience and expertise. They are all striving for professional qualification and career development and are hungry for training and opportunities. Bechtel is large enough that we can offer our engineers the opportunity to develop in many career directions, in Australia and overseas, and in the office and on site. We intend to continue recruiting and developing people in house as our long term investment in our future.
 

Will the MRRT or a price on carbon impact your operations? If so, how?

I am certain that either or both of these events will impact our industry; however I don’t believe they would affect demand for resources to any significant amount. What will happen is that any imposed costs will be passed on to the eventual end user and the cost of living will continue to increase, but the trend to higher consumption will continue.

Some resource developments may be deferred until the market price has been driven high enough for them to financially viable under these imposts.
 

What needs to be done by mining companies globally to keep improving quality and innovation within your field?

I am not qualified to tell global mining companies how to run their business.

However, in the materials handling field we would certainly improve quality and end product by using all of the available science and technology available to us to develop materials handling systems. We might benefit by not chasing lowest purchase cost but by chasing best overall system functionality.
 

What are your key lessons learned and what pitfalls would you recommend avoiding? 

There are no correct answers in engineering, just a series of alternate solutions. Some are better than others, but it will not always be the most technically advanced or best that is right for a particular problem. Stand back and look at the whole system in design, construction and operation, include all external influences and don’t focus on a specific area and look for a band aid solution.
 

What practical tip can you share with our readers?

In materials handling the cost of guessing or just accepting can be millions of dollars cost over the total life cycle of a large project. The cost of definition at the inception of a project or even solving an existing problem may be thousands of dollars but it is worth every cent. We have materials handling engineering skills – use them – talk to the specialists.

Thanks Steven!

More about Steve:

Steve is a Bechtel Chief Engineer in the engineering of bulk materials handling projects involving integration with mining, crushing, conveying, storage and stockpiling, mobile materials handling machines, port handling and all related aspects.

Steve has over thirty years experience in the design of mechanical equipment and project and design management of bulk materials handling, including conceptual and scoping studies, feasibility studies, estimates, design, tendering, fabrication, construction and installation, commissioning and operational and safety assessment.

Recent Projects include lead materials engineer on an oil sand project, management of the Anvil Hill CHPP design, preceded by completion of the NCIG coal terminal feasibility study as Engineering Manager. Steve is currently working on studies and projects for copper, coal, iron ore, alumina and bauxite ore materials handling, and in particular as lead for the Caval Ridge CHP design.