Starting today, International Longwall News looks question by question at what consultants had to say about the coal mining sector.*
Australia’s Longwalls: Three years ago, respondents remarked on the growing role of consultants in strategic decisions in Australia's underground coal mining industry. How has this evolved in the light of mining sector consolidation?
Consultants were overwhelmingly bullish about their continuing role in the sector given a continuing skills shortage and industry consolidation.
Consultants today are more involved than ever before in key strategic areas within mining companies, including new project evaluation and major capital expenditure evaluation, attributed by many to the current upswing in the coal sector.
Many commented on a shift away from day to day operational issues: “a growing part of our business is centred on corporate level decision making,” said SCT. “This includes brownfield and greenfield developments, design of key infrastructure and milestone events that are now more commonly co-ordinated at head office level.”
SCT said this has translated into the client project managing a multi-disciplinary team of in-house specialists and third party consultants (geologists, geotechnical engineers, mining engineers). “With respect to future roles, a natural requirement of the client is to maintain ownership and direction of the project, but seeking value adding from consultants in areas of technical speciality, and to a lesser extent resources to permit timely completion. From this perspective, consultants will need to differentiate either on product/capability and/or on cost.”
Mineconsult saw this continuing with both long and shorter term planning being provided by consultants. The role of consultants is expanding “to review and question in house assumptions, to identify additional resources for mining and to think outside the corporate square.”
The foreseeable downswing at the end of the current cycle made a convincing case for the use of consultants for strategy and new business development, IMC said, so companies can avoid engaging a short-term surplus of employees with these particular skills.
Over the next 2-3 years, Palaris sees a return to areas of business improvement, asset utilisation, specialist technical and operational advice and support for management change processes.
SRK said a trend becoming apparent was major coal mining companies were more interested in developing longer-term relationships with a few consultants.
“This seems to be so in the hope of retaining corporate knowledge with a loyal consultant who is expected to be available at any time as would be expected of a full time employee.
“This has had the effect of alienating these consultants whereby the other major competing mining companies will not use them in fear of their corporate knowledge being unintentionally leaked back to the loyal client,” SRK said.
Like many other consultants, Tennent Isokangas commented on continuing competition for qualified/experienced engineers/professionals, particularly in the 35-45 year age group.
Strata Engineering said it had begun partnering with clients to improve mine site strata control and mine design practices. “An end-product of this service to the mines is improved reliability of supply to their customers. Fit for purpose strata control design and ongoing design upgrades to suit variations in geotechnical conditions require regular review.”
In summary: Consultants are involved less in day to day operational issues; they are more influential at board level and have big input into corporate decision making. This trend likely to continue.
* Survey respondents were Australian Mining Consultants (AMC), International Mining Consultants (IMC), John T. Boyd, Mineconsult, Minecraft, Mining and Resource Consultants (Minarco), NorWest Mine Consultants, Palaris, Runge, Seedsman Geotechnics, SCT Operations, Snowden Mining Industry Consultants, SRK Consulting, Strata Engineering, Tennent Isokangas. Transcripts of all responses will be made available on International Longwall News in August.