This opinion piece came from: http://www.theaustralian.com.au/
A MAJOR report released today by Rio Tinto shows just how foolish ACTU president Ged Kearney is to dismiss mining as merely “digging things out of the ground”.
And just how wrong-headed the Gillard government is to focus on locking resources into the industries of the past rather than freeing them for those of the future.
The report, by my former colleagues Brian Fisher, long-time head of the Australian Bureau of Agricultural and Resource Economics, and Sabine Schnittger examines the technological revolution in mining.
The report’s findings (available at www.baeconomics.com.au) are striking: automation is comprehensively transforming mining. Within a decade, that transformation will lead to a “mine of the future” in which myriad robotic devices, controlled from vast distances, undertake functions ranging from tunnelling to blasting, sorting and transporting ores.
Most of those devices are already entering widespread use; with billions of dollars of investment pouring in, the next stage will see them integrated into fully co-ordinated processes, linked through powerful sensors, communications paths and data processing systems.
And with that transformation in full flight, the Australian mining services and technology sector, which produces specialist equipment and applications for the mining industry, already employs nearly as many people as the assembly of motor vehicles and is emerging as a world leader in its own right.
The mining revolution is of fundamental importance to our prosperity. A study by Port Jackson Partners estimates Australia’s commodity export revenues could grow significantly faster than gross domestic product for the next two decades, with total commodity exports reaching $480 billion in real terms by 2030 from a base of $210bn in 2010. If these projections come to pass, commodity exports would increase to more than 20 per cent of GDP.
But that expansion cannot be taken for granted.
Australian mining competes with projects overseas. These include the planned expansion of the Carajas Mine in Brazil, which contains the world’s largest reserves of iron ore; in thermal coal, the expansion of the Cerrejon mine in Colombia, as well as the Ovoot Tolgoi project in Mongolia and the East Kutai project in Indonesia; and for coking coal, the Zambeze project in Mozambique and the expansion at Mongolia’s Tavan Tolgoi, one of the largest deposits in the world.
Not one of those projects will face a carbon tax. Nor do they face the distortions associated with the Fair Work Act and a union movement rapidly reverting to bloody-minded militancy. Given these projects’ low cost base, their ultimate impact on prices could be greater than even the expansion in supply would suggest.
This makes it crucial Australian mines increase their productivity. So does the fact that for many minerals, we are reaching the point where ore bodies are more difficult to access, meaning more effort is needed to find and produce a unit of output: Geoscience Australia reports that merely between 2002-03 and 2006-07 the depth of metres drilled by Australian miners increased 64 per cent, reflecting the need for companies to drill deeper in their exploration efforts.
For the rest of this article, please go to The Australian website: http://www.theaustralian.com.au/news/opinion/direct-support-to-those-industries-with-a-future/story-fn7078da-1226263159305