Post on 23-Mar-2016
description
Dr Simon Michaux
The Implications of Peak Mining for the Industrial Sector
Mining Supports Industrialisation
• Manufacture and application of technology at all scales makes up the industrial grid
• That technology allows us to live in the numbers we do and in such densely populated cites
• Big agriculture (thus our food) depends on industrial services
• Industrial grid heavily dependant on raw materials from mining
• Mining is the exploitation of a non-renewable natural resource
The impact of mining and processing minerals
Payal Sampat in a Worldwatch Institute report (State of the World 2003)
“consumes close to ten percent of world energy, spews almost half of all toxic
pollution from industry in some countries, and threatens nearly 40 percent of the world’s undeveloped tracts of forests—while generating only a small share of
jobs.”
Mining empowers everything else by supplying raw
materials for manufacture and energy
40% Decrease in Multifactor Productivity
Well, GOLLY! We aren’t growing new deposits are we?
Driven by increasing demand
Economies of Scale Has Carried the Industry
71.5
62.3 61.6
55.057.059.061.063.065.067.069.071.073.075.0
1980's 1990's 2000's
Aver
age
A*b
Comminution Impact Breakage A*b
Ore has been progressively getting harder
Softer
Harder
~3000 Drop Weight Tests
What does this mean?
More power draw is required to break the rock
Target Grind Size is Decreasing
1 mm
Target ore P80 = 150mm
10 mm
Target ore P80 = 4mm
Ore grain size becoming more disseminated
General form of the Energy-Size relationship
An exponential increase in power draw
A decrease in plant final grind
size P80
=A decrease in metal grain size
=
Ener
gy, k
Wh/
t
Hukki 1962
Economic goal posts are shifting for future deposits
• Huge low grade deposits
• Penalty minerals more prominently present in deposit that prevent efficient processing
• Ever decreasing grind sizes (close size 5-20mm)
• Operating on an economy of scale never been seen before (4MT blasted rock a day, 40% of which is ore!)
• To stay economically viable, economics of scale have to be applied. Operations will double and triple in size.
All of this based on the assumption that there is no energy or water shortage
With a continuing grade of 0.5% this will require 20000Mt of Rock
With a decrease of grade to 0.2% this then requires 50000Mt of Rock
Copper Demand Outlook
Is this sustainable?
World Cu grade 0.5%
17Mt
3400Mt of RockWorld Cu grade
1.6%
Eventually the cost of dealing with the wastes will exceed the value of the metal…
With current estimations the demand for copper will increase to ~100Mt by 2100
Mining Challenge: Energy Shortage
Source: Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) 2008
Energy consumption in mining increased 450% in the last 40 years
Peak GasYear 2018
Zittel, W. et al, Fossil and Nuclear Fuels – the supply outlook Energy Watch Group March 2013
CSG and shale gas has pushed this date back from approx. 2011
Peak Oil - conventional and unconventional
Source: The Oil Drum
Tar and oil sands have pushed back the peak of total oil supply back 6-7 years
Year 2012
Peak Coal
Zittel, W. et al, Fossil and Nuclear Fuels – the supply outlook Energy Watch Group March 2013
Year 2020
This should frighten the hell out of any thinking politician
World supply of fossil fuels and uranium
Zittel, W. et al, Fossil and Nuclear Fuels – the supply outlook Energy Watch Group March 2013
Peak energy approx. 2017
Dynamic Interaction and Exacerbation
• Power & water shortages
• Decreasing grade requires more tonnes of rock extracted for the same resulting amount of target metal.– More energy is needed (diesel and electrical power draw) per unit of
extracted metal– More potable water is needed per unit of extracted metal
• Increasing ore hardness requires more power draw to crush and grind the ore
Dynamic Interaction and Exacerbation• Decreasing grind size due to finer mineral grains requires more
power draw to crush and grind the ore– More water is needed per unit of extracted metal– Water recycling is more difficult– More disseminated finer grained rocks are usually harder to crush and grind
• Exponentially more energy demand from shrinking energy sources
• To remain economically viable operation scale has to double/triple in size
• Metal demand is growing fast
What we must choose to do to, if our industrial sector is to survive
Room to Manoeuvre
MountingStress
Drift
Fundamental Reform
EarlyCrisis
ExistentialCrisis
MountingStress
Drift EarlyCrisis
Trapped Transition
Trapped Transition
Drift/Decline
Write-off & Reset
Decay/Collapse
ExistentialCrisis
Drift/Decline
Decay/Collapse
Inelastic oil supply 2005
Leadership & Vision
Understandtrue implications
Peak Total Energy2017
We
are
here
DecreasingGrade
Sovereign DebtDefault
DecreasingGrind size+ Increasing
Depth+ Peak FossilFuel+
PeakMining
CreditFreeze+ Structural
Inflation+FIATCurrency
Devaluation+
PeakFinance
PeakManufacturing
PeakIndustrialisation
=
=
The End of Materialism
The End of the Industrial Revolution
Expansion of production needed to stay viable
Expansion of money needed to service debt
The Industrial Big Picture
The fate of the current system of industrial management
This is not the end of industrialization but the end of the current way of doing this.
A new system will be developed through necessity.
Are these issues really unknown to the senior
global decision makers?
What happens to due process and democracy
when there is not enough to support everyone?
Systemic environmental disruption
Natural raw materials unavailable for
industrialisation
Energy supply disrupted then
unavailable
• Reset all FIAT currencies – asset based• Restructure all debt• Need to grow into new system
• Cannot sustain growth• Cannot grow economy system• Change to alternative energy system• Rebuild all infrastructure to meet
requirements of new energy system
• Cannot supply raw materials for construction or manufacture at needed rate or volume, if at all
• Need to reassess what is really needed
• Mine our rubbish dumps
• Cannot run any existing system for very long
• Resilience and redundancy required on all fronts
• Practical carrying capacity vastly reduced
FinancialSystemicMeltdown
Popu
latio
n O
vers
hoot
• Puts pressure on all other sectors except finance• Most people of which have few relevant skills
outside existing paradigm• Wilful ignorance & aggressive apathy
The ethics of what gets used and for whom becomes relevant
• Person A and Person B want the same pallet of aluminum ingots
• Person A wants to build a roof over his swimming pool at his holiday home– has lots of $$$
• Person B wants to build a series of bore water pumps in a region with drinking water shortages– represents a nation state government where resource is
situated
But money has become really unstable
The ‘have-nots’ vastly outnumber the ‘haves’
grab your pitch forks and burning torches, its time for a visit to the castle…
Personal epiphany after a 15 year professional career
You can be at the right place at the right time, when that system breaks…
You can’t make a system change that doesn’t want to, that also regulates its own authority
and has its own political power source
Conventional thinking has no hope for the future.
Unconventional thinking and asymmetrical strategyis the way forward
Timing is the key to everything
Questions???
Peak mining & implications for natural resource management - Simon Michaux
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