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18 SMe Mining engineering handbook
mining industry must be part of the solution and that energy to choose between an urban and rural lifestyle, and substantial
produced from the mining of coal, uranium, and tar sands will opportunities to travel.
continue to provide a major part of the world’s energy supply. Finally, there is a strong trend toward fly-in/fly-out (FIFO)
operations for new development projects. These FIFO opera-
Safety tions are an alternative to creating remote residential towns to
The mining industry has historically had a poor safety record, support nearby mining activities and are seen as a more attrac-
and the industry is viewed as a dangerous one. While injury tive lifestyle alternative for many potential employees. This
rates and fatalities continue to be unacceptably high, the move toward FIFO operations also supports a sustainability
industry overall has dramatically improved its safety perfor- agenda, because when the mine is depleted, the towns that were
mance. For context, the construction of the Panama Canal in built to support it are frequently left without an economic base.
the early 1890s involved the movement of 300 Mt of mate-
rial and cost 26,000 lives. BHP Billiton’s Escondida mine goveRnAnCe
moves 360 Mt every year with the expectation that this will be There is unquestionably a trend to increased governance of
achieved without the loss of a single life. Safety performance public companies in general and mining companies in particu-
is still an issue, but dramatic improvements have been made lar. These come from many sources:
and must continue to be made.
• Unions: Although union membership has been falling
worldwide, the statement that “you get a union when you
huMAn ReSouRCeS
earned one” is still valid and provides an important check
The design and material flow sheets for modern mines are
on the management of industrial relations.
complex and unique, the equipment is large and expensive,
• Nongovernmental organizations: NGOs are passionate
and operations are frequently remote. Capable people, at all
about their individual issues, and they are growing. Areas
levels of the organization, are therefore essential to operating
such as human rights, protection of indigenous people,
a successful mine or mining company.
biodiversity, and the environment all attract strong fund-
Despite this requirement for large numbers of capable
ing and provide a voice on mining issues that is widely
people, the mining industry has faced and is facing a global
heard and considered. The trend is for these groups to
skills shortage. The best evidence of this is the decline in
become more pragmatic in their approach, and many
university graduates in mining engineering, earth sciences,
NGOs have moved from simply being against mining to
and metallurgy. In Australia, the supply of mining engineer-
engaging companies in substantial discussions about how
ing graduates declined to just 100 in 2005, down from 200 as
mining can be done more sustainably.
recently as year 2000. In the United States, there were only
• Regulators: Stricter reporting requirements and unbi-
86 mining engineering graduates in 2005. Similar acute skills
ased verification are clear regulatory trends through leg-
shortages have developed for mechanical and electrical trades-
islation such as the Sarbanes–Oxley Act of 2002 in the
people and to a lesser degree for skilled equipment operators.
United States. Industry groups such as the ICMM are
The reasons for this shortage of skilled people in mining
also substantial forces for self-regulation through their
include the following:
members’ commitments to codes of conduct and report-
• Remote locations: Mine locations are frequently rural ing. The trend is for industry to increasingly rely on self-
and remote. This lifestyle is generally less attractive than regulation and voluntary compliance to standards that
living in large cities, particularly to unmarried new grad- exceed legal requirements.
uates and families with high-school-aged children. • Financial institutions and shareholders: Equity ana-
• Industry unattractiveness: Particularly in developed lysts are increasingly independent from their lending
countries, the image of mining industry work is (incor- institutions, and banks and investors have much better
rectly) of low-skilled, dirty jobs in an outdated, boom/ access to information about the companies they choose to
bust industry. This image does not attract high-quality financially support. For these reasons, it is harder for bad
entrants. companies and projects to attract funding.
• Lack of awareness: As the relevance of the mining • Society: The volume of information and speed with which
industry has declined in the developed world, potential it is transmitted through sources such as the Internet are
entrants are increasingly unaware of the opportunities the making it harder for unacceptable actions to go unnoticed.
industry offers. • Boards of directors: Members of the boards of direc-
tors of public companies strongly dislike being associated
Increasingly, the trend is to fill the void left by a lack
with any type of scandal or perceived violation of a com-
of new entrants in the developed world by recruiting skilled
pany’s “social license to operate.” Most boards devote
workers from developing countries. In 2007, the mining
large amounts of time to ensuring that high standards of
industry employed 8% of Australia’s skilled migrants but
governance are upheld.
only 1.3% of its native workers. A number of companies have
started recruiting new graduates in less-developed countries Lastly, there is a clear trend toward more disciplined man-
with strong mining or manufacturing cultures. As a result, agement decision making. As mining companies have become
South Africa, Russia, and China have started to become tar- larger and more global, the costs of the decisions they are
geted countries for recruitment of new graduates with techni- making, particularly to build ever larger individual mining
cal degrees. These steps will help, but they are not enough to projects, are increasing. This has brought with it a higher level
attract the talent the industry requires. To lure skilled workers, of discipline to operating and capital decisions that have ben-
the industry is increasingly promoting the benefits of a career efited all aspects of operation, including safety and environ-
in mining, including career development, high pay, the ability mental performance.

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18 SMe Mining engineering handbook

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