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Software eats the resource sector

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Echoing Marc Andreessen's years-old witticism that "software eats the world", the authors of an Australian study try to imagine a fully-digitized resource sector.

Released this month, the Staying Ahead Of The Game report was commissioned by the Industry Growth Centres for Mining Equipment, Technology and Services (METS Ignited) and National Energy Resources Australia (NERA).

The authors believe a fully digitized resource sector would have a huge impact on Australia citing A$74 billion in value to the nation's economy and over 80,000 new jobs created.

The authors partly came to the figure by assessing the impact of automation on mine sites, such as reducing labor costs, increasing output and allowing access to previously uneconomic resources.

"Some digital technologies could have larger impacts than others. For example, integrated data analytics and machine learning are expected to have the greatest impact, increasing value added in the sector in 2030 by about A$10 billion, followed by intelligent design software with a A$7 billion impact," write the authors of the report.

"This is unsurprising, as the use of integrated data analytics can greatly improve equipment utilisation e.g. it can be used to identify and remedy bottlenecks in production. Similarly, intelligent design software can generate significant equipment, construction and procurement savings."

Workers jobs will be shift when the resource sector is digitized. Driverless trucks won't need drivers, but the trucks will require a high proportion of maintenance workers, as well as a supply chain of goods and services.

The authors believe that adoption of technology would spread its benefit to suppliers and local communities. They point to a growing software niche that Australia is fostering.

"Local universities, research institutions and a host of small innovative technology firms have already developed strong technical expertise in applying automation technologies to Australian resources operations.

"The appetite for new technology is strong and a prime example of our innovation is the fact that Australian technology developers already produce the majority of the world’s specialist mining software."

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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