How General Electric and Mitsui plan to drive down operational costs
General Electric is teaming up with Japanense resources and energy company Mitsui to explore new ways of driving mining operational costs down, signing a memorandum of understanding (MoU) earlier this week. The agreement between the two companies will focus on increasing efficiencies and improving overall safety in mining operations.
Efforts to increase productivity and efficiency are two widespread problems currently facing mining companies. A recent report -- MineLens Productivity Index -- said global mining operations are 28 percent less productive today than a decade ago.
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“Miners are seeking to cut costs incurred to produce mining output, or to increase output at no additional cost—in other words, to raise productivity. CEOs have been acknowledging to investors that poor productivity performance must be addressed. Meantime, governments in big mining countries are also trying to understand the productivity challenge, with publicly funded research institutions studying the issue closely,” stated the McKinsey report.
Under the partnership, GE and Mitsui will collaborate together to examine initiatives like switching from diesel oil to cheaper natural gas in order to analyze cost reductions and payoff.
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The new concept is currently being rolled out by energy company Shell, which is looking to introduce LNG-powered fleets at Australian mines. Rio Tinto and BHP Billiton have both expressed interest in the technology.
The partnership is the latest move by General Electric, which recently partnered with Komatsu Ltd. in April to offer big-data analysis services, to implement its Internet of Things platforms. GE has previously stated it envisions a world of smart machines that can diagnose their own problems and find solutions.
As Japan’s largest trader of oil, Mitsui & Co. also holds stakes in iron ore, coal and copper projects in Australia, Brazil and Chile.
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