Automation to further lower Pilbara costs

RESEARCH from GlobalData has quantified the benefit of rolling out automated trucks to Pilbara iron ore operations.
Automation to further lower Pilbara costs Automation to further lower Pilbara costs Automation to further lower Pilbara costs Automation to further lower Pilbara costs Automation to further lower Pilbara costs

Rio's autonomous trucks

Staff reporter

Automation has already led to productivity gains in the Pilbara, but the analytics company said the implementation would continue to lower costs.

Rio Tinto was the first to introduce an automated haulage system (AHS), expanding from five in 2008 to 95 at the end of last year.

It plans to increase the fleet to 150 by 2020.

The US$2 billion investment to date has increased per person productivity levels by 37% between 2014 and 2017.

"AHS can have a significant impact in reducing the mining cost, which accounts for an average of 34% of the total operating cost," GlobalData senior mining analyst Ankita Awasthi said.

"The key benefits of AHS trucks include improved haul truck utilisation, alongside higher productivity."

Rio's peers have also been jumping on the automation bus, with Fortescue Metals Group moving from 56 AHS trucks this year to 68 in 2020, and BHP expecting to add another 50 AHS trucks in 2020.

"While the numbers are still relatively small, the gradual increase in the AHS fleets is expected to have a noticeable impact on average operating costs for the major iron ore miners," Awasthi said.

GlobalData expects costs for the iron ore majors to drop by US50-62c per tonne by 2020, which would reduce the average C1 cost from $13.63 per tonne in 2017 to $13.07/t in 2020.