Trends and Challenges in MMM

Presented by: Kevin Fitzgerald / Rogerio Martins

Confidential Property of Schneider Electric

Kevin Fitzgerald
MMM Consulting Director

Foxboro, USA

*
*
Belo Horizonte, BRAZIL

Rogerio Martins
MMM Vertical Director
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5 Years Commodity Historical Prices
Iron Ore Fines

Goldman Sachs maintains the

long-term iron ore target of $35/t
but highlight the potential for
continued price volatility until
steel inventories normalize. This
price will keep pushing higher-
cost companies out of the
market.

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5 Years Commodity Historical Prices
Thermal Coal

The industry does not require

new investment given the ability
of existing assets to satisfy flat
demand, so prices will remain
under pressure as the
deflationary cycle continues,
Goldman Sachs wrote in
September 2015.

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5 Years Commodity Historical Prices
Nickel

According to the the Australian

Department of Industry, world nickel
consumption is expected to stay flat
in 2016 and 2017 as a result of weak
economic growth and no rise in steel
production.

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5 Years Commodity Historical Prices
Copper

The value of Chile's copper exports

fell 16.1% in the first half, compared
to H1 2015, on par with the financial
crisis of 2009
The plunge in values of course
reflects the slump in the copper price,
which has halved from $10,190 a
tonne in 2011 to a seven-year low of
$4,318 in January.

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 Mine of the Future?

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Trends and Challenges to the MMM Segment
Global demand for minerals and metals will continue rising...

Fundamentals driving consumption increase Global Economy is becoming consumption-driven

If in 2025 (8B people) 60% of the world consumed as the US does it
today, then capacity will have to increase by

% Capacity Increase
191%
191% 51% 15% 40% 110%
110%
51% 15% 40%

Aluminum Copper Zinc Nickel Phosphate

Production 2014 49Mt 19Mt 13Mt 2.4Mt 220Mt
Consumption
US/Person 30Kg 6Kg 3Kg 0.7Kg 96Kg

Despite commodity price decrease and volatility Investment will continue

1. Capital and Labor Productivity Increase

2. Sustainability
3. Differentiation (Value Creation)
4. Capacity Increase (Volume and Grades)

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 Trends and Challenges to the MMM Segment
Sustainability as a must to operate; efficiency and productivity as a must to grow....

People Environment Assets Capital Government

Safety Reduce Emissions Increasing Demand Limited Access to Capital Resource Nationalization
Talent Scarcity Reduce Energy and Water Increase Production Capacity Market Volatility Regulations
Knowledge Transfer Consumption ROCE Maximization Decreasing Market Prices
Reporting and Regulations

Connected operations to Sustainability as a must to Renewed but stronger focus Focus in optimizing Adapted local sales
monitor and operate remotely operate in decreasing the production operations rather than approach face a different
Increased training and Increased investment in cost (operation efficiency) increasing capacity customer profile
simulation for quality, safety sustainability solutions and in additional added value
New business models to fund
and efficiency. New information layer to to differentiate from
competition and increase top capital projects with budget
Safe operation solutions. meet stakeholder from operations
requirements line
Segment knowledge, local
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sales
Tomorrows Mine Enabling Technologies

Autonomous Virtual Internet of

Systems Reality Things

No Accidents Optimized
Fewer personnel near risky Predictable
processes/ areas Less variability
Situational awareness Empowered operators Remote Mobile Big Data
Getting the most from assets Operations

Simulation & Social Analytics

Optimization Enterprise

Fully Sustainable 100% Integrated

Water and carbon-neutral Real time response to market/
Energy-efficient / self-sufficient raw material fluctuations and
Integrated with the community market demand Adaptative Contextual Cloud Hybrid
Resource-to-market single view Supply Chain Information Computing
Business-to-mine/ mine-to-
business alignment
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 MINING WILL BE THE BUSINESS
OF THE BEST AND NOT THE
BIGGEST
More efficient and sustainable operations due to the
higher investment in R&D and use of technology

More disciplined capital allocation and increased

focus on cost management, operational excellence
and value creation
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.
Mining, Big Data, Cloud Computing and IoT - Examples of Enabling Technologies

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 ..by 2018

Digital traffic is expanding

annually by 23%+,
creating the need to scale
digital infrastructure
Source: Cloud Index Report 2014

8.6 Zettabytes of IP Traffic

8,600,000,000,000,000,000,000 bytes

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 Sources: Cloud Index Report 2014 Intel

Growth is driven by the connected

users and the Internet of Things

2 Billion Internet users

21 Billion network devices

1.3 Million video views per min

665TB Data per hospital per year

40TB data transmitted / flight hr

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Big Data in MMM

3+
40
Million
300
Million
400 Billion
Million

Predictive Analytics Tool

Images posted on Photos posted on Tweets posted on Events stored per day at a
Instagram per day Facebook per day Twitter per day single industrial user

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Big Data Operational Challenges

Lack of collaboration across various

departments
Disparate systems and data sources
ROI justifications for improvement
justifications
Lack of executive support

Lack of available talent

0 20 40 60

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Recent industry moves showing a pendulum shift back, creating a
decentralized, hybrid computing ecosystem

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What is IoT?

Connected world solutions combine

sensors and technologies to enable
objects and infrastructure to interact
Things Connectivity
with monitoring, analytics and control
systems over Internet-style networks.

Source: Forrester

Data Analytics

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 We see the Industrial Internet of Things
as an evolution not a revolution
The Industrial Internet of Things brings about a world where our smart connected
products and systems operate as part of larger systems of systems. In our world, smart
plants and machines with intelligence embedded at their core cooperate to enable the
smart enterprise where tangible business value is realized through improvements to
efficiency and profitability, increased cyber security and innovation and better
management of safety, performance and environmental impact.

Confidential Property of Schneider Electric |

IoT technology has been in development for more than 30 years

First intuitive The first in a series of patents Computerworld Convergence of MB/TCP & Eurotherm Online
industrial HMI for web servers in Smithsonian Ethernet/IP Services
automation devices award winner

1980 1996 1999 2010 2016

1987 1997 2004 2015

Foxboro I/A Series system Introduction of Modbus/TCP MB/TCP submitted to IEC

is launched, heralding the worlds and Transparent Factory for Modicon M580
for standardization
first open industrial system Automation ePAC

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 IoT brings benefits across the automation journey

Cost & Time-to-Market Efficiency & Flexibility Availability & Sustainability

Empowered Operators Design & Commissioning & Maintenance &

Engineering Operation Services

Smart Control

Optimized assets

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 Mining IoT and Application Landscape

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Example: Energy Management
Combining energy and production data to improve operational efficiency

kWh / $ / Ton
Mine

Ton / kWh

kWh

Ton/h
kWh
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Example: Ventilation on Demand Control Room Ventilation

Environmental
Sensors

People
Location

Asset Data &

Location

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Example: Augumented Reality

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 Example: Water Management Solution Water Management
>Transform data into information
> Water Performance
> Water Balances
> Alerts
> Water Quality
> Reporting

Mine / Process Water Tailings Surface / Ground Water

Monitoring Wells

Weather

Levels
Flows

Inspections Inspections

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Example: Predictive Analytics

Historical Data Pattern Recognition Early Warning Detection

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 Example: Advanced Process Control
Benefits & Tools
Steady-state optimization tools
APC address individually each process addressing the whole processing plant
targeting simultaneously considering constrains
Throughput rates
Recovery
Energy Efficiency
Process Stability

> APC for Crushers > APC for Grinders > APC for Flotation > APC for Thickener > Optimization Solutions
Maximum power draw Increased throughput Increased rougher Increased underflow Steady state optimizer based on
Finer product rate recovery density current economic and process
Managed circulating Decrease in specific Increased and Decreased flocculant conditions, giving operators the
loads energy consumption stabilized cleaner grade consumption ability to make informed decisions
Choke Feed Control Increased stability Optimized reagent Improved overflow at an expedited rate
Gap Control Finer product grind consumption clarity
sizes or reduction in
particle size variation

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Selected Reference

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Questions?

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 THANK YOU.

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