EY with the Center for Copper and Mining Studies, CESCO,held  the forum “Mining Risks in times of covid-19” via streaming with the aim of answering one question: How are the high-impact risks t changing  the industry? This great question was analyzed by Baldo Prokurica, Minister of Mining; and Iván Arriagada, CEO of Antofagasta PLC, using EY study guides that were determined at the event: “Covid-19 and its implications in the mining sector” and “Top 10 risks and opportunities in mining”.

“Our main economic activity in Chile faces the greatest global risk in the last century, where various aspects of this industry have been strongly impacted. In this forum, we discussed the “new normality in mining”, how operations are working, what the main challenges are in the crisis and how post-covid-19 activity is projected,” said Alejandra Wood, executive director of CESCO.

Regarding this new normality, Minister Prokurica stressed that mining operations have not stopped and that the industry is taking precautions not to stop its operations. “I absolutely highlight  the strict measures that have been adopted by companies in the sector, such as temperature controls at accesses, passenger registrations for transfers, distance on trips and in cafeterias, sanitation of common spaces and transfer vehicles, etc. Also, several fields are operated with minimum staff, 14 × 14 shifts, and construction projects that have been halted to prevent contagion. Mining does not fail Chile and it does not stop, but it does take measures to care for its people”, said the Secretary of State.

Iván Arriagada, CEO of Antofagasta PLC, expressed that we must incorporate these health practices and protocols (distancing, face masks, hand sanitizer, speed up teleworking, etc.) into daily mining activity, adding that “once we entirely resume our operations and projects , we have to integrate and manage this new risk. Besides, critical supply chains must be reviewed as there is a systemic risk, and work with communities and authorities must be reinforced, since the role of mining in the territory in which it operates is very important. For example, we created a fund to help with medical equipment, sanitary barriers, and sanitation.”

Fall in demand and technological role

The duration of this health crisis is one of the doubts that have been generated and that raises the greatest concern of the authorities, companies and workers, since it will be key to knowing when the different economic activities may be resumed, partially or totally.

“If the pandemic persists for more than 12 months, our analysis indicate that the result is likely to be a reduction in demand for key minerals, especially those used in manufacturing; the demand for bulk minerals will drop between 6.5% and 8.5% in 2020; in the case of base metals, the demand for copper is projected to decrease between 12% and 15%, while aluminum could be between -16% and -20% ”, explained Eduardo Valente, leading partner for the Energy Industry and Mining of EY Chile.

“In the case of the crisis that we are experiencing, the cost for an industry like mining can be high if it is not possible to continue operating. Companies will be challenged to ensure the health of their collaborators and at the same time look for alternatives to keep working. In this type of situations, the role of technology and innovation is essential to find tools that allow remote or remote operation, avoiding contact between people as much as possible and allowing operational continuity”, concluded Valente.

During the activity, the CEO of Antofagasta Minerals, who was interviewed by Alejandra Wood, received video questions from Karen Poniachik, director of the Global Center at Columbia University; and the deputy Daniella Cicardini; president of the Chamber of  mining commission. The event was broadcast by Diario Financiero and  Minería Chilena magazine.