development of scandinavian mining cluster · development of scandinavian mining cluster ... early...

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1Pentti Noras 21.10.2009

Development of Scandinavian Mining Cluster

Innovación para crecimiento y sustentabilidad – éxitos de Finlandia y Chile

Organized by VTT – SOFOFA – Embajada de FinlandiaSalón Auditorio de SOFOFA, Santiago, 3 November 2009

by Pentti Noras, Director International Relations Geological Survey of Finland (GTK)


Crises and survival are #1 to encourage inventions : “scrapping the oil dependency”

Source: The Finnish Defence Forces 1940

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The driver #2: to grow and succeed in international competition


Lessons learned in arctic can be ”tropicalizados”!

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17th Century

Early world- scalemining knowledge

from Potosí, Bolivia by Padre

Barba


Early value chain cluster in the Kingdom of Sweden-Finland in 16th and 17th centuries

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Wealth creation through natural resourcestransforming of natural resources to physical and human capitals

Natural Resources Capital

Physical Capital

Human Capital

SUSTAINABLE

NON-SUSTAINABLE


MINERALS PROCESS IND Value addedproducts

SIDESTREAM

Minerals process industry and minerals cluster witheconomic linkages

Replication capacity

NON-MINERALS IND

Generic governance & institutional capacities

Generic production technology & system capacities

Socio-economic benefits

DIFFUSION

Standard suppliersUPSTREAM

Innovative suppliers DOWN-

STREAM

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Why clusters matter?

• A cluster is a geographic concentration of companies, in a particular business sector. Related industries, institutions and their customers compete but at the same time cooperate. All contributors are related by activities.

• provides improved access to specialized inputs and employees, public goods, and knowledge.

• exploited to reduce cost of operations and to develop new products and services (SYNERGY!).

• increased communication and competition from local rivals enhance firms’ability and incentive to innovate.

• strong and numerous linkages across and within clusters allows for faster innovation processes.

INCREASED INNOVATION, PRODUCTIVITY AND LOCAL BENEFITS AND WEALTH


Natural resources clustervehicle to orchestrate sustainability & wealth creating factors

PRIMARY FACTORS

-geography-culture-innovative capacity-stability-maturity of institutionalstructures

SECONDARY FACTORS

-public education & awareness-corporate social responsibility-developmental / promotional agency success-informed leadership-local benefits scheme

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Baltic

BarentsBothnian

Possible extension of Bothian mining cluster in Northern Europe

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Bothnian mining cluster

• Oldest in the world (merchantilism based, ”non-Porterian” origins)• Existed long before the forestry industry kick off• Fundaments in hard, crystalline bedrock• Fits small country / limited resources conditions• Survived, even strengthened, through radical historic crises• Mature, international, even virtual• Inclusion of extension sectors, eg., aggregates & natural stones and

infrastructure building• Based (also) on

– Non-enabling, harsh production conditions– Tradition of education and training– Social inclusion/capital, straightforward communication, …– Shared values of people (relatively) – Wide concensus on means and objectives– Incremental changes approach (workers/operators initiativeness)


NW Russian Ni &Fe and phosphate mining cluster

Aluminum mining and metal working cluster

Northwest Russian minerals and metals industry sector

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Bothnian mining cluster: operating mines & projects in Finland and Sweden

• LKAB (Fe)• Boliden (Zn, Cu, Pb, Au, Ag)• Lundin (Zn, Cu, Pb, Au, Ag)• Dragon Mining (Au)• Minmet (Au)• Lovisagruvan (Zn, Pb, Cu)

• Projects15 companies35 projects

• Outokumpu (FeCr, Ni)• Talvivaara Mining (Ni-Co-Cu)• Pyhäsalmi Mines (Zn-Cu)• Agnico Eagle (Au)• First Quantum (Ni-PGM)• Gold Fields (PGM, Ni)• Lapland Gold (Au)• Endomines (Au, Li)• Polar• Mondo (talc)• Yara Finland (apatite)Projects 2007

43 companies1943 claims

SWEDEN (in 2006) FINLAND (in 2008)


Research & education

Research & education

ExplorationExploration

DrillingDrillingBlastingBlasting

LoadingLoadingHaulingHauling

Mine structuresMine structures

Bothnian mining suppliers

SWEDISHSWEDISHRMGSGU

universities HagbyCraeliusFlexit

ABBAlimakIndauJama

WassaraAtlas Copco

Tamrock

ToroVolvo

FINNISHFINNISH

universitiesGTK

SMOYKati

WärtsiläAhlström

RobitKonegranes Normet

Kemira

Dyno NobelKimitSandvik

Sandvik

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Bothnian mining cluster: suppliers for processing

Mineral preparationPhysical separations

Chemical separationsMetsoOutotecMetso(Larox)

OutotecKemira Mining Water

ITT FlygtGrindexAlvenius

Tamfelt

SWEDISH

FINNISH

Sandvik


SAG

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Bothnian mining cluster: approximate world market shares

0 50 100

MiningExplorationSmeltingFlash smeltersDrill unitsSAG mills

%


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Most voluminous tank cell installation in Australia (2009)


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Source: Nordic Lights


Novel GTK services for exploration industry: high-resolution seismicreflection surveys on ore desposit sitesVMS, IOCG, orogenic Au and layered intrusions

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Finnish industrial clusters 1990>2000>2010?


MANUFACTURING TECHNOLOGYmining machinery andequipmentenriching equipmentmaterial technology

INFORMATION TECHNOLOGY sensors, measuring andcontrolcomputational intelligence,simulation and machinevisionmultimedia and tele-communication

METALLURGICAL TECHNOLOGYprocesses with few stages(flash smelting, verticalcasting..)

process automationengineering

PLANT DELIVERIES

CONSTRUCTIONTECHNOLOGY

steel construction

MARKETSquality competitivenessprice competitivenesslogistical expertiseenvironmental expertise

BIOTECHNOLOGYbioenrichmentwastewatertreatment

CHEMICAL TECHNOLOGYmineral technologyhydrometallurgycorrosion prevention

Base Metal IndustryMultidisciplinarity can secure its competitiveness

mining

steel and metal industry

technologic solutions

B services (KIBS)

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Future: Where the Finnish metal/mining cluster may best meet the global market demand?

Knowledge-intensiveservice business

Knowledge-intensiveservice business

Machines, equipmentand servicesMachines, equipmentand services

System suppliersSystem suppliers

Renewing metalRenewing metalLogistic solutionsLogistic solutions

DM 12986305-2005 Copyright © Tekes

Finnish businessgrowth potential

HighLow

Globalmarketgrowth

Slow

Rapid

Low grade ores& critical metals


Future challenges of Finland and Sweden to improve economicperformance

• Ageing population (weakening dependency ratio), welfare state.

• Employment rate (eg. Finland 67% vs. Denmark 75%).

• Entrepreneurship.

• Attracting laborious and talented individuals (immigration policy).

• Inward FDI and local DI.

• Entirely new niche strategies.

• Not only ICT manufacturing, but more application and allocation of information resources.

• Not only technological, but also productional, organizational, social and, in particular, serviceinnovations.

• Commercializing of innovations and marketing.

• Ability to adopt bio-society and then possibly ”fusion” society.

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GROWTH

PRODUCTIVITY

ITCEnvironmentalperformance

Energy saving

Low-grade/large-Deposit/critical metals capability

Mining sector priorities in 2010s

LOCAL WELFARE

Intelligent exploration


GROWTH

PRODUCTIVITY

ITCEnvironmentalperformance

Energy saving

Low-grade/large-Deposit/critical mertals capability

Mining cluster priorities in 2010s

LOCAL WELFARE

Cross-sector applications

B-B services

Novel processes

Functional excellence

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/wEPDwU

•HOME•SUMMARY

•EXECUTIVE SUMMARY•KEY FINDINGS

•THE RANKINGS•COUNTRIES

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Select countriesSelect the countries you'd like to compare.

AustraliaChileFinlandFranceCompareanothercountryProsperity factorsSelect factor from the list below. Hover over the options for more information.

#1 FINLAND

#6 AUSTRALIA

The Legatum Institute´s Prosperity Index 2009

#17 FRANCE

# 36 CHILE

Source: Legatum 2009

Just as a screwdriver (physical capital) or a college education (human capital)can increase productivity (both individualand collective), so do social contacts affectthe productivity of individuals and groups".


Strategía de transformaciones progresivas: sincronizacióncuatro procesos simultáneo-esenciales:

1) profundicación democrática2) crecimiento sustentable3) inclusión social4) apertura cultural

Rol de las empresas P&M en la construcción de una equidadsocial: ”para ser eficaz, el progresismo debe combatir losprejuisios y a una posición reduccionista, que ve los empresarioscomo antagónicos al la equidad”

Mr Sergio Bitar, Ministro de Obras Publicas:”Chile Más Allá del Bicentenario: Chile-2010”

emisión en 6 de noviembre de 2009

Source: La Tercera 1/11/09 p.10)

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The Nordic mining cluster: What may be replicable in a/o transferable to Chile?

• both national and international scale, even virtual (further to local),• informal links btw individuals and groups; significance of trade

unions, industry associations and NGOs,• atmospehere for innovations: process, organization and

commercializing, • emphasis on all value chain, vertical and horizontal• 3-bottom line sustainable development objectives, • R & D projects in cooperation with technology leaders (countries,

companies) and demanding users, • link with energy and water savings• progress by filling crucials gaps through gradual, small improvements

development of scandinavian mining cluster · development of scandinavian mining cluster ... early...

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