transforming exploration - sykes et al - sep 2016 - centre for exploration targeting / the...

TRANSFORMING

THE FUTURE OF

MINERALS

EXPLORATION

John P. Sykes, MAusIMM 1,2, Allan Trench, FAusIMM 1,3,4, T. Campbell McCuaig, MAusIMM 1,5,

Tim Craske 6, Joe Dwyer 7, Naren Subramaniam 3,8,Siobhan Sullivan 9,10,† & Will Turner11

1. Centre for Exploration Targeting, The University of Western Australia

2. Greenfields Research Ltd., United Kingdom

3. Business School, The University of Western

4. CRU Group Ltd., United Kingdom

5. BHP Billiton plc., Australia

6. Thinkercafe, Geowisdom Pty Ltd., Australia

7. HiSeis Pty Ltd., Australia

8. Transmin Pty Ltd., Australia

9. School of Plant Biology, The University of Western Australia

10. Botanic Gardens and Parks Authority of Western Australia

11. Independent Geological Consultant, Australia

† Today’s presenter

6 September 2016

AusIMM New Zealand Branch Conference: Wellington, New Zealand

TRANSFORMING THE FUTURE OF MINERALS EXPLORATION

What is the future of minerals exploration?

• What will we be exploring for?

• Where will we be exploring?

• How will we be exploring?

• Who will be doing the exploring?

• Who will pay for the exploration?

• In summary, what is the future, high-level

‘strategic’ approach to exploration?

6 Sept 2016

AusIMM New Zealand Branch Conference, Wellington, New ZealandSlide 2 of 32


The future of minerals exploration scenarios

6 Sept 2016

AusIMM New Zealand Branch Conference, Wellington, New Zealand

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Group scenario planning

trial

• Workshop in early June 2016

• Deductive and inductive

approach

• Three researchers: John

Sykes, Allan Trench &

Campbell McCuaig

• Six participants: All CET PhD

students

• To be published at the World

Renewable Energy Congress in

February 2017

• Reference: Sykes et al. (2017)

• Emergent focus on the energy

transition

Individual scenario

planning trial

• Undertaken throughout 2015

• Deductive approach

• Two researcher participants:

John Sykes & Allan Trench

• Published at AusIMM

International Mine Management

Conference in August 2016

• Reference: Sykes & Trench

(2016)

• Emergent focus on mineral

economic cycles over time

Expert scenario planning

workshop 1

• Workshop in mid-June 2016


approach, with emergent

transformative approach



Campbell McCuaig

• Nineteen participants: Experts

in exploration, mining,

renewables, commerce and

environment from industry and

academia

• Four guest speakers: Mining

law, history, economic geology

and sustainability

• Published at AusIMM New

Zealand Branch Conference in

September 2016

• Reference: Sykes et al. (2016)

• Emergent focus on technology,

skills and social licence

STAGE 1STAGE 2

STAGE 3

STAGE 4

Expert scenario planning

workshop 2

• Workshop in late-June 2016


approach



Campbell McCuaig

• Twenty-four participants:

Experts in exploration, mining,

commerce, environment and

society from industry and

academia

• Four guest speakers: Mining

technology, indigenous

relations, Asian commerce and

leadership

• Yet to be published (planned

2016-17).

• Focus on synthesizing the

previous workshops

STAGE 0

Syn

thesis

& c

om

mu

nic

ati

on

(pla

nn

ed

2016

-17)

STAGE 5

THIS PRESENTATION

Slide 3 of 32


THE TRADITIONAL APPROACH:

‘SMALL’ EXPLORATION


6 Sept 2016



Business strategy is traditionally ‘rationalist’

MOVES TOWARDS A GOAL:

• Traditional ‘rationalist’ strategy;

• Focused on ‘predicting and controlling’ the

‘transactional environment’ e.g. competitors,

suppliers, regulators, investors;

• Objective – there is a ‘best’ strategy, which can

be worked out with enough analysis and then

pursued;

• Military & sporting analogies – reflecting

interaction with transactional environment e.g.

competition, supply chains;

• Mechanical & machine analogies – reflecting

objective, predictive approach.

6 Sept 2016


COMPANY

TRANSACTIONAL

ENVIRONMENT

Competitors Investors

NGOs

Regulators

Suppliers

Clients

Employees

Based on: Van der Heijden, 2005; Ramirez & Van der Heijden, 2007; Ramirez & Wilkinson, 2016

Slide 5 of 32


Traditional exploration strategy also rationalist

MOVES TOWARDS A GOAL:

• Conceptually also a rationalist ‘traditional business

strategy’;

• Moving out across the world and finding new ore

deposits;

• Whilst also beating your rivals to the prize – as

there are objectively better places to explore;

• Aim is predict where the best deposits will be &

gain control of the land, then detect the deposit;

• The transactional environment covers the whole

world – it’s just a matter of getting there;

• Also known as ‘small’ exploration.

6 Sept 2016


Based on: Van der Heijden, 2005; Ramirez & Van der Heijden, 2007; Ramirez & Wilkinson, 2016; Trench, 2016

EXPLORER

TRANSACTIONAL

ENVIRONMENT

Competitors

InvestorsNGOs

Regulators

Suppliers

Mineral deposits

Employees

Slide 6 of 32


New technology & skills to predict & control

• Exploration is technology and skills

focused;

• Traditionally used to open up the

‘transactional environment’;

• Aim of finding new deposits before

competitors;

• Mitigates increasing maturity of

exploration ‘search space’;

• A ‘rationalist’ approach – predict

and control;

• The scenarios workshop initially

started out in this mindset focused

on technology.

6 Sept 2016


Workshop photo courtesy of Will Turner

Slide 7 of 32


THE CURRENT APPROACH:

‘SHRINKING’ EXPLORATION


6 Sept 2016



Business strategy has since ‘evolved’

MOVES AWAY FROM CONSTRAINTS:

• Reaction to the traditional ‘rationalist’ approach;

• The world is big, fast-changing, complex and

inherently unpredictable;

• Key strategic constraints impact from the

‘contextual environment’ (e.g. economics,

politics, society, environment) outside of the

influence of the ‘transactional environment’;

• Transactional environment seems to be

shrinking – can lead to strategic paralysis;

• Emergent – strategy is only recognised

retrospectively, from multiple small decisions;

• Ecological, adaptive & systems analogies.

6 Sept 2016



TRANSACTIONAL

ENVIRONMENT

COMPANY

CONTEXTUAL

ENVIRONMENT

Geo-politics

Finance Commerce

Economics Legislation

DemographyEcology

Technology

Slide 9 of 32


Broken promises and confused perceptions

• Exploration increasingly affected by the

‘contextual environment’;

• Financial (affecting funding),

environmental and socio-political

(affecting access) issues now much more

important;

• Exploration and mining suffers from poor or

mixed perceptions;

• Not helped by a track-record of broken

promises – financial, environmental and

socio-political;

• Reduced support for exploration from

financiers, employees and communities;

• Social licence and commercial licence to

operate under threat (Andrews et al., 2016).

6 Sept 2016


Why the wealth of

Africa does not make

Africans wealthy

- CNN, 22 April 2016

BHP, Vale joint

venture boss in Brazil

‘environmental crime’

probe

- The Australian, 14 July 2016

Junior explorers under pressure as commodity price malaise deepens

- Sydney Morning Herald, 27 Sept 2015

One in three

geologists

unemployed or

underemployed- ABC, 16 Feb 2015

Slide 10 of 32


Exploration has ‘evolved’ but is ‘shrinking’

MOVES AWAY FROM CONSTRAINTS:

• Unplanned reaction to a bigger, fast-changing,

complex and inherently unpredictable world;

• Traditional ‘rationalist’ approach impossible as

too many important ‘contextual environment’

constraints are beyond explorers control;

• Transactional environment (and places to

explore) seems to be shrinking;

• Different rules and contexts around the world

means explorers have to re-learn the strategic

environment every time they go somewhere new;

• Exploration is paralysed by the complex,

shrinking transactional environment.

6 Sept 2016



TRANSACTIONAL

ENVIRONMENT

EXPLORER

CONTEXTUAL

ENVIRONMENT

Geo-politics

Finance Commerce


DemographyEcology

Technology

Slide 11 of 32


THE CAPABILITIES APPROACH:

TOWARDS ‘BIG’ EXPLORATION


6 Sept 2016



A strategic middle way can be charted

AIMS TO UNCONSTRAIN A KEY PART OF THE

STRATEGIC ENVIRONMENT:

• Known as ‘processual’ strategy, based on internal

capabilities;

• Aim is to reclaim part of the contextual

environment by extending your transactional

environment – both evolutionary and ‘controlling’;

• Key strategic skills are perception, institutional

memory and adaption (i.e. learning

organisations) – diversity is key;

• Scenario planning is an important strategic tool;

• Analogous to living organisms – adapting and

specialising in each new environment.

6 Sept 2016



TRANSACTIONAL

ENVIRONMENT

COMPANY

CONTEXTUAL

ENVIRONMENT

Geo-politics

Finance Commerce


DemographyEcology

Technology

Slide 13 of 32


Is there a middle way for exploration?

AIMING TO UNCONSTRAIN AREAS WE CURRENTLY

CANNOT EXPLORE:

• Build appropriate processes and capabilities in

exploration companies / teams;

• Turn the key challenges into new opportunities;

• Currently ‘constrained’ areas for exploration (both

physical and conceptual) are the next ‘new’ search

spaces;

• Diverse, adaptive, learning teams / companies that

can operate in many ‘new’ environments;

• Scenario planning could be a useful tool for

learning how to understand and respond to new

exploration environments and ‘search spaces’.

6 Sept 2016


Based on: Van der Heijden, 2005; Ramirez & Van

der Heijden, 2007; Ramirez & Wilkinson, 2016

TRANSACTIONAL

ENVIRONMENT

COMPANY

CONTEXTUAL

ENVIRONMENT

Geo-politics

Finance Commerce


DemographyEcology

Technology

Slide 14 of 32


Technology & skills are influenced by context

• Technology and technical skills sometimes

seen as of limited use in tackling the ‘non-

technical’ challenges facing exploration;

• However, technology and skills do not exist in

a vacuum – they interact with society;

• Exploration technology and skills (in the

transactional environment) are thus

influenced by the contextual environment;

• Other industries have effectively used

technology and skills to improve the industry

social and commercial licence:

– Reduce impact on society;

– Resolve societal / environmental problems;

– Increase economic / social well-being;

– Attract ‘talent’ to the industry;

– Provide better returns to financiers.

6 Sept 2016



Slide 15 of 32


Can technology & skills improve our reputation?

• Aim of the scenarios workshop emerged as:

– to investigate the interaction of technology

and skills in exploration and mining with

wider society;

• The key question was:

– Can technology and skills be used to

improve exploration industry reputation,

support and access, by targeting

economically viable, yet socio-politically

and environmental acceptable deposits?

• Such an approach could:

– Reduce exploration’s impact on society;

– Resolve societal / environmental problems;

– Increase economic / social well-being;

– Attract ‘talent’ to exploration;

– Provide better returns to financiers from

exploration.

6 Sept 2016



Slide 16 of 32


THE SCENARIOS: TECHNOLOGY,

SKILLS AND SOCIETAL SUPPORT


6 Sept 2016



A Tale of Two Peoples: Trapped in a Cycle

• Starting from a divided society:

– Wealthy, educated urban elite;

– Poor & uneducated in regions working in primary industries;

– Mining & exploration professionals are part of the urban elite;

• The elites control society and resources:

– Use technological sophistication and education to control societies

resources, inc. mines;

– Resources extracted at lowest cost possible to provide cheap goods for

urban elite;

– Mining and undesirable activities occur away from the urban elite,

impacting only on the regional poor;

• The division leads to revolution:

– Eventually the regional poor rise up and take control;

– Mining industries and financiers are destroyed;

– Employees are endangered;

• The cycle begins again:

– The regional poor have to resort to artisanal mining;

– Eventually, technology advances and a new elite emerges…

• An “extractionist” society:

– Society focused on extracting existing resources, rather than

discovering new resources;

– Malthusian – Fighting over ‘limited’ resources

– Akin to “The Hunger Games”.

6 Sept 2016


Image: The Hunger Games

Slide 18 of 32


iWorld: Breaking the Cycle

• Starting from an open society:

– Open use of technology and innovation;

– Global collaborative projects and research;

– Global democratic institutions;

– A positive feedback loop is created with technology and innovation driving

wealth creation and distribution;

– Society becomes wealthier, more educated and technologically

sophisticated as one;

• The mining industry is a key part of society:

– The mining industry benefits from the technological; sophistication and

innovation;

– Mining is simultaneously more profitable, safer and with a reduced

environmental and socio-political footprint;

– Mining is an important, sophisticated industry able to attract the best talent;

– Mining links local operations with global ambitions so is a key part of the

socio-economic ladder – everyone has a chance to succeed;

• Humanity rises to new highs:

– A global, united, open, sophisticated society is able to take on colossal

projects, perhaps even conquering space… [where mining is also key]

• An “explorationist” society:

– Society focused on discovering and developing resources;

– Human ingenuity is essentially infinite, so global resources are also seen

as infinite;

– Akin to “Star Trek”.

6 Sept 2016


Image: Star Trek

Slide 19 of 32


Towards ‘BIG’ exploration

• Capabilities required for the “Two Peoples” scenario:

– Ability to communicate and work with different local

communities, across a differing and fractionated world;

– Ability to locally adapt technologies and innovations as new

ideas do not travel across a divided society;

• Capabilities required for the “iWorld” scenario:

– Ability to collaborate at a global-level with multiple

government, industry and academic stakeholders;

– Ability to adopt fast-evolving new technologies and

innovations which sweep across an open access world;

6 Sept 2016


Both scenarios are fantastical, but contain important lessons for the exploration industry:

• Strategically sophisticated explorers are able to operate in both, recognise which environment they are in, and apply the relevant capabilities;

• This is the process or capability orientated strategic approach to the future of exploration;

• Explorers can generate extra ‘shared’ value for society and their corporate owners:

– Via minerals discovery (aka ‘small’ exploration); but also:

– As technology and innovation ‘hot houses’ using the small, focused, fast-moving, adaptive teams typical of the exploration industry;

– As first contact with key stakeholders be these local communities, or local, national or international government;

This is ‘BIG’ exploration (Trench, 2016)

Slide 20 of 32


THE NEXT STEP:

TRANSFORMATIVE EXPLORATION


6 Sept 2016



Even the best are vulnerable to collective liability

• An explorer’s [or miner’s] reputation [its social and commercial licence],

however, is affected by the ‘broken promises’ of every player in the industry

and the industry as a whole;

• When environmental disaster, social injustice, financial failure or employee

negligence occurs everyone in the industry finds their reputation damaged

and their social and commercial licence diminished;

• As such, even ‘best practice’ BIG explorers would remain vulnerable to

collective industry liability over ‘broken promises’ – their access to new

opportunities would be as diminished as everyone elses;

• Therefore there is a need to move forward together as an exploration

industry – together doing BIG exploration;

• At this stage the workshop began to progress from simply a strategic scenario

planning workshop [generating outputs useful to individual exploration teams

and companies] to transformative scenario planning [aimed at changing the

exploration industry as a whole for the better].

6 Sept 2016


Influenced by: Kahane, 2012a, 2012b

Slide 22 of 32


Overcoming collective vulnerability

• The two scenarios are linked:

• “iWorld” is what happens when the cycle trapping us in the

“Two peoples” scenario is broken;

• The “iWorld” scenario is clearly preferable;

• In the “Two peoples” scenario ‘small’ exploration would be

the default strategy;

• The aim should be for explorers to move from the “Two

peoples” scenario to the “iWorld” scenario – this is done via

‘BIG’ exploration;

• However, due to the collective liability of ‘broken promises’

all explorers must move towards ‘BIG’ exploration;

• Otherwise we will be dragged back to ‘small’ exploration

and the “Two peoples” scenario;

• Collective ‘BIG’ exploration becomes ‘TRANFORMATIVE’

exploration involving the whole industry.

6 Sept 2016


A Tale of Two Peoples

“Trapped in a cycle”

iWorld

“Breaking the cycle”

Slide 23 of 32


Towards ‘TRANSFORMATIVE’ exploration

Local “Two Peoples” scenario

Local “iWorld” scenario

6 Sept 2016


Both scenarios exist at different places and times in the present world

‘Small’ exploration ‘BIG’ exploration

Global “iWorld”

‘Small’ exploration ‘BIG’ exploration

Collective ‘BIG’ exploration aka ‘TRANSFORMATIVE exploration

Slide 24 of 32


But how?

• Collective ‘TRANSFORMATIVE’ response to shrinking exploration

opportunities is the only way to mitigate the collective liability of ‘broken

promises’;

• Additional skills likely to be required by explorers:

– Technology adoption and adaption;

– Major global collaboration and local authenticity;

• Areas of knowledge required by a future explorer:

– Focused knowledge (of exploration);

– Inter-disciplinary knowledge of the technical and non-technical aspects of

mining (the ‘transactional environment’)

– Broad knowledge of the world beyond mining (the ‘contextual

environment’)

– The ability to connect all of this together (systems and scenario thinking)

• We need to train exploration professionals more broadly and create

broader skilled, more diverse exploration teams;

• This will require the efforts of individuals, companies, educators and

professional organisations: How can the AusIMM help?

6 Sept 2016


Focused

Knowledge

Inter-disciplinary

Knowledge

Broad

Knowledge

Systemic

Thinking

Source: Sykes & Trench, 2014b

Slide 25 of 32


CONCLUSIONS


6 Sept 2016



TRANSFORMING EXPLORATION

• Traditional exploration was rationalist – travelling where we wanted in the world, and using whatever technology

and skills were needed to unveil new deposits;

• However, exploration technology and skills have become constrained by many external factors – economic,

environmental, socio-political etc;

• We need to turn these constraints into opportunities – these are new exploration search spaces so important

exploration opportunities;

• Diverse teams and a scenario mindset are required to learn about and adapt to these new search spaces;

• Technology and skills can be used to improve industry reputation and open up new search spaces, by helping

discover and develop deposits that are economically, environmentally and socially viable;

• Future explorers (BIG explorers) will be the first contact with communities, securing social licence;

• Future explorers (BIG explorers) will act as technological hot houses attracting the best talent to the industry;

and acting as a ladder for economic and social elevation;

• However, the mining industry remains collectively vulnerable to ‘broken promises’ which affect everyone’s

reputation – even the best, BIG explorers;

• As such we need to transform the whole exploration industry, so that everyone explores in a ‘BIG’ way, and the

whole search space (or transactional environment) increases – TRANSFORMATIONAL exploration.

6 Sept 2016



PRESENTATION FUNDED BY:

6 Sept 2016


www.thinkercafe.orgwww.cet.edu.au www.uwa.edu.au

Slide 28 of 32

THANK YOU

CONTACT DETAILS

John P. Sykes: [email protected]

Allan Trench: [email protected]

T. Campbell McCuaig: [email protected]

Tim Craske: [email protected]

Joe Dwyer: [email protected]

Naren Subramaniam: [email protected]

Siobhan Sullivan: [email protected]

Will Turner: [email protected]

AusIMM New Zealand Branch Conference

Wellington, New Zealand: 4-6 September 2016


SCENARIOS TEAM

6 Sept 2016


Team photo courtesy of Will Turner

Slide 30 of 32


SCENARIOS TEAM

Investigators

• John Sykes: Centre for Exploration Targeting (CET),

University of Western Australia (UWA)

• Allan Trench: Business School / CET, UWA

• Campbell McCuaig: BHP Billiton / CET, UWA

Participants

• Aida Carneiro: Mining Engineering, UWA

• Aaron Colleran: Evolution Mining

• Tim Craske: Geowisdom

• Liz Dallimore: KPMG

• Deon deBruin: Diamond Indicator Minerals

• Edoaldo Di Dio: Calibre Projects

• Joe Dwyer: HiSeis

• Chris Gonzalez: CET, UWA

• Paul Hodkiewicz: Anglo American

• Amy Imbergamo: Environmental Science, UWA

• Heta Lampinen: CET, UWA

• Sandra Occhipinti: CET, UWA

• Narendran Subramaniam: Transmin / Business

School, UWA

• Siobhan Sullivan: Plant Biology, UWA / Botanic

Gardens & Parks Authority of Western Australia

• Daniel Sully: Teck

• Marcus Tomkinson: MMG

• Will Turner: Independent Geological Consultant

• Stanislav Ulrich: AngloGold Ashanti

• Wenchao Wan: Chemical Engineering, UWA

Guest speakers

• David Groves: CET, UWA

• Martin Lynch: Author “Mining in World History”

• John Southalan: Law School, UWA

• Jessica Volich: BHP Billiton

6 Sept 2016



REFERENCES

This presentation

• Sykes, J.P., & Trench, A., 2016, Strictly Boardroom: The light and dark side of education and technology, MiningNewsPremium.net, 4 July:

http://www.miningnews.net/insight/strictly-boardroom/the-light-and-dark-side-of-education-and-technology/

• Sykes, J.P., Trench, A., McCuaig, T.C., Dwyer, J., Subramaniam, N., Sullivan, S.T.M., & Turner, W., 2016, Transforming the future of minerals

exploration, AusIMM New Zealand Branch Conference, Wellington, 4-6 September.

Other relevant references

• Andrews, T., Harman, J., Horgan, M., & Volich, J., 2016, ‘Future licence to prosper’ key to unlock mining sustainability, CET News and Events, 19 February: http://www.cet.edu.au/news-and-media/news/news-

details/2016/02/19/future-licence-to-prosper-key-to-unlock-mining-sustainability

• Kahane, A., 2012a, Transformative scenario planning: changing the future by exploring alternatives, Strategy & Leadership, 40 (5), pp 19-23.

• Kahane, A., 2012b, Transformative scenario planning: working together to change the future. 168p, Berrett-Koehler Publishers, Oakland, CA.

• Ramirez, R., & Van der Heijden, K., 2007, Scenarios to develop strategic options: a new interactive role for scenarios in strategy. In: Scenarios for Success, Sharpe, B., & Van der Heijden, K., eds, pp 89-119, John

Wiley & Sons, Chichester, UK.

• Ramirez, R., & Wilkinson, A., 2016, Strategic reframing: the Oxford Scenario Planning Approach. 242p, Oxford University Press, Oxford, UK.

• Trench, A., 2016, Strictly Boardroom: Towards big exploration, MiningNewsPremium.net, 11 January: http://www.miningnews.net/insight/strictly-boardroom/towards-big-exploration/

• Van der Heijden, K., 2005, Scenarios: the art of strategic conversation. 2nd ed. 356p, John Wiley & Sons, Chichester, UK.

Other related work by the authors

• Sykes, J.P., & Trench, A., 2014a, Chapter 14: Finding the copper mine of the 21st century: conceptual exploration targeting for hypothetical copper reserves. In: Special publication 18: Building exploration capacity

for the 21st century, Kelley, K.D., & Golden, H.C., eds, pp 273-300, Society of Economic Geologists, Boulder, CO.

• Sykes, J.P., & Trench, A., 2014b, Resources versus reserves – towards a systems-based understanding of exploration and mine project development and the role of the mining geologist, AusIMM International

Mining Geology Conference, Adelaide, SA, 18-20 August, pp 243-270.

• Sykes, J.P., & Trench, A., 2016, Using scenarios to investigate the long-term future of copper mining and guide exploration targeting strategies, AusIMM International Mine Management Conference, Brisbane,

QLD, 4-6 September, pp 265-289.

• Sykes, J. P., Trench, A., & McCuaig, T.C., 2017, The energy transition: a mining and exploration industry perspective, World Renewable Energy Congress, Perth, WA, 5-9 February, in press.

6 Sept 2016


http://www.miningnews.net/insight/strictly-boardroom/the-light-and-dark-side-of-education-and-technology/

http://www.cet.edu.au/news-and-media/news/news-details/2016/02/19/future-licence-to-prosper-key-to-unlock-mining-sustainability

http://www.miningnews.net/insight/strictly-boardroom/towards-big-exploration/