Blockchain in mining presentation
It was great to have a full hour to talk about blockchain technology and how it is applied in mining industry, the full recording can be viewed here
(61) Blockchain Technology in Mining – YouTube
ESG is all the rage in blockchain in mining
Article for Digibytes, April 2021
Where are our metals coming from? Blockchain technology helps mining industry to re-assure consumers about sustainability of critical metals
Even if most members of the general population don’t spare much thought for the mining industry, and some are even amazed when they learn that humanity is still engaged in this ancient-sounding activity – digging big holes, getting the metals out of the ground, the reality is – yes, humanity is very much engaged in mining. And the demand for metals is only growing, as cities grow and demand more iron for the steel constructions, more copper for electric cables, more exotic metals for electronics, the list goes on. So yes, we are mining metals more than ever, and mining continues to be a critical part of our life and it will carry on strong, even as we learn to re-cycle metals, still, there will be a lot of mining metals needed in our future – both immediate and distant.
But there is one change in the mining industry that I would like to focus on today. These days discussions around environmental impact, sustainability, and governance (ESG) dominate the discussions in the mining industry. As the world is debating transition to sustainable energy, what does it mean for mining industry? If the vehicle that is using solar-generated electricity but is made out of components that are produced in a way that is very harmful to nature – will environmentally-conscious buyer still want it? How big a deal is that? Big enough that Elon Mask recently announced that Tesla will be investing in mining lithium in Nevada and nickel in Indonesia 1. The reason for this move of Tesla into mining is two-fold – first – to secure the supply. Second – to be able to assure their customers that the metals that are going into making of environmentally-friendly vehicles are made of metals mined in environmentally – and socially – responsible manner.
Tesla is investing in Goro Mine to secure supply of nickel for the electric car batteries.
Influential mining billionaire, charismatic and almost supernaturally lucky discoverer of new supersized-deposits, Robert Friedland, recently highlighted the importance of ESG parameters for copper mining during CRU World Copper Conference3:
“Miners are used to cut-off grade and head grade and cash flow per share, but now there’s another whole parameter, which is, how are you producing that metal? Who’s benefiting? Who’s not benefiting? Is the benefit shared at a local level, with local people? Is it shared at a national level? Is it sustainable? What happens at the end of the mine life when you try to go away? What impact do you have on the water table? What impact do you have on training, and how sustainable is it?”
The concept is now emerging that metals’ price will depend not just on the supply-demand in the market, as before, but also the data on the ESG parameters associated with the production of the metal.
And this is where blockchain comes into force. Blockchain-supported tracking of where stuff is coming from has now transcended from tracking organic coffee, cotton, through tracking of diamonds, gold and cobalt into much wider array of metals. And the criteria that are being considered for tracking now are not just whether it is legal, and no child labour is involved, but also – what is the CO2 impact, what is social impact, what is a safety record associated with this particular mining location? The list keeps growing.
Rio Tinto, one of the major mining companies, has announced the launch of the first sustainability label for aluminium using blockchain technology. Digital sustainability label – similar to a nutrition label found on food and drink packaging will provide key information about the site where the aluminium was responsibly produced, covering ten criteria: carbon footprint, water use, recycled content, energy sources, community investment, safety performance, diversity in leadership, business integrity, regulatory compliance and transparency.
Circulor, fast-growing technology company is working with Volvo and Boeing, among others, providing the service they call “traceability as a service”, using blockchain as a foundation for tracking tin and cobalt from Democratic Republic of Congo, mica from Madagascar, nickel from South America. Most recent announcement: Circulor and Finnish Minerals Group are launching technology development to verify the origin data of minerals in the Electric Vehicle battery value chain as part of the Battery Passport.
“The traceability of mineral raw materials and the provision of information on their environmental and social impact and carbon footprint, for example, are key ways of improving the responsibility of the electric vehicle battery value chain. It also helps us promote the recycling of valuable metals and the competitiveness of raw material production in Europe,” says CTO of Finnish Minerals Group Jani Kiuru.5
In conclusion: environmentally- and socially-conscious manufacturers are demanding from miners to supply metals that are produced environmentally-responsibly and sustainably, and blockchain technology is beginning to play a key role in verifying the critical data in metal’s supply chain.
About us: KAMNI Chain Ltd. is a UK-based consultancy focussed on helping mining companies integrate blockchain solutions in their operations.
References
1 Tesla takes part in deal to take over controversial nickel mine in New Caledonia – Electrek
2 Tesla partners with nickel mine amid shortage fears – BBC News
3 https://www.northernminer.com/news/cru-world-copper-conference-friedland-on-the-new-world-order/1003830145/?ctname%3dCRU+World+Copper+Conference%3a+Friedland+on+the+new+world+order
4 Rio Tinto launches START: the first sustainability label for aluminium using blockchain technology
5 FMG press release | Circulor
KAMNI won the hackathon!
We did it! Congratulations to our mighty team on winning the Canadian Blockchain Supply Chain Association Hack the chain event!
Thank you to Christopher WelchM. Balandari ToroghiGustavo Hamu for putting together our solution for tracking mineral assay data on blockchain. Thank you for DLT Labs for allowing access to DL Asset Track platform to design our solution. It was an honour to present our idea alongside other great competitors. We are delighted that our efforts were so highly appreciated and we are looking forward to design many other blockchain-based solutions for the mining industry!
From the official Canadian Blockchain Supply Chain Association announcement:
“With high marks, Team Kamni Chain was the winner of the Tech Off! Kamni Chain demonstrated how blockchain creates immutable, transparent and auditable transactions of materials and data between all participants in the mining ecosystem.”
#blockchain#thankyou#miningindustry
Blockchain for mining in Australia
It was a great pleasure to present my vision of blockchain technology for mining industry for Australian audience – even if I had to do it at 5am! Thank you, Jessica Keast @ Geohug and all the friendly audience for you interest! Looking forward to follow up work together!
https://www.youtube.com/watch?v=Hl580fSRepk&feature=emb_logo
Mining and Blockchain fairytale presentation
My Mining and Blockchain fairytale – enjoy! Apparently there is even name for this genre – commercial storytelling. It was fun doing it, especially grateful for my son’s help with drawings.
#mining #blockchain
https://www.youtube.com/watch?v=yjwL-y01AdM
My latest piece on blockchain in mining, written for Team Blockchain newsletter, Digital Bytes.
Blockchain in the mining industry
Author Tanya Matveeva – https://www.linkedin.com/in/tanya-matveeva-763ba537/
It is a relief and a challenge to write about Blockchain applications in the mining industry for ‘non-miners’. And a responsibility. It is a relief because I will be talking about an industry I know well. It is a challenge and responsibility because mining has a bad name and, as a geologist, I feel this is very unfair and largely undeserved. The modern mining industry is not a dirty, backward business. What is not grown has to be mined. Have you ever stopped to think about it? It is true.
Modern mining is a sophisticated and complex industry, striving to use all the best available technologies to get better in every way – to be more efficient in providing essential metals and materials, to be less damaging to the environment, to be more beneficial to the communities where it operates and to be more ethical. It is with this last point where Blockchain technology is currently most applied in mining, so this is where I will start – the supply chain.
Tracing diamonds
The pioneers of Blockchain applications in mining are the diamond miners. The world has heard plenty about blood diamonds, but it is only a tiny proportion of the stones that are coming from conflict areas. Yet they taint the whole shiny business, where the majority of sparkles comes from huge, sophisticated mines equipped with the most advanced technology. So, two of the major diamond miners, De Beers and Alrosa, have dropped their age-long rivalry by working together to implement a Blockchain-based solution, aptly named Tracr (pronounced “tracer”). The results are most impressive.
Every stone coming from the mine (and you can imagine how many there are!) will now carry a unique digital certificate of origin which follows it from the mine, through to the place where the rough diamond will be cut into brilliant stone, on to the jeweller and, finally, to retail. An impressive 50% of all stones mined by De Beers will be on Tracr by the end of 2020. Together with the diamond you will now buy the whole verified story of this particular stone’s journey from the depths of the Earth – be it in South Africa, Namibia, Botswana, Russia or Canada – and into a sparkle in a ring. Another very important advantage of creating unique digital certificates for each and every stone is to eliminate trade in stolen diamonds – a plague affecting this high-value industry from it’s very beginning.
Tracing metals
Tracr, like many other Blockchain-based solutions, can also be run on a mobile phone. Some of the essential metals which go into mobile phones come from very challenging places, such as the dangerous artisanal mines in the Democratic Republic of Congo. Manufacturers of the phones and, more importantly, electric vehicles (EV) need one of these essential metals – cobalt – and they need to be assured that the cobalt in their products is not coming from the results of child or slave labour. Cobalt demand is expected to grow dramatically as it is an essential ingredient in the EV batteries. Each car EV requires 5-10 kg of cobalt and 60 percent of the global cobalt supply currently comes from the Congo. How are consumers assured that the metal in their product does not come from exploitative mines? Blockchain to the rescue.
Major mining companies, EV battery producers and car manufacturers have teamed up to implement an IBM Hyperledger Blockchain solution to track the origin of cobalt and other vital metals. Responsible Sourcing Blockchain Network (RSBN), initiated by RSC Global, is now uniting cobalt mining and trading company Glencore, Huayou Cobalt supplier (China) and battery producer LG Chem (South Korea), as well as Volkswagen, Volvo, Fiat Chrysler and Ford motor companies, which will be using customised Blockchain application to track cobalt through its RSBN’s complex journey from the mine to consumer product. The same system will later be adjusted to add other essential metals, such as lithium and nickel.
Metals trade
Two global mining titans are now selling iron ore using Blockchain. Rio Tinto and BHP have partnered with the largest steel producer, Baosteel (China) to use the Contour platform, based on R3’s Corda Blockchain, in order to complete transactions in yuan-based trade. Contour affords digitisation of the letter of credit process, which brings many benefits. Originally, paper-heavy processes included shipment of important documents by courier, resulting in long delays, risks of loss and creating opportunities for fraud. Digital documents, once on a Blockchain, are tamper-proof, transmitted immediately and, especially during the COVID-19 pandemic, have been particularly important in making trade processes reliable and efficient.
different use for Blockchain technology is currently being tested by Russian mining giant – Norilsk Nickel. Despite the name, the company is not only just a nickel miner, but is also major producer of platinum, palladium and copper – all essential elements supplying the EV revolution. Norilsk Nickel plans to boost the output of metals, which will require annual investments of $2.5 billion through 2022. This need for investment will push the company to seek alternative, more efficient solutions to the trade side of business.
Norilsk Nickel is working with commodity trader, Trafigura, together with metal refiner Umicore and financial and logistical solutions firm Traxys, to use Atomyze (a Hyperledger-based Blockchain platform) in order to create and trade metal-backed tokens. First tokens will be backed by palladium, cobalt and copper. In the first year Norilsk Nickel aims to tokenize 10% of the overall sales volume. One of the main goals is reduction in funding costs by the means of these “digital assets” and, as a result, a chance to free up the turnover capital.
Blockchain-on…
Every mining project is really a combination of many subprojects: there is mine construction, so space for smart contracts; then there are the logistics of moving the materials (and who has not yet heard of Blockchain use in tracking containers?); finally, there is the trading of intermediate and final products. Every stage has ample room to welcome Blockchain technology in order to improve efficiency and transparency and to move mining into the next distributed digital era. The challenge is to connect this resource (heavy, data-heavy and just… heavy) industry with the right solution-providers for the benefit of all involved, and for humanity as a whole. To achieve this, the mining industry must, and does, look at the development of Blockchain applications in other industries such as construction, logistics, real estate and agriculture and, of course, our close relative forever walking a stride ahead of mining – the oil and gas industry where Blockchain is, by now, well-established in many areas, adjusting and developing already existing solutions for mining’s specific needs.
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