The Mining Industry has a Unique Set of Economic and Political Characteristics
There Has Been Strategic Convergence Around Operational Efficiency
Since the slowdown in the commodity super-cycle, the strategy has converged around cost-cutting and operational efficiency. Uniform technology, historically slow growth due to sector maturity, limited product differentiation and the attachment to price setting terminal markets has intensified this confluence. Industry leaders have focused on cost reduction, capital efficiency, productivity, exploitation of big data and divestment of non-core assets as their strategy to gain competitive advantage. At the same time, the search to acquire and prove new assets through new green field exploration has constricted, placing more weight on operational efficiency and exploration of existing brownfield sites than the development of unique portfolios of green field, high-grade assets. This focus is evidenced in the shrinking pipeline of quality development projects and limited discoveries.
Sustainable Competitive Advantage is a Result of Differentiation, not Operational Efficiency
Emerging and Frontier Markets Present the Greatest Opportunity to Own Unique Assets
However, These Jurisdictions Present Substantial Challenges
The Above Ground Risks of Operating in Emerging and Frontier Markets are Greater Than Technical Below Ground Competencies
The Competencies Which Will Address These Above Ground Risks Are Economic, Political and Social Sciences