11 May Iván Arriagada, Executive President of Antofagasta Minerals Plc: “Mining investment is going to be an important engine for recovery from this crisis, as it has been in other times”
During the Forum “The risks of mining in the time of Covid-19”, organized by EY and the Center for the Copper and Mining Studies, Cesco, its executive director Alejandra Wood, interviewed in-depth the executive president of Antofagasta Minerals Plc, Iván Arriagada, on the changes and learning that the pandemic leaves in the most important industry in the country.
The focus is on the health and safety of both its workers and the communities near its sites. This slogan has turned out to be key for Iván Arriagada, CEO of Antofagasta Minerals, when explained how the company is facing the current Covid-19 pandemic, and that it has had adverse effects on both the global and local economies.
“We had a good 2019 in terms of security, in our results, and obviously this means a complete change of priorities and focus,” Arriagada explained to Alejandra Wood, executive director of Cesco, within the framework of the Forum “The risks of mining in the days of Covid-19”.
In this sense, the executive explains that the company has relied on its corporate values charter where it was defined that “the first thing was to seek, preserve and ensure the health of our teams, our workers, and also the communities around us. Based on that we have made all the decisions that we have been taking, and responding to this challenge.”
Under this premise, the company has adopted measures to mitigate contagion, and to guarantee operational continuity, always in line with the health of workers, and thus generate well-being and social development. “The worst thing is that the health crisis is accompanied by an acute, deep social crisis, and we believe that is key to maintain our operations, always subordinated to the criteria of health”
The executive highlighted that this is a time where teamwork is required, and where it is required to look at the long term, in addition to responding to short-term emergencies. “Priorities change and that is good. Once the contingency is over, we are going to look up a little and see the medium term, what is the new normality, how is the new world that we have to live in.”
The lessons of this new context
Arriagada explained to the more than 800 attendees who followed the online forum, that although it has been a period that no one was prepared to face, it has been a learning experience for the company to consolidate health as a fundamental axis within the mining business. “Mining has had a very particular focus on safety, but in reality, safety has to fully integrate aspects of health and, therefore, one of the lessons, I would say it is to more actively integrate those aspects into our activity.”
“This is here to stay. We have this new reality, where we must gradually integrate health practices and protocols into our activities: social distance, repowering the use of personal protective equipment, such as face masks, hand sanitizer, “said Arriagada, who added that all these behavioral changes add up to this importance must be fully integrated into the way they work, to maintain the operation in this new context.
“There has been a joint effort with the communities and with the authority. I believe that this reinforces how important is the insertion of mining in the territory where it operates, and how important it is to build a shared vision on how to solve both short-term and long-term problems and contingencies,” said the executive.
Glimpsing the future
The eyes are on the contagion containment measures taken by companies in the mining sector, and the impact they will have on production. Among the measures adopted in Chile, there has been a decrease in staffing, which has reached an average of 35%, and the stoppage of various projects.
This is the case of Antofagasta Minerals, which, to reduce the number of on-site workers, decided to suspend the Complementary Infrastructure Project (INCO) of Minera Los Pelambres. “We see it as a transitory action. The idea is to resume construction of that project as soon as possible,” said Iván Arriagada.
In this line, the executive assured that the necessary conditions are being created for this to happen, guaranteeing the minimum health conditions for the workers and the communities where the project is developed, which, according to the company’s estimates, it would be carried out in 120 days from the suspension.
About the market, Arriagada was emphatic in pointing out that he does not consider that there are structural changes in the copper market due to the coronavirus. “I think it is a contingency that is going to have a space of time in which it is going to take place, it may be one or two years, but the vision and perspective of the market in the long term have not changed.”
Taking this into consideration, the CEO of Antofagasta Minerals was optimistic: “mining investment is going to be an important driver of recovery from this crisis, as it has been in other times when there have been other crises of a different nature in Chile. I think the challenge today is that we return to the construction of these projects as soon as possible, putting health as a priority, and integrating these protocols into construction activities, when conditions are right.”
In this context, Arriagada explained that the measures to reduce the endowment and telework have allowed them to maintain the projection estimated by the company for this year in productive terms. “Our production range is between 725 and 750 thousand tons of copper. And with these adjustments, what we are projecting is that we are going to be within that range but at the bottom of it. To the extent that we can resume, and once we increase our endowment, we will mitigate that effect.”
Mining and work post Covid-19
The pandemic has accelerated changes in the way we relate and work in a dizzying way. In the case of mining, the decrease in the workforce and the readjustment of the work plan designs, social distancing, the use of masks and the increase in teleworking, have been essential to maintaining the operation.
This operational continuity, for Arriagada, will be essential to face the complex moment the country is going through, both economically and socially. “The reactivation of our activity has a very important role to play in the communities, from the perspective of supporting entrepreneurs, small local producers, and in recovering employment.”
“In that sense, I think we have a responsibility as an industry to do well,” added the executive. “We have to gradually resume our activity, to be a pillar that allows the social crisis to be mitigated and minimized, so I am in this sense optimistic about the role of the industry in the economy of the future.”
For Arriagada, all this goes hand in hand with prioritizing the health and safety of workers, which will be a structural change in all industries, with the technologies at hand. In this sense, the executive president of the company highlighted that the incorporation of new technologies associated not only with teleworking but also with automation or remotization, can be accelerated, improving the conditions of workers.
“What does that mean in terms of employment,” Arriagada explained. “I think we will be migrating from skills and roles, and that this will not necessarily mean less employment, but that the positions and roles will be different”, adding that the great challenge for the industry is to work with its teams, workers and union leaders, to carry out this transformation so that people will be at the center of the process.
“Our roles will not be the same in three or four more years, and what we need to do is work together to prepare for that transition.” The executive noted that these technologies, accelerated in their use by the pandemic, offer an opportunity. “The focus should be on each one of us acquiring these skills to perform in a world that, from now on, will have different work practices,” he concluded.