What I saw and experienced during my visit to underground mines in the USA was something that I will never forget. What amazed me was the stark contrasts in mining practices in Australia vs the USA.

I thought that I would share some of those experiences for those that have not had the privilege of seeing both USA and Australian underground mines.

In Australia, the use of diesel engines in underground mines is widespread. In the USA, there are some states that ban them underground – for safety reasons.

Yet, there are some things that are allowed in USA mines that Australian mine workers would not believe.

During a visit to a Pennsylvanian longwall mine, the longwall superintendent was showing me the underground workings plan for their upcoming longwall move. He was showing me where they located all the equipment. As I looked at the plan, I was shocked to see Oxy/Acetelene shown in a cut-through. When I asked him, he told me that they always use Oxy/Acetylene underground to assist in longwall moves. It was common practice. When I told him that we don’t use it underground, he asked, “how else do you cut things that are stuck?”

A few days later, I was driving to a mine in West Virginia. I got off the Interstate, following the directions I was given. I was told that the mine was 12 miles along this road that ran beside a river. Try as I might, I could not locate the mine. Finally, I decided to try driving up to a property up on a hill that was behind a barb wire fence. To my surprise, that WAS the mine. There was a small sign tied to the fence with the mine’s name.

I was invited to go underground at the mine. I was taken underground where we got on the trolley-wire lomotives to go to a development panel. I was amazed at the arcing and sparking of the trolley wire system. Yet, later I was told that regulations don’t allow diesel engines underground due to safety reasons.

When I arrived at the development panel, I went into the crib room. I was shocked to see 110v extension leads with incandescent lights. The lights were the same type that your local garage uses – the type that have the plastic cages around one side of the light. When the bulb blows, simply change the bulb, right?

Another thing that amazed me was the work management philosophy.  In USA mines, if they need people to work overtime on Saturday, they simply declare it a work day and all employees are required to attend work for the day. If they don’t attend, they are considered absent just like any standard work day for them.

On my way back to Australia, I began to realise why the American mining company that I worked for in Australia was struggling with its industrial relations. They were simply managing workers the way they did in the USA.

Having lived and worked in both the USA and Australia, I understand how important it is to understand and adapt to local practices when doing business internationally.

The AMMA surveyed over 100 mining companies and found that:

• 55% of companies were likely to cut staff
• a further 21% of companies said that cutting staff was a possibility
• 15% suggested that they were not likely to cut staff
• 9% said they were not sure

These figures come on the heels of the news that in the last quarter, over 10,000 job cuts have been made, according to the AMMA.

This is amazing given a prediction less than 12 months ago suggesting that an additional 86,000 mine staff would be needed.

Calvin Close
Australian Mining Reference

This cut represents a $5 billion cut in export earnings for Australia.

You know that times are really not so good for the Australian mining industry when companies can take that sort of cut and be convinced that this is a good result for them.

When you look at the spot price hovering around US$60 per tonne, you realise that the companies might be right in their enthusiasm.

Although down 40% from last year, this year’s price will still be the second highest price paid by the Japanese companies. It is also still far higher than the contracted price just 2 years ago.

The slightly better that expected thermal coal prices being negotiated have given hope that the coking coal prices will not be hit as hard as previously expected.

Our iron ore producers are expecting a 30% cut in prices from the current US$100 per tonne.

Calvin Close
Australian Mining Reference