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The roots of mining start from the Stone Age, some 5000 years back but with direction and momentum generated the processes have changed to a great extent. Though this sector is still in a developing stage, it is embracing innovation and new technologies. One such technology for which the mining industry has the opportunity to be a fast adopter is Blockchain technology.
Blockchain technology was introduced about a decade back and its founder, Satoshi Nakamoto described this technology as a ‘chain of digital signatures’. Most industries especially financial institutions are successfully adopting Blockchain technology in their existing systems. Blockchain in the mining industry is quickly and effectively making its advent, and this is majorly due to the array of benefits provided by the technology.
Areas of Application of Blockchain in the mining industry
The features of Blockchain technology provides numerous cases in mining. Blockchain can transform the mining business processes with the following applications:
1. Engineering, and handover of mine sites
The engineering and construction businesses generate complex engineering information in formats that are structured and unstructured. Managing such an extensive burden of information increases costs, and delay in the management of information can lead to a fall-back of enterprise goals.
Blockchain technology can help make the transactions traceable and ease the complex processes of management of regulations and standards. Efficient management of database ensures trust and work compliance.
2. Mining lease management
The mining industry has to manage the documents related to resource and reserve estimation, exploration, mine design, and planning processes. The mining industry wants a more regulated mechanism of custody and control with proof of approval embedded on the documents.
Blockchain technology helps to improve the traceability of the reserve estimation for stock management and better traceability for inventory management through blockchain. Blockchain can also utilize the concept of smart contracts which can be extended to external entities.
3. Mineral provenance
Manufacturing organizations are very much concerned about the provenance of minerals. Tracking the source of minerals becomes important to ensure the legal trade of minerals. Many manufacturing companies have decided not to use minerals that are being supplied from conflict zones or mining companies that do not follow proper environmental standards.
Blockchain technology has a broad business network of assets and transactions that help to track the mineral supply chain.
4. Supply chain
Blockchain technology can be used to track the materials in the mining value chain from the blocks and concrete to metal. This information can be systematically shown from the provenance to the final consumer. Blockchain also helps to provide transparency to its mining partners, as most of the mining industries have fragmented supply chains that have transactions spread across multiple parties.
Blockchain leads to the automation of invoice reconciliation and assignment of the quality certificate that the customer sends to lab testing for reassurance. This whole process integrates Blockchain and leads to better supply chain management.
5. Mining equipment OEM
Mining equipment OEM resources the parts from various places and works together in an environment that is high performance. When critical failure situations occur in a supply chain, the only source for vendor information is OEM. Getting information from OEM can be a tedious and cumbersome process.
When Blockchain is attached to the relevant part of the OEM contract, the authorization to view the information of that part is easily received. Through blockchain systems, both clients and OEM can work together and are assured of the quality of parts and systems used.
In conclusion, the potential benefits that Blockchain presents for transparency and traceability along the supply chains are numerous. Blockchain technology allows the data to be validated and stored as an immutable ‘block’. From helping the participants to validate the transactions to building trust in transactions, Blockchain technology can make the supply chains more efficient and reshape the overall mining industry.
We understand that implementing suitable Blockchain architecture can be a daunting task. Debut Infotech hosts one of the best team of Blockchain Supply Chain Developers that help you ease the Blockchain implementation process.
Get in touch with us now to know more about our Blockchain solutions.