MIN­ING MONEY HELPS COPE WITH VIRUS

The Australian Mining Review - - PUMPS -

These are chal­leng­ing times, as the world comes to grips with the ef­fects of COVID-19. Ev­ery re­source sec­tor has been af­fected, but most com­pa­nies are mak­ing ef­forts to con­sol­i­date and pre­pare them­selves for the re­cov­ery phase that will oc­cur once the catas­tro­phe has passed.

Aus­tralian Min­ing Re­view in­ter­viewed the com­pany’s man­ag­ing di­rec­tor, War­wick Lorenz, about how he views the sit­u­a­tion.

Q: What’s the con­nec­tion be­tween min­ing and this hor­rific pan­demic?

A: I haven’t heard of any­body blam­ing the min­ing in­dus­try for the coro­n­avirus. No doubt sooner or later, some­body from a new age po­lit­i­cal party will find a way to make a con­nec­tion, es­pe­cially if it has some­thing to do with coal. How­ever, min­ing does have a very strong con­nec­tion, not with the disease it­self, but rather with the so­lu­tion.

Q: How can the min­ing in­dus­try solve the corona prob­lem?

A: That’s pretty sim­ple. Most of our pop­u­la­tion don’t un­der­stand the true sig­nif­i­cance of the Aus­tralian min­ing in­dus­try. Of Aus­tralia’s 25m pop­u­la­tion, it’s hard for most of them to com­pre­hend that the min­ing in­dus­try, em­ploy­ing around 230,000 peo­ple, can con­trib­ute so sig­nif­i­cantly to the Aus­tralian econ­omy.

Q: In what way is it sig­nif­i­cant?

A: The answer has to be found in the ABARE re­port that tells us just how im­por­tant min­ing is. If you take min­ing, and re­sources in­clud­ing oil and gas, you see that 73pc of our prod­uct ex­port comes from that in­dus­try. The value is $285 bil­lion, so you can imag­ine the im­pact of it on our bal­ance of trade.

When I am try­ing to ex­plain this to some­body, I sug­gest to them that with­out the min­ing in­dus­try, the im­ported mo­tor ve­hi­cle they’re driv­ing would only be around 27pc of the size of the cur­rent ve­hi­cle. I do that to make a point. The re­al­ity is, we’d all be driv­ing clunkers if not for min­ing!

Q: In what way does that re­flect on the coro­n­avirus? How can it beat the disease?

A: In the last weeks, we’ve seen the Mor­ri­son gov­ern­ment do a bril­liant job of tak­ing prompt ac­tion to beat the pan­demic.

Every­thing that has been done (apart from the Ruby Princess) is text book ac­tion, taken ex­pe­di­tiously to halt the disease in its tracks. It doesn’t just take will and com­mu­ni­ca­tion, it takes money! That’s where the min­ing in­dus­try comes in.

Q: So you’re say­ing that’s where the gov­ern­ment is get­ting the money from to try to kick­start the econ­omy? Even when we’re hav­ing to self-iso­late and in many cases, work from home?

A: Well, all of us who pay taxes are con­tribut­ing to that but the sup­port schemes the gov­ern­ment im­ple­mented for peo­ple who are un­avoid­ably los­ing their jobs, with money pump­ing into the econ­omy to get peo­ple spend­ing, even if it’s buy­ing lat­tes, is all about get­ting money mov­ing. Where the min­ing in­dus­try comes in is that huge im­pact on the Bal­ance of Pay­ments made by our ex­ports of re­source in­dus­try prod­uct.

Q: Are you sug­gest­ing that the min­ing in­dus­try tax and roy­al­ties are what is giv­ing the gov­ern­ment that abil­ity?

A: No, not en­tirely of course. Peo­ple who work for the min­ing in­dus­try ob­vi­ously pay taxes, just like you and I do. The point is, when it comes to the Bal­ance of Pay­ments, it’s the min­ing in­dus­try that pro­vides a pos­i­tive re­sult. In other words, pay­ing for all those im­por­tant mo­tor ve­hi­cles, fridges, earth­mov­ing and min­ing equip­ment; even agri­cul­tural trac­tors, com­bine har­vesters and sprayers, as im­ports, are com­pen­sated for by the min­ing in­dus­try’s ex­ports of raw ma­te­ri­als.

Q: Surely ev­ery­body knows that?

A: No, it doesn’t work like that. About 65pc of our en­tire pop­u­la­tion lives in four cities. Their minds are on other things, and they blindly ac­cept the bounty pro­duced by farm­ers and min­ers that pro­duce the ex­port in­come that buys us the com­modi­ties men­tioned ear­lier. Be­lieve it or not, buy­ing those im­ported com­modi­ties, and the mar­ket­ing of some of those com­modi­ties, em­ploys an aw­ful lot of peo­ple and at the same time, they all pay tax too. It’s all part of the mighty wheel of the econ­omy.

Q: So how does that im­pact on beat­ing the virus?

A: It’s sim­ple. With­out money, we can’t beat COVID-19. With­out the fund­ing avail­able, the Fed­eral Gov­ern­ment couldn’t do the things they’ve done in the last weeks. Sure, we’re go­ing to get our­selves into debt. Ab­so­lutely, we will lose the chance of sur­plus for maybe one year or two years, maybe five years, maybe longer! But that doesn’t mat­ter. What we’re talk­ing about is keep­ing peo­ple alive. It is a great stroke of luck that we are an is­land con­ti­nent. Keep­ing our borders safe is not as dif­fi­cult as Asia, Europe or even the United States. No won­der they call Aus­tralia the “lucky coun­try”!

Q: So what does Aus­tralian Pump In­dus­tries have to do with all of this?

A: Aus­tralian Pump is one of the very few Aus­tralian de­sign­ers and man­u­fac­tur­ers of ma­chin­ery specif­i­cally tar­get­ing earth­mov­ing, in­fra­struc­ture, min­ing and gas projects. Our prod­ucts are used widely through­out those in­dus­tries and our cus­tomers ap­pre­ci­ate the huge amount of Aus­tralian in­put in our equip­ment. Q: Are all the com­po­nents made in Aus­tralia?

A: Of course not. No­body makes diesel en­gines in Aus­tralia. No­body even makes petrol en­gines in Aus­tralia any­more. The way I un­der­stand it, we don’t even make lawn­mow­ers. No, we have to im­port our en­gines and we have to im­port some of the more so­phis­ti­cated pump kits, but we de­sign and match those prod­ucts and build them with Aus­tralian com­po­nen­try with Aus­tralian-sourced add-ons. That makes them more suit­able to the most de­mand­ing ap­pli­ca­tions than any other prod­uct in the world.

Q: How do you know? How do you com­pare other na­tions’ prod­ucts?

A: That’s easy. We know our com­peti­tors very well, whether they’re made in Ger­many, Italy, United States, Ja­pan or even South Amer­ica. It is a global en­vi­ron­ment and it isn’t hard to be up to date with what ev­ery­body is do­ing, if they’re sig­nif­i­cant in the busi­ness. Our prod­ucts are used in cop­per mines in South Amer­ica, gas projects on the bor­der of So­ma­lia and Kenya, cop­per mines in Mon­go­lia. Our ex­port depart­ment is very proac­tive, par­tic­u­larly in the min­ing ma­chin­ery busi­ness.

Q: How are Aus­tralian small and medium-sized en­ter­prises able to achieve that kind of pen­e­tra­tion?

A: Most of our best sales­men are Aus­tralian min­ing engi­neers who have ex­pe­ri­enced the prod­uct in Aus­tralia. They then wind up in mines all around the world sell­ing their skills and ex­per­tise to the ben­e­fit of multi­na­tional com­pa­nies that are ex­perts in se­lect­ing the right peo­ple, and the right prod­ucts. We owe a lot to the min­ing in­dus­try in Aus­tralia be­cause that’s where we learnt to make ma­chines that are dif­fer­ent!

We do a lot of re­search di­rectly with mines and we are al­ways di­a­logu­ing with mine op­er­a­tors, whether it’s coal, cop­per, gold or other ex­otic ma­te­rial like lithium. It’s from that we get the in­spi­ra­tion to im­prove our prod­uct. We keep adding value and for­tu­nately, as our vol­ume grows, we’re able to com­pen­sate for in­creased costs.

Q: Why can’t the in­ter­na­tional play­ers do that as well?

A: That’s a very good ques­tion. We’re aren’t quite sure about that be­cause we think in to­day’s world, although, we can reg­is­ter the de­sign, it’s very easy to em­u­late some­body who is be­ing in­no­va­tive. That way you don’t have to spend any money on R & D, you just copy. Nor­mally how­ever, the prob­lem is more to do with the level of mo­ti­va­tion needed to de­velop the copy.

Q: What do you mean by that?

A: Well, if the mo­ti­va­tion is to make money, rather than ac­tu­ally solve the prob­lem on a mine site, then you know the prod­uct will ul­ti­mately fail. It’s all about in­tegrity. The in­tegrity of the de­sign, the in­tegrity of the de­sign con­cept and tak­ing the trou­ble to un­der­stand ex­actly what the chal­lenges are. Some­times in­dus­tries can go on do­ing things in a sim­i­lar man­ner for decades with­out re­al­is­ing that there is a bet­ter way, a bet­ter prod­uct, a more ef­fi­cient way of do­ing things. We have worked to­wards sav­ing the min­ing in­dus­try a lot of money on main­te­nance costs over the years and will con­tinue to do that by pro­vid­ing the right prod­uct.

Q: What is it you ac­tu­ally do that helps the min­ing in­dus­try to be ef­fi­cient?

A: We just set out to make sure the prod­ucts last longer and have an easy ser­vic­ing ca­pa­bil­ity. Then we can back up those de­sign ideas with longer war­ranty than any of our com­peti­tors. For ex­am­ple, our unique Aussie Fire Chief in mine spec con­fig­u­ra­tion, is built like a tank but light enough to be car­ried by two men, comes with a five year pump end war­ranty. We nor­mally use Yan­mar diesels to drive them and we do that be­cause they also come with a two-year war­ranty.

Q: Do you get a lot of sup­port from your ven­dors?

A: You bet we do. Peo­ple at Yan­mar and Kub­ota have been very sup­port­ive over the years. They work with our prod­uct de­vel­op­ment, care­fully mak­ing sure that all the com­po­nents we use are match-tested to en­sure com­plete com­pat­i­bil­ity to en­gine ca­pa­bil­ity and pump per­for­mance.

Q: Does that ap­ply to pres­sure clean­ers as well?

A: Yes, that’s ab­so­lutely true. Our range of heavy duty “Ex­treme” mine spec hy­drob­lasters are ex­tremely pop­u­lar be­cause we care­fully matched them to Yan­mar water-cooled diesel en­gines. We build them into a frame with ei­ther a big high flow high pres­sure pump (one spec­i­fi­ca­tion is 4300 psi at 31 litres per minute), or the high pres­sure ver­sion. The big­gest we go is 500 bar (7300 psi). We will have a 700 bar range out soon!

Q: What you see as the fu­ture of this coun­try, once the coro­n­avirus has been beaten?

A: It’s all about sup­port­ing our pri­mary in­dus­tries. A huge pro­por­tion of our pop­u­la­tion lives in four cities. Well, 85pc of them live within 40km of the coast. In other words, the in­land is al­most as empty as it was when Arthur Phillip sailed into Syd­ney Har­bour 200 years ago. The re­al­ity is, we are on the way to be­ing the most ur­banised na­tion on earth.

That ob­vi­ously has to change, es­pe­cially with the world’s pop­u­la­tion head­ing for 8b; and within 50 years we will prob­a­bly be well on the way to 10b. All those souls have to be fed, but even more im­por­tantly, given use­ful things to do! Min­ing and agri­cul­ture are the heart­beat of this coun­try. Most peo­ple don’t know it. Agri­cul­ture could be as big as min­ing but there are ob­sta­cles. Q: What ob­sta­cles do you mean?

A: Well, the big one is water! Our water se­cu­rity in this coun­try is poor to say the least. Former Prime Min­is­ter Tony Ab­bott planned to do some­thing dra­matic about build­ing 100 dams, but un­for­tu­nately wasn’t around long enough to do it. That was costed at $30b, a frac­tion of what we’re spend­ing on the corona rem­edy from the Fed­eral Gov­ern­ment. Surely it is pos­si­ble to pro­vide water se­cu­rity for farm­ers with a se­ries of dams, chan­nels and re­con­fig­ur­ing the land­scape in or­der to pro­vide water se­cu­rity for farm­ers.

Q: Is there a con­nec­tion be­tween farm­ers and min­ers?

A: I think there is. I think that farm­ers and min­ers re­ally un­der­stand what makes this coun­try tick. They are the heart­beat of the econ­omy.

It’s the ex­port of their prod­ucts that pro­vides us with the abil­ity to im­port every­thing else we need. To be able to build Aus­tralia’s pro­duc­tion of agri­cul­tural prod­ucts for ex­port, be­yond the $60b per year now, is a joke with­out water se­cu­rity.

Q: Do you re­late to farm­ers?

A: Here at Aussie Pumps, we cer­tainly do. 90pc of our cus­tomer base is in re­gional Aus­tralia. We see towns dy­ing be­cause of lack of water se­cu­rity. We see and hear about more des­o­la­tion be­ing caused by the re­cent drought than there will be by COVID-19 in Aus­tralia.

Q: So, what’s the prob­lem?

A: It seems to be po­lit­i­cal will and not enough peo­ple who are pre­pared to fight for the bush.

Q: Do you have any al­lies for this pro­gram to pro­vide water se­cu­rity?

A: Try ev­ery farmer in the coun­try! Try ev­ery re­gional lo­cal gov­ern­ment body who had to truck in water dur­ing the drought. Try Twiggy For­est, Gina Rine­hart, Alan Jones and loads more. Dare I men­tion Barn­aby Joyce? He was fore­front in the 100 Dams Project!

Q: So drought-proof­ing Aus­tralia is go­ing to have some im­pact on the fu­ture of this coun­try?

A: It cer­tainly will. It will change de­mo­graph­ics, tak­ing pres­sure off the cities and pro­vide water for not just farm­ers, but also min­ers.

The min­ing in­dus­try needs a huge amount of water to make it work. We hear sto­ries all the time, like the prob­lems Ca­dia were hav­ing over strug­gles to get suf­fi­cient water to op­er­ate ef­fi­cient min­ing pro­cesses.

Q: If you had some way of chang­ing the way peo­ple think about min­ing and agri­cul­ture, what would you do?

A: First of all, I would tell the pop­u­la­tion the truth. With­out min­ing and agri­cul­ture, this coun­try would be broke and all the wel­fare pro­grams and emer­gency pack­ages would be nonex­is­tent.

Have you ever no­ticed that we have plenty of money to clean up af­ter a flood but not enough to build dams to pre­vent it? Try Rock­hamp­ton and Townsville in the last cou­ple of years and see how long it took the Queens­land gov­ern­ment to fi­nally de­cide to build the Rook­wood Weir! Even now, the speed at which that is hap­pen­ing is mon­u­men­tally slow. Why let all that water go to waste?

Q: Do you only have this opin­ion be­cause you’re a pump man?

A: I’ve been in the pump busi­ness now for over 40 years and yes, I think in terms of water. Any­body who has ever read Joan Di­dier’s es­say, “Holy Water”, will know what I mean. When you’re in the busi­ness of mak­ing and de­vel­op­ing pumps to solve peo­ple’s most ba­sic and es­sen­tial re­quire­ments, you have a pro­found re­spect for water. To quote Ion Idriess, that ter­rific Aus­tralian, writ­ing about the in­land he said, “Water is Life”.

Copies of this in­ter­view are read­ily avail­able. War­wick Lorenz wel­comes your com­ments. His plat­form is to sup­port the min­ing in­dus­try’s ef­forts as with­out its 230,000 peo­ple, ev­ery­one would be in real trou­ble dur­ing this “age of corona”.

Projects like the Ord give the Aus­tralian econ­omy a huge boost by pro­vid­ing water se­cu­rity for min­ers and farm­ers.

Aussie Pumps man­ag­ing di­rec­tor, War­wick Lorenz.

Aussie Pumps’ Ex­treme, a typ­i­cal ex­am­ple of an Aus­tralian de­signed and built 500 bar hy­drob­laster, now be­ing used not just in min­ing but in ship­yards around the world.

Aussie Pumps’ big 5000 psi portable steam clean­ers, trailer-mounted with its own water tank, pro­vide fast, chemical-free steam clean­ing of equip­ment in the field. Who wants to work in a filthy ma­chine?

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