By Anastasia Lyrchikova, Clara Denina and Melanie Burton
MOSCOW/LONDON/MELBOURNE (Reuters) - From using drones for field inspections to stockpiling cyanide, miners are scrambling to maintain output amid the coronavirus pandemic, a task made trickier in underground mines where social distancing is nearly impossible.
The virus has claimed 8,700 lives and infected over 200,000 globally. While miners have faced some outages, due to government shutdowns in places like Peru and Mongolia, most production continues.
In a defensive step, miners have begun stockpiling fuel, hydrofluoric acid, lime and other industry staples, including cyanide, which is used to extract gold from rock.
"I'm sure every mine is trying to do the same thing," Clive Johnson, chief executive of Africa-focused B2Gold Corp (TO:BTO), told Reuters.
Chilean miner Antofagasta Plc (L:ANTO) has start using drones to inspect tailings dams, which store industry waste rock. Manual inspections can take days and put engineers in close contact with each other.
The coronavirus "is actually providing us a very significant opportunity to be able to step forward on our use of technology," Antofagasta CEO Iván Arriagada said.
Bankers are also using drone footage from mine sites as they pitch deals to prospective buyers. While such footage might not help clinch a deal, it helps keep deal momentum alive, one London-based banker told Reuters.
The outbreak has begun to surface across the mining industry.
Kinross Gold Corp (TO:K) has quarantined nearly 900 workers at its Kupol mine in Russia's Far East after two workers were hospitalized with suspected coronavirus. Test results are pending and the mine is still running. BHP Group Ltd (AX:BHP), the world's largest miner, said a vendor who recently visited one of its Australian coal mines has tested positive for the virus. The company quarantined staff who interacted with the vendor. None have developed symptoms so far.
A handful of staff at mines in Chile, Ghana and Burkina Faso have tested positive for the virus, though they were quarantined before exposing others, the companies involved said.
WORST CASE SCENARIO
Miners, like many industries, have cut employee travel and encouraged frequent handwashing. Barrick Gold Corp (TO:ABX) checks the temperatures of every mine visitor. Polyus (MM:PLZL), Russia's largest gold producer, hands out masks at office entrances.
But public health advice to practice social distancing is all but impossible in the narrow workspaces of underground mines, fuelling a logistics nightmare for the industry.
The industry's workforce housing standards should also improve, critics say. In South Africa, some mine staff live in employer-provided hostels and cramped, one-room flats that could encourage the virus to spread.
"The scenario that (miners) are all preparing for is, what if someone turns up on the mine camp, presents symptoms and tests positive?" said commodity analyst Lachlan Shaw at National Australian Bank.
Gem Diamonds Ltd (L:GEMD) is splitting its workforce so one half is not around the other, a step aimed at halting the spread of the virus. Other miners have hinted they may do the same.
Newcrest Mining Ltd (AX:NCM), which operates in Australia and Papua New Guinea, plans to maintain production even if a "significant" number of workers become infected. It was not immediately clear how Newcrest plans to achieve the goal.
As miners focus on their supply chain to ensure output, some are trying to support end users with no end in sight to the outbreak.
Russian diamond miner Alrosa is giving long-time customers extra time to pay bills, a bid to lift sagging sales of the precious stones. Alrosa warned it could shutter some operations because of the virus.
Miners cannot plan for an “apocalypse scenario”, said a source one of Russia’s main metals companies: “No one knows how to go and what to do."