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Risks
Asset Management
Critical minerals companies have various physical and intangible assets that are interdependent and often costly to establish, maintain, and replace.
Risks
Asset Management
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Critical minerals companies have various physical and intangible assets that are interdependent and often costly to establish, maintain, and replace. Understanding how to manage the daily activities and future-facing initiatives involves trade-offs between asset maintenance and replacement. An asset management mindset, or ‘lens’, provides a unifying mindset where dissimilar elements within a critical mineral company can by compared on a like for like basis as to their:
- current and future value;
- current ‘lifecycle’, based on usage and competing options;
- current state of performance and potential optimised performance;
- dependencies and weakness in the procurement, maintenance and sale of assets, including from the wider global supply chain.
Without an asset management mindset, critical minerals companies can become internally fragmented, divided by apparently divergent internal demands for investment and resourcing, and suffer from an overall lack of cohesion and acceptance of strategic direction.
The justification for which areas, equipment, and processes receive investment and resources – versus those that go without – can appear arbitrary to internal and external stakeholders, including major customers. A company can appear to be operating ‘on instinct’, at the whims of fads and bias, susceptible to self-interested external parties, and stuck in the present without being able to see itself in the future and the changing environments these futures may bring.
Historically, asset management was for large physical assets, however intangible assets are becoming an ever-increasing proportion of company value globally.
The increasing value of intangible assets is further complicating the challenging task of identifying and protecting value and making decisions on assets. While known for its valuable tangible assets, the critical minerals sector is no different to any other in its growing dependency on ‘intangible assets’.
The advent of functioning artificial intelligence and machine learning as creates new challenges and opportunities to leverage data as an intangible asset.
Physical assets can also be represented virtually as a ‘digital twin’, with benefits such as improved monitoring and control, forecasting and prediction, more rapid identification of bottle-necks, and thus greater production efficiency and overall decision-making at the overall organisational level. The digital twin of a physical asset itself becomes an ‘intangible asset’.
Therefore the importance of intangible assets, including data, records, and other forms of information, is increasing exponentially.
The mining and minerals sectors are no exception; Intangible assets are an essential component of a critical mineral companies’ success, and successful companies are those that derive value from intangible assets.
Resilient, empowered critical minerals companies take a holistic approach to their company’s value, by considering physical assets, such as production facilities, together with intangible assets, such as data and brand reputation.
