Mining Strength

Mining Strength

Jon Stanton, CEO, Weir Group, sits at the helm of a Scottish institution that is leading the way on advanced mining.


Weir turned 150 years old last year and has earned itself a solid reputation as a key engineering group, delivering advanced and innovative solutions that improve safety, efficiency and sustainability. Over a year ago, the group made the strategic move to sell its oil and gas division, thus becoming a pure mining technology player. Would you give us a rapid historical perspective on the group, its development and evolution over the years? How does Weir stand out in the Scottish market, and what have been some of the major factors behind its success?

Weir was formed in 1871 by two brothers, George and James Weir, and turned 150 years old last year. It still carries their name. They invented a revolutionary pump that was used in steamships. This was a key part of the growth of Glasgow in the Clyde as a major shipbuilding city. Essentially, innovation in the propulsion of steamships was the genesis of the company. In that period, Glasgow became the largest shipbuilding city in the world.

We are proud to say that we are still resident in Glasgow 150 years later, although the business is now vastly different. It has been incredibly resilient over the years and done lots of different things. The company has a history of reinventing itself and going into the next important thing, the next innovation. For example, Weir invented the desalination process. When they discovered oil in the Middle East and needed fresh water to grow those populations for industry, Weir technology was a huge part of building the infrastructure. In oil and gas, itself, when oil was discovered in the North Sea, Weir provided innovative pumping solutions that went into developing those industries. In recent years, we became quite diversified. We were supporting many different industries—mining, oil and gas, power, energy and chemicals.

Over the last five years, we strategically focused the business on mining because it was our strongest business, where we felt we should prioritize investment. It is where we saw the greatest growth opportunities ahead for the company. Weir supports 5,000 mines around the world. Our products range from ground engaging tools, which are the teeth that are on the excavating machines, right through to crushing, grinding, concentration and tailings management. We have a footprint of digging the rock out of the ground, making big rocks into small rocks, then ultimately getting the concentrate or the product out at the end of the process and managing the waste byproducts. Our products sit in that value chain.

We are excited about the potential because fundamentally, the business demand for copper and other metals that our technology helps to produce has continued to grow strongly, as it grows with gross domestic product (GDP), with population and urbanization, with emerging developing economies, and that’s been a key factor over the last few years. Furthermore, as the world looks to decarbonize and electrify, it will need significantly more copper, nickel, cobalt, lithium and all the metals that will need to go into energy infrastructure for renewables, and battery technologies. The demand for those metals is going to increase significantly. If you take, for example, copper, which is our largest exposure, an electric vehicle requires four times as much copper as an internal combustion engine car. Then you need all the charging infrastructure and the conductive metals that go with that. Every year, all the mining companies mine roughly 20 million tons of copper a year and over the next decade that probably needs to go to 30 million tons plus to satisfy the demand for decarbonization and electrification. We are in an industry where there is going to be tremendous growth potential in the production of these metals.

In parallel, there is a huge need for the miners and us as an industrial company to reduce our emissions, reduce our CO2 footprint. Mining uses a lot of energy and water, produces a lot of waste byproduct, and is impactful on communities. The industry needs to produce all of those metals, but do so using less energy, less water, producing less waste. There is a very significant technology shift happening in mining, which as an innovative engineer, is also a tremendous opportunity for us to really help our customers reduce their footprint and produce more metals, while limiting their impact on the environment. We see multiple tailwinds for this sector for many years to come, which is why we have really focused the company in this space.


Weir’s results for the first three quarters of 2021 align with overall improving global market momentum, the recovery of the mining market and the return of confidence to growth compared to 2020. Could you offer us an overview of how Weir has done amid the pandemic, what strategies management has applied to steer the firm through this time, and what your outlook is for the company for 2022, during an increase in commodity prices and the surge of inflation?

COVID-19 has been incredibly disruptive, but our sector has been rather resilient. Mining is an essential industry and all over the world, governments have done much to keep mining going because we need the metals and natural resources that are produced from mining. As a supplier to the mining industry, we have had to figure out how we can continue to support our customers, because our products are absolutely mission critical—the pumps, the cyclones, the valves. If they are not running, the mine cannot produce. We operate in around 70 countries around the world, where all the big mines are, with many regional facilities and service centers close to the mines. Every single facility had to be reconfigured to allow for social distancing and operate in a way that we could keep our people safe through the pandemic. It was a huge exercise to get the organization reconfigured to keep supporting our customers. Happily, we were able to do that in a magnificent effort from our 11,000 people all over the world.

But our 2020 results were in line with the previous year’s, so on the bottom line there was no net impact from Covid despite having to do all that reconfiguration of the business. Demand was solid, and we could fulfill it. Fast forward to 2021 and the current market environment is highly active. Commodity prices are strong and there is a rebound from Covid as other industries ramp up, which is supporting demand for copper and lithium as the net zero challenge really gathers momentum. This is incredibly significant. We see that our customers are trying everything they can to maximize production from their existing mines, particularly given the strength of commodity prices. There is a real thrust to drive production and we are benefiting from that. In the longer term, for metals like copper and nickel, there are not enough mines operating today to actually produce the amount of these metals that will be required to achieve the Paris targets. Hence, there is a lot of activity at the moment in trying to identify and develop new resources so that supply can catch up with the demand that is coming. We are seeing both extraordinarily strong activity in the existing mines, but also strong activity in the development of new mines that are going to satisfy the demand.

Given that commodity prices are so strong because of the supply-demand imbalance, it is driving an active market. The orders that we have been seeing in the business as we have moved through 2021 have really accelerated and we expect that to continue into 2022. I’m very bullish about our end markets. There is a lot of opportunity in our markets, and we really expect the business to grow strongly, not only lifted by a market that is growing but also by bringing new products and services, new innovations and technologies into that market so that we can help our customers produce more from less, and use less energy and water. As an example, we have a technology called a high-pressure grinding roll, which is a novel way of grinding the rock into a fine powder. It is 40 percent more energy efficient than existing technologies and is a dry process as well, so it doesn’t use water. That is just one example of how we are supporting our customers on their journey to use less energy and water. To sum up, I see a very active market ahead and lots of opportunity for Weir.


Can you give us a glimpse of the flagship technologies Weir has developed or the biggest projects you have or are currently running. What sort of competitive edge do they give you?

From a technology point of view, we have a whole spectrum of areas that we drive forward. The core product has fundamental technology in it in terms of material science, such as proprietary alloys and polymers which provide longer wear life. The hydraulic and mechanical properties of our equipment differentiate them. A big issue for our customers, particularly in a time like now where commodity prices are so strong, is that they just want to keep running. Their enemy, the big cost, is downtime. If your equipment’s spare parts last longer, you can keep them running for longer, and if you can do quicker change outs for the spare parts, its a tremendous advantage for our customers, particularly if you are producing valuable metals like copper and gold. They just don’t want to stop. In response to this we have a core technology program, which is about how we continue to improve the materials that we use and continue to improve the characteristics of the core products, so that we are reducing customers’ downtime and improving their productivity.

We then have a pipeline of sustainable solutions in development that will help our customers reduce their energy and water consumption. Increasingly we are trying to work in partnership with our customers to look at the entire process, from the machines that are digging the rock, right through to tailings to find bottlenecks, challenges and what levers can be pulled to essentially enable productivity improvements and enhancements. We often find that there are bottlenecks that are quite easy to solve. For instance, we found that in a particular mine in Latin America, the tailings pipelines were too small for the mine. By doubling their size, putting another tailing circuit in, we could double their production overnight. It cost them a few million dollars to do, but the payback was literally a few days, because of how much production it enabled.

Beyond what we do today, if there is not enough production in the existing mines around the world to meet demand, where else is it going to come from? There is now a lot of research going into deep sea mining. These are the highly concentrated metal nodules that sit in the deep ocean. There is research going into asteroid mining, for example. Therefore, we are starting to think about where these new sources of supply can come from, and how we can play into that and use our products. There is a whole array of technology that we are trying to deploy across the value chain. The glue that sits behind all of that is digitization. We are a mechanical engineering business that has traditionally been a hardware provider, but one increasingly needs software, big data and digital enablement to optimize that hardware. Consequently, the other shift that we have on the way is upgrading from a mechanical engineer, which we will always be, but adding a tech component to that in terms of data and insights that we can provide to our customers to optimize their operations.


What are some of the key R&D advances that you have made, what lies in your research pipeline and how are you combining the traditional mining technologies with the latest technologies like AI, data analytics or robotics to continue deliver innovation in your field?

Material science is really important to us. We make things out of metal, rubber and other polymers, and we are on a constant journey to improve the performance of those materials to make them last longer so that the customer gets better product performance. That is a continuous journey, and we work with academic establishments around the world, but our primary relationship is with Strathclyde University in Glasgow, where we have the Weir Advanced Research Centre (WARC). That is where we are doing low technology readiness, blue sky thinking in terms of material science and other technology advancements. Within that, we are working on things like self-healing materials such as polymers that line some of our machines. As they process the slurry and the rocks, they get damaged. We are working on technologies that mean if the rubber is cut, it can actually heal itself.

We also focus a lot on sustainable solutions: how to reduce energy and water consumption. This year we are working on generating a ‘Scope 4’ analysis of our product, so we can demonstrate that, compared to any alternative, our product is able to better save energy or water for our customers.

Another interesting area for our customers is safety: how can you use robotics, automation and other technologies to get people out of harm’s way? That is right at the start of what we do, for example, automating the changing of ground engaging tools on the machines. This has historically been a manual process in the pit, where people literally have to use sledgehammers and other big tools on very unstable ground to remove and change the ground engaging tools. We have now built a semi-autonomous robot that can move people out of danger. In many parts of the world, working deep underground is the most dangerous place you can work. We are working on technologies that would allow the ore that is being mined to be processed and then lifted to the surface of the mine without human intervention, a process we call hydrohoisting using our pumping pressure exchange technology. There is a lot in the pipeline from a technology point of view that plays to those needs of our customers and that will help make mining smarter, more efficient and sustainable.


Weir is a highly international business, with over 11,000 employees working in 70 countries. What are some of your biggest or priority markets at the moment? Where do you see the most growth opportunities in the future? How important is the U.S. market for the group?

We will go wherever our customers go. We have the technology and the capability to support miners wherever they are. Our business model is that we produce the product and the solutions, but it is important that we have people on the mine or close to the mine that can support our customers with the ongoing maintenance and repair of our equipment and helping them maximize that uptime. Real customer intimacy on the mines all over the world is fundamental to us. We have about 100 service centers all over the planet, whether this is 4,000 meters up in the Andes, in the DRC, or Mongolia. Wherever our customers are, we are there with a facility to support them. As new mines open up, we follow our customers into those markets and ensure that they have the service on the ground so that we can support the product. And our customers are exploring all over the world to find the new resources that are going to be needed.

One of our biggest growth markets is Latin America. Chile and Peru have the fortune of having a lot of the world’s copper resources. So those markets are enormous, extremely important for us and will continue to grow strongly. Certain markets are new and opening up strongly: Russia is one and then Central Asia places, like Kazakhstan and Kyrgyzstan, are really developing their mining markets. There is already a big mining industry in Russia and other ex-Soviet markets, but a lot of the equipment is old and inefficient, and given where commodity prices are at the moment, our customers there are really looking to upgrade to cutting-edge technology and equipment. Saudi Arabia is also interestingly on a journey to reduce its dependence on oil and gas and open up other new industries. Mining for minerals is a big strategic initiative that Saudi Arabia has underway at the moment. Copper, gold, lithium and other materials are untapped there because historically the country has been focused only on oil and gas. Now they are investing heavily to develop mining as a new industry, among others. That’s another potential growth market for us.

The US and North America is a particularly important market for us in both mining and infrastructure. We support the construction industry at the high end in terms of quarrying for sand and aggregates. There is a lot of excitement around the $2 trillion infrastructure stimulus bills recently approved through Congress. This will mean significant investment in infrastructure, and they will need materials which will be produced in the US and in Canada, so we also expect that market to be strong as well.


You just turned 150 years old, which is not a trivial milestone. As we look ahead, in what is one of the most challenging periods of all time with the climate battle, what do you have most at heart to accomplish now, and what is your vision for the next 150 years?

We feel good about the next few decades. The last few years we have gone through the process of transformation: selling our oil and gas business, selling our flow control division, buying ESCO, which is another mining technology business, to create the platform that we have today. We have had to do a lot of heavy lifting to get the business to where it is today. 2021 was quite a special year in many ways: not only as a landmark of 150 years, but it also because we completed that transformation. Weir in its latest form emerged, focused on mining technology.

With the platform that we have and with the end markets we are in, there is a multi-decade opportunity ahead of us. There is going to be a colossal demand for natural resources such as copper and lithium, driven by the need for technologies, like electric vehicles, to enable the carbon transition. We start 2022 extremely excited about the future opportunities that lie ahead, very bullish on the outlook for commodities production. We also recognize that mining is inherently cyclical through CapEx, but we also have an incredibly resilient business. Therefore, regardless of what happens to CapEx or commodity prices, the miners do tend to keep producing and need suppliers like Weir to continue to support them. Hence, the outlook is very positive and the core technologies we obviously need to deliver on. Beyond that is also the next stage of the transformation of Weir, from an industrial company to an industrial tech company who can not only provide products but provide data, insights, process optimization, and a broader offering of solutions to its customers.


What’s your final message for the readers of Newsweek magazine?

Weir is very proud of its heritage and the fact that it has reinvented itself over the years and been at the forefront of many critical innovations for humanity. There is more to come. In the next few years, we will see a transformative period for the world and its people, and once again, the company is going to be at the heart of it, firmly rooted in Scotland.