Sergey Nazaryan


Deputy CEO for Operational Excellence
Eastern Mining Company

Born in 1979 in Lipetsk, Russia, Candidate of Technical Sciences, graduate of the Yale Business School. He began his career at the Novolipetsk Metallurgical Plant, one of the architects of NLMK's production system. He has been engaged in the creation and development of production systems in various companies for more than 20 years. Currently, he is the Deputy General Director of VGK LLC for Operational Efficiency

DigiTech’24 Conference (Session 1)
18 April 2024 / 09:15 - 11:00 | Sary Arka 3

Digital transformation: increasing efficiency and profits in the mining business

The report is devoted to the practical aspects of digital transformation using the example of the mining company VGK, describing the necessary conditions for transformation, barriers and ways to eliminate them. Over the course of 6 years, the VGK company increased its productivity in terms of rock mass by 3.4 times, became the largest open-pit mine in the CIS and came very close to the top 10 world leaders. Over the same period, VGK reduced the cost of coal production by 10% and ensured EBITDA growth by 2.4 times. Thus, the company demonstrated how the use of digital technologies allows for significant, almost exponential, growth in the mining business while significantly reducing costs. The experience of digital transformation of VGK shows that the optimization and management of processes in the mining industry has its own specifics, including due to the discrete nature of mining operations. The report, using real cases as an example, provides an assessment of the potential of such processes and ways to implement it using our own digital platform. The report paid special attention to its own digital platform PULSE, as it is the technical core of the transformation. A general vision of the PULSE digital platform, a description of the modules and technical advantages are provided. Each module of the digital platform allows you to both optimize a separate business process (equipment performance, fuel efficiency, dump truck speed control, predictive equipment maintenance, complex balancing, loss monitor, active shift management, etc.) and take remote control of processes enterprises as a whole. PULSE takes production management processes to a new level by analyzing big data, processing it with artificial intelligence and issuing recommendations to all key persons involved in shift management - dispatchers, managers, equipment operators. The report ends with the company’s development plans in the areas of increasing efficiency and digital transformation.