Pedro Hoyos Salazar
Deputy Director of Commercial, Innovation, and Marketing
GlobalSat
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Insight

Satellite Telecoms Offer Freedom to Mine Sites

Wed, 10/21/2015 - 18:00

The mining sector witnessed major legislative changes in early 2014, which have trickled down to be felt in the way mining companies are making use of satellite technology. “We have recently noticed that the market has not been growing as steadily as it did in the last two years,” says Pedro Hoyos Salazar, Deputy Director of Commercial Innovation and Marketing at GlobalSat. “Some of the projects we were working on have been stalled, mainly because companies are waiting to see how the new mining royalty will impact their performance.”

GlobalSat specializes in advanced satellite telecom services for several industries, including mining. In 2013, GlobalSat installed 7,500 very small aperture terminals (VSATs) for Mexico’s Ministry of Communication and Transportation. The installation was part of a project called ‘Proyecto 10K’ which is intended to provide small rural communities with telecommunication services. Two more large government projects were being carried out in 2013, in which an additional 14,000 terminals were implemented. “These types of projects certainly piqued the interest of the mining industry, as some of the larger mining corporations had already been sharing telecommunication services with local communities. The services create better opportunities for people who live near isolated mining operations by ensuring that these communities are no longer solely dependent on major corporations for their telecommunications needs. Furthermore, the services increase security because, as soon as telecommunication services are installed, communication, awareness raising about problems, and rapid response scenarios improve,” explains Hoyos Salazar. Though the level of security in these remote regions is improving, there is still more work to be done, as illustrated by the fact that GlobalSat still receives military escorts on its way to certain mines.

GlobalSat’s biggest competitors are other satellite operators within the mining sector, while the company does not face any major competition from terrestrial service providers. However, some mining corporations have set up communication systems using several microwave antennas that connect the mine to the nearest village that possesses internet access. The costs of equipment, installation, and maintenance for such a system are significantly higher than a satellite-based solution, allowing GlobalSat to offer solutions that are both cheaper, and more technologically advanced. The communications company is defiant about its ability to maintain a service level as high as 99.95%, even for isolated sites such as oil rigs or remote mining operations, by providing the clients’ personnel with technical training. “We also stand out from the competition because of our experience,” says Hoyos Salazar. “We have been providing these types of services longer than most companies in Mexico, and we manage the largest network in the country, comprising of almost 17,000 VSATs, and counting.” Unlike its competitors, GlobalSat offers small scale solutions involving as little as one or two VSATs. As such, smaller mining projects that are starting up in the southern part of Mexico have started to look like promising clients.

Even though it does not offer the cheapest option, Hoyos Salazar believes that GlobalSat provides the most added value for its clients, with an important component of this being transparency of the company’s services. “If one of our services is not performing to an optimal level, our clients are able to identify the issue, whether it be a virus or a problem with the local network, just as we can. This technology allows them to solve problems by themselves.” This confidence seems well-deserved, given that the likes of Goldcorp and First Majestic Silver, have elected to trust in GlobalSat for their communication needs. However, Mexico’s Telecommunications Reform has come to alter this landscape. The telecommunications sector was restricted for some time, but now all companies in the satellite business can be bought, accept foreign investment, or take advantage of the other benefits that the new structure brings. While this would naturally be good news for the likes of GlobalSat, Hoyos Salazar expects that it may take up to 18 months before all the legal challenges to the Telecommunications Reform will be sorted, delaying the arrival of big companies and large investments in the sector.

13 years ago, Globalsat started out by selling services with a download capacity of 128 Kb/s and 64 Kb/s for uploads. The aim for this year is to deliver 8 Mb/s download speeds and 2 Mb/s upload speeds. Hoyos Salazar points out that there is a continuous development of these new solutions. “Today we are doing very well. We are not aiming for large consumer markets, at least not for the next three years. Instead, we will continue to provide high quality services to clients in the sectors that we are servicing today like mining. Everything I have seen in the global satellite market shows that the more specialized a company’s services are, the better the opportunities are and the better their service becomes. The mining industry is benefiting from this reality.”