Digitising mining processes could curb leakages, data manipulation, says expert

PUTRAJAYA: Implementing digitised systems in the Malaysian mining sector, including geotagging and blockchain technology, could help curb leakages and deter manipulation of mining output data, suggests Dr Mohd Hazizan Mohd Hashim, an associate professor at the Universiti Sains Malaysia (USM) School of Materials and Mineral Resources Engineering.

Such technologies would enable real-time recording and reporting of production and raw material data, facilitating more efficient monitoring. He proposes a geotagging system to trace the origin of extracted raw materials and blockchain technology to prevent data manipulation compared to manual methods. If digital data is directly sourced from weighing processes and transmitted to the state government responsible for managing royalties, taxes, and other related matters, the federal government could also access this information.

This would make large-scale manipulation of data impossible, he said during a presentation at the 5th National Governance, Integrity and Anti-Corruption Research Conference. The widespread use of digital systems could also improve transparency and boost confidence among investors and the industry in Malaysia's mining sector. The technology is already in use within some industries and companies, and field studies have shown its potential to reduce leakages and enable real-time reporting.

Malaysia can also learn from the implementation of such technology in other countries, including the use of an operations room or 'war room' to continuously monitor operational movements. However, the digitalisation effort requires closer cooperation between state and federal governments, given their respective roles in managing the mining industry.

State governments oversee licensing, royalty rates, and taxes, while federal agencies focus on technology and enforcement related to operations. If these two levels of government can collaborate through a special committee, it would simplify the process for industry players, according to Dr Hazizan.