Red Herrings on the Path of Technology Development: Capital Destruction in the Pursuit of a Bad Idea

"The history of extractive metallurgy is replete with examples of commercializing new processing technologies. The successes are widely reported, but failures seldom are. This is unfortunate, for usually we can learn more specifics on how to succeed in technology development by studying and thoroughly understanding their failures. Frequently one encounters a red herring that caused the whole effort to fail. A thorough and objective due diligence up front would have identified those red herrings and prevented the pursuit of a bad idea and the resulting destruction of capital. Due diligent analyzes performed before construction of three such bad ideas will be discussed. One is an EAF dust process, which pursued the red herrings of a poor understanding of the business, a naïve view of past experience, and false confidence in the technology. Another will examine the effort to commercialize a new pressure copper leach process that followed the red herrings of inadequate testing of the raw material, application of processing conditions that were inherently unsafe, and an improper assessment of the inherent advantages of past developments. The last is an alternative iron-making process, where the red herrings were incomplete and superficial assessment of prior pilot plant and demonstration plant tests, an assumption that the commercialization model of “build it and we will make it run” was viable, and a technology whose technical fatal flaws had already been identified. Unfortunately, capital destruction often also closes the window to more intelligent pursuit of technology development. TECHNOLOGY COMMERCIALIZATIONThe development and commercialization of new technology is a vital part of keeping industry profitable, able to deal with new sorts of feed stocks and current with economic, product, operational and environmental requirements. This is a difficult task in the best of times, and can be compounded when the developers become enamored of a particularly favorable characteristic of the project or of the product. These “red herrings” divert project focus away from the arduous path to success and, in the end, result in project failure."