ON THE SHOULDERS OF GIANTS

Leadership lessons from mining greats

ON THE SHOULDERS OF GIANTS

CONTENTS LUKAS MARYSE LUNDIN BELANGER 14–17 30–33

HUGH CATHERINE INTRODUCTION MORGAN MCLEOD-SELTZER 4–5 18–21 34–37

IAN RICK DAVID PEARCE RULE NETHERWAY 6–9 22–25 38–41

ROSS MARK LESSONS BEATY O’DEA FOR LEADERS 10–13 26–29 42–43 4

INTRODUCTION

INTRODUCTION WILL COETZER

MANAGING PARTNER AND FOUNDER, STRATUM INTERNATIONAL

Over the years I’ve had the Since we launched Resource IQ in while Skype enabled me to include pleasure of meeting and working 2015, we’ve been overwhelmed by contributions from industry leaders with some of the finest leaders, the support and contributions in Australia. and future leaders, in our sector. we’ve had from mining luminaries My work with Stratum such as Ross Beaty and Ian Pearce. Starting with an opening gambit International, advising mining of “How did you first start in companies and placing mining “We’ve benefited so mining?” the interviews followed a professionals into leadership much from the wisdom similar structure, while often taking positions, has afforded me access they’ve shared, we felt fascinating diversions. Our aim in to industry figures from whom their insights demanded each interview was to uncover the any new leader can learn. characteristics of good leadership further investigation and in mining, to seek advice for the I wanted to tap into this expertise a wider audience. next generation of mining leaders, and develop some lessons for new This acted as a catalyst and to identify potential stars of mining leaders straight from the for a series of one-to-one the future. wisest minds in the sector. interviews I recently conducted with some The result is nine conversations, It was this interest, our involvement presented here as edited transcripts in the mentoring initiative, Resource of the best-known to give readers as accurate an IQ*, and the findings of previous names in mining.” impression as possible of the way Stratum research reports, including our subjects think and express the Demographic Time Bomb in The interviews were largely themselves. We feel this form of Mining and The Lost Leaders, that conducted in face-to-face meetings presentation will enable you to led us to conduct this research. in Canada, the US and Europe, draw your own conclusions and insights from the conversations. *Resource IQ, which we established with colleagues at Altus Strategies, is a proactive response to the risk of widening demographics in the mining industry and the resulting talent gap. Resource IQ dinners provide an opportunity for mining leaders to network and to mentor potential leaders of the future in an informal environment.

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ON THE SHOULDERS OF GIANTS

“OUR AIM IN EACH INTERVIEW WAS TO UNCOVER THE CHARACTERISTICS OF GOOD LEADERSHIP, TO SEEK ADVICE FOR THE NEXT GENERATION OF LEADERS, AND TO IDENTIFY POTENTIAL STARS OF THE FUTURE.”

“We conclude this locations for long periods to get a mining leader spoke about the report with some of rounded, hands-on understanding value of their relationships with of the mining sector. Everyone who colleagues, teams and the future the lessons for future had done so maintained it was an leaders they had inspired. We leaders that I drew experience that had served them explored some of the mentors who from the experience.” well throughout their careers. had influenced them in their earlier careers, uncovering some unsung While each conversation was “The importance of heroes of mining in the process. unique, I was struck by several persistence came common themes that emerged. In Our interviewees were, without an age where ‘passion’ has become up again and again. exception, candid, articulate, warm such an overused word it has lost its The mining industry is and incredibly generous with their power, the interviewees’ genuine unforgiving, even of the time. To be able to spend nearly an hour with Ross Beaty, Maryse love for the sector was clear from ‘one-hit wonder’, and this the engagement and energy in the Belanger, Lukas Lundin, Catherine conversations. In many cases, this group recognised that McLeod-Seltzer, Hugh Morgan, connection can often be traced while every career has its David Netherway, Mark O’Dea, back to a childhood interest in peaks and troughs, those Ian Pearce and Rick Rule was a real nature and the great outdoors, privilege and I would like to thank with a long-term vision them all for agreeing to take part. while for others a family and commitment can background or an inspiring degree course lit the flame. ride most storms.” I hope you find the conversations as interesting and enlightening as I did. My interviewees talked about Unsurprisingly, this clarity of vision earning their stripes early in their results in an assertive and direct careers and the sacrifices they way of communicating that can Please note: Interviews are presented in made, often taking roles in remote result in some friction. Yet every the order in which they were conducted.

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THEIAN PEARCELEADERS

IAN PEARCE

BIOGRAPHY

Ian has worked for over 35 years at the most senior Health, Safety, Environment & CSR and Governance levels in the field of mining and metallurgy. He served Committees at Newgold. as Chief Executive at Xstrata Nickel, a subsidiary of Xstrata plc, from August 2006 to May 2013. He was He has recently become the Non-Executive Chairman also Director of Xstrata Nickel Australasia Pty Ltd from of New Gold Inc and a Non-Executive Director at February 2008. As CEO, he was responsible for global Nevsun Resources. nickel and ferro-nickel operations and projects in North and South America, Europe, Africa and the South Ian served as Chair of the Mining Association of Canada Pacific. With an attractive portfolio of Greenfield and and Chair and Director of the Nickel Institute. He Brownfield projects, his focus was on the continuing served on the Advisory Board of Canada’s Most growth of the nickel commodity business. Powerful Women: Top 100.

He held the position of Chief Operating Officer at Mr Pearce holds an Engineering HND in Mineral Falconbridge Corporation, and joined Falconbridge Processing and a BSc degree from the University of the in 2003 where he spearheaded the advancement of Witwatersrand in South Africa. He also attended the major growth initiatives as Senior Vice-President of Management Advancement Program at the University Projects and Engineering. of the Witwatersrand and received strategic and general management training at Henley College in the Prior to joining Falconbridge, Mr Pearce worked on United Kingdom. Canadian oil sands projects as well as metallurgical and mining projects for Fluor in Canada, Indonesia, Chile and South Africa. He also served as Executive Project Director at Fluor Corporation. Also, Chair and Non-Executive Director at MineSense, Non-Executive Director and on the Audit and Risk Committee at Outotec, and Non-Executive Director and on the

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ON THE SHOULDERS OF GIANTS

With more than three decades of Here was this vehicle and an That whole programme set me on experience working at the most opportunity to get my studies paid my career. I’ve got to say that I give senior levels in mining, few people for by someone else; I gave it a go. Goldfields credit for that. can rival Ian’s level of insight and Initially I wasn’t that keen because experience. I came out of the city, and was Stratum: Were there any through and through a city boy. individuals who helped you Ian famously worked with Sir Mick It was tough getting used to the advance? Davis at Xstrata plc, helping to remoteness of mines but the create a culture where young talent bursary locked you in. You either There were several individuals who was encouraged, given responsibility had to pay them out to exit or stick coached and mentored me during and rewarded exceptionally well for with it. my career, always helping me good performance. decide on those tough assignments Those four years were important which were career builders. One I knew long before I met Ian that as it allowed me the time to see the person early on in my career was providing mentorship to future opportunities and excitement that Noel Peverett, one of the Consulting leaders was a core part of his the mining industry could offer. Metallurgists in head office. He was personal philosophy, making him a very smart, matter-of-fact kind an ideal person to interview for Stratum: Looking back, what was of guy. this report. your first big break in the industry? I remember having a conversation As a former director of Xstrata, no I think the programmes that the with him about the Goldfields one would question Ian’s business mines had put together were great bursary scheme, saying they’re resolve or his ability to make tough and something that’s missing in the crazy to pay me all this money, and decisions. But he wears this lightly industry right now. When you came because I was a ‘city boy’, when I and my lasting impression from our out of university they put you into a finished paying back my bursary I conversation was a man who cares two-year postgraduate programme was out of there. He gave me great deeply for the industry and for the and they trained you. counselling and said “Well, we’re people he works with. okay with that because we’re The training was well designed. building capacity for the industry, I began our conversation by asking It was a tax break for the company, so if you leave this company or this Ian how he first became involved it gave you all the qualifications to mine or whatever the case is, I’m in mining. register as a professional engineer, okay with that, as long as you stay and it gave you a great perspective associated with the industry”, and Believe it or not, I wanted to be a on the industry. here I am some 35-plus years later. veterinary surgeon! I always had an interest in animals, but when that After going through this training, So, his thinking, his mentoring, and didn’t pan out I turned to other I was placed at a gold mine, West his nurturing of young talent was areas of interest and that was Driefontein, which at that time was just fantastic. He tolerated our geography; rocks and geology. the richest gold mine in the world. frustrations and was very good at I was given a chance to be a understanding our potential and I came out of school not knowing technical assistant and then knew how to guide us. what I wanted to do and the mining technical manager. The retrofit industry at the time was quite capital program gave me exposure If I think back on my career I had progressive by providing bursaries to automation and controls some lucky breaks too. But Gary to students who wanted to study (I co-authored a technical paper on Player, the golfer, used to say “The in the various fields associated with cyanide addition and control which more I practise the luckier I get.” mining. My father’s career was was published), to elements around And I say in the business, the harder connected to mining and so he project scope, cost and execution, you work the luckier you get. Hard pointed me towards these bursary- plus it gave me a chance to travel work and dedication gets sponsored studies, saying “Why overseas and work with the recognised and then you get those don’t you think about this?” company designing the control lucky breaks. For me it’s about system platform. putting a shoulder to the wheel and driving hard, doing the very best you can, and then you’ll get lucky.

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THEIAN PEARCELEADERS

Stratum: So, if you were to meet Stratum: And what do you look enable them to show their your 30-year-old self now, what back on as your biggest mistakes? leadership capabilities and it makes advice would you give him? the job so much more rewarding. I suppose the bigger mistakes are There are parts of your work life the ones you make in the more Every organisation has ‘growers’ that form the foundations of a great senior positions of your career. and ‘keepers’. Growers are those career. Early career jobs, like shift Certainly, the acquisition of Jubilee individuals who will take on work, labour-intensive jobs, and as CEO of Xstrata Nickel was not management roles in the living in remote locations were not our finest moment. organisation, also referred a lot of a highlight for me and it seemed at times as talent. I firmly believe the time to be going on forever. Massive amounts of learning come organisations need ‘keepers’. However, later in your career, as a from mistakes. I would say it’s They’re not going to become the CEO, you visit people who are probably the most difficult thing next CEO, they’re not going to doing these jobs and because you to do but for me it’s the most become the next Vice President, spent time doing these jobs you important decision management but they’re playing an important can relate to the challenges must make. If you don’t admit there part in the company and they need they face. is something wrong, and you to be recognised for this. believe in a list of excuses then you So for me, it would be to take the never take on the challenge of So, it’s about recognising that full time to absorb the experiences, fixing it. The longer you take to spectrum of the team, as so many not be too hasty to move up the come to that conclusion, the more companies only focus on talent and ladder too quickly and build a solid likely it will be more damaging, as they leave behind the rest of the foundation of experiences that are time in these situations is not organisation, who end up feeling aligned with your career. your friend. marginalised.

They become invaluable later in life. Stratum: What do you look for in a Stratum: How do you implement The higher you go, the lonelier it leader? that? Do you use assessment or becomes and you call upon your gut feel or….? experience base to guide you then. One of the more important aspects of a leader is to recognise There are some great tools out I also tell people that there are leadership within people and there that can help you define what ‘leaders’ and there are recognise talent. I always say to you are looking for and then help ‘administrators’. You need to find people “You get hired for what you you establish how people stack up the leaders and find a way to can do, not what you’ve done” and against those criteria. There is a lot connect with them so you can the job of a leader is to recognise of unconscious bias that goes on in have enlightening conversations. the potential in people. hiring and promoting, so these tools and well-defined processes takes A leader needs to recognise the away a lot of that subjectivity and “True leaders are not ‘potential energy’ in an individual gives you great insight, allows you frightened of talent; and convert that into ‘kinetic to focus on questioning, and energy’, which has them executing ultimately, one then does overlay administrators are to their full potential confidently. all of this with sound judgement. threatened by people Leadership is not just for managers I got introduced to psychometric smarter than them. but it’s a role that everybody can testing back in the early Nineties You’ve got to look at play. Whether you’re a cleaner, when I attended Henley organisations and receptionist, an engineer, or a Management College just outside manager, everybody has, I believe, London. It blew me away in that understand how that a leadership role they can play in here was a tool being used to works and get to grips their job. successfully hire and retain staff. with that very quickly.” Still today many companies are not If you get an entire organisation to aware, or have no experience, in act with a leaderful way and you using these tools. give them the ability to lead, you

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ON THE SHOULDERS OF GIANTS

“As a CEO, I used these how to assess the potential in There were some amazing leaders kinds of tools in the hiring people and the management style like Hugh Coble and Vince Kontny. was to allow you to realise your full It was interesting to see how they process and to help the potential which was very energising. behaved. One time I had to go to existing management I must say it also did not allow the Irvine, California to meet with ‘administrators’ a place to hide and several of the company senior teams understand invariably they would leave on their leaders. And people like Vince and themselves and their own accord. Hugh would come to reception and peers. Recognising collect you personally while less It was a company on the move and charismatic leaders would send strengths and blind spots there was no place for politics their assistants and invariably leave is important, thus helping either, which again generally you waiting in a reception area. teams move into a created a great work environment. That was never the case with guys For instance, age and years of like Hugh and Vince. They always performing phase.“ service was not a criterion used for showed everyone the utmost selection, which allowed for quite respect and never took a stance a diverse management team. that they were somehow above Stratum: Most companies don’t others. This type of personal use assessment, yet it’s obvious Stratum: Are there any particular leadership brings out the very that most people get fired on people in mining that stand out best in people. behaviour. to you as great leaders or potential leaders? My last ten years of my Totally agree. Unconscious bias career brought me back to and poor cultural fit are big There are a few memorable people the operational side of the mining impediments to successful hiring that stand out for me. business and leaders such as Derek and retaining of people. Pannell at Noranda/Falconbridge There was a shift supervisor at and Mick Davis at Xstrata stand A lot of companies focus on Libanon Gold Mine who was out. I am a firm believer of what I capabilities around the what, and assigned to train me to be a shift call now the ‘X way’ of running a not so much on the how. Plus they supervisor. Because we were called mining company. The business is generally assess what the person shift supervisors he insisted we underpinned by a set of values, did in the past and not what they wear a tie with a white lab coat at with a highly accountable small can do for the future. all times, because we were now management team and devolved supervisors and not operators. He corporate structure driven by Stratum: Xstrata always stood was meticulous in the way he went looking for value. out as being willing to test about his business and he taught younger or less experienced me how to be a supervisor, and pay Stratum: Thank you. And finally, people in big jobs. attention to detail as we walked are you reading anything around the plant. He was a great interesting right now? The devolved and highly guy, and taught me to be accountable model required Xstrata observant. He said “You need to The book that I always have to have a sense of the capabilities learn to walk with your eyes open.” close to me is Good to Great by of the individuals within the Jim Collins. organisation. The lean approach I have already mentioned made talent very visible which Noel Peverett. It’s an easy read and for me one of afforded them a chance at the most important but seemingly opportunities, and it was a growing Then I joined Fluor and I realised difficult things to do is get a great not stagnant organisation, which that there was a whole new world team together before you try to do again propelled people’s careers. of mega-projects out there, anything. The other profound thing requiring a whole new set of Jim states is that good is the enemy None of us were afraid of skills to execute these large of greatness and I have found that surrounding ourselves with people capital programs. to be so true in my career. who were smarter than us. Again, the leadership team understood

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THEROSS LEADERS BEATY

ROSS BEATY

BIOGRAPHY

Ross J. Beaty is a geologist and resource company of the Beaty Biodiversity Center at the University of entrepreneur with over 41 years of experience in the BC and Director of several environmental NGOs, international minerals and renewable energy industries. including Panthera and the Pacific Salmon Foundation. Mr Beaty founded and is Executive Chairman of Alterra Power Corp., a mid-sized clean energy company with Amongst his numerous awards, the most recent geothermal, solar, hydro and wind power operations include his induction into the Resource Hall of Fame, in BC, Iceland and Ontario. He also founded and serves in 2015 the Vancouver Aquarium’s North Medal for as Chairman of Pan American Silver Corp., one of the Ocean Conservation and the Alumni Award of world’s leading silver producers, and has successfully Distinction from UBC’s School of Law, in 2016. founded and divested a number of other public mineral resource companies. Mr Beaty was born in Vancouver, Canada and educated at the Royal School of Mines, University Mr Beaty is President of the Sitka Foundation, one of of London, England and the University of British Canada’s leading environmental foundations, patron Columbia. He and his wife have a son and four daughters.

Ross Beaty needs little It’s not without reason that Ross I spoke with him on the fringes of introduction to anyone involved is renowned for his impeccable a mining conference in his home in mining. Currently the Chairman timing, to the extent that he is city of Vancouver. of Pan American Silver and regularly referred to as “the Executive chairman of Alterra broken slot machine”. I have always been impressed Power Corporation, Ross has by Ross’s willingness to share his created 14 successful businesses These days, you’re just as likely to knowledge. His colourful and direct over four decades, creating more find Ross championing clean way of talking made for a very than $4 billion in shareholder energy or one of the environmental illuminating conversation. value in the process. or philanthropic causes he supports.

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ON THE SHOULDERS OF GIANTS

Stratum: So Ross, what first Stratum: What would you say the 14 have been huge successes, got you into mining? was your first big break? they’ve all been 10 baggers at least from the IPO. I was born and brought up in Well, in 1980 I went to New Zealand Vancouver. I have loved the for almost two years. I came back Stratum: Which is the fourteenth? outdoors all my life and I wanted to Vancouver in 1982 just as the a job that would take me outside. economy changed from a bear The only one that hasn’t been a I did geology in the first year of market to a bull market, and so home run yet is my clean energy university, but I already had my first there was opportunity in Canada to company that I started a few years rock collection when I was eight. start as a young geologist. I built ago called Alterra Power. It’s a I just had an attraction to minerals my first company up to the point different business. It doesn’t have and the earth, so it was a very easy that we had 33 geologists working that big upside but it’s a lot more step for me to go into geology. with it by the mid ‘80s. stable and predictable. A different kind of business completely. It just “And once in geology Then when I started my first doesn’t have that huge upside that I studied economic public company I had one of several you can get through discovery or epiphanies I’ve had in my life. It was increases in metal prices. But we’ve geology because apparent to me that when you run built a solid company now that will I thought it would be a public company you have a live beyond my lifetime, producing full of opportunity to chance for a retirement fund, clean electricity. That’s my real whereas if you run a consulting or dividend. work in industry, a contract company it’s a kind of potentially to own my bread and butter business that “I’ve been extraordinarily doesn’t have that opportunity own company which for a great outcome. lucky in my career; I mean is something I had my a lot of my success has eye on doing from a “I did my first deal and my been just being at the young age.” public company bought right place at the right my private company, I time and making lucky It was successful, I graduated from the University of British Columbia, merged them together discoveries. Though it’s then I went to the Royal School of and I was able to acquire true you make your luck Mines in London, came back to more shares in the public Vancouver for a law degree, just as to some degree.” company and really run a hobby. All the time I worked in the Stratum: Now you’ve gone from summer as a young geologist in one business.” being the miner to investing in BC, Alaska, South Africa, and Asia other people, are there criteria That was an ‘all for one and one for for different mining companies. that you look for in leaders? In 1980 I finished my education, all’ kind of thing where I had all my family involved as shareholders and I started my first company, Beaty The first thing you look for in an everybody I knew, and it was head Geological Ltd, and I’ve worked for investment is who are the people down and work hard. We had our myself ever since then. I started my running the business. It’s true that big break by discovering a gold first public company, Equinox successful people tend to be serially mine in Nevada called Rosebud, Resources, in 1985 and then there’s successful, and you can see that which ultimately led to the sale of been a series of public companies with many people in the business, Equinox in 1994. since then. myself, Bob Dickinson, Robert Friedland, Lukas Lundin, Richard That allowed me to do many other So it was a love of the outdoors Warke and so on. plus an opportunity to be an things, and then as each company entrepreneur, and it’s been was successful I was able to build a good run. the businesses bigger and stronger. I’ve started 14 companies and 13 of

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THEROSS LEADERS BEATY

But even an idiot can discover – a good geologist, a good financial a mine, so don’t discount good guy and a good legal guy, a good projects either. Good projects that team that creates success. are really good, even if they’re run by fools, will still make investors “Our business is fraught money. But smart people can make with risk, it’s not just money from mediocre deposits. technical risk, its social The project also must be good, has risk and political risk... to stand on its own. I like less risky and timing risk and all projects, but it depends on the manner of other risks.” nature of the investment, the percentage of the company I can Stratum: If you had any piece buy for a certain amount of money. of advice for a 29-year-old, The risk/reward ratio has to be either looking to embark on an right. I’m quite happy to swing for entrepreneurial mining career, the fences and strike out. or even just someone that has a slightly different view to everyone The thing that irritates me, though, else and just wants to follow that and I’ve seen this several times over through in a more conventional the last five or six years, is when a capacity, what would that be? management team sells me a business plan saying that they’re You have to know who you are. going to take my money and spend I was just a born entrepreneur, it on X. Then they go and do Y I’m a good salesman, I’m very with it. impatient, I don’t suffer fools easily, I’m hard to work with but I’m quite Those people lose their credibility, driven. I work hard. I would make they often waste the money, they a terrible employee, but I need come back for more and they people who are good employees don’t get it. It’s so unnecessary, to make me look good, and they if somebody creates a plan that need guys like me to make them they sell to investors, they at least look good. There are a lot of people should follow the plan. who try to be entrepreneurs who just simply aren’t by nature. This particularly happened in the 2010/2011 period when I “My advice to a 29-year- was investing in some projects old would be to look at in Africa, Indonesia and South yourself in the mirror America. I was surprised at the and ask yourself if you’re management teams that just were flaky and surprisingly incompetent. better working as part of a team, or being the They came across quite well in leader of the team, the presentations, but they were person who can wrangle incompetent at running the the cats?” business. The entrepreneur needs to have Now geologists aren’t all known the vision to make the big deals for being good managers of money, and then delegate to all the other they’re usually pretty spendthrift, guys in the team who are doing they don’t look after detail very the hard work, to make it all happen. well. But that’s where you need to And monitor them to make sure it have a strong management team does happen.

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ON THE SHOULDERS OF GIANTS

“I WOULD MAKE A TERRIBLE EMPLOYEE, BUT I NEED PEOPLE WHO ARE GOOD EMPLOYEES TO MAKE ME LOOK GOOD, AND THEY NEED GUYS LIKE ME TO MAKE THEM LOOK GOOD.”

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THELUKAS LEADERS LUNDIN

LUKAS LUNDIN

BIOGRAPHY

Born in 1958, Lukas Lundin was raised in Stockholm, North Limited and is one of the largest gold/copper Sweden and educated at the Ecole Internationale de producers in the world. Mr Lundin was also responsible Genève in Switzerland. In 1981, Mr Lundin graduated for the discovery of Argentina Gold’s multi‐million from the New Mexico Institute of Mining and ounce Veladero gold deposit. Argentina Gold was the Technology (Engineering). subject of a $300 million takeover by Homestake in 1999. In addition, as a senior director of Lundin Oil AB, A well-known and respected business leader and Mr Lundin was instrumental in the $480 million takeover philanthropist, Mr Lundin has enjoyed international of Lundin Oil by Talisman Energy in 2001. These are but success in the resource industry, spearheading a few examples of how Mr Lundin has been and numerous world-class discoveries and developments continues to be focused on the realisation of worldwide in both the mining and oil and gas sectors. extraordinary value for his shareholders through exploration and development success, takeovers and As principal of the Lundin Group of Companies, a group multi-billion dollar mergers. of twelve publicly-traded companies, Mr Lundin is actively involved in the exploration, development and Mr Lundin currently serves as Chairman of a number production of copper, cobalt, zinc, nickel, lead, gold, of publicly traded natural resource‐based companies, uranium, oil and gas, and diamonds. including Lundin Mining Corporation, Lundin Gold Inc and Lucara Diamond Corp. and NGEx Resources Inc. At age 25, Mr Lundin headed International Petroleum Also, he is Executive Chairman of Denison Mines Inc. Corporation’s extensive and then rapidly growing international operations based in Dubai, U.A.E. From 1990 to June 1995, Mr Lundin was President of International Musto Explorations Limited and was responsible for Musto’s acquisition of the Bajo de la Alumbrera deposit. Bajo de la Alumbrera was the subject of a $500 million takeover by Rio Algom and

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ON THE SHOULDERS OF GIANTS

Lukas is part of the legendary Stratum: What would you say was Stratum: At the junior end I find Swedish Lundin dynasty and son your first big break? that a lot of armchair expert to Adolf Lundin, who originally investors forget very quickly and established Lundin Mining in From ’81 to ’89 I lived in Egypt and they just back the same things 1994. One might assume that Dubai. My first real break came every four to five years. being born into a family of such when I came to Vancouver in the achievement might dull the mining business and I picked up this It happens: greed takes over. But I appetite for hard work and the big deposit, Bajo de la Alumbrera, think that happens in every market. pursuit of business growth, but in 1991, with the big porphyry The high-tech market must be 100 the opposite is true in Lukas system up in the Andes in times worse. In any market when Lundin’s case. His drive has led Argentina when Argentina had they have a commodity running as to Lundin Mining’s ongoing just opened up. a favourite you’re going to get a lot growth and diversification into of people jumping in just to try to one of the leading mining “At that time, I knew not make a quick buck. You can’t avoid businesses in the world. very much about mining. that. It’s the nature of business. When we met over a coffee in I didn’t know what Stratum: Do you think that applies Knightsbridge, London, I fired porphyry was!” to lithium? off my now standard opening question, “So how did you get Stratum: And how about your Definitely. Lithium is a tiny market into mining?” biggest mistake? and I think if you combine lithium market, lithium companies are “I was born into mining It was early on a smaller project. probably five times the size of the because my father was a We were probably looking at ore whole market. Of course, that’s a bodies that should not have been bubble. mining entrepreneur early put in production. The grade wasn’t on, so I was always high enough; it wasn’t enough There’s about 20 lithium companies tonnage. It’s very important to get in Vancouver right now. There were exposed to it as a kid.” the right quality asset when you none up till six months ago. Ten Stratum: Can you tell me about do this. years ago, we had no uranium that famous meeting you had with companies, suddenly we had 100. your dad when he told you and The problem in a very warm or hot That’s the nature of the business. your brother about your future market is that you can finance a lot careers? of things that should maybe not be Stratum: What advice would you financed. I think you have to be give to your 30-year-old self, I remember the Riviera about the careful and think long-term and not based on what you’ve learned in age of seven and nine and Dad told short-term in this business. the few years since then? us it was just a question of who is going to become a mining engineer Stratum: Do you think the current Stay focused. You’re going to have and who’s going to be a petroleum system allows for that, given how to have a good exploration engineer! everything seems to be driven by programme because you’re not financial markets? going to be able to finance yourself At the time I said mining and my buying assets when you don’t have brother said petroleum. At the end I think the market corrects itself the money, so surround yourself of the day we both studied quite quickly. In a heated market, with good exploration people and petroleum engineering and I think of course everything goes, but it look at projects that have size it stuck in our head and we just gets corrected very quickly in a and grade. talked about what we were downturn. I think the market also supposed to do. We didn’t think is getting quite sophisticated in much of it at the time. That’s a what’s good and bad; the capitalist true story! market works well.

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THELUKAS LEADERS LUNDIN

Stratum: But unfortunately, Stratum: Are there any leaders Stratum: Are there any areas exploration is not very sexy, is it? amongst your peers or those who where you particularly enjoy are up and coming you particularly doing business? No, it’s not very sexy and it’s very admire? time-consuming. From exploration A very good place to do business to mine… if you do that in ten years My peers and I are old! People like is Sweden because of very easy you’re fast. Ross, Friedland and David de Witt. mining laws. Very easy permitting and very friendly where we’re The mining business is not an easy I’m so involved with what I do involved. business because first you have to myself so I haven’t noticed that find it, being able to explore, then many young guys around me but South America, of course, we like you have to build it. It’s all very hopefully there’s some around. because the systems are very big. treacherous and then you finally Chile we’re involved in. Argentina get it going. You can come out, Stratum: There are at all levels; we’re very involved in and hopefully it collapses! If you look at it from probably more than people think. will go back. Georgia looks good 1,000 miles off it looks like a crazy I think the hard thing for guys like and with the new government business. It’s not that easy to that is recognising that they need we’ve lots to do, a lot of big make money. more experience and mentorship systems. And of course, South before they can take on the big America and Peru we like. Stratum: What do you look for in things, because people, certainly We do a lot of business in Africa; leaders who are executives or my generation, and perhaps the Botswana is fantastic; Congo is leaders across the entire range one before me, tend to be quite more complicated. of the business? impatient. Finally, I wondered if there are Leaders are hard to find. Most “I know, but you’re going any books you’d recommend. people that work for me have been to make a lot of mistakes with me for ten to twenty years and I read a very good book recently; they all know the business. and if you learn from John D Rockefeller’s autobiography your mistakes you which is called The Autobiography Most people that run our of an Oil Titan and Philanthropist. companies are miners or become much stronger.” I thought that was very interesting. professionals in the oil and gas This is not a perfect run. We all do a business. We look for guys that are lot of mistakes and the successful steady, good. They have to be able people learn from their mistakes to delegate well and build good and unsuccessful never learn. They teams around them and it’s very go back and do the same thing and hard to find leaders that can do it’s amazing to watch people do the all this. same mistake over and over and over. You must be in control, at the same time be able to delegate and at Stratum: Canada has quite a good the same time be able to build. selection of youngsters, 38 to 45, There’s a lot of different skills for coming through. It’s only a handful one person.” of people; about maybe 20 or 30.

That’s fine and another thing is all the guys out of Perth. They’re all over in oil and gas and mining.

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ON THE SHOUDLERS OF GIANTS

“LEADERS ARE HARD TO FIND... THEY HAVE TO BE ABLE TO DELEGATE WELL AND BUILD GOOD TEAMS AROUND THEM AND IT’S VERY HARD TO FIND LEADERS THAT CAN DO ALL THIS.”

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THEHUGH LEADERS MORGAN

HUGH MORGAN

BIOGRAPHY

Hugh Morgan is Principal of First Charnock Pty Ltd. now Emeritus Director; President of the Business Hugh was appointed Chief Executive Officer of Council of Australia (2003-2005) and now an Honorary Western Mining Corporation (1990-2003) and prior to Member; Member of the Anglo-American plc Australian that served as an Executive Officer (1976-1986) and Advisory Board (2006- 2014). then Managing Director (from June 1986). Hugh is a Member of the Lafarge International Advisory Mr Morgan has served as a Director of Alcoa of Board; Chairman of the Order of Australia Association Australia Limited (1977-1998 and 2002-2003); Director Foundation Limited; Trustee Emeritus of The Asia of Alcoa Inc (1998-2001); Member of the Board of the Society New York; Chairman Emeritus of the Asia Reserve Bank of Australia (1981-1984 and 1996-2007); Society AustralAsia Centre; Member of the Asia Society President of the Australian Japan Business Co- Australia Advisory Council; President of the National Operation Committee (1999-2006); Joint Chair of the Gallery of Victoria Foundation. Hugh is a graduate in Commonwealth Business Council (2003-2005) and Law and Commerce from the University of Melbourne.

I was fortunate to be introduced a government appointee, and industry from a position of ultimate to Hugh Morgan by a friend and the Business Council of Australia. success, but not without difficulties associate, Matthew Grainger at on the way. Altus Strategies, the co-founders I spoke with Hugh in Australia of Resource IQ. I hope Hugh will and found him as actively Not that Hugh is ready to withdraw pardon me for describing him as interested in and enthused by into quiet retirement just yet; he one of the great elder statesmen the mining industry as anyone remains active in pharmaceuticals in mining. A former CEO of the else I interviewed. I was disarmed and private equity, and has a Western Mining Corporation, by Hugh’s often brutal honesty continuing interest in mining. Hugh also served on the board of and he struck me as a man who the Reserve Bank of Australia, as was reflecting on his time in the

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ON THE SHOULDERS OF GIANTS

Stratum: How did you first get into Stratum: Reflecting over an entire I think leaders need to be selected mining? career, what would you say was the on the basis of being fit for purpose biggest mistake that you’ve made? at the time. It may well be you have My father had been in mining for a a large company that needs to have long time. I had never intended to I think I’ve got a catalogue of those! a more aggressive accountability follow that profession, but at the The largest financial one was the for what they’ve been doing, and time I qualified there were a lot of failure of some investments in the you need a certain person to do jobs available and I was about to United States and Canada; we lost a that. take up a position with Shell significant amount of money. As International when I was persuaded CEO, you take responsibility for You may, on the other hand, need to join what was then North Broken these issues, notwithstanding one to implement a significant change Hill. That was a last-minute decision, had followed what was thought to in culture. Changing culture is very which set me off on a course of a be due process, etc. The answer is hard, it takes a particular type of lifetime in the mining industry. they turned out to be a dud. We leadership, and it may take anything ended up in that situation losing up to ten years to put in place. So Stratum: What would you say was quite a few million dollars. Not a that you have an implicit change in your first big break in the industry? good call on the bottom line. behaviour patterns rather than just an explicit statement of behaviour. Those who remember the Statum: When you say dud, you Australian mining industry in the mean the people or what was sold early ‘60s will know Collins House. to you, or the asset? “So, I think the selection of Collins House was a collection of like-minded mining companies. At The assets were dud, in fact you’d a CEO today is governed that time, it was headed by a man have been better off buying these by what is needed for the named Sir Maurice Mawby, and he four assets, going down to the bar enterprise at that time, had a second in command called and putting all the names on a dart Arthur Rew, who was the person board and you’d have done better! and that there is no who looked after all the mathematical model administrative issues of CRA, later Otherwise, you always have made where you tick all the to become Rio Tinto. some judgments internally that you would like to rerun, and I wouldn’t boxes and say, that’s the Arthur Rew must have taken a shine know a CEO who would not reflect person I need on all the to me, because he suggested that I that, if they were reappointed time, on every occasion. should negotiate the South today, there are some things they Australian Railway freight rate could have done better and more between Broken Hill and Port Perrie. urgently to achieve a better Stratum: You mentioned This was a major contract for all the outcome. behaviours. There’s a saying that companies with the South goes that you tend to hire on gut Australian Railway works. Stratum: Absolutely, and that’s feeling and skill but you fire on one of the things we are trying behaviour. Does that resonate with I think I must have been about 26 to achieve with these interviews, you? at the time. helping the leaders of the future learn from the past. I think there’s a fair bit of that, This ‘appointment’ recommended although unkindly, there’s also a fair by a company other than which I I’m a great believer in that bit of firing because of the market. worked for was at that time quite a Roosevelt quote, “The only man The old saying is “good rains make strong statement of faith in me by who never makes a mistake is the good farmers” and if you’re in the Arthur Rew. That brought me more man who never does anything.” mining industry good prices can exposure than I would have ever make good managers. And the expected. So that was a significant As you’ve reached this stage of converse applies; prices collapse break in terms of engagement in your career, I’m taking it a lot of and you’re left with an overload of the industry as distinct from leaders have started working for past ‘sins’ that land on the CEO at engagement in the company. you; what do you look for in a the time. It’s not exactly as you leader these days? put it.

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THEHUGH LEADERS MORGAN

Stratum: Yes, but you do seem to Stratum: Some of the younger new probably as equipped and has done get serial success over a long entrants seem to be very urgently as much as I can observe to handle enough time frame. There tends to chasing corporate leadership roles that with great skill. Because it be serial success and serial failure with a strong strategic element, requires not just an understanding between certain groups of people. and not so much getting their of engineering skills of mining, but hands dirty. being able to read the tea leaves of Yes, but it doesn’t last all the time. how to manage properly with I felt very much engaged with, let’s That’s the very point. This is not just owners who are a long way away. say, Alcoa, in the early ‘60s; it was run off and get an experience with He’s done that with remarkable skill. number one. Today, for whatever a major consulting firm and think reason, it’s almost a shadow of its that you’ve added to your brownie Stratum: Finally, are there any former self, and the query is, why is points. You’re better to get your books you’ve found particularly it so? For most of WMC’s hands dirty from experience with interesting or insightful recently? association with it, but not at the communities learning; the flexibility finish, we had a remarkable that’s required to handle people, I’m always fearful of reading association which was one of the the exposure to the multiplicity of something because I put everything most remarkable mining/metal obligations of management, remote else down until I finish. The last companies in the world. So it’s not location issues, supply chain… book I read was Red Notice, Bill always given that this is the Browder’s book on the heritage outcome, put it that way. “You get a first-hand investment history in Russia. It’s a experience of all that fantastic book about the corruption Stratum: If you reflect on your that reads like a thriller; it’s career now, what advice would you very quickly, which is compulsory reading for anyone give to your 30-year-old self? something you can never who invests in Russia.

If I was in the mining industry today substitute by being at a Let’s get this right, though, they’re I would be saying having done your university, and is more very smart; there are some very graduation, the important thing is difficult to get later.” smart people in Russia, there are to have as much experience in some very good things that go on difficult places, in operations, as you Stratum: I know you’re not that in Russia. But also, it is a challenging can accommodate or accomplish actively involved necessarily in the environment that shouldn’t be before marriage, mortgage and on-goings of the global mining undertaken lightly. kids. Because later it gets much industry now, but were there or are more difficult. These ‘qualifications’ there any particular leaders that of having experience in tough you respect or that you follow, or locations become almost more that you communicate with? prized and more recognised than the initial graduate qualifications Well it’s still a small industry, and so later. yes, I know several of them well, though there’s a generational You cannot substitute at age forty change. For example, I’m not close or fifty the experience of having to Andrew McKenzie, but I think worked in China or Colombia or he’s handling a challenging Brazil. These things provide a enterprise [at BHP] and he’s doing lifetime of experience and it well. qualification and appreciation by your colleagues that you can’t go And Andrew Michelmore, who’s out and duplicate at a later stage. dealing with MMG. He succeeded me at WMC Resources. He’s at the This I think is something very forefront of dealing with a Chinese- special, that would be my starting owned enterprise who have been point in talking to and mentoring smart enough to work out how to somebody. engage with a non-Chinese jurisdiction. Andrew, I think, is

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“YOU CANNOT SUBSTITUTE AT AGE FORTY OR FIFTY THE EXPERIENCE OF HAVING WORKED IN CHINA OR COLOMBIA OR BRAZIL. THESE THINGS PROVIDE A LIFETIME OF EXPERIENCE AND QUALIFICATION THAT YOU CAN’T GO OUT AND DUPLICATE AT A LATER STAGE.”

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THERICK LEADERS RULE

RICK RULE

BIOGRAPHY

Rick Rule has dedicated his entire adult life to many private placement markets, having originated and aspects of natural resource securities investing. In participated in hundreds of debt and equity addition to the knowledge and experience gained in a transactions with private, pre-public and public long and focused career, he has a worldwide network companies. of contacts in the natural resource and finance worlds. As President and CEO of Sprott US Holdings Inc, Mr Sprott US Holdings Inc is a holding company made up Rule leads a highly skilled team of earth science and of three separate and distinct companies: Sprott Global finance professionals who enjoy a worldwide Resource Investments Ltd, a FINRA-Registered Broker/ reputation for resource investment management. Dealer; Sprott Asset Management USA, Inc, an SEC- Registered Investment Adviser offering managed Mr Rule is a frequent speaker at industry conferences, accounts; and Resource Capital Investment Corp., an and is interviewed for numerous radio, television, print SEC-Registered Investment Adviser that manages and online media outlets concerning natural resource Limited Partnerships. These three companies make up investment and industry topics. He is frequently quoted the US Subsidiaries of Sprott Inc, and are active in and referred by prominent natural resource oriented securities brokerage, segregated account money newsletters and advisories. Mr Rule and his team have management and investment partnership management long experience in many resource sectors including involving both equity and debt instruments, across the agriculture, alternative energy, forestry, oil and gas, entire spectrum of the natural resource industry. mining and water. Mr Rule is particularly active in

Rick Rule is renowned as told me about times when he with his time. He is a natural someone who works relentlessly backed them when no one else storyteller and he could – and in identifying and bringing mining was willing to take a risk. should – fill a book with his companies to market. Over the anecdotes from a lifetime in years many people, particularly I found Rick to be charming mining. It’s not without reason that those in the junior space, have company and extremely gracious he is one of the most in-demand

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ON THE SHOULDERS OF GIANTS

speakers at mining events and greatest natural resource boom natural resource investing. conferences and he is always an market that we’ve ever seen. articulate and compelling voice for The second big business break the industry. I’ve stayed in the business since, that happened was really as a I like the people, I like the process, consequence of my aggression As one of the best-connected I like the cyclicality in resources, rather than skill. I came to the people in mining, who has his ear I like the predictability of the cycles. attention of some very high profile to the ground arguably more than I have the psychological profile natural resource investors. I came to anyone else in the industry, it is where volatility is a tool rather than the early attention of the generation encouraging to hear his positive a risk. I’m uniquely suited to natural ahead of me of natural resource and enthusiastic support for resource finance, natural resource investors who used my energy, my younger talent in the industry. investment and natural resource ambition and their own talent to Indeed, he describes the current speculation. help build companies. I was able cadre of up and coming leaders as to learn in the first decade of my “the best generation of natural Stratum: What would you say was career that the early part of natural resource professional I’ve ever seen your first big break? resource investing is less about the in my life”. asset and more about the people Being born to hard working, involved. Stratum: How did you first get curious parents was my first big into mining? break. My first big business break And I had the extraordinary good would come as a consequence of fortune to surround myself with I had an interest in the out of doors my wanting to be a tax lawyer. ‘A’ players while I was still in my and natural resources as a young twenties, I didn’t have to, as many man. The consequence of that is I saw a tax lawyer I wanted to go people have, surround themselves that I emigrated from the United work for and offered to pay him to with ‘C’ players. States to Canada to attend the mentor me. He said, “If you get University of British Columbia, through law school I will certainly Stratum: If you reflect on your which had a major in natural hire you, but you will be miserable earlier career, what would you say resource finance in 1970. but effective as a lawyer. I’ve been was the biggest learning and the watching you and I think you biggest mistake that set you on a It’s odd that a 16-year-old aspired should be an investor.” different path? to a career in natural resource finance, or originally natural He introduced me to Peter Cundill, That one’s easy, a young male often resource tax law, but I was an odd who unbeknownst to me was makes mistakes because of ego. young man. I’ve become an odd already a world-famous value I was in a market where the oil price old man, and amusingly my college investor, and also unbeknownst to went from $3 to $30, I made a lot education is something that I have me had come to like me because of money, and I thought it was used every single working day of other aspects of my personality. because I was smart. In retrospect, since. I was personally mentored at a this is pathetically stupid, I equated young age, age 20, by an a bull market with brains. My original interest was more oil absolutely legendary value and gas than mining, but in the investor, and I can’t describe how And the big thinkers, the Jimmy commodities boom that occurred beneficial that was to me. Carters of the world, believed that in the decade of the ‘70s, if you the necessary outcome of the ‘70s had some sense of geology, or We were taught to look at was that oil would be $200 a barrel rather if you could keep geologists redundant assets, the latent value by the year 2000, that 20 or 30 from either lying to you or making of investments, and that money is million people a year would be mistakes with your money, that made on the delta between starving and that copper would be was a valuable talent. perception and reality. $10 a pound. In other words, they forgot that high commodity prices So, as a young man I had the What a company is selling for lead people to conserve and they extraordinary good fortune to have relative to what it’s worth, and that increased supply. I wanted to my talents match a market that, is the discipline that I’ve followed believe that, it was an important from 1970 to the 1980s, was the ever since. It’s uniquely suited to part of my own thesis, I became

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THERICK LEADERS RULE

a very wealthy young man and I talents of other people and employ I sold that business to become wanted to become much wealthier. the talents of other people. a very large shareholder in a The Malthusian prescription of the competitor, Sprott. I had built my Club of Rome was strangely “The alchemy in building business, a natural resource convenient to me, and I believed, a natural resource money management business, as like the big thinkers, the Royal Bank, far as my capabilities allowed me. the World Bank, the International company is the ability Energy Agency, that markets didn’t of the CEO to look at What I enjoy is securities analysis. work, and that the bull market I don’t enjoy running companies, would last forever. the task at hand and the consequence of that is that assemble the appropriate I fired myself as CEO. Then, an interesting year called range of talents.” 1982 happened and the Stratum: Looking back now, what commodity prices collapsed. As an investor, you have a would you say to your 30-year-old Towards the latter part of the ‘70s I secondary challenge, and that is to ambitious self? What lessons have came to believe that the cheapest identify people whose experience you learnt? capital for me was credit rather and track record is specifically than equity. What I learned in 1982 suited to the task at hand. Align yourself with extraordinarily is that although my debts were high quality people. My experience money good, my assets had People will come to me and say has been, it’s about wanting to be ephemeral value. And I went from “I have been a success at mining.” rich as opposed to live rich. The being a very, very wealthy young But they define success as way to get rich is to make rich man to having a negative successfully operating a gold mine people richer, rich people enjoy net worth very quickly, and that in French-speaking Quebec in money and they understand the was sobering. Archean terrain. While the task value of people who make them that they’ve set for themselves is richer. Rich people are more But it was also very useful, it exploring rather than producing, generous; they’re willing to overpay taught me a first-hand lesson copper rather than gold… for the certainty of success. about cyclicality and about value, a lesson that’s been responsible for The skills sets are not equivalent, the fortune that I’ve built since. so as an investor you have to make “As a young person, sure that the skills sets which are use your energy, your Stratum: Are there very specific described as successful are also creativity to create utility criteria you follow when you assess suited to the task at hand. leadership as to who you are going for a very successful to invest in? Stratum: I’m thinking about person who you both Anthony Hall, the CEO who admire and like.” That’s a long conversation, so has just resigned from Highfield I’ll try and summarise it: blazing Resources. That to me is a sign And after you have obtained some determination. of good leadership, realising credibility by assisting a successful that you’re not right for the person, very, very quickly build a This is a very hard industry. next stage of the lifecycle. team of people that you can work Somebody who is in this business Would you say that that’s what with and you can mentor. Share the for money, somebody who wants you would look for in people, credibility that you’ve obtained to live rich as opposed to be rich, that kind of behaviour? from the early successful efforts will absolutely fail. If it’s about a by other, younger, hungry, honest, mansion and a Ferrari it isn’t going Absolutely, I made the same determined people that can assist to work. It’s about outcompeting all decision myself. I built a very you. The alchemy is what the group your peers. Tenacity as well as successful business where a board can do. determination, and curiosity. The meeting was me walking on the successful person considers three beach, “Rick, what do you think?”, or four models, not just the obvious “Well Rick…” model, and the truly successful entrepreneur is able to envision the

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Stratum: I read somewhere that Kirwin who was one of the best to employ, this is the best the difference between millionaires geologists I ever met, worked for generation of natural resource and billionaires is that billionaires Robert for many years. Robert’s a professional I’ve ever seen in my life. know how to motivate millionaires. very demanding guy, calls you at two o’clock in the morning, things And most people my age don’t I think that’s probably accurate, but like that. And I asked Doug “Doesn’t know that the game of getting there’s probably more to it than Robert’s personality sometimes ahead isn’t to be right, it’s to be that. Obviously you can’t build a big make him difficult to work with?” more right than the other fellow, business by yourself, many people and mercifully for me most of the like to believe they can, many other I’ll never forget as long as I live what other fellows have unilaterally people take the credit for it, but the Doug Kirwin said to me: “Rick, for disarmed. truth is that’s not the way it works. 20 years as an exploration geologist people told me I had brilliant ideas Just in this town there’s so many, A wonderful example is Jim Bob and Robert drilled them. If you’re there’s twenty up-and-comers, Moffett, who built Freeport- passionate about exploration, a there’s young Amir Adnani lowering McMoRan, of course he’s had his fellow who doesn’t give you lip his cost to capital. There’s the folks ups and downs. In the 1980s service but gives you a budget is over at Sandstorm, there’s Marcel Freeport-McMoRan was so far somebody who you’ll take any de Groot. ahead of anybody else in the Gulf amount of abuse from.” in terms of exploration efficiency. I used to say to my young friend I asked Jim Bob one day why this Stratum: Is there anyone now in Marin Katusa who I’ve personally was the case. He told me two very the industry that you’ve got your mentored, when Marin has asked interesting things; he said if they eye on? Whether they’re veterans me what he could do for me, I said had a young hotshot geologist or up-and-comers, anyone that you “Marin, hang out with people your working for Shell, a guy that was look to and go “Wow!”? age and tell me who the folks who knocking the lights out, that they’d are better than you are!” give him a pay rise from $75,410 to There’s a lot, I mean the young $86,392, and if he was politically crop is particularly promising. good in the organisation they might It amuses me to listen to people give him a credenza. What Jim Bob of my generation describe the would do is give them a profit millennials in the context of people participation in successful efforts older than me describe their vested over six or seven years so generation. I hear the millennials he kept them. described as undereducated, unmotivated, spoilt and I look at But he said a much more important the ranks of junior analysts at thing and Robert Freedland said Sprott, and I think “I don’t know the same thing. Jim Bob would sidle who these old folks are referring to.” up to a young promising guy who was a bit too cautious, and Jim Bob These young kids have remarkably would say “You know, I have a lot better educations than me, they more faith in you than you have in came out of geology school or they you. We didn’t build Freeport by came out of business school in doing one BCF corner shots, we 2008 when there were no jobs built Freeport by drilling 300 BCF available. They’re scared to death, discoveries. You’re a lot smarter they’re not complacent, and they than the prospects that you’re work like scalded dogs. putting up suggest, don’t ever be afraid to drill a smart dry hole for The truth is that most of this third Jim Bob Moffett, don’t make a generation are not Caucasian, so habit of it, but drill good ideas.” that’s changed, and that’s all good. 40% of them are female. So if you Robert Freedland similarly are less ethnocentric about the empowered geologists, Doug human resources that you’re willing

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THEMARK LEADERS O’DEA

MARK O’DEA

BIOGRAPHY

Dr Mark O’Dea has played leadership roles in founding, Chairman of the Board of Pilot Gold and as Director financing and building numerous mining companies, of Pure Gold Mining. creating over $3 billion in shareholder value. As co- founder, CEO and Director, he grew Fronteer Gold His many business and industry awards include the from start-up to its sale in 2011 to Newmont Mining, Globe and Mail’s Top 40 Under 40, EY Entrepreneur which included the spin-out of Pilot Gold. of the Year™ (Pacific mining and metals), and AMEBC’s Murray Pezim Award for perseverance and success Dr O’Dea co-founded and served as CEO and Director in financing mineral exploration. of Aurora Energy, which was sold to Paladin in 2011. He co-founded True North Nickel, which was sold to Mark completed his Geology degree at Carleton Royal Nickel in 2014, and most recently co-founded University and gained a PhD at Monash University. and served as Executive Chairman of True Gold Mining, He and his wife have three children. Mark is a which was sold to Endeavour Mining in 2016. He is the contributor and participant in the Mining for Miracles founder of Oxygen Capital Corp., and serves as fundraising campaign. He and his wife have supported the BC Children’s Hospital for more than five years.

At 48, Mark is one of the Fiercely intelligent, he has a PhD I found Mark to be very personable youngest interviewees in this in geology amongst his many and excellent company. He was report, but his achievements are honorifics. When I met him for considered, thoughtful and full of just as impressive. He has coffee in Denver, Colorado, I noticed energy and enthusiasm. launched and sold several a few pages of notes on the table in companies since 2011, including front of us; although he barely Fronteer Gold and, most recently, referred to them throughout our True Gold Mining, which was conversation, I was struck by his level acquired by Endeavour Mining of thought that has gone into the late in 2016. topic of what makes a good leader.

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Stratum: How did you first get go to Newfoundland or Saskatoon exactly what they want to do. into mining? or Africa. They want to head It’s misleading and leads to straight into the boardroom. disappointment in the real world. From the age of 10 to 20 I grew up in Newfoundland, also known as the I think it has a lot to do with the So much of life and our career is Rock, out in the cold Atlantic. That’s work ethic and culture in which just drudgery. It’s hard work. It’s not the environment you’re living in, a you’re brought up. glamorous but the reward is pretty raw elemental place. completing it and doing it to the It’s a good segue into what advice best of your ability, so work hard, Then, in my second year of I would give someone new to the do your absolute best and the university, I discovered geology as industry, which is put your feet on rewards will come, even if that task a degree, and instantly fell in love the rocks, put your boots on the that you’ve just done is deadly with it. I felt like I’d found my tribe, ground, get your hands dirty and boring. I’d found my vocation and it just learn the business from the offered me the kind of outdoor ground up. Stratum: Looking back at your lifestyle that I was looking for at earlier career, what would you say the time. That means soil sampling, cutting was your first real big break? line, staking claims, logging core, I guess the subconscious influences managing drill crews, learning how “Life is full of breaks, that we all have also came into play. to map, learning how to prospect, It turns out that both my all that fundamental stuff that goes isn’t it? Our careers, grandfathers were real hobbyists in into the fabric of our industry. our lives are touched by geology. My maternal grandfather people who open doors staked claims and would show me If you don’t know that, and you specimens of gold that he would haven’t cut your teeth on the rocks, or circumstances that are find or trade. As a career, he ran a you can’t possibly expect some presented to us and one small hotel in a mining town near kind of leapfrog over that right into door leads to another. one of the richest mines in Northern the corporate world. Get right in Ontario. Those things, I think, feed there and learn your business, learn There are three or four breaks that into what makes you up. your rocks and work hard. There are I would see that were pivotal. One no short cuts. was getting my first real field job in My other grandfather on my dad’s Labrador and immersing myself in side would tell us stories about Twenty or thirty years ago mining bush culture. That was with a guy being out hunting and finding these companies did a lot more named Derek Wilton who was a veins of gold or copper and taking mentoring of their own young professor at Memorial University. samples, but unfortunately they fell employees. They had the budgets Derek, I and one other student flew out of his backpack before he got for it and they had the longevity for off into the wilds of Labrador and home. He could never find those it. They were investing in the people basically prospected the mount for outcrops again. more than we are today. a month and I didn’t want to come home. I found my bliss. Stratum: Would you say that the There really is a long apprenticeship storytelling element of your that ought to accompany any new Stratum: How did that come about? grandfathers perhaps caught your graduate moving through the ranks imagination at a young age? and learning how all the facets of I was a hungry summer student and the business work; starting with was doing well in school. I knew he It did, and seeing my grandfather how to identify rocks. was hiring so I approached him. reading the Northern Miner, I didn’t That was the first big break that know what that was at the time, Stratum: Unfortunately, a lot of really set me on my course. but it all sort of came together. kids believe they can be billionaires at 25. The next big break, I would say, Stratum: We’ve noticed several came on the back of a pretty of the new generation of mining It is unfortunate. Kids are taught gruelling mountain biking trip I took professionals have all studied today that everything they do has around Australia. The last leg of the geology but they don’t want to got to be fun and has got to be trip was through a section of South

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THEMARK LEADERS O’DEA

Australia called the Oodnadatta that our enterprises have touched Ask a million questions, stupid Track, which is this desolate, dry, and helped is gratifying. questions, ask and be the guy in dreary place. It’s the lowest point in the room that asks the stupid the Australian continent. It’s like the Stratum: It sounds like you put in questions, because if you’re Great Salt Lake of Utah; it’s just all a lot of time before you got your thinking that, then chances are salt and it was blistering hot and biggest breaks. everybody else is. dry as a bone. “A good chunk of time, Don’t be afraid of not knowing I emerged out of that completely yes. At one point, I everything because there’s nothing wrecked and found myself a couple more boring than the smartest of days later in Melbourne and calculated, if I added person in the room. cold-called a professor that I had up all of the time I’d spent admired named Gordon Lister. I just The other thing I would throw in: rolled up on my bike, all skin and living in a tent in the get a life outside your work. Pay bones because there was nothing middle of nowhere I think attention to the people who love left of me and I said “I just cycled it’s four years of my life” you. We all need to find somebody around Australia and would love to who understands what we’re doing come and do a PhD with you.” He The old saying is “Look, this is my and is supportive and is truly a life laughed and said “Are you nuts?” 10-year overnight success.” Success mate through it because we’re He thought about it for a while. – whatever you want to define that away a lot in this business. It’s a as – comes in a moment in time tough gig on a family and to have He concluded that anyone crazy but the backdrop to that is a the right partner is a real blessing. enough to cycle around Australia massive amount of work and And I’m very fortunate in that way. was crazy enough to do a PhD with love of the craft. him! He was known to be a bit of a Stratum: A consistent theme wild man. I went back to Canada, Stratum: Looking back again, what coming from most people I’ve applied for the scholarships and would you say were the biggest spoken to has been they were admissions and six months later I mistakes? knocking down doors to get was doing a PhD with him. It was advice and mentoring. If you’re one of these moments in time that I see every single chapter as a a credible person I find people it clicked. That got me on to an fundamental prerequisite to the genuinely want to help. academic path and honed my next one, so you cannot possibly be geology skills. ready for what you’re facing had Human nature is amazing and you not gone through what you’ve there is a human tendency to want The next big break came with Rob just gone through. So through that to teach and impart knowledge McEwen, who launched the lens I don’t see anything as a and share. Goldcorp Challenge for geologists mistake—just an opportunity to from around the world. I placed learn—even if sometimes you don’t I’ve been incredibly fortunate my second and immediately got an appreciate it. whole life to have had these opportunity of a lifetime through mentors throughout my entire Wayne Beach and Hugh Snyder out Stratum: You’re still very young, career, all the way from working of Toronto to start Fronteer with you’re probably one of the on a cod fishing boat having a them, and that launched my public youngest people I’ve spoken to, skipper that I admired to the best company career. but what would you say to your boss I ever had, a man named 30-year-old self? David Caulfield. The most exciting part of my career to date has been involved in I’d say a bunch of things. One links David ran a company called Equity creating these companies and into the advice I’d give anybody, Engineering, which was a consulting employing all these people and which is never stop learning. It company. I’d just come back from creating a culture of our own. We’ve doesn’t matter what stage you’re travelling around Thailand – created wealth as well along the at, you’re always going to be penniless, shoeless, walking around way, but what’s nice is I never think surrounded by people who know town with flip-flops and shorts about it or quantify it, but more than you, who are smarter looking for a job. thousands of families and people than you; learn from them.

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ON THE SHOULDERS OF GIANTS

Dave Caulfield looked at me and There’s no formula. But I’ve learned, Labrenz is CEO of Pure Gold and laughed and said “Sure, why not? particularly over the last five years, doing a great job advancing the Come and start.” that if you get the team wrong, you Madsen Gold Project in Red Lake, have to change it right away. Ontario. Finally, Leigh Curyer is He had such an amazing ability to doing a top-notch job running manage people and connect with Don’t live with the dysfunction NexGen, having made a very people in a way that I’ve admired longer than you must. significant uranium discovery in my whole life. He could bring the the Athabasca. All three of these best out of everybody by dialling You might have made the wrong individuals are going to be around into what made that person tick. choice. You can try and trim around for a long time, and I give them my the edges to make things okay but full endorsement. Stratum: Has that influenced what in reality, in your gut, you know it’s you look for in leaders now or the wrong person and you’ve got to Stratum: And finally, are there any where you choose to invest? make that change. You get the books you’d recommend for future team right and everything will fall leaders? Ultimately I think it comes down to in place. somebody you want to follow, All the good books come to me somebody who leads from the Stratum: It’s interesting that most from my wife Victoria. She brings a front. They’ve got the vision. of the things you’ve spoken about very eclectic mix to the table, opens They’ve got the passion. They’ve in terms of what you look for in new doors that lead to places I got the drive and the creativity to people tend to be behavioural wouldn’t necessarily go to on my almost conjure this thing into factors. own. I tend to revert to the classics. existence and are not going to take no for an answer. I want smart people but I want Sitting on my desk is a book of smart people who have some social Seneca’s writing on the shortness of “But they also need to skills. I’m not looking for a bunch of life. It’s a little treatise that goes have empathy and power heads. I have to have people back 3,000 years. It’s all about how who can communicate. time is our biggest commodity and compassion and we’re so wasteful with it, more generosity with their time “In any industry, the wasteful than any other asset that and accessibility. we own. We waste our time. That’s biggest challenge is a typical example of something that I also think it’s important, communicating your craft I like to read at night. when you’ve got a team in a way that’s interesting Next to it is sitting an anthology of behind you, to share in and evocative to an guitars. I love guitars! the accolades. You’ve got audience of investors to give people credit.” without getting bogged Ronald Reagan had a note on his down in a bunch of desk in the White House that read scientific minutiae.” “There’s no limit to what you can accomplish if you don’t care who Stratum: Is there anyone you rate gets the credit.” It’s true and I in the industry at the moment as think a good leader is generous a great leader or a great potential with the praise and the sharing leader? Anyone that stands out of the spotlight. as a future leader?

Stratum: When you’re investing There are a few new CEOs that I $50 million into someone, or think very highly of. Christian Milau. someone’s going to come and We hired him out of Endeavour and work for you as a CEO, are there gave him his first CEO job at True specific criteria that you use to Gold. He did a great job for us and assess this person? he’s now running Luna Gold. Darin

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THEMARYSE LEADERS BELANGER

MARYSE BELANGER

BIOGRAPHY

Maryse Belanger has over 30 years of experience in the engineering functions. During her career, Ms. Belanger mining industry with strengths in studies, technical has also gained considerable expertise providing services and operational excellence and efficiency. She oversight and project management support for some was the Chief Executive Officer and Managing Director of the mining industry’s key strategic acquisitions. of Mirabela Nickel Ltd where she was responsible for the remarkable turnaround of the company and the Prior to joining Goldcorp, Ms. Belanger was Director, reestablishment of the Santa Rita mine as one of the Technical Services for Kinross Gold Corporation for world’s premier nickel copper sulphide open pit Brazil and Chile. Ms. Belanger holds a Bachelor of operations. Science degree in Geology and a graduate certificate in Geostatistics. She is also fluent in English, French, From 2012 to 2014, Ms. Belanger was Senior Vice Spanish and Portuguese. She has been an active board President, Technical Services at Goldcorp where she member at Mirabela, True Gold, Newmarket Gold oversaw the global geology, mine planning and design, (Kirkland Lake Gold) and Plateau Uranium. metallurgy, hydrology, tailings dam and geotechnical

Maryse became Chief Operating Bloomberg as ‘remarkable’. She a spirit for adventure that continues Officer at Atlantic Gold in the attributes some of her success to to this day. Summer of 2016, just a few her decision to return to operational months before we spoke. roles from time to time in her career to ensure she never loses sight of It seems that after 30 years in the needs of her colleagues on site. mining, very little fazes this multilingual French Canadian. When Listed by Women in Mining UK as we spoke Maryse had only recently one of the top 100 most inspiring completed her turnaround of women in mining, Maryse’s entry Mirabela Nickel, described by into a mining career was inspired by

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Stratum: What first got you Stratum: One of the striking would tell you that. Some of them into mining? similarities between the people were on the technical side but we’ve spoken to is that they’ve all many of them were related to It’s all down to the influence of my had a very influential mentor. Did people. More related to not listening father. He worked for Honeywell, you seek out a mentor or was it or maybe thinking I was listening installing control systems at the iron luck? but not hearing or understanding ore mines in northern Quebec and what was said. Labrador and that’s where my It was more that I was working interest came from. very hard and wanted to learn I tended to have a pretty bad everything. It was a combination temper. It was about learning to Plus, I like adventures; the opening of hard work, being defined as manage as opposed to trying to run up of the world, the travelling and somebody who really wanted to away from difficult situations, being away from home and Canada. learn, but some of it was luck slamming doors and getting angry. I I always had that strong desire to as well. had to learn that very powerful tool travel and explore the world. called negotiating over the years. You have to be open to people Stratum: Looking back to when who want to give you advice. In my younger days, building you started in mining, what would Sometimes, for young people, it is consensus was not something I was you say was your big break? not easy to take advice. It takes a good at. From the time you’re in bit of humility. your mid-20s through to your 50s it My first big break was with Echo is a learning process and you evolve Bay Mines. That’s a long time ago “Everybody needs some as a person. and the reason it made such a guidance; everybody difference in my career is that That’s the great pleasure of getting there was somebody who was my needs to grow as a older and having more experience. mentor, George Woollett. He taught professional and then When you’re younger you’re more me everything about what I call develop some leadership selfish, more self-centred and you being a professional; whether it was tend to lack in a little bit of presentation, explaining things to qualities as well.” perspective in the sense of seeing senior executives… these behaviours the bigger picture. that nobody tells you about. So, it was a stroke of luck and a lot of hard work. Stratum: In addition to those ideas When you go to university nobody you’ve just mentioned, what defines for you what being Stratum: Have you had a mentor advice would you give to your professional is and with Echo Bay throughout your career? 30-year-old self? Mines, in the late 1980s, I learned the key aspects. I was in my Absolutely, yes. I always did. Even at That’s a good question. I would say mid-20s and it opened my eyes to the senior vice president level I have learning earlier about organisations not only the technical aspects, had a mentor and a coach as well; and the corporate world and what because George was a technical somebody to talk to, somebody to motivates other people. person, but also more corporate help reflect on things as well. side of things and what I call that It took me a very long time to standard of professional behaviour. An important part of leadership is understand others and asking yourself questions and organisations and the way they are That’s now my definition of reflecting on things. It’s not always created. I think I had a very strong professional behaviour; you must easy to do that on your own. You focus on the technical things but be willing to defend your work in need somebody to discuss ideas less about other aspects of working front of a panel of your peers. and concepts. in organisations.

Stratum: And when you’re That’s when I decided to go from reflecting on things what do you the corporate world to actual see as your biggest mistakes? operation and then follow that back to the corporate world. There’s Lots of them! I think most people been a clear pattern over the last

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THEMARYSE LEADERS BELANGER

30 years to go between the You have to be generous with your company full of people like corporate base, technical services time. You have to share your ourselves would be chaos. We for example, back to operations experience. But it’s also being at the do not want to hire operating after a few years. To me it’s about ground level and having an open- leadership exactly like us. not losing touch and understanding door policy so that people can what drives people at the ground come and talk to you. I think some people do that but I level in the mining industry. think it’s a mistake. You want a mix I like to hear people saying “Maryse, of different styles and you also want From the time I was 30 to now I’ve I really think we should be doing a different mix of styles in terms of had this clear pattern in my career this this way.” Being approachable, people learning, solving problems, of corporate world and then an open-door policy, having and so on. switching to more hands-on roles younger people come to me with and closer to operations, for ideas and showing leadership skills We need left brain and right brain example. It is something I would is key. thinkers in leadership. We need that strongly recommend to young basic engineering skill but we also professionals in the mining industry. I try to give people access. It’s need the more creative concepts, difficult because it takes a lot of people who can be developing new Stratum: When it comes to time and energy but I think it’s ideas and concepts. understanding what drives people worth it because we need to and creating or investing in future develop that young leadership in Making a team is about finding that leaders, what do you look out for the industry. I really believe you balance between your team in leaders you engage with now? have to trust the younger members. So when I assess people generation. We have to be open or decide if I want them in the team, I’m looking for people who are not and spend the time and energy I try to be conscious of that fine afraid to use their voice. A funny developing them. balance and make sure that my first mix of technical skills, personality rule is applied: not to hire people also. Not followers, but asking So, it’s through personal contact, like myself. questions, being creative and being at the operations level and understanding the big picture. talking to people and letting Stratum: Thank you Maryse. My people come to you, that I do final question is whether you’ve “People should feel most of my assessment. read any interesting books free to ask questions. recently? Stratum: We did a study recently Any question is a good on why people leave their work I do not tend to read a lot of question if it means we and 80 per cent of people, on management books, although I average, leave their job not think we’ve all read Good to Great! get better and improve.” because of a behavioural issue I’m more interested in the world at I like young leaders to have a voice rather than a skill issue. Yet 80 per large; I’m an absolute fanatic of The and be quite open about not only cent of people get hired because Economist, for example. the ideas but the doubts they have of their skill or because of people’s or the values they want to promote gut feel around them. There’s little When it comes to fiction, I am a big into an organisation. assessment or thought about fan of Mario Vargas Llosa. I just read behaviour, which at leadership The Way to Paradise. It’s a fantastic Stratum: Everything you’ve level is the most important aspect. book connecting Paul Gauguin and described relates to behavioural his grandmother, whom he never tendencies. Very little involves It is the single most important met. It is a double portrait where technical skill when you get to a aspect, because on a strictly their travels and obsessions leadership position. How do you technical level you get some really, intersect; their passion and assess that side of things? really good people out there, but in ambition and pursuit of greatness. terms of organisations and A fascinating story. I believe in personal leadership. maturing organisations and I believe in being very open and developing leadership, it takes a exposing myself a little bit. concerted effort to develop that. We all must recognise that a

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“WE ALL MUST RECOGNISE THAT A COMPANY FULL OF PEOPLE LIKE OURSELVES WOULD BE CHAOS. WE DO NOT WANT TO HIRE OPERATING LEADERSHIP EXACTLY LIKE US. MAKING A TEAM IS ABOUT FINDING THAT BALANCE BETWEEN YOUR TEAM MEMBERS.”

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THECATHERINE LEADERS MCLEOD-SELTZER

CATHERINE MCLEOD-SELTZER

BIOGRAPHY

Catherine McLeod-Seltzer is a serial company builder Catherine has raised more than $650 million in working and a recognised leader in the minerals industry for her capital for mining exploration in the past 20 years, and ability to create growth-focused companies that been directly involved in more than $4 billion in generate significant shareholder value. Catherine has corporate transactions. Her leadership and financial successfully partnered with numerous geological teams expertise, access to capital and respect in building in the past 20 years with successes including Arequipa companies have been invaluable assets to the Resources, Francisco Gold, Miramar Mining, Lucara companies she is involved in and have created Diamonds, Stornoway Diamonds and Peru Copper. significant wealth for shareholders. Catherine’s Catherine was named Mining Man of the Year by The directorships in other publicly traded companies Northern Miner in 1999; given the Award for include Kinross Gold Corporation, JDL Gold, Grenville Performance by the Association of Women in Finance Strategic Royalties and Major Drilling. in 1997; positioned on the Financial Post’s Power 50; has received Canada’s Most Powerful Women Top 100 Award and in 2013 and 2016, the WIM UK’s 100 Global Inspirational Women in Mining.

I met Catherine McLeod Seltzer A serial entrepreneur, Catherine I found her serious, focused and in London, during one of her UK lends her talents as a director to thoughtful. Like all the interviewees, transits to far-flung mining sites. several organisations in the sector. she was gracious and generous With a track record stretching She’s also received several awards with her time. back 20 years, and with no and accolades, including Canada’s signs of slowing down any time Most Powerful Women Top 100 and soon, Catherine is a seriously famously The Northern Miner’s impressive figure. Mining Man of the Year for 1999.

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ON THE SHOULDERS OF GIANTS

Stratum: How did you first get the money in Canada to do this. We were fortunate in meeting people involved in mining? raised about $5 million to start with. who almost anyone would want as That copper exploration led to a a mentor… I was born into a mining family, third discovery, but the real gem was the generation, in British Columbia. My gold prospects he had staked up in Absolutely, and number one education was in finance, but in the Ancash region. was Dave. 1985 I started working for Yorkton Securities, a Canadian broking firm, We didn’t know it at the time, but Stratum: But you had to perform based in the London office. I was what we had been sitting on of course, to have a ticket at the working with Frank Giustra. ultimately turned out to be a table. 10-million-ounce gold deposit from We did a lot of mining work, almost day one, because we had Well I was young, but I told him I financing mainly North American staked that prospective territory could raise him the money and I did. precious metal stocks. A couple early on. But it was the real ‘boots I raised every single dollar that years later – after we successfully on the ground’ exploration, Arequipa spent on exploration. financed Bema Gold for an following up stream sediment Which at the end of the day was acquisition and development in samples that led to the Pierina just under CAN$40 million in total. Chile – Frank decided it was a good discovery in 1995. By early 1996 We sold the company for $1.1 billion, time to put someone in Latin we had started drilling. so that was a pretty good return on America to access projects for the investment for our shareholders. money we had the ability to raise in Stratum: Perhaps you’ve already North America and Europe. answered this, but what would you Stratum: Have you always sought consider your first big break? out mentors throughout your I spent about a year in Chile running career? that office and then I met David It was definitely meeting David Lowell, who was very, very integral Lowell at that cocktail party. You I’ve just been very fortunate. I didn’t to the mining exploration boom in know, he’s a fascinating man, he’s particularly seek out David, but we Chile. He found Escondida and worked all over the world, and he just hit it off and had a lot of things multiple other deposits in other was surrounded with fascinating in common. parts of the world. people, like John Guilbert. After that, Eira Thomas, Tom We happened to meet at the “The Lowell and Guilbert Shrake, and Andy Swarthout opening cocktail for Yorkton’s porphery copper model became friends and mentors… Chilean office and we quickly I guess if you meet one of that became good friends, talking about was their thesis, which circle you’re going to meet many trends we were seeing. led to many, many of that circle, so it kind of moved forward very quickly after that. David had his ear to the ground, discoveries. what things are happening; There was a multitude of people Stratum: There’s always a bit of technically and politically. He saw from that era who would come to luck involved in everything, but what had happened in Chile in the visit him in Chile or in Peru. I got to there’s also design, in that you put 80s, where the country opened up sit with them and hear the stories of yourself in a position to meet these to foreign exploration investment. major discoveries in all parts of the people. Many people want mentors And now he saw the same thing work including Papua New Guinea, but they don’t necessarily do that, happening in Peru. Australia, the Philippines, as well as they don’t go out, and perhaps South America. don’t actively seek opportunities So in early 1993 David and I went to to meet these people… Peru together. He was telling me Stratum: Those are some big what prospects he was staking and names that you mentioned there. I think what put me in that position the type of assets he was looking Many of the leaders I’ve spoken to was taking the opportunity to go to for, mainly porphyry copper in the in this series of interviews seemed Chile. This was the early ‘90s so cooper belt. to have actively sought out Chile was the prime posting for an mentors that made breaks happen ex-pat who, say at BHP or at Rio I told him I thought I could raise him for them, but it sounds like you Tinto, wanted to move up the ranks

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THECATHERINE LEADERS MCLEOD-SELTZER

in the company. It was a great spot Stratum: Reflecting over your Stratum: What would you say to to put those people for international career, what would you say your your 30-year-old self who is just experience. I met a lot of people greatest mistake has been? getting going in the industry? who turned out to be in senior positions in mining companies I think impatience. Enjoy the moment, enjoy the around the world. It was a good people, don’t always agonise place to be at that time. This is a very cyclical industry and about the future, be patient. one of the hardest things to do is Stratum: Everyone we’ve spoken just be patient to wait for the And focus on assets. It’s about to so far have told me they’ve opportunities to come to you, people and assets. Always focus gone out to the locations, putting instead of sometimes being too on getting the best assets you can. in the time, living in tents and so ready to chase things because on. And I get a sense that the you want to seem like you’re doing Stratum: What about someone who next generation is less willing to something. I think back on all the isn’t necessarily an entrepreneur do that. time I spent worrying about this who wants to be an engineer and that. working for a larger company? That’s very true. To that point, Stanford University reported once If you surround yourself I think they live the cycles as well. that David Lowell has found more with the right people So I’d say just know it’s a cycle, and ore than anyone else alive, I mean position yourself to make the most amounts of ore that has affected and the right assets, being of the up cycles and don’t agonise the economies of nations. patient is sometimes all about the down cycles, because they will pass. He’s 88 years old and he’s out in the you need to do.” field still as much as he can be. I And this is an industry… because of once asked him “David, why are you Stratum: Rick Rule from Sprott those cycles, the brutality of them… so good?” and he said “Well, I think says in some situations it’s we lose a lot of good people. So if I’ve been on every known porphyry sometimes much more profitable people can hang in there they will deposit on the planet.” not to mine than to mine, would have an extremely brilliant career you agree? path, as things turn, as they So he knows what a certain type inevitably will. But it’s hard to of rock looks like that’s associated Absolutely. When you have a full believe that at the bottom. with porphyry, he’s seen them all. treasury that you’ve raised in a And he’s got suites of rocks from period when the market was open, Stratum: You are obviously very dozens of mines. So he knows the sometimes it’s better not to spend well known for doing deals textures; he hasn’t seen them in a it; to wait for opportunities. We are successfully. What do you look for textbook, he’s held them in his in such a cyclical industry and when you hire people, either hand. I think that’s something that’s assets are mispriced at the top and directly or when you invest in missing from the education of at the bottom at extremes that them? younger geologists. people could never imagine. It’s a lot to do with how known they Lukas Lundin, whom I know you If you can position yourself with the are within the circle of people that have also interviewed recently, says right people and the right access to I’ve got to know and trust over the something very true. He says that capital at the bottom, that’s how last 30 years. That’s important. “the guy who’s actually built a mine the Rick Rules and Lukas Lundins from start to finish… it’s a lost art”. have been so successful. They have Moral character, very important. And That’s his theory on why we were the guts to act at the bottom, and it’s such a small industry that you seeing so many cost overruns and they have the chequebook to act at can pick up the phone, talk to three mines that were having the bottom. Sometimes it’s better people and you’ll have figured out commissioning failures. to do nothing or be a seller when somebody’s past: good, bad or assets are priced too high. indifferent. I think it’s important you guard your reputation with your life in this business. I think it has to do with that reputation that you bring.

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Stratum: Any last word of advice for the younger guard coming into the industry?

I think patience and reputation, hang in there. My dad, who’s 88, and my very first and most enduring mentor, started in the mining industry when he was a teenager. He always said it’s a very long walk on a short street.

You see the same people and the same assets come around multiple times by the time you’ve been in the industry a few decades.

Stratum: Finally, are there any books you’d recommend?

I read sporadically for pleasure so I go to a book club that forces me to make time to read! But when I was travelling a lot on planes or when I was moving down to Chile, I got into the mystic realism of the Latin American genre of Gabriel Garcia Marquez. Reading those Latin American novelists at that time when I was living and travelling to those countries was a really great experience.

One of them was House of The Spirits by Isabel Allende. It’s set in Chile and it’s that mystical realism genre, but the places she was talking about existed, and I saw them, so that was a cool experience.

I can’t remember a book that has affected me as much as that, at that time of my life.

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THEDAVID LEADERS NETHERWAY

DAVID NETHERWAY

BIOGRAPHY

David Netherway is a mining engineer with over 40 acquired by International Mining and Infrastructure years of experience in the mining industry. David was Corporation in 2013. David has held senior positions in involved in the construction and development of the several mining companies including Golden Shamrock New Liberty, Iduapriem, Siguiri, Samira Hill and Kiniero Mines, Ashanti Goldfields, Crusader Resources and gold mines in West Africa and has mining experience in Semafo Inc. He is a former director of Altus Resource Africa, Australia, China, Canada, India and the former Capital and Altus Global Gold. Soviet Union. David served as the CEO of Australian- listed Shield Mining Ltd until its takeover by Gryphon Mr Netherway is currently the non-executive Chairman Minerals Ltd; prior to that he was the CEO of Toronto- of Kilo Goldmines Ltd (TSX: KGL), Canyon Resources listed Afcan Mining Corporation, a China-focused gold Ltd (ASX: CAY) and Altus Strategies Ltd and is a mining company that was sold to Eldorado Gold in non-executive director of Avesoro Mining Inc (AIM/ 2005. He was also the Chairman of Aureus Mining Inc TSE: ASO). and the Chairman of Afferro Mining Inc which was

I have the pleasure of knowing in Resource IQ, where he is the I always enjoy speaking with David Netherway well and was Chairman. David’s support of the David, and it was particularly pleased when he agreed to an networking group is indicative of his interesting to be able to conduct a interview. Now into his fourth desire to give something back to the slightly more formal interview with decade in the industry, and with a industry he has enjoyed for nearly him on this occasion. I started, raft of Chairmanships and NED 40 years. naturally, by asking him how he roles to his name, few people had first become involved in the have the breadth of experience David’s lost none of his zest for the mining industry. and expertise that David can offer. industry over the years but over that time he has become one of the wise Our connection originally came via mentors of mining, with a particular Altus Strategies Ltd, our partners expertise in the junior space.

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ON THE SHOULDERS OF GIANTS

Stratum: Tell me how you first got go and get a job in the mining department in the mine, into mining. industry as a vacation job.” including every section of the mill, underground, everything, I was born and bred in Ballarat, I wrote to every mining company including the laboratories. which was the centre of the I could find in the telephone Australian gold mining industry. directory in Melbourne, got one So instead of spending two years My father was a very eclectic reply with an underground job in, say, the ventilation department person who was very interested in offer in Kalgoorlie which I took. I spent three months in there so everything but he was fascinated I got this broad experience for by rocks. This was the end of first year where two or three years. Then I went I had to make a choice. You do a underground and finished all my He was a draughtsman in the common first year of engineering underground experience, because advertising business but on the and then you do electrical, civil or you need three years in and around side, he was into pond life, geology, mining or whatever. You have to a mine for a mine manager’s painting and all sorts of things. make a choice before second year. certificate. He was secretary to the historical I chose mining and never looked association for 50 years and they back. During that period, I was sent to set up what is now Eureka Mary Kathleen Uranium Mine Stockade, the tourist replica village, It helped that Australia at that time because they needed someone to museum and underground mine; was just entering the nickel boom, go and do a study for three months. one of the first ones in Australia. so mining was high profile too. That was an open pit so I got good open pit experience also. It was set up in Ballarat because the Stratum: What would you say Eureka Rebellion was the only civil was your first big break? I got all this incredible experience war ever in Australia, between the over three years. At the end of three miners and the police back in 1854. Five of us graduated that year and years I said “Sod this! I need a a couple of years later they closed break. I’ve been doing all this and the Melbourne University mining studying and everything.” I wanted “I did mining engineering school. Three of them were on to go to Europe and have a holiday at the University of scholarships and therefore had jobs. for a few months. Two of us took a few months to get Melbourne. I was a job. Minenco said “Fine, you go and do influenced by a very that. When you come back we’ll We got jobs at Minenco, which was send you to our mines at flamboyant mining Rio Tinto’s Consulting Group, and Bougainville or Hamersley for some engineer there called they didn’t know what to do with open pit experience.” Simon Peck and by us. They were told by McKinsey to go and hire some young guys But my mentor, a guy called George John Dunlop.” because you’re all too old and you Reynolds, said “If you’re going to need some young blood, so they London you’d better see my mate hired us! Dick Moffat, who’s the CEO of RTZ They were both mining engineers Consultants.” and a few years ahead of me. I was They said to us “What do you want doing engineering but I wasn’t sure to do?” I said “I want to finish my By the time I got to London, Dick which engineering. I was thinking underground mine manager’s goes “You have to go to India next about surveying, because my sister certificate.” I’d already done most of week. I’ve got you lined up for had a boyfriend who was a surveyor the actual underground experience something.” and it seemed a pretty good but I needed a couple of years in outdoor life and a lot of travel. underground mines so they got me This was around June 1978, and I’ve into Broken Hill in Australia. never lived in Australia since. Then These guys said to me at university RTZ Consultants got sold to Golder “Don’t do surveying. You become When I was there, I asked to get Associates and you could either go a good surveyor like you become a experience on everything. I spent with Peter Stokes and join good plumber. Be a mining two or three months in every Micromine, to Bristol with RTZ engineer, but what you must do is

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THEDAVID LEADERS NETHERWAY

Technical Services or Golder’s. I got Jim into Ghana, where, as Another one – and again it’s the I joined Golder’s here in the UK. Golden Shamrock, we built the people issue – was when I was with Following that I spent six months Iduapriem Gold Mine. Later he RTZ Consultants, I was told “We are in Oman, four months in Malaysia became my chairman of Prospex hiring a guy to go out to Oman and and three years in India. Mining and I’ve worked with him be our chief geologist.” I had a beer ever since, on and off. He’s had with him and he seemed like a good Stratum: You mentioned your a big influence. He’s one of my bloke, but get him out there and he mentor at the time. Was that more recent mentors over the was useless. You need to do your something you actively last 20 years. homework properly. sought out? Stratum: What would you say is It’s all changed now and you can Minenco appointed a senior your biggest success to date? evaluate these people a lot better. person to keep an eye on us. I got on well with him because I would like to say Altus Strategies You guys (Stratum) have got a lot he was an experienced mining which is heading that way. But I better systems to do it but it was a engineer and I looked up to him. think probably Afcan because it real risk in those days. Some people But, because I was in the UK and became an operating mine. We just ‘spat the dummy’ the minute he was over there, the relationship took the Tanjianshan gold project they came in and got back on the didn’t continue. in the west of China through to plane, others lasted longer and you selling it to Eldorado. I bought it had to throw them out because However, I’m still close friends with from Sino Gold. they went ‘bush’. John Dunlop. He came back to Melbourne University as a lecturer Stratum: And have you ever Stratum: Accurate assessment while I was there in my last two looked back and thought “that is a big thing for our company. years of mining. He had spent was a big mistake”? Do you have any specific way three years underground as a of assessing people? mining engineer at Rosebury in My role these days is all about Tasmania. He was the first mining people. You’re in the people I found the best way when I was lecturer at Melbourne University business so you fully understand running Ghana was a six-hour drive for about 200 years that had that you have to choose the to the site. That was one of the recent mining experience! right people. more interesting ways of finding out whether this guy was going to work He was fantastic because he was “I guess the biggest risk is and finding out his attitude to three or four years older than us not making the changes looking round. Driving through and he could relate to us and we’ve villages, poverty, black Africa and all been very close friends ever since. you should make when that, seeing whether he was going He’s been very much involved in you realise there is a to fit in and then giving him a pep the AusIMM in Australia. talk on how he should fit in and how problem. It’s hard, but as he’s representing his country, he’s The other mentor I need to mention you get older and greyer representing all sorts of things, and is Jim Askew. you get tougher in this how he should act. Jim is the chairman of OceanaGold business. Usually they’d fly in that night, and of Evolution in Australia, two you’d have dinner with them, have I think the other lesson is that of Australia’s biggest gold mining breakfast, leave early in the morning as a director, and especially as a companies, and of Syrah Resources, and then drive on to the site. That non-exec director, you have to be which has a big graphite project gave you some sort of window to very involved. You need to make in Mozambique. Jim was CEO of give this guy an idea of how he’s sure you regularly visit the site Golden Shamrock and we were at meant to behave and get a feel of operations to ensure that what you Broken Hill together. He was about the feedback of what he’s actually are being told is what is happening two or three years older than me. like, whether you think he will fit in. and that the executive is not being He set up James Askew and Of course, you can still get it wrong. ‘economical with the truth’. Associates, which became Australia Mining Consultants and Ausdrill.

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ON THE SHOULDERS OF GIANTS

Stratum: What level were you at My consulting career in India was Stratum: Are there any up and the time? unbelievable because we were coming youngsters or high flyers doing underground lead, zinc, you’re keeping your eye on in the I was country manager. But even asbestos and copper all round India. industry right now? now on CEOs and board members, Every three months I would go to you must do some basic some of these consulting jobs, I think Steven Poulton is one of groundwork at least. Talk to the travel around India and then my them. I backed him 10 years ago right people and have more than a boss had to come back to the UK when I first agreed to become his beer with the guy. and run the company. chairman because I felt that he was going places. It’s been hard through The only people I hire these days Then I was in India by myself at the cycles, but it’s getting better. are either NEDs or CEOs. I’m not the age of 26, running the India I think something’s going to pop involved in the rest. My opinion is operation. I’d go to Nagpur or out of there. He’s just full of ideas asked but that’s about it; it’s not Calcutta, and then we were doing all the time. necessarily my decision. They are a job at 15,000 feet in Nepal up on such important roles but it can take the Tibetan plateau right on the Stratum: And my last question three or four months to find out if Chinese border – a three-day trek is whether you have any book someone’s no good. By then it’s to get up there. I was getting paid recommendations, professional too late. to go trekking! It was absolutely or personal? unbelievable. Stratum: What advice would you Currently I’m reading Diana Athill’s have for your 30-year-old self? When I came back after all that, biographies, they are unbelievable. What do people need to do to be I decided that I’d not had enough We went to Japan last week for the successful in this business? experience. I had to get back to first time, so I’ve been reading a the sharp end. The good thing book on the economy of Japan, “Be lucky. Be in the right about the mining industry is you Bending Adversity: Japan and the place in the right time can sit in Canary Wharf, you can be Art of Survival by David Pilling, an underground as a mining engineer, FT Asia editor who was based out and then grasp the there is such a wide range of things there for 10 years or so. And there’s opportunities when you can do but the sharp end is another one I just finished called they come.” where it’s really at. Lost in Japan, which was written about 20 years ago, about how I had a great life. It’s been fantastic. I got a job in Ghana, with Ghana Japan was losing its heritage, even I’ve travelled, I’ve seen the world, National Manganese, under an then. Fascinating. I’ve worked in all different countries, EU-subsidised programme. I was I’ve been given these opportunities chief operating officer and then and people eventually believed in never looked back from that. I me and that I could run a company. brought Jim Askew in and we built I jumped at the opportunity and the Iduapriem gold mine a couple tried it. of years later.

Stratum: A common theme that You have to take those has come out with people in this opportunities but you have to series, has been a willingness, in realise your shortcomings and the early five to 10 years, to go to which way you want to go. It’s a the middle of nowhere rather than great industry but you have to get sitting in Canary Wharf in an office your hands dirty at some stage. A building on a computer. lot of people don’t believe me.

Absolutely. It’s essential. I did three years in an Australian mine, got my mine manager’s ticket, and then came to the UK, where I was consulting.

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THELESSON’S LEADERS FOR THE LEADERS

LESSONS FOR LEADERS… … FROM MINING GREATS.

In compiling this series of for example, made her own luck by describes an early project in West interviews, we have been attending the right events and Bloemfontein as his biggest break: privileged to get inside putting effort into mixing in circles “I was selected to go on a course the minds of some of the where she would meet the right and to do this programme, which greatest and most successful people. As with so many other set me on my career.” contemporary leaders in examples in this series of interviews, our industry. those early career life-changing 3. GET EXPERIENCE events tend to be out in the field, AT THE COAL FACE – Although we encountered a on travels, or at mine sites. IDEALLY BEFORE FAMILY broad range of personalities, seven common threads – or 2. WORK HARD, BUT IT COMMITMENTS KICK IN success factors – emerged HAS TO BE SMART during these conversations. Our interviewees agreed that anyone expecting to build a mining It’s boring but it’s true; putting 1. SEEK OUT MENTORS career with longevity and in the hard work to ensure you progression should not expect to shine will get you noticed by work at a desk from day one. The earlier in your career you employers, influencers and identify a mentor or mentors who Hands-on operational experience potential mentors. The better able is critical for developing the have already taken the road you you are to demonstrate you are want to travel, the greater the understanding to work in the entrepreneurial, dependable and industry and the credibility to hold impact they will have on your willing to take on a well-judged long-term success. It is, however, your own with your peers. As Hugh risk, the more likely people are to Morgan says, “You get a first-hand never too late to start and you invest their time and cash into could, like David Netherway and experience which is something you you and the more opportunities can never substitute by being at Catherine McLeod-Seltzer and I’m will present themselves. sure all our interviewees, establish a university, and is more difficult to get later.” friendships that last a lifetime. Isn’t Of course, prioritising your work that what it’s all about anyway? around gaining a wide range of But it is difficult, involves months experiences and working on living away from home base and These relationships don’t just high-impact projects with happen, however, though some of can be lonely. Ian Pearce adds measurable results will always be “There were parts of my career the most effective involve a degree more effective than simply working of serendipity. Even so, Catherine, earlier on that I thought really hard for working’s sake. Ian Pearce sucked. I started at the bottom of

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ON THE SHOULDERS OF GIANTS

the pile” before emphasising “but comes in how they respond. Lukas every right to consider themselves that has been invaluable in my Lundin puts it this way: “Successful self-made successes. Yet every one role as a COO.” people learn from their mistakes. attests to the importance of both Unsuccessful ones… go back and their mentors, who helped them get Mark O’Dea puts it this way: “I’d do the same thing.” to the top, and the partners and advise anyone new to the industry employees who keep them there. to put your feet on the rocks, put Rick Rule explains it well when he your boots on the ground, get your describes his frustration if people Only those leaders who can attract, hands dirty and learn the business securing his investment in one retain and motivate top-tier talent from the ground up.” project spend his money on – and remove those who are not another. If, however, they proceed delivering – will be able to achieve So, if possible, gain this experience as expected and they find nothing, and sustain success. Getting the early in your career to earn your he says that’s okay. “I don’t mind balance right is equally important: mining chops and to develop a that, that’s the risk I’m prepared to “The alchemy in building a natural wider understanding of what accept. If they lose all my money resource company is the ability of sort of role you enjoy. You may that’s okay, I’m betting that they are the CEO to look at the task at hand be surprised. going to have luck with their drills, and assemble the appropriate but it’s a very risky business.” range of talents” says Rick Rule. 4. BE PATIENT So, take risks, make mistakes, just The greatest leaders recognise this Mark O’Dea speaks about being a own up to them and learn! and accept it. Lukas Lundin extols “10-year overnight success”, and the benefits of surrounding himself closer analysis reveals his greatest 6. COMMUNICATE with the best exploration experts successes came after 20 years in WHAT YOU WANT and Rick Rule puts at least some the industry. “Success – whatever of his success down to the fact WITH CLARITY you want to define that as – comes that he had “the extraordinary in a moment in time” he says. “But good fortune to surround myself When Mark O’Dea is looking for the backdrop to that is a massive with A-Players while I was still in leaders, the ability to communicate amount of work and love of my twenties”. well is paramount. “I have to have the craft.” people who can communicate” he Good leaders can be demanding, says. “In any industry the biggest Catherine McLeod-Seltzer makes but they reward well, share credit challenge is communicating your the point that in mining you and are always looking out for craft in a way that’s interesting sometimes have to sit out what she talent in the next generation. and evocative to an audience calls the “brutal cycles”. Rick Rule of investors.” has often made the point that the From the observations we heard best strategic decisions depend on from our interviewees, and from our David Netherway was clear about timing and waiting for the bottom own experience at Stratum, there is what he needed fresh out of of the market. some formidable new talent coming university. He wanted experience through. We look forward to our underground to gain his mine Success can come early, as it did continued association with those managers’ certification and to get for Ross Beaty, but for most leaders we already know, and building our as wide a range of experiences in the greatest success comes later relationships with those we have mining as he could in his first few in their careers and everything that yet to meet. years. It was this kind of clarity that preceded it was equipping them to set him on a course from which he’s take full advantage of opportunities never looked back. as they emerged.

5. TAKE RISKS AND 7. SURROUND YOURSELF Contact: WITH THE BEST PEOPLE MAKE MISTAKES Stratum International We interviewed some of the most t: +44 (0) 203 627 3271 Our interviewees were refreshingly successful mining leaders of their e: [email protected] candid about the mistakes they generation; people with arguably w: stratum-international.com made along the way; the difference

< PREVIOUS NEXT > CONTENTS To discuss this report in more detail please contact:

Will Coetzer John Larpent Jane Banks Managing Partner Partner Principal Consultant London, United Kingdom London, United Kingdom Washington DC, USA t: +44 (0) 203 627 3272 t: +44 (0) 203 627 3273 t: +1 202 455 0982 e: [email protected] e: [email protected] e: [email protected]

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