Australia Vs Canada the Big Debate

Est 1835: Global mining investment and business insight COMMODITIES Lithium: technology meets technology 47 WORLD The top 100 ASX risers 58 OPINION mining-journal.com The show must go on 64

July 15-28, 2016 Australia vs Canada The big debate

ASX Code: GCY One of the four big independent gold developers in Australia gascoyneresources.com.au

001CoverMJ160715a.inddUntitled-1 1 1 14/07/201611/07/2016 08:5711:08 ASX code: TNR

Developing the gold mines of tomorrow

Australian gold exploration and development company Focused on growth by quality acquisitions and low-cost exploration Four advanced projects in the Goldfields Regions of Western Australia

torianresources.com.au

Torian2.indd 1 08/07/2016 16:14 July 15-28, 2016 CONTENTS WORLD VIEW 11 PEOPLE 5 Est 1835: Global mining investment and business insight ON THE COVER COMMODITIES Lithium: technology meets technology 47 5 Appointments LBMA appoints Fisher WORLD The top 100 ASX risers 11 Keno Hill restart hinged on 58 mining-journal.com OPINION The show must go on chairman; Rutherford to chair Dalradian; July 15-28, 2016 64 streaming: Renegotiating an 22 Australia vs Australia vs Canada existing streaming agreement could Atalaya appoints Sanchez as CFO; Canada: Two great The big debate be the key to Alexco Resource Corp McAlister joins ZincOx as FD; Changes mining nations go restarting production in Yukon at the top for Kefi; New directors join head-to-head to decide Mariana; Former Rockwood duo join who’s the top digger 14 Peregrine higher on Chidliak Lithium X; New investor chief at Barrick; PEA: The share price reached its Flanagan leaves Atlas Iron ASX Code: GCY highest level in almost a year after the One of the four big independent gold developers in Australia 6 Interview Back in development 001CoverMJ160715a.inddUntitled-1 1 1 gascoyneresources.com.au company released a PEA for its MARKETS 63 14/07/201611/07/2016 08:5711:08 Chidliak diamond project MOD: Experienced mining executives Julian Hanna and Terry Grammer join 63 Indices and prices: A rundown forces again in Botswana of the sector scorecard from the MJ BRIEFING 2 past two weeks 2 SolGold’s ’world-class’ intercepts; Banro’s record production; Hedge FEATURES 20 junkies get their fix; ‘Next bull run is 20 Discordant mood music in coming’; Endeavour’s growth plans; Philippines: What’s in the future COMPANY PROFILES Energia ploughs on in Italy; Tahoe puts now a strident anti-mining president 12 Cardinal Resources has been sworn in? faith in Lake Shore Gold; Market takes Cardinal sings golden tunes to Cardinal; Newmarket Gold onto a 21 Vietnam could do with a wake-up 16 Altech Chemicals winner; Pilbara lift-off on China deal; call: TSE Asian country failing to tap From clay to a new-age, must-have material SRK tops the reporting table; EY: ‘How into its geological potential 32 Torian Resources miners can fight volatility’ 56 New Zealand’s best and brightest Eureka moment at Zuleika 58 The top 100 ASX risers 34 Explaurum Ltd Golden triple for explorer OPINION 2 59 Aussie investors bask in better 2 Comment Not so skimpy this year 36 Gascoyne Resources year: Australian miners heading to Gilbeys proves just the tonic for the annual Kalgoorlie gab-fest in a far Gascoyne better mood COMMODITIES 29 38 St Barbara Gold producer poised to be stronger 15 From the Capital Bar set by 29 Gold – as good as it gets: The only for longer thing better than gold at the moment Western Areas too low: St George 40 Ramelius Resources mining keeps hitting nickel but must is gold in Australia Future glitters for star gold miner do more to sate investors 30 Aussie gold stocks on the move 42 De Grey Mining 19 Miner’s right Better times in the 47 Lithium – technology meets Gold development on the horizon for De Grey sandpit: Titanium and zircon prices technology: A breakthrough in 44 Alto Minerals lifting mineral sands miners processing method may transform Explorer set to rise on high-grade gold 51 Critical perspective The core of burgeoning lithium sector exploration: Australian explorers 48 Platypus Minerals 54 Uranium back on Australia’s Global player has many lithium irons have disrupted the niche minerals agenda: Three mines set to become in the fire space more 52 Independence Group NL 64 View from the West End The show 62 Iron ore – it’s all about supply: Independence to have its day must go on: Board-level bureaucracy Cost, not demand, will underpin the 60 CSA Global looks good but means little Building winning reputation as market price forces knock down some rivals

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FINANCE The Editor The TOP Hedge junkies stories get their fix Not so EXPLORATION Gold miners hedged another SolGold’s ’world- 1.62 million ounces of produc- skimpy tion in the March quarter of class’ intercepts 2016 as 33 companies became this year SolGold has drilled out some net hedgers during the first “world class” intercepts that three months of the year. The have gained it even more atten- gold price, currently at What a difference 12 months can make. When Aussie miners were pre- tion. The latest highlight came US$1,341/oz, has moved up so paring last year for the annual Diggers & Dealers conference in the from hole 17 at the Alpala rapidly this year that the top gold-mining heartland of Kalgoorlie, Western Australia, many manag- deposit, which saw a 948m inter- ends of the zero-cost collar ing directors would have been wondering if it would be their last. section grading 0.54% Cu and instruments put in place only For those in the younger generation of mining leaders, their last 0.53g/t Au, or 1.01% Cu-equiva- months ago are being tested, or with their current company. For industry veterans, they would have lent, from 330m depth. Within have already been surpassed. wondered whether they'd seen their last boom and were signing off this was a 562m width grading The largest new hedger was on their career. If they were, well, what a boom to go out on! 0.7% Cu and 0.75g/t Au from Newcrest, which hedged One of the widely quoted figures at that time was the number of 702m depth. This hole, along 530,749oz of production from ASX-listed equities with less than A$1 million (US$760,000) in the kitty. with the 16 that preceded it, has its Telfer gold mine out to mid- We were told there were many and equity markets offered little hope confirmed mineralisation over 2018 at an average price of of a rescue. So many equities had held on so grimly for so long, rightly 450m width, 700m length and A$1,737 per ounce (US$1,328). or wrongly, and the end, it appeared, was nigh. 1,800m vertically, in the mean- Since that hedge was signed, Not so. As both our Aussie gold feature (pp.29-31) and the ASX top time redefining Cascabel as a the spot gold price has gained 100 feature (pp.58-59) attest, there has been an extraordinary recovery gold deposit, as opposed to the almost A$200/oz and remains for ASX-listed stocks. copper asset SolGold initially close to all-time record prices of This has been fuelled by a slow-moving realisation that equity val- thought it had on its books. just over A$1,800/oz. Austral- ues, as they were going into the December quarter of last year, ian-focused Evolution Mining couldn't get any lower. added 150,000oz of gold pro- There has been a glorious rise in commodity prices: gold is up on PRODUCTION duction to its existing hedge fear and uncertainty; zinc is up on lack of supply; lithium is running on book during the quarter at an the demand story; and nickel, most recently, has been moving on sup- Banro's record average Australian dollar gold ply threats. The flames have been fanned by the ailing Aussie dollar – production price of A$1,764/oz. The overall a natural cure for cost inflation. Congo-focused gold producer delta-adjusted hedge book And so equity markets have opened, with gold and lithium equities Banro Corp has announced a stood at 8.69Moz by the end of at the front of the queue. record quarter of gold produc- March, the largest amount of Macquarie said this week that GDP growth usurped by uncertainty tion as output at its Namoya total hedged ounces since the could restrict further gains for the rest of the year and into 2017. mine edged towards steady- middle of 2010. But still a long But conventional wisdom of those who understand the commodity state levels. Production from way from the 1999 peak of cycle is: the longer it remains subdued at current levels, the bigger and the two mines is expected to be more than 100Moz. more prolonged the spring back. over 210,000 ounces in 2016. And so we enter ‘Diggers’ with smiles for the first time in near-on The company’s two gold mines half-a-decade. in the Democratic Republic of TRADE Those quoting the number of balance sheets in crisis are few. the Congo produced a total of And those veterans who enjoy a beer and something else in the Pal- 49,673 ounces in the three ‘Next bull run ace Hotel this year may be tempted to come back in 2017. months to end-June, and is coming’ 93,965oz in the first half of 2016, The supply picture has materi- World markets: stock markets also a record. John Clarke, Ban- ally improved following a lack ro’s CEO said: “We are very of investment in new capacity Index July 14 June 30 %chg pleased with the continued in most commodities and the TSX Global Mining 67.20 60.73 10.65 TSX Venture 757.69 721.10 5.07 ramp-up at Namoya during the emergence of potential supply ASX 300 Metals & Mining 2652.61 2312.86 14.69 June quarter, culminating in shocks, according to a note by FTSE/JSE Africa Gold 2728.31 2378.35 14.71 over 9,000oz of gold being brokerage Jefferies. Excluding FTSE 350 - Mining 11768.00 10115.54 16.34 poured in June.” Europe, the demand outlook Nikkei 225 16235.13 15566.83 4.29 Hang Seng 21322.37 20794.37 2.54 Dow Jones Industrial 18372.12 17694.68 3.83 Nasdaq Composite 5005.73 4779.25 4.74 Euromoney Global Mining 295.26 263.37 12.11 World markets: currencies Index July 14 June 30 %chg AU$ per US$ 0.76 0.74 2.66 EUR per US$ 1.11 1.13 1.31 GBP per US$ 1.32 1.35 1.85 SAR per US$ 14.33 14.79 3.09 Yen per US$ 105.63 103.20 2.35 RMB per US$ 6.69 6.65 0.59 BRL per US$ 3.26 3.21 1.60 CAD per US$ 1.29 1.29 0.03 Banro's Namoya mine, DRC: 9,000oz of gold was poured in June

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may be improving as well, it Editor’s pic FINANCE said. The coal supply picture was described as bullish due Tahoe puts faith in to significant Chinese product- Lake Shore Gold ion cuts. Elsewhere, a nickel Three months since Tahoe supply shock triggered by the Resources took over Lake Shore new anti-mining government in Gold, it is showing how far it is the Philippines could send the willing to back the former man- price up further. But Jefferies agement's growth plans. After cautioned that risks were on completing the US$681 million the high side. A sustainable, deal in April, Tahoe was forth- fundamental recovery right in its strategy, saying it was more likely in 2017-18. wanted to expand the Ontario Despite a number of positives, gold assets it acquired with the production growth in copper transaction to 250,000 ounces and iron ore in the second per annum by 2020. Tahoe has half was a concern. However, now put some meat behind the broker added that though India’s Prime Minister Narendra Modi (pictured right) and his these words. It has acquired the the timing of the next bull delegation visited South Africa recently. As part of the trip, Modi 2% net smelter royalty (NSR) market was uncertain, if history and South Africa’s president, Jacob Zuma (pictured left), addressed Goldcorp had on the Bell Creek was a guide, “it is coming”. the South Africa-India Business Forum. Zuma said the visit would mine in Timmins for C$12.5 mil- “be used to further bolster cooperation on economic, political, lion (US$9.7 million), freeing up social and international areas”. Anil Agarwal, chairman of Vedanta future revenues from a poten- COMPANIES Resources, who was part of the delegation, said two MoUs were tially dilutive stream. Second, the signed for the development and supply of equipment and the company has agreed to swap the Endeavour’s transfer of technology, with the aim of improving safety and 30% interest Goldcorp had in growth plans productivity at the mechanised underground mines of Vedanta’s Tahoe’s Whitney project for a 2% Mexico-focused Endeavour Sil- subsidiary, Hindustan Zinc Limited (HZL). Vedanta is developing NSR, giving the company 100% ver has decided to increase capi- the Gamsberg zinc mine in South Africa’s Northern Cape Province. of the asset. With near-surface tal spending, boost production mineralisation at Whitney already and ditch a plan to put El Cubo 15,649oz for silver-equivalent ing below existing workings to expanded through a Lake Shore on care and maintenance “to production of 2.6Moz using a find the next zinc mine at Gorno. drill programme earlier this year, reflect higher metal prices and a 70:1 silver-gold ratio. The company’s inferred resource acquiring the remaining piece of renewed focus on growth”. Capi- of 2.9Mt at 5.8% Zn, 1.5% Pb and the project allows the company tal investment guidance for 23g/t Ag includes a portion of full control. 2016 has been lifted from C$11.3 EXPLORATION Colonna Zorzone, but the latest million to C$17.4 million hits show this zone has plenty (US$13.3 million), while for Energia ploughs more mineralisation to come. COMPANIES exploration the number is up on in Italy Drill hits such as 14.9m grading from C$2.5 million to C$10.8 mil- Colonna Zorzone is continuing 17.6% Zn, 3.4% Pb and 40g/t Ag Market takes lion. Production guidance has to perform for ASX-listed Ener- (or 21% Zn+Pb combined) from to Cardinal been increased to between 9 gia Minerals, with the latest 80.5m depth, 7.1m averaging Ghana-focused gold explorer million silver equivalent ounces intersections from the prospect 26.5% Zn, 2.5% Pb and 95g/t Ag Cardinal Resources has seen its and 9.8Moz. Silver production in expanding the potential size and from 129.8m depth give share- shares increase more than 130% the June quarter was 1.55Moz confidence in its Gorno project holders plenty of food for this year with official resource and gold production was in northern Italy. Energia is look- thought. numbers pending at Namdini in the country’s north. The compa- Best and worst performers (June 29 - July 13) Euromoney Global Mining Indices ny’s management and shareholder pedigree, plus renewed Local closing 2wk share Country Industry group Sector price (July 13) price move (%) West Africa gold fervour and Top 10 risers what Cardinal’s drilling has 1 Western Areas Ltd A$3.01 50.50 Australia Base Metals Nickel revealed to date at Namdini, are 2 Cliffs Natural Res US$7.29 41.30 USA Base Metals Misc Base Metals obvious reasons for the run on 3 Whitehaven Coal A$1.52 38.80 Australia Coal Coal its shares. The company has 4 Independence Group A$4.37 38.70 Australia Diversified Diversified 5 Century Aluminum US$8.21 35.50 USA Base Metals Aluminium about A$5 million (US$3.8 mil- 6 Vale Indonesia Tbk Rp2410.00 33.50 Indonesia Base Metals Nickel lion) in the bank, so fully funded 7 Vedanta Resources £5.29 32.30 UK Diversified Diversified through its definitive feasibility 8 Hochschild Mining £2.30 29.50 UK Other Metals/Minerals Silver study phase including, poten- 9 Exxaro Resources R82.39 29.40 South Africa Coal Coal 10 First Majestic Silver C$21.98 29.10 Canada Other Metals/Minerals Silver Top 10 fallers 1 Gemfields Plc £0.34 -6.30 UK Other Metals/Minerals Diamonds Western Areas 2 Assore R181.50 -6.00 South Africa Diversified Diversified 3 Agritrade Resources H$1.49 -2.60 Hong Kong Coal Coal 4 Centerra Gold Inc C$7.44 -2.50 Canada Gold Gold Producers 5 Semirara Mining PP121.00 -2.00 Philippines Coal Coal 6 Netmind Financial H$0.08 -1.20 Hong Kong Base Metals Copper 7 Cameco C$13.86 -1.00 Canada Other Metals/Minerals Uranium ê 8 Mandalay Resources C$1.19 -0.80 Canada Gold Gold Producers é Gemfields 9 Guyana Goldfields C$9.09 -0.30 Canada Gold Gold Producers 10 Nyrstar Nv €8.40 -0.10 Belgium Diversified Diversified The biggest riser and faller

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tially, a lot more drilling. Cardinal good shareholder value, accord- Commodity watch has announced the first assays ing to RBC’s Stephen Walker. He from step-out (and deeper) dia- said: “Newmarket remains one of Precious metals (June 30 - July 14) mond drilling, which indicated the top free cash flow genera- US$/oz % ch that its previously outlined tors, and we estimate a free cash Gold 1325.7 0.66 Silver 20.25 10.29 900m-long, 200-300m-wide and flow yield of 14% in 2016 versus Platinum 1093 8.33 200m-deep mineralised system the tier three average of 2.3%.” Palladium 650 9.61 has depth extensions. More Iridium 530 0.00 results are due to be publicised Rhodium 650 0.00 in the coming weeks. Cardinal FINANCE Ruthenium 42 0.00 CEO and managing director LME prices (June 29 - July 13) Archie Koimtsidis told Mining Pilbara lift-off US$/t % ch Journal in Perth the core from on China deal Aluminium 1670 3.44 depth-extension drilling, at least, Lithium market darling Pilbara Aluminium-alloy 1535 0.00 looked the same as shallower Minerals has further cemented Copper 4919 2.90 drill samples. The seasoned its credentials by signing a bind- Lead 1863 7.44 Ghana gold explorer (and resi- ing off-take and downstream Nickel 10290 10.88 Tin 17995 5.54 dent for much of the past 30 processing agreement with “a Zinc 2187 6.22 years) said: “We’re pretty lucky in major” Chinese chemicals com- that the block as it stands [900m pany. The shares shot up LME official averages of strike; c200m wide and deep] another 16% on the news, build- US$/t Cash 3 mths is fairly homogenous all the way ing on an already strong run in (settlement) Aluminium 1592.2 1591.83 1600.51 through.” 2016. The six-year agreement for Aluminium-alloy 1532.5 1527.61 1556.36 the annual supply of 140,000 Copper 4630.64 4630.26 4637.35 tonnes of spodumene concen- Lead 1713.91 1713.6 1719.78 COMPANIES trate includes partnership in a Nickel 8915.45 8911.7 8957.27 future downstream processing Tin 16985.23 16980.8 16942.5 Newmarket Gold Zinc 2023 2022.59 2027.8 joint venture and an A$18 mil- Settlement exchange rates GBP/US$ US$/JY EUR/US$ onto a winner lion (US$13.5 million) cash injec- 1.421 105.47 1.1227 tion into Pilbara. The off-take Settlement is the average of the cash sellers’ prices. Newmarket Gold Cash and three-months are the average of the buyers’/sellers’ price. 4 share price (C$) agreement is for the supply of 3 chemical-grade spodumene Comex copper prices (July 14) concentrate from Pilbara’s C$ 2 100%-owned Pilgangoora lith- US cents/lb July 223.80 1 ium-tantalum project from the August 223.80 0 March quarter of 2018, with the September 224.00 July 2015 July 2016 option to extend for a further Newmarket’s shares are up 228% four years after 2024. Pilbara has Other commodities (June 30 - July 14) in a year said the project should come Price % chg % chg 1yr One of the few TSX-listed stocks into production by the end of Iron ore 62% 58 7.01 3.94 48.7 5.64 -6.88 offering exposure to Australia’s 2017. Iron ore 58% Uranium 26.5 -1.85 -27.40 booming gold sector is set to retain its premium valuation as a resource-estimating activity TECHNOLOGY focus on cost per tonne contin- SERVICES includes logging of independent EY: ‘How miners ues to pay off. Newmarket SRK tops the consultants signing off on JORC, Gold’s three operating mines in NI 43-101 and other standard can fight volatility’ the Northern Territory and Victo- reporting table reports. RSC records shows that Mining companies must move ria have been churning out more Scale and its diverse geographi- in the 21 months since October faster to generate cash and ounces at lower-than-expected cal and commodity expertise has 2014 (when it started tracking strengthen balance sheets to costs thanks to a weak Austral- kept SRK Consulting well and activity) SRK consultants certi- successfully navigate volatility, ian dollar. Such performance, in truly on top of the global con- fied almost double the number according to an EY report. Paul tandem with higher gold prices, sulting-sector league table dur- of reports of nearest rival CSA Mitchell, EY global mining and has resulted in a 228% share ing a much busier 12 months for Global – with unnamed smaller metals advisory leader, said: price rise in the past 12 months. the sector (to the end of June), independents collectively sitting “Too many have viewed cost- Looking to the most recent quar- an industry scorecard shows. at number two on the table. reduction measures and produc- ter in question – the three RSC Mining and Mineral Explora- Roscoe Postle Associates (RPA), tivity initiatives as a one-off, months to the end of June – tion’s authoritative tracking of Giroux Consultants and AMC when they need to embed con- Newmarket beat expectations worldwide public reporting of Consultants rounded out the tinuous improvement in their again and continues to offer mineral-exploration drilling and top five. DNA. They need to challenge themselves to find the next Pick of the quotes 10-20% of productivity savings.” The report noted working capital “I now challenge other[s] to Association of Mining and Exploration as one area to improve, with Companies CEO Simon Bennison has thrown aggregate levels in the sector of do the same by bringing down down the gauntlet to all Australian states, more than US$200 billion, and some of the financial and non- challenging them to match South Australia’s pointed to processes and sys- recent efforts to improve conditions for juniors tems across the supply chain as financial barriers” the biggest area for miners to make gains.

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APPOINTMENTS [email protected]

LBMA appoints ber 2013, has served as a non- Ian Plimer will become chair- ment, commissioning and executive director of Anglo man of the exploration review operation of the company’s Fisher chairman American. committee. The existing roles Salar de Atacama project. Paul Fisher has been appointed of deputy chairman and senior He later served as general man- as the new non-executive chair- independent director will pass ager of the operation before man of the London Bullion Mar- from Prof Plimer to Wellesley- leaving Rockwood in 2014 ket Association (LBMA), replac- Atalaya appoints Wood as from January 2017. following the company’s sale ing executive chairman Grant Sanchez as CFO John Leach has agreed to join to Albermarle. Barrientos is Angwin, the president of Asahi Atalaya Mining has appointed the senior executive team as also a former Rockwood Refining. Fisher has been a sen- Cesar Sanchez as group chief finance director as the com- employee, having had the role ior figure at the Bank of England financial officer, effective pany begins its transition of engineering and research for 26 years. He was a member immediately. Sanchez has towards production. The board superintendent of its Chile of the Monetary Policy Commit- served as CFO of various com- will comprise two executive operations until 2012. He later tee for five years, the interim panies in both the mining and directors (chairman Harry moved onto BHP Billiton to Financial Policy Committee for financial industries, including Anagnostaras-Adams, pictured work at its Escondida copper two years and the PRA Board for Iberian Minerals Corp, formerly below, and Leach), and three mine. six months. He will take up the a public mining company with non-executives (Norman Ling, role on September 5. He is due interests in copper assets in Plimer and Wellesley-Wood). to retire from the Bank of Eng- Spain and Peru. Atalaya said land at the end of July. Angwin, Sanchez played a key role in New investor will continue to work alongside Iberian’s equity and debt rais- chief at Barrick Fisher as a co-chairman for the ings. He previously worked as Barrick Gold has appointed remainder of 2016 to provide an auditor and financial adviser Daniel Oh as senior vice-presi- support and continuity for the at Ernst & Young, where he dent of investor engagement market. gained broad experience in and governance, effective July restructurings, IPOs, mergers 18. Oh has more than 16 years and due diligence processes. of experience covering corporate governance, capital mar- Rutherford to kets, accounting, investment chair Dalradian valuation, portfolio manage- McAlister joins ment and business strategy. He ZincOx as FD joins Barrick from BlackRock, ZincOx, an AIM-listed zinc recy- where he was VP of investment cler, has appointed Donald stewardship. Angela Parr, VP McAlister as finance director New directors of investor relations, will report with immediate effect. McAlis- join Mariana to Oh, as will Michael Leonard, ter is a seasoned executive, Mariana Resources, with pro- who has moved over to the having previously been FD of a jects in Turkey and South Amer- team from his role as director of number of London-listed firms ica, has strengthened its rela- forecasting and performance including Mwana Africa, Ridge tionships with partners Lidya measurement after Susan Mining and Reunion Mining, Mining and Sandstorm Gold by Muir, also VP of investor rela- the latter of which involved appointing Mustafa Aksoy tions, left the company. developing the Skorpion zinc from Lidya and Ron Ho from Northern Irishman Jim Ruther- mine in Namibia with ZincOx’s Sandstorm as non-executive ford has been appointed non- current CEO Andrew Woollett. directors. Lidya is the current executive chairman of Dalra- He has also been involved with 70% owner and operator of the Flanagan leaves dian Resources, a year after the economic evaluation of high-grade Hot Maden gold- Atlas Iron joining the board as a director. gold and base-metal mines and copper project in northeastern After salvaging the company Patrick Anderson, the outgo- the arranging of project finance Turkey. Sandstorm recently par- from near-extinction, Atlas Iron ing chairman, will remain as for feasibility studies and mine ticipated in the company’s pri- managing director David Fla- CEO and president, and as a developments. vate placing and now has a nagan has decided to stand director. “The board felt that 7.5% interest in Mariana. down from the ASX-listed iron this was the appropriate time ore miner. Flanagan, who to split the role of chairman Changes at the founded the company, will and CEO, thereby bringing the Former Rockwood remain in place until a replace- governance structure of the top for Kefi ment is found, or his six-month company into line with the UK Kefi Minerals, the gold explora- duo join Lithium X notice period is served, which- Corporate Governance Code,” tion and development com- Argentina-focused Lithium X ever comes first. He came back according to a statement. The pany with projects in Saudi Ara- has made chemical engineer into the Atlas Iron hot seat company owns the Curraghin- bia and Ethiopia, has unveiled a Eduardo Morales its chief close to a year ago and man- alt underground gold project in number of boardroom changes operating officer and Andres aged to negotiate a novel Northern Ireland. Rutherford with Africa veteran Mark Barrientos its new project gen- pact with contractors to get its has more than 25 years of expe- Wellesley-Wood to join as a eral manager of South America iron ore mines back into pro- rience in investment banking non-executive director. He will operations. Morales was previ- duction, while reducing the and investment management, also serve as chairman of the ously president of the Latin debt load of the company amid both as an institutional investor newly created technical review America arm of Rockwood Lith- falling prices for the steel raw and analyst and, since Novem- committee, while Professor ium, where he led the develop- material.

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INTERVIEW Back in development MOD Experienced mining executives Julian Hanna and Terry Grammer join forces again in Botswana

Richard Roberts ment status, outstanding geol- ner in the Kalahari. copper belt, MOD and Metal ogy and more competitive cost The pair picked up extensive Tiger the Ghanzi end. The latter MOD Resources (ASX: MOD) base. But Hanna’s focus has exploration ground previously is a regional centre of a few managing director Julian Hanna shifted to Botswana, and cop- held by failed Boseto copper thousand people. has been in the right place at per. producer Dis- “There has al- the right time before. He’s upbeat about where the covery Metals. “Discovery Metals ways been this The former Western Areas price of the red metal is head- Their main never really had myth that all the chief oversaw the Australian ing over the next two years, but Kalahari copper is up in nickel miner’s rise in the 2000s he’s positively buoyant about neighbour, the firepower the eastern end to consistent profit generator MOD’s Kalahari copper belt Cupric Canyon to deal with this of the belt and and dividend payer on the back prospects due to the results Capital, got its it’s completely of two high-grade mines and flowing from T3 – only the sec- hands on properly because wrong,” Hanna China’s insatiable appetite for ond drill target on a list of 10 mine infra- they were hell bent told Mining the steel-hardening metal. Nick- Hanna, his Africa exploration structure Journal. el prices reached the strato- general manager Jacques Janse probably on production and “This belt runs sphere and Western Areas’ mar- van Rensburg, and one of Han- worth $200 getting Boseto into Namibia – ket cap burst through A$1 na’s chief former Western Areas million, in- across the bor- billion. collaborators, Terry Grammer, cluding a settled in” der there are Many Australian mining lead- drew up earlier this year at a three million-tonnes-per-an- copper deposits all through the ers who headed offshore to pur- coffee shop opposite the MOD num concentrator, and resourc- Namibian end of the belt. And sue opportunities during that office in Perth. es, for about $35 million. this area [south-east Botswana period are again extolling their Grammer is chairing Metal Now Cupric dominates the Kalahari] is covered mainly by home country’s risk-free invest- Tiger (AIM:MTR), MOD’s JV part- Maun end of the sand-covered shallow sand [and a] lot of cat-

Drilling in progress at MOD/Metal Tiger ground in the Kalahari

6 July 15-28, 2016 • mining-journal.com • Mining Journal

06,07,10MJ160715.indd 6 14/07/2016 08:38 PEOPLE

tle farms. In some places you go Hanna and Grammer with a se- for the copper we think. We “More veins equals more bor- 5m through sand and calcrete rious track record of discovery could be dealing with a poten- nite equals better copper straight into fresh rock; fresh and corporate development in tially extensive shallow-dipping grades and more silver,” Hanna sulphide. Western Australia, who have a thrust zone [which] only dips at said. “So we like these bonanza “Discovery Metals never really passion for exploration and 20 degrees. When it comes up veins. We’re not really sure what had the firepower to deal with who won’t die wondering about onto the top of the dome, the direction they’re heading in in this properly and explore it me- the prospectivity of any of the axis of the dome, the minerali- the core – we’re starting to get thodically because they were targets on their initial list. sation seems to be more lead a better idea of that. hell bent on production and Magnetics, and zinc domi- “We are learning about this getting Boseto settled in.” soils and struc- “Wherever you go nated. So we deposit almost on a daily basis A fourth drill rig has just start- tural interpre- in the Kalahari, now look for … and realising [more about] ed work at T3, where MOD’s tation helped lead-zinc the potential that exists outside third drill hole hit 52m grading define those you’re looking anomalies at of the area that we’re drilling at 2% copper. initial targets, for the footwall surface [soil the moment. Resource-definition drilling but the drilling sampling] and “We’ve said there’s high- has been focused on an area, or itself has been sandstone and then we drill grade moly numbers … and ‘block’, 800m-long, 300m wide somewhat less the hanging wall down-dip to there’s some very weird intru- and 200m deep, over what scientifically find the cop- sions in the basement as well. MOD calls the T3 Dome struc- regulated on siltstone/mudstone per. The porphyry copper analogy is ture, but the company this the ground, and bang, you know “T3 is just very interesting. The IOCG-type week reported latest results had mainly because part of the T3 alteration in the footwall, no- extended the resource block there seems to that’s where the Dome – a frac- one knows what they are, and about 200m to the east – to- be copper eve- goodies usually are” tion of the the moly … no-one has done wards MOD’s Mahumo project rywhere a bit strike length any work on that. where it has a resource of 2.7Mt goes into fresh rock. here – and we’ve got three rigs “There has got to be a source grading 2% copper and 50g/t “We teamed up with Metal going backwards and forwards for the metals. silver included in a scoping Tiger to bid for that [former Dis- drilling out a resource just on “Wherever you go in the Kala- study. covery ground] and about a that panel there.” hari, in Namibia or Botswana, The partnership between week after the minister signed Below the calcrete and still fair- you’re looking for the footwall MOD and Metal Tiger reunites off on that [in February] we ly shallow drilling is picking up sandstone and the hanging wall two veteran geologists in started drilling. We were into vein and disseminated chalcopy- siltstone/mudstone – the pro- copper from day one on T4 rite and bornite, with the density spective contact – and bang, [north of Ghanzi],” Hanna said. of vein distribution variable. continues on page 10 “There had been some previous copper hits there and we extended that straight away with the first drilling. “Quality First” since 1882 “And then we thought we can either get stuck here or move Longevity... through the list. And so the Customer Support... next one we drilled was T3 – Quality Manufacturing... that was in March – and we’ve If these are qualities you require, then look no further. been there ever since. It’s a fab- Brunner & Lay has been ulous discovery. established as a leading supplier of Rock & Demolition “T3 has just opened up the Tools for over 125 years. whole belt.” Our experienced engineers, technicians, and support Geophysical surveying be- staff are dedicated to tween T4 and T3, and to the satisfying your product requirements. north and south, points to the prospectivity of a 100km-long elliptical area that covers about 1,000km2 – an indicator of the vastness of the haystack in which MOD and Metal Tiger are finding good accumulations of copper and silver. Together they have more than 11,600km2 under prospecting licences. “This target we call the T3 Dome is about 25km long. We just picked a line across the middle – there is a soil anomaly here and we drilled it and the 1510 N Old Missouri Rd third hole got 52m of 2% cop- Springdale, AR 72764 ph 479 756-0880 per. We got pretty excited fx 479 756-5366 about that,” Hanna said. toll free 800 872-6899 “What we’ve found is zinc www.brunnerlay.com seems to occur at very shallow Drilling in progress at MOD/Metal Tiger ground in the Kalahari depth and is the indicator here

Mining Journal • mining-journal.com • July 15-28, 2016 7

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8 July 15-28, 2016 mining-journal.com Mining Journal

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Strength on the ground Since 2014 SRK ES has seen positive business growth in Gabon. After initially opening a project oﬃ ce in Libreville ‘The next stage in developing the to support ongoing work on the Belinga Iron Ore Project Belinga Project will for the Government of Gabon, SRK ES has seen increasing be the completion of demand for in-country services. Ngaire McDiarmid reports a MRE conforming

SRK ES projects HE IMPORTANCE OF HAVING programmes including completion Belinga deposit contained 410Mt at to international in Gabon an in-country presence with of all associated logging and 64% Fe and 0.07% P. reporting guidelines strong local knowledge sampling of recovered material; In 2006 China Metallurgical was emphasised by the conducted geophysical surveys; and Equipment Importation and such as the JORC subsequentT development of close undertaken geological, structural Exploration (CMEC) acquired the The core of SRK ES’ technical metallurgical testwork purposes. Showing the way Code and NI 43101’ relationships with numerous new and regolith mapping. In-country rights to Belinga, which were programme has been the Environmental and socio- in Gabon clients already operating in Gabon, logistics, corporate administration, subsequently bought back by the geological mapping of nine target economic baseline and monitoring  GARETH O’DONOVAN such as IronRidge Resources and the construction and government in 2013. ridges across the Belinga Project, studies are required before MANAGING DIRECTOR & CORPORATE CONSULTANT (Tchibanga and Belinga Sud), Apollo refurbishment of exploration camps each showing extensive high- extensive ground works continuing Minerals (Kango North) and Genmin of various sizes have formed the Current activities grade haematite and magnetite given the diversity of fl ora and Inc (Baniaka). basis of additional support services In April 2014 the Government of mineralisation at surface with fauna in the Ogooué-Ivindo region. Gareth O’Donovan, SRK ES provided. Regional offi ces were Gabon mandated SRK ES to conduct evidence of both hypogene In the longer term, development Managing Director, comments: established to support fi eld work, a full independent evaluation of and supergene alteration and of regional infrastructure will “We hope to help add value to improve relations with local and the Belinga deposit on its behalf. enrichment of the primary banded be needed, mainly a rail spur these projects and give a certain regional authorities and encourage The fi rst phase of the project was to iron formation (BIF). connecting the Belinga Project amount of credence to the data the employment and training for the establish a logistical framework to Ground magnetic and electrical to the Trans-Gabon railway and owners are attributing to them. Our local population. support the fi eld operations, and to resistivity surveying over the same either an existing or new coastal involvement also gives any potential Additionally, consulting services conduct geological and geophysical targets has helped to refi ne the port. The Government of Gabon SRK EXPLORATION partner on a project confi dence that such as project data review, fi eld work ahead of diamond drilling lateral extent of wide magnetic remains committed to this highly SERIVCES the information being provided has programme design, technical and culminating in the production anomalies seen in low-resolution prospective, high-grade and high- AT A GLANCE been verifi ed in accordance with audits, independent technical of an internationally recognised regional historic airborne magnetic tonnage deposit. As such, they various international standards.” reporting and asset valuation have Mineral Resource Estimate (MRE). data and led to generation of are welcoming discussions with 2500 Something The varying stages of been key to providing clients with a SRK ES began with renovating the multiple prioritised targets for potential investment partners who Something else development and contrasting full range of products suited to their existing camp, including installation future drill testing. are interested in unlocking the deposit styles, have required SRK ES needs. of water pumps, fi ltration and An airborne LiDAR survey was full value of this highly promising 2000 to adopt tailored approaches to wastewater disposal; rewiring fl own to produce a high-resolution deposit. developing each project. electrics and installing primary and digital terrain model along with Belinga Iron Ore Project 1500 SRK ES has provided design and The Belinga Iron Ore Project lies back-up generators; expanding the capture of orthophotos, which Final thoughts Showing the way management services for both some 100km north of the equator, accommodation to 100-plus proved essential for navigation Despite the global drawback in Gabon diamond-core and auger drilling in the Ogooué-Ivindo province capacity and employing all staff and fi eldwork planning and in exploration expenditure in 1000 April 2012 April 2013 of Gabon, 720km east-northeast needed to support exploration will be benefi cial to future site recent years, SRK ES has remained of Libreville. The project sits at activities in the coming years. development, infrastructure design adaptable to the needs of the southern edge of a belt of SRK ES recognises the ethical and and MRE production. exploration companies and the HEAD OFFICE Archaean greenstone rocks that socioeconomic importance of challenges they face. SRK ES has SRK Exploration Services Ltd Reach global investors through leading form a growing iron-ore district employing staff locally, resulting in Looking ahead established a presence in West 12 St. Andrew’s Crescent that includes projects in southern most camp and project staff coming The next stage in developing Africa that enhances the services Cardiff CF10 3DD United Kingdom Cameroon and northwest Republic from the villages surrounding the Belinga Project will be the that can be off ered to clients Tel: +44 (0)2920 233 233 of Congo. the project or from local towns completion of a MRE conforming to and their projects in Gabon and Email: [email protected] Web: www.srkexploration.com Following initial discovery of iron (Makokou) where skilled/technical international reporting guidelines surrounding countries. SRK ES mineralisation in the late 1890s, the expertise were more prevalent. such as the JORC Code and NI 43101. is confi dent that Gabon hosts a DIRECTORS Belinga deposits and those in the A dedicated team in Libreville This will require a limited amount of wealth of unexplored and under- Names go in here please, names go in surrounding were responsible for sourcing all core drilling over the priority Babiel developed mineral assets and here please region only became the focus of supplies and consumables for Nord prospect, for which most of a government that is keen to iron-ore exploration in the late the project, from food and PPE to historical non-compliant resources engage explorers through well- MARKET CAPITALISATION 1950s and early 1960s. At Belinga, vehicles and fuel. SRK ES’ Libreville have been attributed, followed by established minerals legislation. $$$$$$ million (at press time) this involved excavating more than team were also responsible for more comprehensive drilling of the SRK ES is well placed to provide 8km of adits. Between 1975 and arranging all visas for foreign remaining prospective ridges. high-quality exploration services to QUOTED SHARES ON ISSUE xxxxxxx 1977, a new exploration programme specialists and handling the import/ The adits excavated in the 1950s new and existing clients taking up reportedly completed over 10,000m export of equipment. This allowed require remapping and sampling these opportunities in Gabon and MAJOR SHAREHOLDERS international mining resource titles. of drilling. A non-compliant pre- SRK ES’ technical team to focus on utilising modern methodology throughout Africa. Company name Pty Ltd 00.000% feasibility report produced in 1977 the geological challenges of such a and international best practice, such project and is considered to Company name Pty Ltd 0.000% stated that the oxide portion of the large project. both for resource modelling and have the potential to Company name Pty Ltd 0.000%

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Mining Journal • mining-journal.com July• 15 28, 2016 9

New_Recruit&Services 15-28 July.indd 9 14/07/2016 10:25 PEOPLE

Botswana too that’s … relatively rare globally … is that all of these deposits where testwork has been done [and including Boseto when it got into primary sulphide ore] produce extreme- ly high-grade, low-impurity concentrates: anywhere up in the 40%-plus copper range. “We can produce from our Mahumo deposit, for example, 50% con grades, and some bonanza silver credits. There’s no cobalt, no arsenic. It’s a pretty simple product and smelters love it for blending.” MOD, which had a market capitalisation this week of about A$39.5 million (US$30 million), and Metal Tiger are aiming to get a maiden resource number for T3 out this quarter and finish a scoping study on openpit mining by the end of the year. A prefeasibility study would follow. Hanna said the partners were Make that four … four rigs now drilling at T3 juggling resource drilling, with wider T3 exploration, and then continues from page 7 ment and operation, to bulk tourist capital of Botswana … regional exploration, as study you know that’s where the concentrate transport. so there is a very strong desire work led by experienced metal- goodies usually are. If there is a “For me personally what I’m on the part of the government lurgist and project manager structure on that contact you very driven by is the prospect of to extend grid power grid up to Royce McAuslane fired up. find copper. We’re still some- developing mines in Botswana. there, all from coal sources [in “I’m hoping that when we get where up in the hanging wall, It is just the best jurisdiction,” the country], and then ultimate- a resource out it provides some [in the] mudstone/siltstone he said. ly down this road to Ghanzi. basis for investors to value the package of rocks. “You’ve got a government “It is a core cattle area and a company,” Hanna said. “The other thing that sets this that wants to build a copper in- developing region. “And then in the same time- deposit apart from all the rest at dustry. They can see a long- “We’re anticipating power up frame as we’re getting that re- the moment is that’s it’s very term decline – over 20 years into this part of the world source out we’re pulling out all flat-dipping, and it’s stratiform, maybe – in the diamond indus- around late 2019. the stops on looking for other and it’s … wider. It’s two or try that underpins the econo- “In the meantime if we were satellite deposits around it. three times the width of most of my, so they’re looking for alter- to set up a process plant here “Towards the back end of this the other deposits. And it’s got natives. And that includes a short-term we’d probably be year we’ll borrow one of the di- this lead-zinc association that desire to build a copper smelter looking at diesel-generated amond rigs from T3 for a few we don’t yet understand. in-country. So there is that po- power. We’re just 10km in off weeks and put some deep holes “So it’s early days here. tential as well. And the main road in and start scoping out the “But I don’t think too many they’ve got a very “All of the here. So we’ll see depth extensions. people are reporting these sorts large copper belt deposits to date how this thing “All of the deposits to date in of [copper] intersections.” in the backyard. So evolves. the belt have shown that it re- MOD’s classic exploration ap- we’re working in the belt have “I think with ally doesn’t matter how deep proach of using modern geo- with the govern- shown that it Western Areas we you drill, they just keep going at chemistry and geophysical sur- ment and keeping got lucky … with depth. veying and imaging (induced them very closely really doesn’t the timing – the “The T3 scoping study will run polarisation, or IP) to generate informed of what matter how rise of China in in parallel with the resource viable drill targets and then we’re doing. 2002 [and] 2003. drilling. We’ve already done a “drop anchor” and accelerate “As we said at a deep you drill, We discovered conceptual pit model and that’s drilling activity when the trail resource confer- they just keep Flying Fox then given us the encouragement to heats up has produced great re- ence at Gaborone going at depth” Spotted Quoll do the drilling that we’re doing sults for Hanna, Grammer and a few weeks ago came along. The now. And the resource is com- their investors elsewhere. all we want to see is a big nickel price just responded per- ing along at speed Looking down the track, power transmission line run- fectly. It was the perfect match “So we’re just going to run Hanna has hopes of bringing ning down the side of the road for the China boom really. everything that we can in paral- other key learnings from more [Ghanzi Highway], because at “Now I’m very positive about lel, because we think we’re than two decades of mine find- the moment the key to a long- copper. The focus is so much on going to hit a nice window in ing and development in West- term sustainable copper indus- the Chinese demand and not about 18 months time with cop- ern Australia across to southern try here is getting grid power enough on long-term, viable per. Africa. That covers everything extended up into this area. supply lines. “That’s about where we’re try- from contract mine develop- Bearing in mind Maun is the “And the other thing about ing to get to.”

10 July 15-28, 2016 • mining-journal.com • Mining Journal

06,07,10MJ160715.indd 10 14/07/2016 08:38 WORLD VIEW

SITE VISIT Keno Hill restart hinged on streaming Paul Harris in Keno Hill discovered in 2010 with the dis- C$10 million would go towards in the December quarter that will covery hole cutting 6.55m grad- the six-month development to also include revised and opti- Renegotiating an existing streaming 571g/t Ag. With 176 holes drive in a decline next to the mill. mised development and mining ing agreement could be the key to now drilled, totalling over At Bermingham, some 22,000m plans for the Flame & Moth, Belle- Alexco Resource Corp restarting 41,000m, vein mineralisation has was drilled through the end of keno and Lucky Queen deposits. production from Canada’s only pri- been established over a 1,010m 2015 with assays up to 5m grad- “The ore at Bermingham is mary silver district at Keno Hill in strike length and 450m down dip. ing 7,462g/t Ag. An 8,000m drill higher grade than the concen- Yukon. “A PEA will be completed this programme planned for 2016 trate shipped from the mill in the With the silver price rising to year with an expanded Flame & was recently increased to past. At US$20/oz silver it is a no- around US$20 per ounce and a mill Moth resource and an additional 11,000m to infill and expand the brainer to go into production but already in place, the company is resource calculation from Ber- resource base. we will not move forward until poised to restart production, how- mingham,” said Nauman. The results will provide the we understand what is happen- ever, a streaming agreement that The capital expenditure to start basis to complete an updated ing at Bermingham as this will saw Silver Wheaton provide the production at Flame & Moth is es- Bermingham resource estimate have a significant impact on the company with C$50 million (US$38 timated at C$20 million of which to be included in an updated PEA economics,” said Nauman. million) to restart is holding Alexco back from restarting production after it was suspended in 2013 on the back of a weak silver price. “We would not be here without Silver Wheaton. Silver Wheaton gave us C$50 million to put the project into production and it gets 25% of the silver from the district,” said CEO Clynton Nauman. The mineralisation at Keno Hill has historically had strong lead and zinc content underpinning the project economics, but with the base metal make up forecast to be lower during future operation, “the Silver Wheaton influence has grown,” Nauman said. This has meant the streaming pact starts to eat into free cash flow, making it harder to generate profits. “To Silver Whea- ton’s credit, they want this to move into production and we are in dia- logue to achieve this,” he said. Since the streaming deal was put in place Alexco has made several discoveries in the 233km2 district – which historically produced 217 We see an additional 100,000 million ounces of silver – notably the Flame & Moth and Bermingham deposits. ounces of gold Alexco is looking to restart production at an estimated 3 million ounces per annum from the Flame & Moth orebody but a production decision will wait until the company Accurate structural geology interpretation Before you undertake your next mining has a better understanding of the can mean the difference between a project, let us give you a clear picture of Bermingham discovery it made last money pit and a gold mine. the risks and rewards. year and has renegotiated the Silver When our team of the world’s best For a snapshot of 17 distinct services to Wheaton agreement. structural geology specialists analyse the global mining industry, download Flame & Moth contains about complex data sets you get insights that let our new mining brochure, available at: 30Moz of silver in a resource grading you make con dent, informed decisions. over 500g/t Ag, 1.9% Pb and 5.4% Zn within a total resources base at Keno Hill of over 55Moz silver. A 2014 preliminary economic as- .com sessment outlined production of >1,400 professionals • >45 of ces • >20 countries • 6 continents 812,900 tonnes grading 754g/t Ag, 0.4g/t Au, 2.71% Pb and 4.53% Zn. The Flame & Moth deposit was

Mining Journal • mining-journal.com • July 15-28, 2016 11

11MJ160715.indd 11 14/07/2016 08:57 COMPANY PROFILE CARDINAL RESOURCES GHANA

Cardinal sings golden tunes Despite the incredible number of gold hits at Cardinal Resources’ (ASX: CDV) Namdini project, it could be overshadowed by the increasingly promising Kungongo prospect, also in northern Ghana. Ngaire McDiarmid reports

HIS GOLD-FOCUSED The Namdini project lies 6km “Whilst working on JORC resource explor ation and develop- south of the producing Shaanxi gold and bankable feasibility study, we’ll ment company currently mine near Bolgatanga in northern be drilling along strike to the north counts fi ve major global Ghana. and south at Namdini, and we’ll also institutionsT as cornerstone investors, Namdini has a current strike length be drilling on our other projects, thanks to the excitement being of about 900m and four drill rigs were so we can add to the volumes and generated by its Namdini gold at work in the June quarter, drilling ounces that Namdini has. project in northern Ghana. 41 holes and generating more than “So we’ll be drilling in the Cardinal Resources’ managing 11,000 samples. background as usual, spinning out director Archie Koimtsidis is expected Cardinal has split its core sub- results because of the sheer size and to be announcing an exploration missions between SGS Labor- prospectivity of the package.” target at Namdini in September 2016 atories in Burkina Faso and Ghana to Namdini is one of four tenements in and is quick to point out the drill rigs accelerate the receipt of assay results. Cardinal’s 100%-owned Bolgatanga are still spinning. Once all the results are received, project totalling almost 800sqkm In the fi rst six months of 2016, the drill data will form the basis for in northern Ghana, along with the Cardinal reported a growing number Cardinal to provide guidance on an Ndongo, Bongo and Kungongo of wide mineralisation and visible exploration target, which Koimtsidis prospects. gold hits at Namdini, with the most expected to report in the September To the south, Cardinal has the recent step-out diamond drilling quarter. 64sqkm Subranum project, 240km extending a 200m-wide gold zone to But Koimtsidis said Cardinal would north-west of the capital Accra. a vertical depth of 290m. not sit back and become a desktop Koimtsidis said there were pro- Koimtsidis says Namdini’s company in the coming months, just mising targets throughout all the potential to host a world-class gold awaiting the backlog of assay results. tenements and the company had project continues to be confi rmed by “Firstly, we will be working on to decide how aggressively it would the intersection of long mineralised getting Namdini to a JORC resource, explore them, while also increasing zones, including 54m at 2g/t gold. then a bankable feasibility study on confi dence through further drilling This potential has been recognised the existing orebody,” he said. at Namdini. by cornerstone investors such as US Global Investors, Macquarie Bank, Canada’s Dynamic Fund and, more recently, Switzerland’s Precious Capital Global Mining and Metals Fund and Australia’s long-term award-winning Colonial First State. “These cornerstone investors can see the team is right and the project’s right,” Koimtsidis said, emphasising the signifi cance during a meeting Right: map with Mining Journal in Perth. illustrating “They’ve each made a signifi cant Namdini’s investment, pre-resource. proximity to “That’s key – it’s not common the shear zone. in the current market to Below: four rigs have those kinds of were on site in the cornerstone investors June quarter at in pre-resource Namdini juniors.”

12 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Cardinal_MJ160715.indd 12 13/07/2016 11:19 “It’s looking like we’ve got gold targets out there, so you’ve got to say to yourself: ‘do we tiptoe around the tulips or grab the bull by the horns?’. “When gold went “Geophysical data is providing us with more confidence so it looks like out of flavour four we may have to bring in several rigs or five years ago, we again and start drilling.” Koimtsidis believes the Kungongo went out and bought prospect, west of Namdini, could be another rig and we’re the first cab off the rank in terms of fresh drilling. one of the few gold “We’ve completed some geo- explorers that has not physical work and the preliminary data is quite exciting,” he said. stopped working” “We’ve identified potential gold- – ARCHIE KOIMTSIDIS bearing targets over a distance of MANAGING DIRECTOR 6km. It’s huge, but it’s also great challenge to have.” An airborne geophysical survey “Gold has just begun swinging Top: the cut drill over Kungongo delineated two target back in our favour but we wouldn’t core has visible areas, and the recent Gradient Array have changed anything we are doing gold circled Induced Polarisation and ground on the ground and corporately.” in red. Above: geophysical surveys delineated the Koimtsidis said the company had map showing targets along the 6km zone. strengthened its board in the past Cardinal’s After Kungongo, Koimtsidis said year and also appointed Dr Julian prospects CARDINAL RESOURCES Ndongo could be the second area for Barnes as the project’s technical around regional exploration, while Bongo manager, to take Namdini through to Bolgatanga AT A GLANCE needed further work on developing a bankable feasibility study. A$ ASX:CDV drill targets and it was also a matter of Dr Barnes has 34 years’ experience 0.35 getting south to Subranum to better in more than 52 countries in a variety 0.30 evaluate the previously discovered of commodities, and over 25 years’ 0.25 gold mineralisation in its 5km strike experience in due diligence studies 0.20 length. for major global resource lending 0.15 Koimtsidis is confident about institutions and mining companies. 0.10 Kungongo’s prospectivity, playing “His skills will be invaluable in pro- 0.05 down the certainty of Namdini being gressing the company’s objectives,” 0.00 Cardinal’s company-making project. Koimtsidis said. 6 months ending July 11, 2016 “Let’s see what Kungongo brings Chairman Mark Connelly, who HEAD OFFICE in over the next three to six months,” join ed the board late in 2015, has Cardinal Resources he said. “Namdini definitely has to extensive experience in developing Level 1, 115 Cambridge St be tested along strike but Kungongo and operating projects in West West Leederville WA 6007 may surprise us all because of its Africa, Australia, North America and Tel: +61 8 9322 6600 sheer size.” Europe. Fax: +61 8 9322 6610 “We’re going into a phase of “We’ve got the right mix of people Email: [email protected] studies for Namdini,” Koimtsidis said. on the board and management, who Web: www.cardinalresources.com.au “We need to understand what we have the experience to take this right have within the existing orebody, and through to production, as a well- DIRECTORS Mark Connelly we’re planning a large exploration rounded team,” Koimtsidis said. Archie Koimtsidis programme around it as well as on “We have a strong presence in Malik Easah the other prospective ground we Ghana assessing drilling results on a Mark Thomas have. daily basis, and I’ll be spending more Simon Jackson “When gold went out of flavour of my time in Perth to progress the four or five years ago, we went out plan of having a bankable feasibility QUOTED SHARES ON ISSUE and bought another rig and we’re study completed within the two-year 297.1 million one of the few gold explorers that timeframe we have set. has not stopped working. “We could complete a bankable MAJOR SHAREHOLDERS “We haven’t stopped drilling and feasibility study for Namdini within 1832 Asset Management L.P (Dynamic Fund) – Canada 8.5% exploring and being well supported two years and that potentially could (subsidiary of Bank of Nova Scotia) by our shareholders, because we put us into development in late 2018. Precious Metals Fund - Switzerland 5.5% actually have gold in the ground “Meanwhile, the drills will keep Macquarie Bank – Australia 4.2% and it’s now all coming together for spinning 24/7 and results will just US Global – USA 3.9% open-cut mining. keep on flowing!” Colonial First State – Australia 3.0%

Mining Journal • mining-journal.com • July 15-28, 2016 13

2pp_Cardinal_MJ160715.indd 13 13/07/2016 11:19 WORLD VIEW

CANADA Peregrine higher on Chidliak PEA

Gareth Tredway

The Peregrine Diamonds share price in Toronto reached its highest level in almost a year after the company released the first financial estimates for its flagship Chidliak project on Cana- da’s Baffin Island. The plus-20% share price gain to C$0.285 per share means the price is now more than double what it was at the start of this year and gives the company a market capitalisation of almost C$100 million (US$78 million). The net result of the preliminary economic assessment is A large-diameter drill rig in operation at CH-7 an after-tax net present value of C$471 million and an IRR 15.6 million carats of inferred re- phase-one mine, including the US$114/ct for CH-7. A total of of 29.8%. Capital sources down to expansion of the CH-6 resource 11.6Mct would be extracted at a payback is expect- “We expect to 260m and 240m to depth and through the devel- life-of-mine annual average of ed after just two respectively. Both opment of a potential, phase-two 1.2Mct. years. Initial capi- identify further remain open at resource expansion from the nu- In 2001, Peregrine paid C$9 tal expenditure of upside to the depth. merous other kimberlites on the million for BHP Billiton’s 51% C$434.9 million Peregrine CEO property of which six currently stake in Chidliak, giving it full has been estimat- economics of the Tom Peregoodoff show economic potential.” control of the project. ed. project through said: “As we devel- Diamond pricing was based The study pro- op Chidliak fur- on estimates from WWW Inter- Key figure poses first the de- optimisation ther, we expect to national Diamond Consultants velopment of an studies “ identify further up- and escalated annually from C$471mn openpit at the side to the eco- 2016 at 2.5%. After-tax net present value CH-6 kimberlite, followed by nomics of the project through A value of US$149/ct was esti- for Chidliak CH-7. Combined, they contain optimisation studies of the mate for CH-6 production and

LESOTHO Research suggests Firestone undervalued Staff reporter most capex is behind the company, our NAV increases by over Firestone Diamonds could 25% to £0.52/share and our tar- begin production as early as get price increases by 50% to October as the company nears £0.45/share,” said Morton. completion of construction of Production was said to be its Liqhobong diamond mine in 85% complete and about US$6- Lesotho. 8 million below its planned Following a visit to the site, US$185 million budget. Patrick Morton, analyst at Mac- “Initial production, currently quarie placed a 12-month target guided for late fourth quarter of £0.45 (US$0.60) per share on appears assured, and we believe the stock, about 45% above the early fourth quarter is more like- current share price of £0.31/ ly. Management expects a six share. month ramp-up to full produc- Construction at Liqhobong is said to be 85% complete “We have rolled forward our tion, an achievable target in our model to FY2017E, now that view considering the relatively The NAV is highly sensitive to “Liqhobong benefits from an small scale of the operation (500 prices, moving by 28% on the experienced management team Key figure tonnes per hour).” back of a 10% move in diamond with over 200 years combined % Macquarie is using diamond prices. experience building and operat- 85 prices 18% below the 2014 fea- Morton is also confident the ing mines, a key in our view to Production complete at sibility study estimate of vast management experience help minimise the execution Liqhobong diamond mine US$131 per carat, due to the bodes well for the start-up and risk of the mine’s ramp-up over subsequent market downturn. ramp-up of the 1Mctpa mine. the next three quarters.”

14 July 15-28, 2016 • mining-journal.com • Mining Journal

14MJ160715.indd 14 14/07/2016 10:32 OPINION FROM THE CAPITAL Bar set by Western Areas too low St George mining keeps hitting nickel but must do more to sate investors

Already, St George is perform- a higher share price and divi- John Robertson* ing better as an investment than dends, the company has had to Western Areas had done in its use $408 million in capital from A succession of impressive drill early days. At the time of writing, shareholders. results places St George Mining St George had a market value of Spread over 14 years, the West- among Australia’s most exciting A$38 million (US$29 million) after ern Areas creation of wealth for mineral explorers. having raised $18 million. In mid shareholders represents a return St George was described in a 2002, Western Areas had raised equivalent to having bought a recent Mining Journal company $8 million to underpin a market bond in 2002 with a yield of 4.8%. profile as “the next Western value of just $10 million. That is hardly the worst return Areas”. Western Areas would have from within the sector but does The company’s chairman John Exploration success is great, but been in a similar position in its not adequately compensate for Prineas is keen to highlight the investors want protection along corporate life cycle in 2002 as St the range of risks typically en- provenance of the nickel proper- the journey to production George Mining is today and countered by a development ties at the heart of his exploration amidst another cyclical trough. company. efforts. They had been in a joint el-copper sulphide intersections. The former director of Western Over the same period, the av- venture with BHP Billiton. Ac- St George subsequently drilled Areas reported in Mining Journal erage Australian government 10- cording to Prineas, those with on- another seven conductors at Mt as making the comparison with year bond yield was coinciden- the-ground experience at the big Alexander southwest of Agnew St George Mining would have tally 4.8%. Arguably, the Western miner had held out high hopes with all reporting nickel-copper been visualising St George also Areas return was around 10 per- for their future. sulphides. evolving from explorer, where centage points lower than it BHP’s head office decision to In mid-June, the company re- Western Areas was in 2002, to should have been to justify its call shed its nickel interests was a ported an intersection of 1.17m being a prominent regional nick- on capital. mixed blessing for St George. It at 8.75% Ni, 3.37% Cu and 6.16 el producer. Companies typically begin to lost the heft that would have g/t PGE from a depth of 30.17m Over the ensuing 14 years, the lose ground as investments when come from a partnership with the at Cathedrals, situated on a con- Western Areas market value has it comes time to spend on mines. world’s biggest miner. tact between felsic and ultramaf- risen impressively from $10 mil- St George will not only have to On the other hand, it ended up ic rocks. A deeper geophysical lion to $582 million translate its explo- with control of assets character- target and a related intersection at the end of June. ration excitement ised as out of the ordinary not only were also reported. Quite frequently, “St George into a meaningful by some of the most astute ex- St George has more recently companies will at- needs to mining develop- plorers within BHP but also by oth- reported initial exploration re- tempt to highlight ment but also pro- ers in the industry with a keen un- sults from the Stricklands target, their investment translate its duce a far more derstanding of regional geology. an extensive east-west trending potential by com- exploration competitive return The style of mineralisation domain approximately 1km west- paring market val- on capital than the sought by the company is con- southwest of the earlier massive ues without ac- successes into Western Areas out- sistent with well-known deposits sulphide intersections reported knowledging the something come. at Kambalda, Forrestania and the at Mount Alexander. relative contribu- Signs within the Agnew-Wiluna nickel region. The company’s three intersections to capitalisa- more than industry that the Systems of this type are now tions from three holes at Strick- tion changes of just the next approach to capi- rarely discovered from single point lands were spread over 300m more shares and Western Areas” tal management exploration holes from surface. St with fresh sulphides at 42-54m higher share pric- has changed offer George’s large and growing num- below surface. Their presence is es. hope. Low capital ber of mineral targets arising from consistent with the earlier explo- Between 2002 and 2016, West- project alternatives are being de- a systematic exploration effort ration outcomes at Mount Alex- ern Areas raised $437 million fined increasingly as a matter of means an unusually long-term ex- ander. through the issue of new shares course with the option of larger ploration commitment. The Stricklands target remains suggesting a net positive price scale developments left for the The company began drilling in the largest geophysical anomaly impact on value equivalent to a time being to depend on future November to test promising geo- at Mt Alexander and broadly on more modest $135 million. changes in market conditions. physical exploration targets at its strike from earlier, equally prom- Western Areas paid regular div- Despite the comparison with Windsor and Desert Dragon pros- ising, exploration results. idends between 2010 and 2015 Western Areas being a well-inten- pects in the Laverton region of The Stricklands result raises the adding up to $107 million to tioned endorsement of the qual- Western Australia. probability of a significant miner- complement the positive price ity of the St George holdings, it It completed acquisition of the alised deposit. More drilling, in- effect. The company’s cash hold- misses the mark. BHP interests in its Mt Alexander cluding off-hole targets, will have ings at the end of March 2016 To justify itself as an invest- project in January. BHP had to follow. Once these results are were $29 million. ment, St George needs to trans- drilled three electromagnetic collated, a second programme to To sustain the business and late its exploration successes into conductors at the Cathedrals test deeper targets will most like- produce the $680 million value something more than just the prospect finding high-grade nick- ly ensue. increment for investors through next Western Areas.

*John Robertson is the chief investment strategist for PortfolioDirect, an Australia-based equity research and resource stock rating group. He has worked as a policy economist, business strategist and investment professional for nearly 30 years, after starting his career as a federal treasury economist in Canberra, Australia

Mining Journal • mining-journal.com • July 15-28, 2016 15

15MJ160715.indd 15 14/07/2016 08:56 COMPANY PROFILE ALTECH CHEMICALS WESTERN AUSTRALIA, MALAYSIA

From clay to a new-age, must-have material Altech Chemicals (ASX: ATC) is ahead of the game with an off-take agreement and financing under way for its long-life project turning simple kaolin clay into a raw material for lithium-ion battery and LED components and unscratchable watch faces. Ngaire McDiarmid reports

CLAY PIT NEAR MECK over competitors is its highpurity industrial applications, optical ering in Western Australia deposit and its lowcost, single lenses, electronic substrates, and is the key to Altech Chem plant processing. even the military where they icals’ highpurity alumina In a strong vote of confidence for toughen up the vehicle’s windows (HPA)A project – a project which will the company’s plans, Japanese giant to make them bulletproof,” Tan said. have a pretax NPV of US$357 million Mitsubishi’s Australian subsidiary “The biggest growth is in the LED according to its bankable feasibility has signed an exclusive offtake sales [light emitting diodes] sector, which study. agreement for 100% of the first 10 can produce the same wattage as Altech is already in finance discuss years of Altech’s HPA production. regular light bulbs with less energy ions to develop a lowcost vertically Mitsubishi Australia will be the – and a lot of countries are now integrated business, mining its exclusive global distributor and mandating a move towards LEDs. 100%owned kaolin clay and turning buyer of the full 4,000tpa production “On the pie chart of HPA uses, it into highvalue HPA at its planned capacity. lithium batteries and smartphone processing plant in Malaysia. Altech managing director Iggy Tan screens don’t even feature yet, so The company aims to become said the agreement signed in April that’s another growing market. one of the world’s leading suppliers was an important milestone and “There is no substitute for HPA in of 99.99% HPA at a considerably bolstered the company’s credibility making artificial sapphire. lower cost to other producers and as it continued finance discussions. “The current market of HPA is its project has a forecast life of more “Highpurity alumina will be part about 20,000tpa worldwide – it’s not than 250 years. of the next ‘new age’ materials a big market yet but it’s high value The advantage Altech poses boom like rare earths, lithium and and it’s growing about 25% year on graphite,” he said. year. He was quick to point out that HPA “Altech’s 4,000tpa HPA plant will was not a new material but it was in position the company not only as Right: lithium- growing demand thanks to its role one of the world’s largest producers ion battery as a critical ingredient in artificial of HPA, but also as one of the world’s producers use HPA sapphire, which is used in LED lowestcost producers.” for the coating lights, watch faces and smartphone Tan said typically, bauxite was of the battery’s components. Lithiumion battery processed to create smeltergrade separator. Below: a producers are now also using HPA alumina (SGA), which was turned into sample of Altech’s for the battery’s separator. aluminium, which HPA producers high-purity “It’s used in sodium lamps, medical then purchased and reprocessed to alumina (HPA) applications, semiconductors, create a highpurity alumina. “Our HPA process is quite a disruptive technology,” he said. “We’re taking it straight from the ore to the 4 nines (99.99% purity) in one single step without going through the aluminium metal stage. “And the only reason we can do that is our kaolin orebody has had a lot of impurities leached out, and we will ship it to Malaysia to be converted into HPA through a thoroughly tested and proven hydrochloric acid leaching process. “So we’re using that established technology to meet this new demand in the electronics sector, we have a highpurity deposit and we’ve brought together very experienced people.” Tan and general manager oper ations Dr Jingyuan Liu were

16 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_AltechChemicals_MJ160715.indd 16 13/07/2016 11:19 “Altech’s 4,000tpa

instrumental in establishing Galaxy Above: HPA is the HPA plant will Resources’ Mt Cattlin spodumene vital ingredient to position the company project in WA and associated lithium artificial sapphire carbonate processing plant in China. substrates found in not only as one of Comprehensive testing has proved LED lights. the world’s largest Altech can produce a 99.99% HPA Left: Altech’s high- product through the established purity feedstock producers of HPA, hydrochloric acid leaching process. – its kaolin clay but also as one of the Tan said the growth in LEDs alone from Meckering, was expected to grow demand for Western Australia world’s lowest-cost HPA from 20,000tpa to 48,000tpa by producers” 2018. “The next area of growth is in – IGGY TAN lithiumion batteries,” he said. MANAGING DIRECTOR He said HPA was used as a fire retardant on separators inside larger batteries like those in electric vehicles. The future is in the smartphone market, where artificial sapphire which will process about 1.3 million scratchresistant screens are tonnes of kaolin and Tan said the ALTECH CHEMICALS becoming more common. project had up to a 250year life. “We forecast by 2025 this lithium The company has raised about AT A GLANCE battery sector will require 15,000tpa A$5 million since March 2016 and A$ of HPA and that is nearly four times also welcomed Malaysian insurance, 0.20 ASX:ATC the 4,000tpa plant we intend to investment, credit and finance group build in Malaysia,” Tan said. MAA Group Berhad as another 0.15 “So what we’re saying is that we’re cornerstone investor. entering a market where there’s Altech expects to close project 0.10 high growth and we’re not going to financing by the end of 2016 and 0.05 be fighting for market share, we’re start siteworks at both Meckering

going to fill the growth demand. and Malaysia early next year. 0.00 “About 70% of the demand for With about half of the Johor plant 6 months ending July 11, 2016 HPA is in the AsiaPacific region and using German technology, Altech we think we’re well placed to meet has sought funding support from HEAD OFFICE that demand because our deposit is German bank KfW IPEXBank and Suite 8, 295 Rokeby Road in Western Australia and our plant is export credit agency (ECA) Euler Subiaco WA 6008 in Malaysia.” Hermes Aktiengesellschaft. Tel: +61 08 6168 1555 He said Altech chose to build in “We’re producing a product at the Fax: +61 08 6168 1551 a chemical park in Malaysia that highend of the market and from that Email: [email protected] had port access and government point of view, German engineering Web: www.altechchemicals.com incentives. and equipment is worldclass,” Tan Altech’s updated bankable feas said. DIRECTORS Luke Atkins ibility study (BFS) puts the capital The company’s banking partners Iggy Tan expenditure costs for the plant KfW IPEXBank are now in the Dan Tenardi and mine at US$80 million with a process of finalising the senior debt Peter Bailey payback of less than four years. finance package for the project. Tunku Dato’ Ya’acob bin Tunku Tan Sri “Our NPV on discounted cashflow Tan said the possibility of access Abdullah is US$357 million and it’s not often ing low interest rate, longterm Uwe Ahrens you have a project where the NPV is project financing that could be four times the capex,” Tan said. available under ECA funding was QUOTED SHARES ON ISSUE “The internal rate of return is about compelling. 178.53 million 33% and with an operating cost of “So we believe we’re in the right MAJOR SHAREHOLDERS about US$9,000/t and an anticipated place at the right time, with the right Lake McLeod Gypsum Pty Ltd 13.94% margin of about $14,000/t, the deposit and the right technology to Melewar IIC Ltd 9.49% project throws off about US$55 feed this business going forward – D Tenardi 4.87% million in EBITDA.” and the right people on board,” he L G Dudfield 3.14% The BFS covers a 30year minelife, said. JM Tan 3.03% 3.01%

Mining Journal • mining-journal.com • July 15-28, 2016 17

2pp_AltechChemicals_MJ160715.indd 17 13/07/2016 11:19 Future of Mining

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1p_A4_MJ_FoM_ad_2016_generic_CC.indd 1 10/06/2016 15:09 OPINION MINER’S RIGHT Better times in the sandpit Titanium and zircon prices lifting mineral sands miners

nium dioxide market where Tim Treadgold Chinese pigment producers are reported to have raised It’s been a long time since any- prices for the eighth time this one got excited about titanium year. minerals but when share prices The improvement in market jump by more than 40% in a day conditions correlates with com- it’s a wake-up call too loud to be mentary from major western ignored. chloride pigment producers, as Base Resources, an Australia- outlined in Iluka’s May market listed miner of ilmenite, rutile briefing paper, which mentioned and zircon in Kenya was the US$150/t to US$175/t price in- company that delivered this per- creases (around 6%). formance early this week from Ord Minnett joined the cheer what appears to be an industry- squad early this week with a wide revival triggered by a series sweeping upgrade of the titani- of reports pointing to higher um dioxide and zircon stocks it prices for titanium dioxide and researches. zircon in China. The 12-month share price tar- Long neglected because of get for Base received an aston- low prices for its products, which ishing upgrade from A$0.05 to are mainly consumed in less A$0.24, and perhaps an even than exciting industrial applica- The mineral sands industry finally looks like fun, once more more astonishing decision to re- tions such as paint pigment and tain a ‘hold’ recommendation on the glaze on tiles, Base shares that have enticed investors back Morgan Stanley’s view of the the stock which has delivered a rose by A$0.055 (US$0.04) to into the titanium and zircon sec- market is based on reports that share-price performance to rival A$0.185, a gain of 42.3% with tors. The reports include a study the US-based titanium dioxide the best of the red hot gold and that closing Monday price a 12- by the Australian firm Ord Min- pigment maker, Tronox, was lithium sectors. month high. nett, which noted “signs of tight- seeking a price increase for zir- “Pigment producers have Looked at over a long-term ening in titanium feedstock mar- con sold in China, been increasing timeframe and the rise of Base is kets” and another from Morgan and that Chinese “Having prices and even more remarkable, up 825% Stanley late last week that said titanium dioxide mothballed sales in the latest since it hit rock bottom at A$0.02 miners and pigment producers manufacturers quarter, which is just six months ago. were “seeking to lift prices”. were continuing Jacinth- likely to improve Base wasn’t an orphan. Other But, to get a clearer picture of to lift prices. Ambrosia titanium dioxide titanium and zircon stocks what’s happening it’s important The changing feedstock con- joined in with Iluka, an industry to look back to February when market conditions earlier this sumption and leader, adding A$0.70 or 10.8% the titanium and zircon industry were felt in the year it appears provide confi- to A$7.16, Mineral Deposits was was in the depths of a downturn. share price of New dence for re-stock- up A$0.04 (15.7%) to A$0.295 Back then, Iluka reacted to an York-listed Tronox to have ing,” Ord Minnett and Sheffield Resources was up over-supply of its products by in late June when engineered a said. A$0.04 (7%) to A$0.58. mothballing its best mine, the the stock jumped “We have al- What’s woken the titanium Jacinth-Ambrosia project in from US$3.92 to zircon price ready seen evi- and zircon sector of the mining South Australia that, at its peak, US$4.33 on June rebound” dence of price market is a combination of fac- is capable of supplying between 28, and have con- rises in lower- tors, including production cut- 25% and 30% of global zircon tinued marching higher over grade feedstocks, with Base Re- backs doing their work in reduc- demand. the past two weeks, rising by sources passing on a US$15/t ing stockpiles, along with The aim, according to an Iluka 10.7% last Friday to close at rise for the September quarter.” increased demand for paint and statement on February 16, was US$5.05. The ball is now in Iluka’s court. ceramics in China thanks to a re- to restore an over-supplied mar- Morgan Stanley said it was Having mothballed Jacinth-Am- vival in construction after the ket to balance by forcing the doubtful whether customers brosia earlier this year it appears latest bout of government eco- consumption of stockpiled ma- would accept a proposed zircon to have engineered a zircon nomic encouragement. terial, which is exactly what’s rise of US$60 a tonne with price rebound. Those forces lie behind a se- happened. US$20/t a more likely increase. In theory, Iluka could reverse ries of investment bank reports Depending on market condi- “Even so, it is encouraging to the situation just as quickly by tions, Iluka said, the mine would see another supplier (Tronox) re-starting mining operations Key figure remain closed for between 18-to- seek to lift prices, an indication at the mine but whether that % 24 months, though, given what that zircon prices may have in- would be in the interests of 42.3 seems to be a solid recovery in deed stabilised, countering early the company (and the rest Base Resources share price market conditions, Jacinth-Am- April’s US$100/t price cut,” Mor- of the industry) is a question movement in one day brosia could be back in produc- gan Stanley said. management will be tion sooner than expected. It’s a similar story in the tita- mulling.

Mining Journal • mining-journal.com • July 15-28, 2016 19

19MJ160715.indd 19 13/07/2016 11:48 WORLD ASIA Discordant mood music in Philippines

What’s in the future now a strident anti-mining president has been sworn in?

Philippine Mines & Geosciences Richard Wachman Bureau (MGB) to sign a renewed exploration permit, expected to The Philippines has been a hard be issued “in due course”. sell for years, bedevilled by regu- Ian Holzberger, chairman of latory uncertainty, high taxes, AIM-listed Metals Exploration widespread anti-mining senti- was asked by Mining Journal ment and worries about armed about his experience of the reg- insurgency in parts of the coun- ulatory environment. try where resources are plentiful. “It takes time and that’s not un- But it hasn’t looked this bad common in developing coun- for a while. The election of new tries, in fact it’s not uncommon in president Rodrigo Duterte and developed countries. Early explo- his appointment of mining-un- ration into production in 10 years friendly resources minister, Re- Supporters of Duterte during a campaign rally is not out of the norm," he said. gina Lopez, has left the sector But the company has needed reeling. plates has resulted in a wealth of coming president himself has 400 permits. Isn’t that rather a And that, despite the World geologic formations, with the said he would support responsi- lot? Bank forecasting GDP growth country widely believed to have ble mining which, in his own Replied Holzberger said: “It this year at 6.4% for the wider the third-largest gold reserves in words, ‘should just follow the doesn’t matter what jurisdiction economy. the world, the fourth-largest Australian standard, just take you are working in, the regula- Duterte has said he will review copper reserves and the fifth- care of the environment’”. tions required of us, especially in all mining licences on environ- largest nickel reserves,” said “So I am optimistic overall our sector, have gone through mental grounds and has threat- OBS. that, done properly, there is a fu- the roof. Yes, 400 is a very large ened to continue the policy of So, surely Manila is missing a ture for mining in the Philip- number of permits and more his predecessor by not issuing trick as mineral resources barely pines,” said Howell. than we expected … but the issue new ones. Local entities contributed 1.5% to GDP (United Eufracia Taylor, an Asia analyst more I look around, the more I would be favoured, he said. States Geological Survey 2013). at risk consultancy Verisk Ma- realise that business is becoming Lopez, meanwhile, has made This could easily be increased, plecroft, said the Philippines had hyper-regulated.” known her implacable hostility said experts, if the government faced a backlash against mining On royalties and tax he said to openpit mining, which she adopted a policy framework that following several accidents. For there was a tax-free period to described as “horrific for the en- encouraged foreign direct in- example, in 1996, a tunnel leak allow Metals Exploration to re- vironment”. So any lingerring vestment into a sector that at the Canadian-owned Marcop- cover its risk capital. After that, hopes that regional bans on could contribute hundreds of per Mining Corp’s copper mine the government’s “normal” tax such operations could be lifted millions to government coffers in Marinduque dumped 1.5 mil- rate of 30% kicked in, as well as appear dashed. in the short-term. lion m3 of tailings into surround- what the authorities call an “addi- Philippines-listed miners have Despite the unappealing po- ing waters, contaminating rivers. tional government share”, which seen their shares plummet, litical backdrop, not everyone is Disasters like those have per- nominally takes it to 50%, but while the local chamber of downcast. Australian geologist suaded Manila to combat popu- after offsets was more like 36%. mines has expressed something and SE-Asia mining veteran Bill lar anti-mining sentiment by del- Holzberger said: “Look, I’m not akin to despair. Howell is chairman of London- egating the granting of mining trying to be cute about it. The And yet, it doesn’t have to be listed ECR Minerals, which has a rights to local authorities. reason you are in these countries like this. The Philippines is well- right to earn a 50% interest in “So even if you get the go- is because they are resource rich, endowed geologically. An Ox- the Danglay epithermal gold ahead from national govern- but they come with a set of rules ford Business School (OBS) re- project in the north of the coun- ment, there are no assurances and conditions that you have port last year said the Philippines try. Believe it or not, Howell is a on a local level,” said Taylor. got to be prepared to work boasted some of the vastest pre- fan of the Philippines, though he She said mining FDI had de- around. It is their sandpit, we cious metals reserves in the acknowledges there are difficul- clined sharply over the last dec- have chosen to go and play in world, valued at around US$840 ties. ade or so because of the risks their sandpit, either we learn to billion in 2010 prices, equivalent “The not so good news is the involved. work in their sandpit or we to 14 times the country’s exter- that the outgoing Aquino ad- Big names have pulled out. shouldn’t be there.” nal debt as of January 2014. ministration issued Executive Glencore sold its controlling Another Philippines operator “Its unique geographic loca- Order 79, which has had the ef- stake in the giant Tampakan is Melbourne-based Oceana- tion along the confluence of the fect of closing a number of areas copper-gold project in 2015. The Gold, stewarded by CEO Mick Eurasian and Philippine tectonic to mining and imposing a mora- US$6 billion venture was halted Wilkes. torium on the grant of new min- in 2010 by a ban on openpit The company owns the gold- Key figure eral agreements. mining in Mindanao, where copper Didipio mine on the is- % "Although it does not affect communist and Islamic insur- land of Luzon. It hasn’t all been 6.4 the grant or extension of explo- gencies are ongoing. plain sailing with the group World Bank estimate of ration permits, it has cast a shad- On the ground, ECR has served with temporary injunc- Philippines 2016 GDP growth ow of uncertainty.” moved ahead, announcing last tions in 2008 and the miner tar- On the other hand: “The in- month it had been invited by the geted by indigenous groups and

20 July 15-28, 2016 • mining-journal.com • Mining Journal

20_21MJ160715.indd 20 14/07/2016 13:25 WORLD

environmental activists. But the ASIA latest news from OceanaGold has been rather good, reinforc- Vietnam could do ing Holzberger’s view there are dividends to be reaped by those who stay the course. Didipio exceeded its 2015 with a wake-up call gold production guidance with 127,086 ounces produced. SE Asian country failing to tap into its geological potential Wilkes said: “The operation is now operating on grid power and expects lower processing costs Richard Wachman than in previous years. Develop- ment of the Didipio underground Vietnam is a development suc- mine continues to progress.” cess story, but unfortunately the Philippines-owned and Ma- mining sector has not been nila-listed Atlas Consolidated swept up in the economic Mining And Development, upswing. which operates the Toledo cop- According to the World Bank, per mine is one of the Philip- economic reforms (launched in pines' largest copper operations. 1986) have transformed the According to a recent SEC filing country from one of the poorest it has been shipping its copper in the world, with per capita in- concentrate to smelters in China come around US$100, to lower and South Korea. middle income status within a But you can’t get away from quarter of a century with per the fact the Philippines is far capita income of around $2,100 from a cake walk. by the end of 2015. GDP was Unsettling statistics aren’t among the highest of the ASEAN Vietnam: somnolent mining giant? hard to find. USGS said foreign states at 6.7% in 2015, according and local investment in the Phil- to the World Bank. years. He is also head of the min- by internationally-experienced ippines had decreased signifi- Hanoi recently announced the ing working group at Vietnam personnel (mostly Australian). cantly in the past several years country would drop all further Business Forum. He told Mining The most prominent is Masan to about $160 million in 2012 coal-fired power plant projects Journal: “The geological endow- Resources, a Vietnamese public- (the latest year for which infor- and move towards cleaner en- ment is not really known, be- ly-listed company producing mation was available) from ergy. cause there has been virtually no tungsten at Nui Phao that ac- about $620 million in 2011 and But for western groups Viet- modern systematic exploration. counts for 30% of the total world about $950 million in 2010.” nam represents a hard slog. An “The challenge is to develop supply. Masan said it was “one of One positive has been the Australian government briefing mining legislation that encour- world’s largest identified tung- country’s existing nickel mines paper published in 2015 said the ages foreign investment, utilis- sten deposits outside China, continue to ship out vast quanti- country had serious potential ing the world’s best technology with mining reserves of 66 mil- ties of raw ore, primarily to with more than 60 types of natu- and practices to find the larger, lion tonnes of ore with an aver-

China, where it is processed into ral resources, including coal, deeper deposits. That’s not the age WO3 (tungsten trioxide) nickel pig iron used in Chinese bauxite, titanium, case at the mo- grade of 0.21%. stainless steel plants. iron ore, chromite, “The geological ment, with some Nui Phao is also among the A World Bank report said: “In oil and gas, cop- endowment of the highest roy- world’s largest producers of ac- 2013, the Philippines was tied per, gold, rare alty rates in the id-grade fluorspar and bismuth. with Indonesia as the largest earth, and tung- is not really world [gold, 17%] The other two notable opera- nickel producer in the world, but sten. known, and a cumber- tions involve nickel sulphides at when the latter banned exports But the bad some mineral Ban Phuc (TSX-listed Asian Min- of the metal in 2014 in an effort news is that de- because law.” eral Resources ); and gold at to promote local industry, it was spite the broad there has A spokesman Phuoc Son (Besra Gold). a boon for other nickel produc- endowment, cur- for Verisk Ma- Most of Vietnam’s mining in- ers such as the Philippines.” rent annual pro- been virtually plecroft said industry is dominated by state- While the outlook is uncertain, duction is largely no modern vestment impedi- owned companies using, in to say the least, there was one en- focused on only a ments in extrac- many cases, “inefficient, wasteful couraging morsel from Duterte’s few core commod- systematic tive industries in- and environmentally damaging inauguaration speech on July 1. ities (coal and oil). exploration” cluded “a lack of mining methods”, said Howell. He called on officials to reduce “Further explo- legal certainty, Howell said: “Growth is largely rules that delayed the approval ration work and downstream in- quite frequent changes in export driven by FDI, but in the miner- of government projects and ap- dustry development is required taxes and royalties. The result is als sector there seems to be re- plications to agencies. And he in order for Vietnam to improve a lack of transparency in the reg- sistance, possibly because of en- demanded transparency and its energy security and maximise ulatory regime.” trenched state and provincial fairness in government con- commercial exploitation,” said As a result, there are no major control of minerals, and to tracts. the paper. foreign mining companies com- some extent there may be a lin- Amid gloom and outright de- Bill Howell, CEO of Vietnam- ing to Vietnam at present, and gering but unrealistic perception spondency, a hopeful sign to focused Triple Plate Junction has there are only three mines that that Vietnam’s mineral wealth end on, although, as always, the been trying to develop the Pu are being operated to interna- should be kept for future gen- proof will be in the pudding. Sam Cap gold mine for many tional standards and managed erations.”

Mining Journal • mining-journal.com • July 15-28, 2016 21

20_21MJ160715.indd 21 14/07/2016 13:25 WORLD COVER STORY Australia vs Canada: the great debate Two great mining nations go head-to-head to decide who’s the top digger

Edited by Chris Cann London is arguably the mining to have the leading risk and ing financial fuel for the industry & Daniel Gleeson finance centre of the world; legis lative framework. from the micro-cap through to South Africa has exceptional But none of these countries, the majors. It is straightforward to decide mining pedigree; the DRC or any other, is able to offer the Both offer established and which two countries lead world apparently has more minerals complete suite of mining indus- proven mining frameworks en- mining: Canada and Australia. in the ground than any other try components on anything shrined in stable and workable Other countries compete in count ry; the US is a METS sector like the scale at which they are mining codes and supporting various industry sub-sectors: leader; and Finland could claim offered in Australia and Canada. legislation. They are also cultur- What is more difficult to do is ally hospitable first-world ad- Australia vs Canada: annual production separate which of those two dresses with abundant and ap- countries is better, that is: which propriate infrastructure, which Australia Ranking* Canada Ranking* country can claim to be the best keeps risk at a minimum. mining nation in the world? And both have subsequently Gold (t) 300 2 150 5 Both have a proud mining built thriving supporting service Platinum (t) 0 n/a 35 4 history full of mining booms and industries and technology hubs Copper (t) 970,000 6 696,000 9 big characters, be they miners that have then spread their Nickel (t) 234,000 4 240,000 3 themselves or promoters and wings to become international financiers. firms. Lead (t) 720,000 2 4,000 n/a Both are naturally disposed to In each of these key areas – Zinc (t) 1,580,000 2 300,000 9 extractive industries with a vast history/pedigree, geology/ Tin (t) 6,100 7 0 n/a mineral-rich landmass, much of production, finance/regulation, which suffers extreme environ- legislation/risk, and services/ Bauxite (Mt) 81 1 0 n/a mental conditions – Australia’s technology – Mining Journal has Coal (Mt) 471 4 62 10 deserts versus Canada’s Arctic – made a considered judgement, Iron ore (Mt) 824 2 46 n/a ensuring a limited populous that where appropriate farming in might object to digging great external expertise. Uranium (t) 5,000 3 9,100 2 big holes. Over the next six pages, we * Ranking in world top 10 country producers Both have dynamic and volu- will determine who is the indus- Most recent year in which comparable numbers are available (mostly 2015) minous equity markets provid- try’s leading mining nation.

22 July 15-28, 2016 • mining-journal.com • Mining Journal

22MJ160715.indd 22 14/07/2016 13:07 WORLD HISTORY/PEDIGREE Boom on boom The respective mining pedigrees of Australia and Canada can be gauged by their booms

Michael Coulson

Mining booms usually take place against a favourable background for metal prices and demand. However, one of Canada’s more recent booms, the diamond boom, often referred to as Lac de Gras, was an exception Way out west: Kalgoorlie in the boom of yesteryear during diamond market weak- ness in the early 1990s. development post-Second major stock market moves in the The Randlords in South Africa Key discoveries were what World War in the northern part participating companies, were were classic examples of this but became the Ekati diamond mine of WA of one of the world’s not booms in the classic sense. Australia had William Baillieu, developed by BHP Billiton and major mineral provinces mining Returning to Australia, in the who founded the Collins House Rio Tinto’s Diavik mine. During iron ore, which has been one of late 19th century, one of the group which consolidated the the boom’s peak (1992-95), huge the Australian industry’s great greatest mineral finds of any Broken Hill field; and Lang sums of speculative money were success stories over the past 50 age was the lead/silver deposits Hancock of the Pilbara iron raised in Canada and Europe years. It can also be argued that in the Broken Hill area of New ore discoveries, who was both but, as so often happens, most the uranium discoveries in the South Wales. As with Kalgoorlie prospect or and consolidator. of it found nothing economic. Northern Territory that followed and Dawson City, the town of Canada can point to Noah Tim- Though not geographically a the nickel boom were potential- Broken Hill grew hugely as is mins, who was the dominant Canadian mining event, around ly far more significant than the the wont with mining boom early 20th century figure in con- the same time Canadian explor- WA nickel finds. towns, and, like with most solidating what became known er, BreX, was involved in what in- In terms of history, Canada’s booms, it was often the service as the Abitibi mining province in itially appeared to be a giant greatest mining boom is often providers rather than the pros- Ontario. gold discovery in Indonesia, judged to be the Klondike gold pectors who made the real sucking in huge sums of specu- rush. Images of that boom are money. Verdict lative North American money. In recognisable even today but, as In the late 19th century, the As to which of Australia or Can- the end, the ‘discovery’ proved a mining event, Klondike was town’s population was around ada in terms of mining booms to be a fraud but during the run short-lived, peaking from 1896- 20,000; today, it is a little smaller was the most potent location, it BreX shares rose by 3,300% 1899, after which time gold pro- than that but remains a mining is difficult to separate the two, before collapsing to zero. duction fell off a cliff. community more than a century and probably unwise if one is a For veterans of the mining The gold rush to Kalgoorlie in after the first discovery – in some visitor to both countries. That share market, Australia’s great- WA around the same time was contrast to Dawson City. said, Australia could be said to est modern boom was the far longer-lived and gold mining Another of Australia’s great tip the scales based on the lon- Poseid on-led nickel boom in in and around Kalgoorlie contin- mineral provinces, Mount Isa in gevity of its major mining suc- 1969-70. Known as ‘the Aussie ues today, though it is primarily Queensland’s outback, was dis- cess stories. nickel boom’, the seeds of that a low-grade, earth-moving exer- covered in the 1920s but took What one can say is that both short but sensational boom cise now. huge amounts of capital to open countries have given us and the were sown when Western Min- Around Dawson City, the cen- up and did not attract a large market considerable excitement ing discovered nickel near the tre of the Klondike rush, mining rush of prospectors as a classic over the past 100 years or so. gold mining town of Kalgoorlie today is minimal. The target for boom would have done. None- However, arguably, the great- in Western Australia (WA) in many mining booms is gold and theless, it remains a major pro- est mining boom of them all 1966. Canada saw a number of major ducer of copper and other base didn’t happen in Canada or Aus- However, it was the 1969 nick- gold discoveries in the 20th cen- metals to this day. tralia but in South Africa on the el discovery at Windarra north of tury, starting with Kirkland Lake Witwatersrand, where gold was Kalgoorlie that led to the boom and Timmins in central Ontario, Personalities first found in 1874. erupting as explorers raised where gold mining continues Mining booms typically throw The goldfields of the Wit- money in Australia and London today. up key figures in the form of the waters rand are still alive today to group themselves around In the 1930s, we saw the Red early prospectors, such as Paddy although peak production was Poseidon’s ground. Lake discoveries in the same Hannen in Kalgoorlie, Thomas reached in 1970, 100 years after Poseidon itself rose by 250 area, and in the 1980s the Hemlo Frood in Ontario’s Sudbury the first discovery, and for dec- times over six months before field was discovered nearby. It nickel basin in 1883 and George ades South Africa was the largest crashing back as the company was also near Timmins that the Carmack in the Klondike. source of gold in the world. reported dull drilling results. In huge Kidd Creek base metal de- The real personalities, howev- the end, a small mine was estab- posit was found in 1964. er, were the consolidators who Scorecard lished but was only ever margin- Having said that, it could be followed and built corporate Australia: 9 ally profitable. argued these significant mineral mining empires out of the dis- Canada: 8 Of far more substance was the discoveries, though they set off coveries.

Michael Coulson is a former mining analyst with more than 30 years’ experience in The City and an author specialising in mining investment and history.

Mining Journal • mining-journal.com • July 15-28, 2016 23

23MJ160715.indd 23 14/07/2016 15:41 WORLD

GEOLOGY/PRODUCTION Who rocks the hardest? Make the most of the rocks that you’ve got

2.4 billion years ago when oce- Chris Cann anic cyanobacteria introduced free oxygen to the Earth. Canada Canadian Shield: The Canadian Olympic Dam: The huge Olym- Shield is a big chunk of geology, pic Dam discovery was by most covering half of Canada and act- reports an educated fluke, if you

ing as the leading source of just Photo: BHP Billiton will, but it remains one of the about every mineral the country Australia’s eastern states coal operations are truly world-class richest and probably the world’s produces. most diverse major deposit. It is The Abitibi Belt is the largest higher salinity levels to its east, the east coast across New South something known as an iron- gold belt extending across subsequently precipitating cal- Wales and Queensland, with the oxide-copper-gold deposit, northern Ontario and Quebec, cium carbonate, halite, gypsum, north-south divide dictating the which generally also have ura- which major mining districts and potash in evaporative con- likelihood of digging coking nium and are described as meta- Timmins, Kirkland Lake, Val d’Or, ditions. (QLD) or thermal (NSW) coal, somatic expressions of large Doyon-Bousquet-LaRonde, respectively. crustal-scale alteration events Rouyan-Noranda, Larder Lake The Cordillera: The Cordillera Historically, the Sydney Basin driven by intrusive activity. and Malartic call home. and the adjacent Western Can- in NSW has been the most im- Olympic Dam last year pro- The largest nickel-copper min- ada Sedimentary Basin form a portant with its consistent out- duced some 125,000t of copper eral district is the famous Sud- region running the length of crop, near-surface nature, and cathode, more than 100,000 bury Basin. The deposit was British Columbia and Yukon. access to ports at Wollongong ounces of gold, 725,000oz of sil- formed by the impact of a mete- This area hosts most of Canada’s and Newcastle making it effi- ver and 3,100t of uranium oxide. orite that hit Earth 1.85 billion copper, gold and molybdenum cient to develop. More recently, An expansion project mooted as years ago, creating a layered porphyry deposits along the the mantle of Australia’s chief the world went into the eco- igneous complex rich in mainly west coast. It also hosts a prolif- producing region has been nomic crisis almost 10 years ago mafic elements such as nickel, eration of volcanogenic massive stolen by the Bowen Basin in proposed increasing the mining chrome and PGMs, along with sulphide (VMS) deposits such as QLD, which is actually within the rate from 12Mtpa to 60Mtpa. base metals and gold. the 300 million tonne Windy same larger structure that in- The Geological Survey of Can- Craggy occurrence – Canada has cludes the Sydney Basin. Verdict ada first took a wander around some 350 of the 1,100 known Unlike most Northern Hemi- In common, both countries enjoy Sudbury in the 1850s, confirm- VMS deposits worldwide. sphere coal, which gives the the geographical and demo- ing “the presence of an immense Many of those 350 deposits Carboniferous period its name, graphical advantage of wide, mass of magnetic trap”. Other are found on the other side of the coal in Australia’s east coast largely inhabitable but mineral- mafic districts include the the country within the Appala- stronghold is of Permian age. rich open spaces. This is the Thompson Belt and Voisey’s Bay, chian Orogen region and, optimal combination for mineral one of Robert Friedland’s most specifically, the Bathurst Mining The Pilbara: It is hardly a geo- exploitation and clearly why they publicised success stories. Camp in New Brunswick. logical conquest, given its dis- rank as the top two all-round Uranium deposits are mainly covery was made by an agricul- mining countries. found in the fluvial siliciclastic Australia turalist looking out of an aircraft Separating them is more of a Athabasca basin of Saskatche- WA greenstone belts: The Yil- window, but the Pilbara iron ore challenge. wan and Alberta, where the garn Craton dominates the geol- region in WA is arguably the The key differentiators are the vein-hosted mineralisation has ogy of Western Australia and most important mineral occur- presence or absence of some underpinned some of the high- includes an incredible 30% of rence in Australia. The area from minerals and the general min- est-grade uranium mines in the the world’s economically a geographical perspective cov- eral abundance. While Canada 2 world, at around 20% U3O8. demonstrably recoverable ers more than 500,000km , with can lay claim to PGM production Kimberlite deposits were dis- reserves of gold. These are about 25 major mining opera- and being the world’s largest covered in the Slave Province of hosted within several green- tions ongoing. potash producer, in the product- the Northwest Territories in the stone belts, expressed as The region is the playground ion of global quantities of key 1980s and Canada became a deformed and metamorphosed of mining majors Rio Tinto (13 base and bulk metals, it is regu- major diamond producer in linear belts of mafic, ultramafic mines) and BHP Billiton (six larly eclipsed by its Southern 1998, with several mines includ- and felsic volcanics, intercalated mines), along with the self-pro- Hemisphere counterpart. ing Ekati, Diavik , Snap Lake and with sedimentary sequences. claimed ‘New Force in Iron Ore’, For pure weight of production Victor. They host small- to medium- Fortescue Metals Group (two numbers and with more excep- sized structurally controlled mines). The region is home to tional world class operations, it Interior Platform: The Interior lodes, shears and quartz veins some 24 billion tonnes in re- is Australia for the win with 9, Platform saddles Ontario and best seen in the deposits of sources that, at current mining easily accounting for Canada Saskatchewan, the latter of Kalgoorlie, Kambalda, Mount rates, should see off another with 7. which in turn hosts the world’s Magnet, Boddington, Laverton half-century of operations. premier potash-producing basin and Wiluna. Like most commercial iron de- Scorecard Accumulative with 32% of global exports. The posits worldwide, the Pilbara re- Australia: 9 18 evaporite deposits are the result Coal in the east: Australia’s gion is underpinned by banded Canada: 7 15 of a major barrier that created great coal assets are found on iron formations deposited 1.9-

24 July 15-28, 2016 • mining-journal.com • Mining Journal

24MJ160715.indd 24 14/07/2016 15:41 WORLD RISK/LEGISLATION Building on solid foundations The policy and law that underwrites investment

Minehutte rankings (/100) Daniel Gleeson CANADA Jurisdiction Score There is a reason these countries British Columbia 87 have ended up attracting the Ontario 88 most mining and exploration Quebec 67 dollars in the industry. You can Saskatchewan 83 not move a deposit, but you can AUSTRALIA make it easy to develop and operate a mine through invest Jurisdiction Score orfriendly practices. Canada and New South Wales 44 Australia know this all too well. Potash-rich Saskatchewan is Canada’s top performer in the most Northern Territory 66 recent Fraser Institute PPI survey Queensland 58 Risk South Australia 68 The two nations are going O’Neil of Control Risks said. The PPI gave potash and Tasmania 60 through an evolution right now; Increased delays in environ uraniumrich Saskatchewan Victoria 48 the former is repositioning for mental approvals, a potential (95.10/100) the lead in 2015, just Western Australia 63 growth in sectors outside min reintroduction of an emissions ahead of oil heavyweight Alberta ing and resources and the latter trading scheme and the likely (92.24), as the jurisdictions out point behind South Australia. moving from conservative to lib intro duction of additional paced the topperforming Aus Ontario, British Columbia and eral rule. These changes have environ mental approval require tralian jurisdiction and iron ore Saskatchewan all rank in Mine affected investment risk, accord ments for major mining projects hub of Western Australia (91.53). Hutte’s global top five, receiving ing to analysts from risk consult are just some of the issues The worst PPI performers were more than 80 points apiece and ancy Control Risks. affect ing investment in Australia. the Northwest Territories (64.46) offering the kind of ‘certainty’ “While this doesn’t translate Canada’s government, mean in Canada and New South Wales invest ors crave before making into the government discourag while, has mooted revisions to (NSW) (69.12) in Australia, which big investment decisions. ing continued business growth environmental approvals and a despite hosting some world While MineHutte did not as in the mining and resources stronger voice for first nations in class diamond and coal mines, sess the NWT’s legislation, it was sect or (it remains an important mineral developments adding let the sides down. critical of NSW and Victoria, pillar of the Australian econo complexity to the investment which scored below 50 points my), it does indicate shifting climate, according to Control Legislation and led to an “uninvestable” prior ities for economic manage Risks’ Michael Moran. One would assume legislation classification by the London ment that can, and has, resulted “One of the uncertainties facing and policy scores would be one based firm’s reckoning. Of NSW in some regulatory uncertainty extractive firms in Canada today and the same in Canada and (44), it said: “Scoring inadequate for foreign investors,” Lauren is the extent to which the liberal Australia, but mining code ratings in many of the categories victory in the 2015 elections will expert MineHutte thinks other considered, the level of discre Fraser Institute PPI (/100) impose new regulations,” Moran wise. Still, the Londonbased tion within the NSW regime is said. Royalty and licence fee in firm, like the Fraser Institute, highly problematic.” CANADA creases and the cancellation of a sided with Canada in this battle. Quebec’s mining legislation, Jurisdiction Score number of large pipeline projects “Generally speaking, the Cana meanwhile, was held back by Alberta 92.24 criticised by environmental dian legislation offers far greater the discretion of the minister to British Columbia 75.28 groups have all been spoken of security for tenure to the miner, impose or alter conditions to a Manitoba 88.9 by members of parliament, less room for government inter mineral lease; provisions “more New Brunswick 91.27 spooking potential investors. ference or discretion to enter likely to be found in Africa than Newfoundland & Labrador 88.24 Adding these up, Australia into the legislation and as such the Americas”. Northwest Territories 64.46 pips its rival here, offering more greater certainty and lower risk,” These two countries cover Nova Scotia 87.85 certainty over key investment Emma Beatty of MineHutte said. more than 17 million km2 of land Nunavut 68.85 frameworks than Canada. South Australia, home to the so it is no surprise individual ju Ontario 79.48 massive Olympic Dam mine, risdictions’ reception to mining Quebec 85.02 Policy topped MineHutte’s Australia and exploration is vastly differ Saskatchewan 95.1 The Fraser Institute’s policy rankings with 68 points out of ent. That said, Canada has the Yukon 76.66 perception index (PPI), a com 100 with its mining code com edge over its smaller (by land AUSTRALIA posite measuring the effects of mended for being something of mass) rival in this equation, with Jurisdiction Score government policy on attitudes a ‘model’ piece of legislation. forward thinking mining codes toward exploration investment, With MineHutte only ascribing that are easier to follow and New South Wales 69.12 put Canada’s 12 jurisdictions numbers for four jurisdictions bring certainty to a very uncer Northern Territory 85.15 ahead of Australia’s seven in Canada (Ontario, British Co tain sector. Queensland 79.19 regions on a combined basis, but lumbia, Saskatchewan and South Australia 85.50 the individual states, territories Quebec), it was harder to get Scorecard Accumulative Tasmania 78.34 and provinces all carried differ the complete picture, but Australia: 8 26 Victoria 72.91 ent scores in the Canadabased the worst province – Quebec Canada: 9 24 Western Australia 91.53 research company’s 2015 survey. (67) – was in fact only one

Mining Journal • mining-journal.com • July 15-28, 2016 25

25MJ160715.indd 25 14/07/2016 15:42 WORLD FINANCE/REGULATION Show me the money And the country with the most dollars on offer is…

as soon as it is available to John Robertson the company. The Australian approach delivers less more Canadian and Australian compa- quickly, while Canada’s superior nies face very similar regulatory detail comes with a delay. and financial conditions, Australian investors must with one important exception: usually rely on a company’s proximity to US investors. summary of a feasibility study or A selection of 15 US actively economic evaluation, where a managed precious metal and 43-101 report is released in its mining mutual funds with assets entirety. of US$10.3 billion has a 74% Regulators in both countries weighting for North American Toronto has the most listed mining and exploration companies in the are concerned with eliminating investments compared with world misstatement of resource poten- an 8% weighting for Australian tial or insufficient backing for listed companies. companies, in both Australia and but recently poor historical re- statements about future Australian companies have Canada, are confined to a dimin- turns have limited interest by product ion through standard- potential access to a larger pool ishing share of investible funds. invest ors eligible to participate ised reporting but a 43-101 re- of domestic household savings Listing location has not affect- in these offerings. port typically contains more – currently growing at an annual ed investment returns material- Crowdfunding is an emerging emphasis on project economics. rate of A$85 billion (US$64 bil- ly. Over the course of the cycle fund raising mechanism with There is less emphasis on polic- lion), or 5% of GDP, compared from January 2011 to December potential to widen access to the ing valuation methods and de- with C$44 billion (US$34 billion), 2015, the median annualised global pool of investible funds. scriptions of investment returns or 2.5% of GDP, in Canada. return from the universe of Regulations are evolving in both in Australia. The expansion of compulsory Australian-listed resources Canada and Australia where two For even a modestly sized pro- superannuation linked to wages companies was -37.8% with a existing platforms are able to ject, commentary on environ- and salaries has given Australian 22.1% standard deviation match companies with investors. mental and social aspects of a companies a potential funding compared with -37.2% and The world’s first equity crowd- project in a 43-101 report may edge over their Canadian 23.1%, respect ively, for Canadi- funding platform was establish- go to several pages. Under JORC counter parts. an-listed resource companies. ed in Australia. reporting, on the other hand, a In both Canada and Australia, The flowthrough share system Canada and Australia have few words may be all that is pre- restrictions on financial advisers is the most often cited difference reporting frameworks designed sented in practice (although the are reducing the finance flow to in funding available to compa- to add rigour to the way in intent of the drafters of the code earlier-stage mining companies, nies in the two countries. The which companies describe min- was probably for something which have historically relied on Canadian flowthrough tax eral exploration outcomes and more extensive) without any evi- individuals for their funding. regime can offer an expenditure project development potential. dent policing of standards by Having to work from strictly write-off for individual investors The Canadian 43-101 report- regulators. controlled approved product of as much as 133%. While ing regime was intended as a While listing in Australia is lists prevents financial advisers Aust ralian companies would securities standard whereas generally more expensive than from proactively identifying welcome a similar initiative, the Australia’s JORC Code is an in- in Canada for an early-stage companies at early stages of short-term tax benefit potential- dustry standard adopted by mining company, in both places develop ment for recommend- ly distorts the flow of funds with- market operators and regulators. prices are pitched to attract list- ation to clients. In practice, these out necessarily creating a corre- As a consequence, the informa- ings. Neither jurisdiction has sponding commitment to the tion contained in a 43-101 report taken action to remove compa- Listing fees funding of longer-term industry for a comparable deposit or pro- nies which no longer have suffi- For a $10m capitalised company developments. ject is usually more extensive. cient funds to conduct explora- ASX* TSX** TSX-V** In Australia, companies en- Both codes rely heavily on the tion activities or undertake A$65,000 C$$33,950 C$34,000 gaged directly in exploration skill and experience of technical- developments which had been For a $100m capitalised company may receive tax rebates design- ly qualified individuals responsi- the basis for their listing. ASX* TSX** TSX-V** ed to stimulate research and ble for the content of reports. Every thrust has a counter in A$135,000 C$150,250 C$39,400 development spending and spe- The Canadian report is widely this bout, but 43-101, proximity For a $500m capitalised company cific territories and provinces in seen as more complicated and to US investors and a flow- ASX* TSX** A$295,000 $210,000 Canada offer similar incentives. time-consuming to prepare than through option gives Canada a * At listing, issuer is required to pay the Liberalised share purchase Australia’s JORC requirements points advantage. listing fees, plus pro-rata annual fees, rules for existing shareholders and a costlier burden for cash- so a new listing for a $10m capitalised company could be as high as A$85,000 and reduced documentation strapped companies. Scorecard Accumulative ** Basic fees require ments for rights issues Under the Australian continu- Source: Jennifer Boyle, Corporate Finance Australia: 7 33 Velocity Trade Ltd have eased restrictions on fund ous disclosure rules, all material Canada: 9 33 raising by Australian companies information must be disclosed

26 July 15-28, 2016 • mining-journal.com • Mining Journal

26MJ160715.indd 26 14/07/2016 15:42 Founded Head office Listing Market cap (Mar 18) Focus WORLD Randgold Resources 1995 Jersey, Channel Islands LSE, NASDAQ US$8.8 billion Gold in Africa Fortescue Metals Group 2003 Perth, Western Australia ASX US$6.51 billion Iron ore in Western Australia TECHNOLOGY/SERVICES First Quantum Minerals 1996 Vancouver, British Colombia TSX, LSE, US$4.44 billion Copper, nickel, gold, zinc, PGMs in Panama, DRC, Zambia Mauritania, Finland, Turkey, Zambia, Peru Polymetal 1998 Jersey, Channel Islands LSE US$4.43 billion Gold, silver in Russia/Kazakhstan Vital Aussie METS middle ground Sibanye Gold 2012 Westonaria, Gauteng JSE, NYSE US$3.46 billion Gold, platinum, in South Africa Detour Gold Corp 2006 Toronto, Ontario TSX US$2.64 billion One gold mine in Ontario, Canada The country has a large, mobile METS SME sector intent on taking over the world Evolution Mining 2011 Sydney, New South Wales ASX US$2.53 billion Gold in Western Australia, New South Wales, Queensland technologies. I don’t see that provide new products, or for Tahoe Resources *2009 Vancouver, British Colombia TSX, NYSE US$2.53 billion Gold, silver, in Guatemala, Peru and Canada Richard Roberts happening here yet, but the de- start-ups to link with companies Lundin Mining Corp 1994 Toronto, Ontario TSX, Stockholm US$2.47 billion Copper, nickel, zinc, in Chile, USA, Portugal and Sweden sire exists.” that have international sales and Northern Star Resources 2003 Perth, Western Australia ASX US$2.29 billion Gold in Western Australia Australia has a more youthful, Canadian METS entrepreneur distribution channels to globally OceanaGold 1989 Melbourne, Victoria ASX, TSX, NZX US$1.73 billion Gold, copper in New Zealand, Philippines, USA vibrant and aggressively expan- and president of tech firm Minal- promote their products. Centamin 1970 Jersey, Channel Islands LSE, TSX US$1.54 billion Gold in north/west Africa sionist mining equipment, tech- ytix, David Perez, said it was vital “All of these factors contribute MMG 2009 Melbourne, Victoria HSE US$1.29 billion Copper, gold, zinc, silver, lead, nickel and molybdenum nology and services (METS) sec- in the meantime – to Canada’s to Sudbury being an internation- in Peru, Australia, DRC, Laos, Canada tor than Canada, and leading future mining industry competi- ally recognised and relied upon Independence Group 2000 Perth, Western Australia ASX US$1.25 billion Gold, nickel, copper, zinc, lead, silver in Australia small-to-mid-sized companies tiveness – that Sudbury main- mining technology cluster. OZ Minerals 2008 Adelaide, South Australia ASX US$1.23 billion Copper, gold in Australia are currently back in offshore ing industry progress in future tained its position as one of the “I think this is important in *Originally as CKM Resources growth mode at a time when such as safety, remote control, world’s main mining technology order to ensure the future sus- their Canadian peers have semi-automation and automa- and innovation hubs. tainability of mining. The collab- retreated to traditional markets tion, simulator training, software, “Sudbury has a number of orative effects that clusters have close to home. big data analytics and explora- globally recognised operating on product development will Australia showed during the tion data management, IT-OT in- mines within a relatively small help to ensure that there is a vi- 2003-12 mining boom it was the tegration, supply chain model- geographic radius, and has been brant innovative community that world’s deepest METS equity ling and optimisation, insitu a centre for hard rock mining for is continually advancing mining market, with consulting, drilling, mining and deep exploration. more than 100 years,” he said. technology and making it safer mining, engineering, manufac- Australia has also been the “Over the course of this history and more productive.” turing and technology company world’s leading nursery for new the region has developed a very International consulting firms, listings outpacing those in Van- METS firms over the past two talented and engaged workforce. including North American couver and Toronto by about decades, reflected in the high A number of strong academic groups, comprise most of the five-to-one. rate of M&A involving Australian and research institutions have world’s biggest mining engineer- While North America has the firms before and during the re- also located in Sudbury with a ing and technical consulting industry’s largest mining equip- cent boom, compared with activ- heavy focus on groups, but again ment makers, minerals engineer- ity involving companies from mining, including “Australia it is Australia’s ing and construction contractors, other parts of the world. Austral- Laurentian Univer- SMEs that are and some of the world’s top min- ia has been the primary target for sity, Cambrian Col- showed during growing most aging ICT firms, ASX-listed CIMIC, older, bigger US, UK, Scandina- lege, College Bo- the 2003-12 gressively and dis- Orica and Boart Longyear (US- vian, Japanese, Chinese and real, CEMI, tinguishing the headquartered) are the world’s South African corporates. CAMIRO, MIRAR- mining boom it Australian and Ca- largest surface mining contrac- Mining technology and inno- CO, etc. Sudbury is was the world’s nadian consulting tor, explosives supplier and drill- vation hubs in Queensland, also home to a sectors. ing contractor, respectively. South Australia and Western non-profit innova- deepest METS “I think there are Canada has the world’s biggest Australia are proving to be effec- tion centre named equity market“ significant differ- underground mining contractor tive incubators for the next gen- NORCAT which ences,” said CSA in Redpath, but Australia’s Byrne- eration of METS start-ups. has an operating mine that is Global managing director Jeff El- cut Mining and Barminco are A senior Canadian mining ex- available to companies to de- liott. The company is in the pro- growing more aggressively inter- ecutive said Sudbury had been sign, develop, test and showcase cess of merging with a Canadian nationally. ASX-listed small-cap an important mining innovation new technologies in an operat- firm – effectively taking it over. underground diamond driller hub for the country’s mining sec- ing mine environment. “In Australia, the mid-tier con- Swick Mining Services has moved tor in the past. “Within the region, there are sulting sector around geology, into North America and has its “When INCO was there, they approximately 275 local mining resource, mining and environ- sights on growth in other parts of had a large research department supply and services companies mental, geotech, etc, is all much the world, but similar-sized Cana- and today there are a number of that contribute in the area of more mid-sized businesses – dian companies have contracted, companies working on ways to US$4 billion to the local econo- they’re SMEs rather than really literally, and pulled back from innovate,” he said. my and provides roughly 13,500 large firms. markets such as Australia, Africa But Toronto is the country’s jobs [8% of city employment]. “In Canada, there is this huge and Asia. Australia’s Ausdrill is still major mining financial centre and “There is an organisation gap between the majors and the eyeing international markets, de- shares top billing with Vancouver named SAMSSA [Sudbury Area independents. In the middle spite its difficulties at home over as an address for most of Cana- Mining Supply and Service Asso- ground, there is RPA and a cou- the past three years. da’s vast army of junior explorers ciation] which aims to foster the ple of others – not much. But it is Australia’s legion of and developers. It is seen as an Sudbury Mining Technology “So we see that middle market small-to-mid-sized METS compa- important future mining innova- cluster. This organisation as well in Canada and the Americas re- nies, including many with signifi- tion and METS financial centre. as other networking events and gion being wide open and that is cant offshore revenues, that de- “Toronto has been known opportunities within the city presenting us with a lot of op- fine and differentiate the more as a mining finance centre help to promote synergies be- portunities.” country’s METS sector. They in- than as a research centre,” the tween the many enterprises in clude niche-market leaders in mining executive said. the area. Scorecard Accumulative technology and services fields, “An innovation centre needs “Some examples of this may Australia: 9 42 and particularly in areas that will new ideas, [and] firms that adopt be hardware companies partner- Canada: 7 40 be at the forefront of global min- quickly, support and finance new ing with software companies to

Mining Journal • mining-journal.com • July 15-28, 2016 27

27MJ160715.indd 27 14/07/2016 13:04 WORLD CONCLUSION The verdict After six rounds of toe-to-toe combat, we reach a decision on points

or Canada, is the best mining na- Chris Cann tion. At this point, it is worth point- And it’s Australia by little more ing out this competition is rela- than a nose at 42 to 40. tive. We have chosen the two From the introductory page, standouts in almost all aspects of the final verdict almost seems as- the mining industry and pitted sured. Australia’s production is them against each other – there so much greater than that of are no losers. Canada on almost every front For Canada, its bureaucrats and in some cases at embarrass- should be proud they have cre- ing margins. The ‘Super Pit’ in Kalgoorlie, at 3.5km long and 1.5km wide, attests to ated what is the best large-scale Australia doubled Canadian the unmatched scale of mining in Australia legislative framework to support gold production last year and the mining industry in concert produced five times more zinc. In da’s industry. The 43-101 report- Canada again comes out with a financial community that terms of bulk commodities such ing regulation is a beacon for the stronger. backs mining entrepreneurs as coal and iron ore, Australia’s industry, a heavyweight docu- Independent analysis suggests from the junior through to the contribution dwarfs that of Cana- ment that warrants investor re- only South Australia provides major. da. In bauxite, there is nothing for spect. It is also perhaps the ap- more security on investment There is something to be said Canada to compare against Aus- propriate response to the Bre-X than the most poorly ranked Ca- for making the most of what you tralia’s world leading production. Minerals scandal, which while a nadian jurisdiction and the gen- have and, in Canada’s case, In nickel, there is at least a dis- Canadian market event was rel- eral trend on political support for though hardly starved of a min- cussion to be had. While it is only evant to global markets. JORC is miners seems to be diminishing eral base from which to propel in potash and uranium that Can- robust but inferior. in Australia, which is looking di- itself, that has resulted in the sec- ada holds considerable advan- Heightened investor-protec- versify away from its extractive ond best mining address in the tage. tion is complemented by unri- sectors. world. This production is born from valled promotion of the junior By now, two pictures are The new liberal government some of the most spectacular sector through the flowthrough emerging: one of a country spoilt should be thankful and appreci- mineral provinces in the world share scheme. Australia, mean- with riches and a history of ex- ate what it has inherited. and some of the most individu- while, continues to insist a flow- ploiting them, but perhaps with- For Australia, building and ally rich deposits. through system isn’t needed to out a genuine appreciation of maintaining the world’s best Despite sharing geographic help its explorers what it’s been mining jurisdiction is a mantle it and geologic similarities, the in downturns but “Australia has gifted; and an- should be desperate to hang on sheer scale of Australia’s mineral fails to come up a service and other country to. There is a richness and ro- wealth gives it a clear advantage with an alterna- with significant mance in Australia’s mining his- over its Northern Hemisphere tive. technology opportunity of tory and opportunities for the fu- rival. Canada also has sector more which it is mak- ture on a scale simply It is no surprise, then, to find the natural advan- ing the very most. incomparable almost anywhere Australia has the advantage in tage of proximity deeply rooted in On balance, else in the world. mining history, or pedigree if you to major US in- mining history“ the scores are And while it too can be proud will. More mineral wealth to vestment funds, locked. of its mining frameworks, there is spark a boom and on which to which when choosing between The tie-breaker, as it turns out, perhaps a lesson and an oppor- build a fortune or an empire. two national mining sectors is the services and technology tunity for any Australian bureau- It is not so much the number showing the same return on in- hubs available in both countries. crat with a competitive streak of booms that gives Australia the vestment, logically save them- And, in the context of the discus- (that, we imagine, would cover advantage, but the longevity of selves the legwork and stroll sion so far, it is not surprising most Australians) who might be those booms. The rush for gold across the border to distribute Australia has a service and tech- reading this: Canada is doing it in Western Australia, for exam- their cheques. nology sector more deeply root- better. ple, established one of the great This superior willingness to ed in mining history, which has If they are not too proud to gold mining sites in the world at provide a supportive financial evolved to an appropriate size to pick the best parts from Canadi- Kalgoorlie, which continues to framework around the minerals cater for what is a larger produc- an mining legislation and policy give. The adjacent nickel district sector extends to the political ing nation. – and that from other parts of and its associated boom estab- and legislative environment in The Australian METS sector is the world – the best could yet lished a production centre that Canada. larger any way you look at it, get better. remains meaningful on a world Both countries – and indeed all with more market leaders, par- scale, today. countries – show potential for ticularly in the areas that will be Result At this point, though, the tide change with swinging political at the forefront of mining in the turns. Canada pulls back the lead attitudes, and so does the legis- future. by simply making more of what lation and rule of law that pro- It easily accounts for Canada’s Australia: 42 it has. tects industries such as mining METS players as a grouping and This can be seen first in the fi- where the development stage so ultimately decides the ques- Canada: 40 nancing and regulation of Cana- can outlast two political cycles. tion of which country, Australia

28 July 15-28, 2016 • mining-journal.com • Mining Journal

28MJ160715.indd 28 14/07/2016 12:57 COMMODITIES GOLD As good as it gets The only thing better than gold at the moment is gold in Australia

four or five years and that’s differ- Chris Cann ent in gold. “It’s great for investors.” There’s never been a better time Finlayson, who is already part to be a gold miner in Australia of this crop of company chiefs, or, for that matter, be building said one thing, in particular, gold a gold project or just exploring. companies had been keen to Margins are at historic highs avoid in the current boom was and share price valuations are re- unnecessarily tapping equity flecting genuine market appre- markets. ciation as well as a lack of alterna- Saracen Mineral Holdings is enjoying the best of times as an This restraint had kept existing tives, with the exception of Australian gold producer right now shareholders happy and forced lithium, and more recently zinc. institutions to invest in develop- More than 100 ASX-listed gold More important from an Aus- Saracen is targeting a doubling ing gold companies and explor- stocks – the majority of which tralian perspective is the Aussie of production from its Thunder- ers in order to gain Australian are Australia-focused – saw share dollar gold price, which closed at box and Carosue Dam operations gold exposure, enhancing the price growth over the first six a record A$1,825.11/oz to 300,000oz per annum, while overall health of the sector. months of the year, with a re- (US$1,306/oz) following the Brex- Dacian expects to sign the con- This attitude is unlikely to markable 36 companies enjoying it vote. tracts for construction of its change any time soon, with Fin- returns greater than 100%. This of course doesn’t guaran- 220,000ozpa Mt Morgans project layson dismissing the idea that Almost half of those saw gains tee healthy margins as operators in the December quarter. the period of conservative cost of more than 200%. who remember the previous Aus- Williams said: “If gold miners cutting was at an end and inves- Six companies had returned sie dollar gold price peak of aren’t at a share price high right tors would soon be looking for more than 300% on their year- A$1,806.50/oz in 2011 will attest. now, they’re all very close to it. growth through M&A. opening share price, two compa- But playing into the hands of The market appeal of these com- “Expansion for expansion’s nies finished the first half with Australian gold companies has panies is outstanding.” sake is very much what got us plus-400% returns and another been the decline in the Australian Record margins and enthusias- into trouble last time round and two were basking in share price dollar – from USD1:AUD0.94 five tic market sentiment are largely so people are very wary of that,” appreciation of more than 500%. years ago to USD1:AUD1.31 – and the result of the he said. “Explora- These performances are in the related slump in just about two factors out- tion and organic large part a factor of the gold every other commodity. This has lined above – the “If gold miners growth have been price. Since the start of the year, meant competition for contract- gold price and aren’t at a share very successful in gold is up more than 25% from ing and labour is well off its cost environment the past few years US$1,082.25 per ounce to boom-time peak, which has – but there is a price high right and I think that US$1,354.25/oz on growing fi- translated into better prices. third factor to now, they’re all will continue nancial uncertainty – first on the Adding to the cost reprieve are consider in the ahead of aggres- slowing Chinese economy and lower oil prices and cheaper steel, success of Austral- very close to it” sive M&A.” its drag on global GDP, then on among other materials. ia’s current crop Finlayson said the possibility of Britain voting to “There are not many projects of gold producers: management. the balance sheet was the first leave the European Union, and being built, so access to people is “The investment community priority, as those with debt at- most recently on Britain actually good and getting access to mate- was very critical of gold compa- tempted to purge themselves of voting to leave the EU. rials is good,” Dacian Gold execu- nies over the recent boom, it and those debt-free looked to The next major fiscal spectre tive chairman Rohan Williams building and buying projects “build a stable balance sheet”. on the horizon, as if we needed told Mining Journal. “It’s a fantas- just to add ounces to the book,” Those with stable balance one, is the potential election tic time to be building a gold Williams said, who expects to be sheets are then focusing on the of Donald Trump to the White project in Australia.” the CEO of a gold producer by dividend pay-out and, once that House. Those comments were echoed early 2018. was under control, the final prior- This seemingly indefinite un- by Saracen Mineral Holdings “The current crop [of CEOs] is ity was “to organise spend on certainty is likely to fuel gold buy- managing director Raleigh Fin- more about capital discipline and drilling and development”. ing and speculation through to layson. operating-cost focus to deliver “There are some companies the back of the year and beyond, “As far as equipment goes, the right outcome – the fact with the Hollywood problem of which is why the pipeline of gold contractors are quite often put- they’ve now got this tailwind of the balance sheet growing too companies, not just producers, ting their gear out to work with- high gold prices makes it a dou- big, too quickly, but I think you’ll are being bought. out a margin because it’s better ble-whammy. see special dividends before than being tucked away idle,” he “The managers of gold produc- poorly thought-through M&A.” Key figure said. “That gives you an indica- ers today are the best there has Finlayson was careful to point tion that contracting costs are been. They’re dog-hungry for out that value-accretive M&A 36 close to the bottom. value. It looks to me like there’s a would always be considered but ASX Au companies achieving “You’d have to say costs have new interest in these people and said companies in Australia were plus-100% returns for the first been flushed out and any further their focus on value and share- focused inwards. half of 2016 improvements would have to holder interest. That’s something With earnings going through come from efficiencies.” that has happened in the past the roof, why wouldn’t they be?

Mining Journal • mining-journal.com • July 15-28, 2016 29

29MJ160715.indd 29 13/07/2016 10:02 COMMODITIES GOLD Aussie gold stocks on the move The top-five rising yellow metal equities on the ASX for H1 2016

Chris Cann investors tune in to the demand Top 50 ASX gold movers (to June 30) story for lithium-ion batteries, Gold has been a leading light which are hungry for not just Ticker Company % rise Market cap for a resources sector during lithium but cobalt and nickel, 1 MDI MIDDLE ISLAND RESOURCES 539 15,978,396 what has been something of a too. 2 BAR BARRA RESOURCES 516 16,778,238 recovery over the first half of the 3 RSG RESOLUTE MINING 471 682,768,320 year, with investors who piled l Resolute Mining: 471%. 4 GCY GASCOYNE RESOURCES 423 106,000,048 into a handful of top-performing Resolute’s 2016 performance has 5 EXC EXTERRA RESOURCES 362 8,005,811 companies early in the New Year followed the gold price ascent, 6 AQI ALICANTO MINERALS 362 9,714,520 seeing sensational gains for the while the gold miner’s progress 7 NMM NOBLE METALS 339 8,194,659 first six months. across its Africa and Australia 8 PGO PRIMARY GOLD 329 31,141,430 portfolio has continued to pro- 9 ORM ORION METALS 322 3,092,275 l Middle Island Resources: vide the leverage for which gold 10 MOY MILLENNIUM MINER 321 90,706,584 539%. MIR had a subdued stocks are typically bought. 11 DCN DACIAN GOLD 295 303,614,048 start to the year The company 12 WAF WEST AFRICAN RESOURCES 237 70,455,400 but shot into put on 228% over 13 SLR SILVER LAKE RESOURCES 211 205,670,880 orbit in early May “MIR had a the first five 14 CRB CARBINE RESOURCES 210 20,586,988 when its subdued start months of the announced an year then, as June 15 GMR GOLDEN RIM RESOURCES 208 6,466,435 agreement to buy to the year but approached, 16 KGD KULA GOLD 208 5,979,064 the Sandstone shot into orbit in kicked strongly to 17 BDR BEADELL RESOURCES 201 324,087,200 gold operation in add another 70% 18 TRY TROY RESOURCES 190 148,089,344 Western Australia early May” in a month as it 19 DAU DAMPIER GOLD 163 1,864,941 for A$2.5 million announced early 20 CAY CANYON RESOURCES 162 16,379,272 (US$1.9 million) along with a debt redemptions, a restart at 21 KGM KALNORTH GOLD MINES 161 15,409,187 $400,000 raising – shares roared the Ravenswood openpit (Aus- 22 KIN KIN MINING 159 16,765,764 northward by 300% over three tralia), and the completion of the 23 SAR SARACEN MINERAL HOLDINGS 152 896,938,368 days to $0.04. Bibiani feasibility study (Ghana). 24 MRD MOUNT RIDLEY MINES 143 18,815,888 The company subsequently The definitive feasibility study at 25 PDI PREDICTIVE DISCOVERY 140 6,954,959 said it would raise up to $5.05 Syama (Mali) came in on July 1. 26 BSR BASSARI RESOURCES 136 28,249,820 million through a rights issue 27 RMS RAMELIUS RESOURCES 134 158,440,256 l and conditional placement to Gascoyne Resources: 28 SBM ST BARBARA 133 1,198,106,496 fund a feasibility study and fur- 423%. The improvement for 29 GPH GOLDPHYRE RESOURCES 129 13,821,174 ther exploration. The rights issue the six months was impressive 30 HAO HAOMA MINING 127 19,231,510 for a targeted $1.45 million but the peak performance for 31 WGO WARATAH RESOURCES 126 Suspended closed in late June, netting Gascoyne actually came in early almost $1.85 million and helping May when it reached $0.69 on 32 AYR ALLOY RESOURCES 122 6,941,487 the shares higher still – MIR had the back of two key milestones. 33 RIE RIEDEL RESOURCES 105 3,507,748 put on another 50% in early July. First, a prefeasibility study was 34 AAR ANGLO AUSTRALIAN RESOURCES 104 1,872,802 The company plans to fast- published for its 80%-owned 35 AQQ APHRODITE GOLD 104 11,173,614 track refurbishment of the op- Dalgaranga project in Western 36 IRC INTERMIN RESOURCES 103 12,696,072 eration, which has some 480,000 Australia that outlined a 37 DMG DRAGON MOUNTAIN 97 4,541,052 ounces in resources, “significant 100,000oz per annum operation 38 KGL KGL RESOURCES 95 24,624,902 brownfield exploration targets”, with two openpits feeding a 2.5 39 NST NORTHERN STAR RESOURCES 92 2,343,546,624 and a 600,000 tonne per annum million tonne per annum plant 40 EVN EVOLUTION MINING 91 2,838,057,984 processing plant on care and for an initial six years. Then, Gas- 41 NCM NEWCREST MINING 90 13,782,479,872 maintenance. coyne completed a heavily over- 42 AHK ARK MINES 88 4,655,086 subscribed $15 million place- 43 RNS RENAISSANCE MINES 88 23,670,558 l Barra Resources: 516%. ment to fund a full feasibility 44 MKO METALIKO RESOURCES 88 18,197,160 We’ve maintained Barra on this study and continue “aggressive” 45 KAI KAIROS MINERALS 88 11,647,851 list given its exposure to the exploration of its broader West- 46 GOR GOLD ROAD RESOURCES 87 455,678,432 rising gold price through its ern Australian gold portfolio. 47 MML MEDUSA MINING 87 101,970,064 Phillips Find and Burbanks gold 48 SOC SOVEREIGN GOLD 84 5,237,137 exploration properties in West- l Exterra Resources & Alicanto ern Australia. However, one can’t Minerals: 362%: Alicanto’s 49 PRU PERSEUS MINING 81 431,455,328 help feel it is its plan to develop progress started has been 50 CHN CHALICE GOLD MINES 76 38,125,248 the Mt Thirsty nickel-cobalt pegged to Barrick Gold’s deci- For the full top 100 list, please visit: www.mining-journal.com property (50% Barra; 50% Con- sion to proceed with a plus-$13 ico), also in Western Australia, million earn-in agreement for innovative profit-sharing agree- in Western Australia. The latter has had more to do with the 65% of the Arakaka project in ment with contractor Pybar over has also picked up some lithium equity’s meteoric ascent as Guyana; while Exterra signed an its Second Fortune development ground, which has helped.

30 July 15-28, 2016 • mining-journal.com • Mining Journal

30MJ160715.indd 30 14/07/2016 10:18 COMMODITIES GOLD Evolution assuages production fears

Company reveals plus-800,000 ounce profile out to FY2019

Gareth Tredway

Evolution Mining has filled in the gaps on how it plans to maintain the 800,000 ounce per annum production level that it will soon report for the year to end-June, 2016. The company has transformed itself since last April when bil- In April, Evolution announced that reserves at Cowal had increased by 976,000oz lionaire Naguib Sawiris’s gold vehicle, La Mancha, placed its This annual production level is following year and then $910- capex plans at EVN’s assets, our Australian Frog’s Leg mine into now expected to be maintained, 980/oz in the year after that. NAV and cash flow estimates in- Evolution for a 31% interest in and even exceeded through the Following the news, an RBC crease materially.” that company. 2019 financial year, plus costs are research note upgraded the Given a current Australian- La Mancha soon proved to be expected to decrease. stock from ‘Underperform’ to dollar gold price of plus-$1,800/ a valuable investor by injecting “Our teams have worked ‘Sector Perform’ while increasing oz, the potential margins are ex- A$112 million (US$79 million) to exceptionally the share price tremely attractive. maintain its 31% stake in Evolu- hard at integrat- target to $2.60 This is already reflected in the tion when the company acquired ing our two new “Our teams from $1.90 previ- net mine cash flow estimate for the Cowal gold mine from Barrick mines and im- have worked ously. the full year of $405 million, com- Gold. Cowal, with some proving efficien- exceptionally “Evolution’s pared with just $138 million in 250,000oz of annual production, cies at all of our medium-term the prior year. is now a cornerstone mining operations,” said hard at guidance of circa At the end of June the compa- asset within the seven-mine, executive chair- integrating our 800,000oz repre- ny had outstanding debt of $285 Australia-focused group. man Jake Klein sents a significant million, down from $322 million And so, since May 2010, when on the back of the two new mines uplift against our at the end of September 2015. a handful of ex-Sino Gold em- positive guidance. and improving previous num- Thanks to these strong mar- ployees took on a new challenge, The company’s bers, and re- gins, RBC’s cash-flow projections Evolution has forged a major all-in sustaining efficiencies” moves a key predict that the company would growth path into and through costs are expect- plank of our pre- be debt-free by March 2017. the downturn and is about to ed to come in at $1,000/oz for the viously cautious view (declining report a quarterly production year to end-June, while a range production),” said analyst Paul Key figure record of 213,000oz for the three of $945-1,045/oz has been pro- Hissey in the note. 213,000 months to end-June, and an vided for the coming year. They He added: “As we incorporate The ounces that Evolution 800,000oz total for the full finan- are then expected to track even the details surrounding the long- produced in the June quarter cial year. lower towards $930-990/oz in the er-term production, cost and

GOLD Saracen smashes production record

Staff reporter Saracen unveiled record produc- straight financial years. Meeting at an average price of $1,518/oz). tion in the financial year to end- our undertakings to the market Commercial production was Australian gold producer Saracen June along with confirmation is at the core of our business and declared at Thunderbox in May Mineral Holdings is having quite that the balance sheet is not only we look forward to delivering fur- after a capital investment of $63 a year with shares up more than debt-free, but carries net cash ther growth as outlined in our million. The ongoing ramp-up 130% in the past six months as and bullion to the tune of A$40 five-year plan.” will double group gold produc- Thunderbox ramps up and the million (US$30 million). Key takeaways of the statement tion to about 300,000ozpa at a ounces keep flowing from Caro- The financials demonstrate the were record full-year production forecast all-in sustaining cost of sue Dam. success of Saracen’s now stock- of 188,656oz (Carosue Dam around $1,075/oz. But it seems the market has in-trade strategy of funding pro- 157,191oz; Thunderbox 31,465oz), Like other gold producers, Sar- got used to the good news. The ject development from internal at the upper end of the 175,000- acen has reaped the rewards of stock price barely moved after cash flow. And the production 195,000oz guidance range. a weaker Australian dollar and numbers offer reassurance that Gold sales for the final quarter lower energy and labour costs. Key figure the company under Raleigh Fin- of the company’s financial year Above all, the company has A$40million layson is as good as its word. were 67,693oz at an average sale grown at a time of renewed in- Cash in the Saracen account In an ASX announcement, Fin- price of $1,649/oz for total rev- terest in Aussie gold companies at end-June layson said: “We have now met or enue of $112 million (24,555oz as the spot price has risen and exceeded guidance for four delivered into the hedge book stabilised, lifting sentiment.

Mining Journal • mining-journal.com • July 15-28, 2016 31

31MJ160715.indd 31 13/07/2016 10:19 COMPANY PROFILE TORIAN RESOURCES LTD WESTERN AUSTRALIA

Eureka moment at Zuleika Torian Resources (ASX:TNR) is applying its exploration nous to fast-track development at its growing asset base in Western Australia’s highly prospective Goldfields Region. Ngaire McDiarmid reports

OLD-FOCUSED EXPLORER Torian Resources is cashed up with a busy programme ahead to progress its promisingG high-grade projects in the Goldfields. It is about to follow up on exciting gold results at its flagship Zuleika Joint Venture, and conduct drilling to improve confidence at its existing gold resources near Leonora. Torian is also keeping an eye out for further consolidation and acquisition opportunities and will continue to assess the best way to at 58.8g/t gold from 1m and 3m at by 75% since May 2015 to about leverage value from its four WA gold 22.72g/t gold from 66m as well as 222sqkm through more than a projects. 1m at 50.4g/t gold from 84m. dozen acquisitions. Strong high-grade results from “These results show that our Torian is about to start the second Torian’s initial drilling programme ground is highly prospective for of a four-phase drilling programme at Zuleika have the company fast- high-grade gold deposits,” Sullivan at Zuleika as part of its aggressive tracking work towards establishing a said. Matthew was involved in the growth strategy. resource definition. discoveries of Kanowna Belle and The company is well-funded for The Zuleika JV lies 50km north- East Kundana and knows the area this next stage of exploration after west of Kalgoorlie in a sought- well. a successful A$3.3 million placement after gold mining region. The joint “It’s elephant country out here to sophisticated and institutional venture is with Cascade Resources, a and most of our ground is along investors in early July. privately held company. strike from Kundana,” he said. Torian non-executive chairman Torian managing director Matt- “A number of other companies are Andrew Sparke said the company hew Sullivan said the Zuleika JV lay having a lot of success around us – was delighted with the demand and partly along strike of several major Northern Star’s high-grade Pegasus pleased to welcome a number of gold mines including Evolution discovery is more than 1 million high-profile institutional investors to Mining’s Frog’s Leg gold mine ounces at a grade comfortably the register. and the multi-million ounce East above 10g/t gold.” The company’s second exploration Kundana Joint Venture owned by Sullivan said the Zuleika region target area is at the high-grade Mt Northern Star Resources, Tribune had seen more than A$1 billion Stirling Well resource 40km north- Resources and Rand Mining. worth of acquisitions in recent years west of Leonora, within Torian’s Torian’s phase one drilling pro- and Torian’s increased landholding 100%-owned Mt Stirling project. gramme at Zuleika wrapped up in and systematic exploration put it in The outcropping JORC inferred March and established a 1km-long an excellent position to capitalise on resource contains 41,300 tonnes at mineralised zone along strike of East this. 8.54g/t gold. Kundana. The company has become the A 51-hole drilling programme was Historical drill results on the second-largest landholder in the completed in March at Mt Stirling Zuleika tenements included 1m area, increasing the JV project size Well with numerous intersections greater than 10g/t gold. Highlights included 2m at 30.35g/t gold from 35m, including 1m at 47.4g/t. Sullivan said importantly, the recent drilling did not close off the resource. Above right: more “We’re going to assess the drilling is getting project’s viability as a standalone underway at mining operation,” he told Mining Torian’s Goldfields Journal from Kalgoorlie. tenements. “We have always believed in the Right: Torian’s potential at Mt Stirling.” exploration is He said the existing resource did finding high-grade not take the recent drilling results gold results into account and he was confident

32 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Torian_MJ160715.indd 32 14/07/2016 11:12 “It’s elephant country out here and most of it had the potential to grow Above: the our ground is along significantly. company has Infill and step-out drilling is being a busy drilling strike from Kundana. designed to increase confidence programme A number of other as the company moves towards an ahead. Left: internal economic study. Torian is actively companies are having It is also undertaking metallurgical exploring its a lot of success test work for Mt Stirling Well. Goldfields Torian has made a number of tenements around us – Northern strategic partnerships to progress its Star’s high-grade projects, including setting up a drill for equity arrangement. Pegasus discovery is “We’ve got a number of really more than 1 million great supporters,” Sullivan said. “With the softening of the iron ore ounces at a grade price, contractors are being more comfortably above realistic about rates and availability. “And with the global uncertainties between the two companies but 10g/t gold” pushing the gold price up, it’s a great Torian is also in talks with other – MATT HEW SULLIVAN time to be in gold.” parties and has strengthened its MANAGING DIRECTOR Sullivan said Torian had been corporate position. approached about a possible farm- The company established an out of its Bardoc and Malcolm Advisory Board in December 2015, projects which showed just how allowing Torian to gain valuable much interest there was in the area skills to aid its development while TORIAN RESOURCES but that nothing was settled and minimising the costs of attracting AT A GLANCE

discussions were ongoing. a highly skilled and successful A$ The company acquired the Bardoc management team. 0.30 ASX:TNR

project in April where Cascade also Sullivan said the company was 0.25 has a number of tenements. entering an exciting development The 38.6sqkm project lies 3km phase in 2016 and the changes 0.20 north of new producer Excelsior provided the skills and experience to 0.15 Gold’s Kalgoorlie North gold mine. navigate the future. 0.10

Sullivan said the company had In a further boost, mining exec- 0.05 also been approached about its utive Glenn Jardine was appointed 0.00 Zuleika project by several major as a non-executive director to the 6 months ending July 11, 2016 mining companies with a variety of board in May. proposals. The former LionOre managing HEAD OFFICE “It’s safe to say that a number director brings more than 25 years’ Torian Resources Ltd of people have been talking to us experience in project development, Unit G4, 49 Melville Parade about the possibility of getting operations and corporate activities. South Perth WA 6151 involved,” he said. “Torian has created a strong Tel: +61 8 6216 0424 Fax: +61 8 6216 0425 “We’re assessing these proposals position for itself in the Goldfields,” Email: [email protected] and want to work closely with our Sullivan said. Web: www.torianresources.com.au neighbours and other groups with “Torian is a small company that is the objective of achieving mutually moving fast. We’ve got a lot on with DIRECTORS beneficial outcomes.” our continuing drilling programmes Andrew Sparke, Matthew Sullivan, He said while no formal agree- and our acquisition strategy. Elissa Hansen, Glenn Jardine ments had been made, discussions “We’ll keep discussions going were continuing. about potential future partnerships QUOTED SHARES ON ISSUE Meanwhile, Torian’s ongoing and farm-outs. 94.5 million exploration at Zuleika means the “The company wants to find the MAJOR SHAREHOLDERS company is achieving its earn-in gold mines of the future and we’re Cascade Resources Ltd 28.85% milestones for the joint venture with really excited about the potential R&R Venture Partners II LLC 6.05% Cascade, where Torian can earn up not only at Zuleika but at our other UBS Nominees Pty Ltd 4.98% to 49% interest. projects as well. It keeps us very Johns Corporation Pty Ltd 3.13% There are talks of a merger busy.” Cityscape Asset Pty Ltd 2.33%

Mining Journal • mining-journal.com • July 15-28, 2016 33

2pp_Torian_MJ160715.indd 33 14/07/2016 11:12 COMPANY PROFILE EXPLAURUM LTD WESTERN AUSTRALIA

Golden triple for explorer Explaurum Ltd (ASX: EXU) has an exciting exploration story to tell about its 90%-owned gold deposit, near Narembeen in Western Australia’s wheatbelt. Ngaire McDiarmid reports

Right: RC drilling HE TIME HAS COME FOR THE in progress at Tampia gold project to Tampia. Below shine. The highgrade gold right: Diamond exploration project already drilling crew in hadT a 310,000 ounce JORC resource operation virtually sticking out of the ground in the middle of WA’s wheatgrowing region. Then in June, the exploration target area tripled to 1.3km long and 950m wide, thanks to high grade drilling results, including 5m “A highgrade and shallow at 7.62g/t gold and 5m at 10.42g/t resource such as Tampia in which gold, 500m west and 500m north, mineralisation is open in all directions respectively, of the existing resource. is not common in Australia today. The Gault deposit contains an “The acquisition of the project by established 2012 JORC inferred Explaurum has really given us the resource of 4.7 million tonnes at 2g/t impetus and momentum to progress gold for 310,000 ounces, including exploration on a much faster basis.” a highergrade area of 1.6 million The company raised almost A$1 tonnes at 3.4g/t gold, based only on million in an oversubscribed share historic drilling. placement in April to progress a New drilling in the ‘starter pit’ area potential project starter pit zone at at the end of 2015 struck signifi cant Tampia that could be toll treated at mineralisation, including 7m at nearby orehungry plants. 30.1g/t gold and 5m at 21.5g/t gold. “The market has changed signifi These results are feeding into an cantly since the beginning of this advanced scoping study, due out year – there’s much more interest, in August, that is focused on the particularly in gold, and investors potential of a shallow, highgrade are much keener to see the potential “That gravity work gives us scope ‘starter pit’ to generate cash fl ow scale of this project,” Lawton said. to expand our exploration eff ort to through toll treatment options at Explaurum has a twopronged at least a 4km range from the known existing gold operations within approach to Tampia’s development resource,” he said. haulage distance. – updating and upgrading the “We’re drilling in completely RC drill chip trays The study will be a welcome insight known resource and exploring the unexplored areas, getting intercepts into the potential for development 12kmlong zone of anomalous gold that no one has come anywhere options, highlighting the potential in soils for further upside. near previously. for Tampia to be in production much “The area of the resource has “The upside potential is open sooner than many peers. potentially tripled in area to from an exploration perspective and Explaurum managing director approximately 130 hectares as a that’s exciting as far as the market in John Lawton has long believed in result of the last drilling programme concerned.” Tampia’s potential and brought it with widely spaced highgrade Aside from the exploration eff orts to Explaurum via the unlisted public intercepts,” he said. beyond the known resource, Lawton company Auzex Exploration, with The average historical drilling is keen to see the results of the which it successfully merged in depth at the project was only scoping study that will focus on the September 2015. 40m and Lawton said a gravity ‘starter pit’ which could generate Sub cropping “Tampia is an exciting gold survey conducted earlier in 2016 cash through toll treatment. mineralisation at exploration story which is just had given the company a greater “There’s plenty of upside as we Tampia coming to light,” Lawton said. understanding of Tampia’s potential. see it,” Lawton said.

34 July 15-28, 2016 • miningjournal.com • Mining Journal

2pp_Explaurun_MJ160715.indd 34 13/07/2016 11:17 “The acquisition “Our work at the moment is said. “Our current resource is over RC drilling in focused on establishing the scope 300,000 ounces, but that doesn’t progress of the project by and scale of the project, so it’s really include drilling data from any of Explaurum has really exciting times.” the drilling we’ve completed. The Explaurum divested its Queens resource will be updated as part of given us the impetus land and New South Wales prospects the scoping study. and momentum to late in 2015 to turn its full attention “Our understanding of the to developing Tampia. resource – it’s structure and progress exploration “Tampia is very much our focus metallurgy – has increased drama on a much faster and I think the market appreciates tically with our exploration efforts, that sort of focus as well,” Lawton and we want to increase the basis” said. confidence level in the resource then – JOHN LAWTON “It’s a pretty straightforward story establish an ore reserve. MANAGING DIRECTOR – it’s an exciting project and with a “The scoping study will determine new feel for gold that there is around the best way we can optimise the market, we’re obviously one profitability for our project and our of the projects the market is really shareholders.” interested in understanding and Lawton noted it was a perfect follow ing.” time to progress a precious metals Interestingly, just as the company’s project, given the uncertain times exploration target has tripled, so too in the market prompted by Britain’s EXPLAURUM LTD has its share price in the six months vote to exit the European Union, to early June. which has pushed up the Australian AT A GLANCE “We hope to build on that,” Lawton dollar gold price. A$ ASX:EXU said. “We’re an explorer that’s not “All resources are showing a bit 0.10

high on the radar of the market of an uptick but I don’t think you 0.08 generally and in the view of some should have any doubt about the brokers is trading at a share price future for gold,” he said. 0.06

which is at a discount to our peers. “I think gold is a great commodity 0.04 “But we are getting known and to be in.” benefiting from an increase in our Explaurum is now set to benefit 0.02

market cap and the people who are from the golden trifecta of market 0.00 aware of us are following with real interest, a strong gold environment 6 months ending July 11, 2016 interest.” and continuing exploration success Explaurum owns 100% of the bulk at both its resource and beyond. HEAD OFFICE Explaurum Ltd of the project area, and 90% of the Lawton said the market now Unit 101, Park at Waterfront two mining leases covering the Gault had a greater appetite for quality 27 Cunningham Street, deposit. Explaurum is freecarrying exploration stories and Explaurum Newstead, QLD 4006 the minor party to the completion of was keen to deliver. GPO Box 3249 a feasibility study. “Although the project was Brisbane QLD 4001 The Tampia gold project is next to discovered a generation ago and Tel: +61 7 3333 2722 the small town of Narambeen, about missed the last gold bull market, Email: [email protected] 300km southeast of Perth. our technical understanding of the Web: www.explaurum.com It is on private land close to sealed project now has given the project a DIRECTORS roads, power, water, accomm new lease of life to the point where Chris Baker, John Lawton, Mark odation, services and labour. we can see the project’s potential Calderwood, Stephen Stroud. Lawton said there is considerable exceeding 1 million ounces, the cost community support for the project. of discovery of additional gold being COMPANY SECRETARY “We’ve made it clear that we’ll be low, and building on a resource Paul Frederiks drawing on the local community as where people can see development much as possible if and when the happening in the nottoodistant QUOTED SHARES ON ISSUE project develops,” he said. future,” he said. 231 million “The scoping study will provide “We see Tampia as a potential process design options, resource lowcost operation, and given that MAJOR SHAREHOLDERS Misty Grange Pty Ltd 9.08% estimation and mine design, base it’s shallow and highgrade, that’s a Jervois Mining Limited 4.00% line environmental studies, heritage reasonable expectation. Mr Kieran Slee 3.44% and groundwater studies in what “So really, it’s now onward and J P Morgan Nominees Australia Ltd 2.80% is really quite a new area as far as upward in establishing what this HSBC Custody Nominees (Australia) mineral exploration goes,” Lawton project can deliver.” Limited 2.69%

Mining Journal • mining-journal.com • July 15-28, 2016 35

2pp_Explaurun_MJ160715.indd 35 13/07/2016 11:17 COMPANY PROFILE GASCOYNE RESOURCES LTD WESTERN AUSTRALIA

Gilbeys proves just the tonic for Gascoyne With two 1 million ounce gold projects on granted mining leases, Gascoyne Resources (ASX: GCY) is set for near-term, high margin development. Ngaire McDiarmid reports

HIS WESTERN AUSTRALIA- lines high margins thanks to an all-in based gold company sustaining cost of A$913 an ounce, represents a unique opport- an internal rate of return of 90%, low unity for investors, according capital expenditure of $75 million toT Gascoyne Resources’ managing (due to existing infrastructure) and director Mike Dunbar. payback within 12 months. “We are one of only four inde- Its resource is split between the pendent gold developers left on the historically mined Gilbey’s Pit and ASX who are looking at producing the Golden Wings deposit, and 100,000-200,000 ounces a year (the the lease’s many prospects – with the gold industry which helped others being Gold Road Resources, names inspired by various gins – give Gascoyne a strong headstart in Dacian Gold and Blackham are also proving just the tonic for developing Dalgaranga. Resources),” he said. Dalgaranga. He approached Dalgaranga’s Gascoyne kept its head down Gascoyne has identifi ed mineral- previous owner and operators, during the tough times for juniors isation at Hendricks of 12m at 2.2g/t Equigold, and Nick Georgetta in and has worked hard to progress its gold and 18m at 3g/t and 15m at particular, who had been at the helm two projects – emerging at a perfect 1.5 g/t in the fresh rock and is busy before he went to low-cost gold time, as the Australian dollar gold drilling targets including Vickers and producer Regis Resources. price soars while construction and Beefeater. He asked for information on diesel costs drop and there is a keen “We’ve seen a 40% increase in what had and hadn’t worked labour market. the resource at Dalgaranga since at Dalgaranga, and received “a Dunbar said Gascoyne was in November, it’s now a 1Moz deposit remarkable data set” from monthly a prime position for growth and and it’s still growing,” Dunbar said. processing data to grade control and further re-rating. “While we are yet to confi rm what reagent consumption data. “I have to have to keep pinching the ultimate size of the resource “It gave us a huge head start,” myself,” he said. will be, we believe that like all Dunbar said. “During the tough years, we kept other gold mining projects, Gascoyne then engaged Mintrex our head down and worked on de- the mine life will extend Pty Ltd, which had built all three of risking both projects and we were well beyond the initial mine Regis’ plants and were involved in incredibly frugal. life, with potential for 8-10 refi ning Dalgaranga’s plant, which “All staff voluntarily took a 20% years plus.” has since moved off site, to design pay cut and it’s meant that we’ve The company is debt- Dalgaranga’s 2.5 million tonne come out this side far more prepared free and cashed up processing plant, armed with the than we otherwise would be.” – after releasing its historical data and recent testwork. The fi rst project Gascoyne plans Dalga ranga PFS, it “Due to the excellent relationship to bring into production is the 1.05 raised $15 million via between Mintrex and Regis, we were million ounce (Moz), 80%-owned a private placement also able to tour Regis’ Moolart Well Dalgaranga gold project, 60km that was more processing plant and speak to the north-west of Mt Magnet, producing than three times operators about how the plant was an initial 125,000 ounces of gold in oversubscribed. working, what they would do again its fi rst year. Dunbar and what they would change if they Above right: the Dalgaranga’s robust pre-feasi- also paid tri- had the opportunity – it was very Gilbeys open pit at bility study released in March out- bute to the enlightening,” he said. Dalgaranga. gener- “It gave us a real insight into how Right: drilling at osity in Regis, widely considered Golden Wings

36 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Gascoyne_MJ160715.indd 36 13/07/2016 11:07 “We’re looking to be ‘best in class’ at operating resource estimate at 1.5g/t gold for RC drilling lower-grade open cut mines at one 1Moz. “In the mid-1990s I worked at Gilbeys forward to the of the lowest costs, operates. on Glenburgh when it had only exploration results “I think you have to be prepared to 80,000oz and I believed it would be ask the people who are considered a much larger system and that’s why at Dalgaranga – even the best at what they do for their I joined Gascoyne,” he said. another 50,000oz advice and then listen and learn “In 2009, when we listed, we had from them.” 200,000oz at Glenburgh, by 2013 it could turn our early “Because of our headstart with was 1Moz so that shows how much production into the additional information, it means prospectivity is there.” Dalgaranga is easier to develop Dunbar said it held some 125,000 ounces a particularly as it’s Gascoyne’s first geological similarities to the giant year for the first development and it is derisked the Tropicana gold deposit in eastern most,” Dunbar said. WA as both were found in discrete three years, which “The rapid payback of the pro- terrains that had collided with the will unlock much ject is expected within about 12 WA’s Yilgarn craton. months, although it could be sooner “We did a lot of work on geological more value” depending on the gold price and models on how we believe the area – MIKE DUNBAR debt structure. formed and we’ve only targeted MANAGING DIRECTOR “We’re weighing up our financing 30% of three subparallel trends,” he options that will offer the best said. result for our shareholders and our “It’s a complex area and I think now development.” with the collaboration of Geological Gascoyne’s 20% JV partner is Survey of WA we understand it far GASCOYNE RESOURCES currently free carried to completion better. We’ve certainly got first AT A GLANCE of the feasibility study, when he will mover advantage in the area, and then have to either contribute to all we’ve got all the ground we want. A$ ASX:GCY 0.8 capital expenditure and operating “I like to use the analogy that our 0.7 costs or revert to a 2% net smelter strike length is 70km, which is the 0.6 royalty, which has been assumed in distance between Melbourne and 0.5 the PFS and incorporated in the AISC Geelong. 0.4 of $913 an ounce. “It’s a big system, (former Federal 0.3 Dunbar said Gascoyne was now Parliament Speaker) Bronwyn 0.2 staffing up to a sustainable level and Bishop would need a helicopter to 0.1 bringing on board the appropriate get from one end to the other.” 0.0 6 months ending July 11, 2016 skill sets to transition into a gold The company has set up a producer. separate exploration team for each HEAD OFFICE “To say we’re busy is an project so both teams can work Gascoyne Resources understatement,” Dunbar said. completely independently and the Level 2, 33 Ord St “We’re looking forward to the capital raising has enabled Gascoyne West Perth WA 6005 exploration results at Dalgaranga – to send drill rigs back to Glenburgh Ph: +61 8 9481 3434 even another 50,000oz could turn for the first time in almost two years Fax: +61 9481 0411 our early production into 125,000 to aggressively explore the project. Email: [email protected] ounces a year for the first three years, “There are lots of high-priority Web: www.gascoyneresources.com.au which will unlock much more value.” targets at Glenburgh, including a DIRECTORS However, as Dunbar points out, 6km-long soil anomaly, with grades Mike Joyce while Dalgaranga is being rapidly over 2.0g/t sticking out of the ground, Mike Dunbar progressed to generate cashflow, so there are lots of opportunities at Stan Macdonald that is just the start. The company Glenburgh to grow the resource base Graham Riley already has an exciting growth significantly,” Dunbar said. Gordon Dunbar project in the 100%-owned +1Moz “As one of the very few gold John den Dryver Glenburgh gold project. develop ers left on the ASX, it is a “Glenburgh has the potential to very exciting time for Gascoyne QUOTED SHARES ON ISSUE be a multi-million-ounce system,” and, to have two +1Moz projects 252.6 million Dunbar said. on granted mining leases in WA, I MAJOR SHAREHOLDERS He has long believed in the think Gascoyne provides the best Board and management 15.3% potential at Glenburgh, which lies exposure for investors wanting a Colonial First State 6.1% about 250km east of Carnarvon and company with growth and exposure 1832 Asset Management 5.0% contains a 21.3 million tonne mineral to the Australian dollar gold sector.” JP Morgan Nominees 4.9%

Mining Journal • mining-journal.com • July 15-28, 2016 37

2pp_Gascoyne_MJ160715.indd 37 13/07/2016 11:07 COMPANY PROFILE ST BARBARA AUSTRALIA, PAPUA NEW GUINEA

Gold producer poised to be stronger for longer Record gold production, strong cash ﬂ ow, long mine life and low injury rates have St Barbara Ltd (ASX: SBM; ADR OTC: STBMY) poised for growth and in a position its patron saint of mining – and shareholders – would be proud of. Ngaire McDiarmid reports

Aerial view T BARBARA IS MOVING just tip into the ore passes, so we’re of Simberi beyond its turnaround into getting more tonnes per hour and operations, a gold mining success story more hours a day loading,” he said. Papua New and is in prime position for Gwalia’s ore reserve at June 30, Guinea itsS next chapter of growth. 2015 was 1.6 million ounces at 9.4g/t The company notched up record gold and deep drilling from surface annual gold production at its two is building a case for an ore reserve gold mines during the 2015/16 update. fi nancial year, at Gwalia in Western maintain our focus on costs and “We’ve already got a reserve life Australia’s Goldfi elds and Simberi in performance and sensible growth so that’s the envy of our peers and to be Papua New Guinea. Simberi achieved we don’t destroy value.” able to extend that through deeper its annual target of 100,000 ounces a He said at Gwalia, a series of mining is pretty exciting,” Vassie said. month before the end of the year. operational improvements had “With the drilling we’ve done As managing director and CEO Bob maximised tonnage and reduced during the year from surface – we’ve Vassie explains, St Barbara is now an costs and they were yet to hit the drilled holes more than 2,200m ASX200-listed company and ready to “sweet spot” of higher grade in the long – they show that the orebody begin its next phase of considered orebody. just continues, so the idea is to go growth. “We’re just knocking productivity ‘stronger for longer’.” At the time of going to press, St out of the park, it’s just a fantastic A highlight from deep hole Barbara was reviewing its Simberi performance in getting tonnes out GWDD17C included 1.3m at 72.6g/t operations and examining expansion of the ground there,” he said. gold from 2002mbs. options at Gwalia to take one of “The amazing thing is that back Vassie said further studies on the world’s deepest trucking mines in fi nancial year 2012, the mine deeper mining options were due deeper still. produced 185,000oz and at virtually in the September quarter and an “We’ve got record production at the same grade this year, we’re going investment decision would be made both our operations, a record share to produce in excess of 260,000oz of before the end of the year. price at the moment, record fi nancial gold from the operation. “We understand that we’re the performance in terms of cash fl ow “People think we’re getting higher deepest trucking mine in the world and profi tability but importantly, grades and we’re about to, but this now, so we’re doing studies on the we’re getting all those things in both higher rate of production is really best way to go deeper – whether operations, at the same time as we’ve down to productivity.” we stop trucking and become a reached record low injury frequency Vassie said mining levels had shaft mine, or keep on trucking and rates at both operations, so that’s changed from 20m to 40m, the waste introduce more ventilation,” he said. really pleasing,” Vassie said. ore was being disposed in previously “The way it’s looking, we’re He said the company was well mined stopes to reduce trucking expecting the lower capital cost of placed thanks to its strong cash to surface, and ore passes were a ventilation solution will be the way fl ow, the strong gold price, its installed to increase to extend the minelife debt reduction strategy, reduced tonnage. considerably.” production costs and the quality of “That allows its assets and its people. us to run Trucks in the “We’re in a really good position to through shift tropics, Simberi consider how we substantially grow,” changes and operations, Papua he said. blasting times New Guinea “It’s an exciting time in the gold because we can industry, all gold companies are run the loaders doing well and we’ve just got to remotely and

38 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_SMB_MJ160715.indd 38 13/07/2016 10:59 The company’s strategic review of Simberi was announced in February and St Barbara is considering divestment, joint ventures or continued development, including mining the sulphide ore below the existing oxide pit and investigating the gold oxide, sulphide and copper-gold porphyry potential on “Things are going neighbouring islands. “Simberi is outperforming and well at Simberi considering it produced 44,000oz and there are in the financial year 2014, 80,000oz last year and this year it has already opportunities to hit 100,000oz, we’ve made our further invest in targets which is very profitable and better than losing money, which is PNG; but I think for what we were doing before,” Vassie a company like ours, said. Simberi had a sulphide ore reserve the board needs to at June 2015 of 19.9 million tonnes strategically assess for 1.3 million ounces of gold and the sulphide project indicates a mine life whether we invest extension of eight years, according in PNG, Australia or to its prefeasibility study. St Barbara is also accelerating some other foreign its exploration programmes on its clime” licences at the neighbouring Tatau and Big Tabar islands to contribute to B3 by Moody’s and to B by Standard Gwalia’s open – BOB VASSIE the strategic review. & Poor’s. pit, Leonora MANAGING DIRECTOR AND CEO “Things are going well at Simberi By March 2016, St Barbara had operations, and there are opportunities to repurchased US$82 million of its Western Australia further invest in PNG; but I think US$250 million senior secured note for a company like ours, the board facility, leaving a balance of US$168 needs to strategically assess whether million, and Vassie noted that the we invest in PNG, Australia or some remainder of the Red Kite debt other foreign clime,” Vassie said. facility had been paid out in June, 12 Meanwhile, the company is months ahead of schedule. ST BARBARA continuing exploration at two Aside from St Barbara’s record AT A GLANCE programmes in WA, around Leonora production levels, exploration A$ ASX:SBM and at Pinjin north of the gold mining potential and growing financial 4.0 hub of Kalgoorlie. strength, Vassie is also proud of the 3.5 Vassie said the company had held company’s achievements in gender 3.0 the Pinjin prospect for some time equity. 2.5 and now had the money to explore it It was the only gold miner to be 2.0 properly, starting with a considerable given “employer of choice in gender 1.5 aircore drilling programme. equality” status in both 2014 and 1.0 “Suffice to say, we simply like the 2015 by the Federal Government’s 0.5 0.0 postcode and it’s evident there are Workplace Gender Equality Agency 6 months ending July 11, 2016 few players in that area who like that (WGEA). tract of land,” he said. “Obviously, there should be no HEAD OFFICE “We’ll be putting quite a bit of pay gap at all and that’s why I look at St Barbara effort into Pinjin in the coming year.” individual roles,” Vassie said. 432 St Kilda Rd Melbourne VIC 3004 The 1,358sq.km Pinjin tenements “I’m a WGEA pay equity Tel: +61 3 8660 1900 lie east of Saracen Mineral Holdings’ ambassador and I put my hand up Fax: +61 3 8660 1999 Carosue Dam gold mine. to that and I’m keen to talk to others Email: [email protected] At Leonora, Vassie is keen to bring about how we get there.” Web: www.stbarbara.com.au new exploration technology to look Another gap Vassie would like at the area under Gwalia’s headframe to address is the value difference DIRECTORS and continue exploration on the between Australian gold companies Tim Netscher, Bob Vassie, David Moroney, Centenary leases 60km north of and their North American Kerry Gleeson Leonora. counterparts, who are trading higher. “We want to really look at new He said credit was due to the QUOTED SHARES ON ISSUE 495 million ways of targeting for orebodies that Australian gold players who had might be undercover,” he said. executed well on their various MAJOR SHAREHOLDERS On the financial front, St Barbara’s growth strategies. Van Eck Associates Corporation 12% significant debt reduction has seen it Now St Barbara is in a prime M&G Investment Mgt 10% re-rated by credit agencies, raised to position to do the same. Hunter Hall 10%

Mining Journal • mining-journal.com • July 15-28, 2016 39

2pp_SMB_MJ160715.indd 39 13/07/2016 10:59 COMPANY PROFILE RAMELIUS RESOURCES LTD AUSTRALIA

Future glitters for star gold miner Western Australia-based gold miner Ramelius Resources Ltd (ASX: RMS) has just doubled its life-of-mine and is entering a year of anticipated record gold production at its 100%-owned Mt Magnet project. Ngaire McDiarmid reports

HE STARS ARE ALIGNING for Perth-based gold miner Ramelius Resources as it enters what is shaping up to beT a stellar financial year. Its operations centred in the Northern Goldfields notched up a substantial increase in production to June 2016 year-on-year, from 88,000 ounces to 110,000oz of gold, and managing director Mark Zeptner forecasts the next result will be even better. “We’re a gold producer with increasing production and we plan to produce 135,000oz in the year to this year,” Zeptner told Mining plans and also demonstrated the June 2017,” he said. Journal in July. significant porphyry potential that “Importantly, we now have a Mt Magnet’s confirmed future is remained in the area. new, four-year life-of-mine due also in the stars – the new Milky Way The company was working to to extensions at our existing deposit is giving the company the establish an ore reserve and has oper ations, so we’re increasing sought-after life-of-mine extension slated Milky Way for production in production, and our life-of-mine, out to four years. 2019-20. which we haven’t done for a while.” Milky Way’s maiden 241,000oz Meanwhile, three new mines Ramelius’ Mt Magnet mill is JORC resource was announced in are coming into production at Mt currently fed from its adjacent May. The deposit lies under an open Magnet as the long-running Percy Galaxy mine’s series of open pits and pit that was mined until 2000 by a (Perseverance) pit at Galaxy winds two, new high-grade mines near previous owner and is just 3.6km up in September. Leinster: Kathleen Valley and Vivien. from Ramelius’ Checker mill at Mt Mining has just begun at Galaxy’s “Vivien is now at full production Magnet. Titan pit, Blackmans will be another and we’ve still got Kathleen Valley Zeptner said the Milky Way open pit 30km to the north, and running, so it’s when all the stars line discovery represented a “quantum Water Tank Hill will be the first up to give us the best production shift” for Mt Magnet’s life-of-mine underground mine at Mt Magnet since Ramelius began mining in 2011. Blackmans has a 2g/t ore reserve for 16,000oz and will be mined in less than 12 months, while Water Tank Hill/St George has a total ore reserve of 335,000 tonnes at 4.9g/t gold. Zeptner said Water Tank Hill was on the outskirts of the town of Mt Magnet and its high grade and close proximity to the mill meant it was likely to be the company’s lowest- cost project. “It would be easier to mine at Mt Magnet if it was one huge pit but that’s the nature of the beast up Above right: Vivien there,” he said. pit looking north. “It’ll be good to get back Right: board and underground and have mixture of management at open pit and underground mines, the Vivien decline, and it’s the sort of field that lends April 2016 itself to that.

40 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Ramelius_MJ160715.indd 40 13/07/2016 11:00 “We were underground at Wattle Above: drilling at Dam, Ramelius’ company-making the new Milky Way mine, and we’re underground at deposit. Left: the “We were under Vivien, so we have the open pit Perseverance pit at and underground skills for small to Mt Magnet in June ground at Wattle medium-sized operations. Dam, Ramelius’ “Our mines may be on a scale that the big guys aren’t interested in but companymaking we’ll pick them up and make them mine, and we’re work.” He said more drilling was planned underground at at Water Tank Hill to potentially Vivien, so we have extend the project. “As it stands, it will currently make try to keep options open to finding the open pit and about A$30 million in its two-year something decent outside of that.” underground skills period so it’s pretty lucrative, we just The company has greenfields want it to have more life,” Zeptner projects in Queensland and the for small to medium said. Northern Territory, where it has sized operations” Almost half of the company’s earned an 85% stake in a joint $10 million exploration budget venture with Tychean Resources at – MARK ZEPTNER is being spent at Mt Magnet and the Tanami Gold Project. MANAGING DIRECTOR Zeptner is confident the project’s Zeptner said they had just been life will increase – not to mention granted access at Tanami and early the company’s potential at its other stage exploration was under way. exploration projects in WA and in In the two years he’s been at the RAMELIUS RESOURCES the Eastern States. helm of Ramelius, first as CEO and “The lion’s share is going to go now as managing director, Zeptner AT A GLANCE into Magnet to extend the life said there had been many highlights A$ ASX:RMS there, we’re looking for more Milky to date. 0.6 Ways and we’ll be drilling under the The company is debt-free and has 0.5

Galaxy pits looking for underground forward sold gold to the end of 2017 0.4 opportunities,” he said. while keeping half exposed to the 0.3 Within a month of establishing rising spot price. Milky Way’s maiden resource “We’ve built up our cash position 0.2 estimate, extension drilling has from a low point in mid-2014 of A$15 0.1

intercepted highlights 3m at 21.68g/t million to closer to $50 million and 0.0 gold and 20m at 5.85g/t gold. we’ve done that without significant 6 months ending July 11, 2016 Ramelius has also identified new capital raising,” Zeptner said. REGISTERED OFFICE prospects, Stellar West and Brown “We’ve built the share price from a Ramelius Resources Cow, within 1km of Milky Way, which low of 4c to about 46c. Suite 4, 148 Greenhill Road Zeptner said demonstrated the “The guys have got better and Parkside SA 5063 under-explored, highly prospective more efficient at running the mill – Ph: +61 8 8271 1999 nature of the Boogardie Basin. it has a sub-A$20/tonne operating Fax: +61 8 8271 1988 Recent drilling highlights include cost which is super-competitive. 14m at 3.96g/t gold at Stellar West “On almost every metric whether HEAD OFFICE and 7m at 7.36g/t at Brown Cow. it’s been enterprise value per Level 1, 130 Royal St Zeptner said $1 million was also production ounce or resource East Perth WA 6004 Ph: +61 8 9202 1127 earmarked to drill within and below ounce, we’re below average which Email: [email protected] the current resource envelope at gives us a fair bit of scope for a share Web: www.rameliusresources.com.au Vivien, where exploration highlights price increase. include 3.5m at 7.6g/t gold. “And our new life-of-mine should DIRECTORS Vivien has already over-performed give investors greater confidence.” Mark Zeptner, Robert Kennedy, Michael in tonnes and grade in its initial Zeptner is keen to meet with Bohm, Kevin Lines months of production and by late potential institutional investors on June had produced 22,332 tonnes at an overseas trip this month. QUOTED SHARES ON ISSUE 8.02g/t. “I’m looking forward to sharing 475.2 million “We’ve got increased confidence our story,” he said. MAJOR SHAREHOLDERS that the mine, which has just gone “We have our operations running Citicorp Nominees Pty Ltd 6.5% into stoping now, will still be open in smoothly and we’ve increased our HSBC Custody Nominees Aus. Ltd 6.4% four years,” Zeptner said. life-of-mine significantly. JP Morgan Nominees Aus. Ltd 5.3% “Our priority is on our operations “There is probably no better time Guina Energy & Investments Pty Ltd 2.3% and their extensions but we always to be an Australian gold producer.” National Nominees 1.9%

Mining Journal • mining-journal.com • July 15-28, 2016 41

2pp_Ramelius_MJ160715.indd 41 13/07/2016 11:00 COMPANY PROFILE DE GREY MINING LTD WESTERN AUSTRALIA

Gold development on the horizon for De Grey De Grey Mining (ASX: DEG) is prioritising near-term development of its gold resources, while also progressing its two base metals deposits and pegmatite potential in Western Australia’s Pilbara. Ngaire McDiarmid reports

E GREY MINING HAS grade lodes which start from surface consolid ated its focus on and continue to beyond 200m its 100%-owned fl agship depth. Turner River Project in “The option of a more eﬃ cient theD Pilbara, where drilling is under CIL plant wasn’t really considered way at the main Wingina Well gold previously. The metallurgical test- deposit to increase the confi dence in work shows recoveries of greater the resource at depth and advance than 90% and we can see staged the near-term development of the mining initially of the higher-grade project. lodes in an open pit transitioning The company regained full control into selective underground mining of the Turner River tenements in at depth.” February and has wasted no time “In my opinion, the current in reviewing the three existing underground potential of this high- Wingina resource camoufl ages a JORC gold resources and geological grade mineralisation. nice, high-grade gold system and data, with a view to incorporating The Wingina Deeps drilling there is lots of potential at depth.” the high-grade potential around pro gramme began in early July Intercepts in the Footwall Central Wingina Well, the largest deposit. and Lill views it as a high-impact Lode below Wingina include some The project lies just 50km from programme. exceptional widths and grades the mining hub of Port Hedland “The successful testing of this like 4m at 10.7g/t gold and 10m at and has easy access to established high-grade plunging shoot at 15.1g/t. infrastructure including sealed depth will signifi cantly increase “The question is: ‘how deep the roads, communications, railway and our resource base and provide grade will go?’” Beckwith said. accommodation. confi dence that we can increase De Grey’s current 1500m diamond Executive chairman Simon Lill said: the potential mine life through drilling programme aims to defi ne “The company aims to start open pit underground operations,” Lill said. a signifi cant step-out resource mining at Wingina, supported by the The company appointed geo- extension at Wingina, provide two satellite resources at Amanda logical consultant Andy Beckwith more fresh bedrock material for and Mt Berghaus, and set up a low- to review the project and he fi rmly metallurgical testwork and provide Above right: RC cost, small CIL processing plant at believes in the underground and structural information about the drilling under Wingina.” near-term development potential. three high-grade lodes. way at the A recent review by the new “The previous mining studies, The company believes the Discovery gold- technical and management team, conducted during 2007-10, were project holds strong potential for a silver-zinc-lead shows the Wingina gold deposit completed in a signifi cantly low capex processing plant deposit. Below: hosts numerous high-grade drilling lower gold price environment of with an open pit and the company is intersections, many hits greater around $800 per ounce versus the underground prioritising near- than 10g/t gold, below the main current $1,700 pricing and were mining term development oxide resource. The team is very focused on heap-leach extraction,” scenario. at its fl agship encouraged as it Beckwith said. Turner River looks to test “There are two really Project t h e consistent high-

42 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_DeGrey_MJ160715.indd 42 13/07/2016 11:17 “In my opinion, the

The Turner River gold project and confirmed pegmatite trends. Diamond drilling current Wingina contains a total JORC mineral “I’ve driven over the area and at Wingina Well resource camouflages resource estimate of 406,000 ounces, identified small outcrops over of which 268,000oz are at Wingina. 8.5km,” he said. a nice, high-grade Within a 10km radius, the Amanda “The samples were anomalous gold system and deposit contains 35,000oz and Mt but lithium weathers very quickly so Berghaus 43,000oz. a soil programme will be conducted there is lots of Elsewhere in De Grey’s Turner River over the more anomalous lithium- potential at depth” Project, two VMS-style base metals rich pegmatite zones. deposits have been discovered: “We’re building a programme of – SIMON LILL CHAIRMAN the 1.7 million tonne Orchard Tank soils along the pegmatite trend and JORC resource contains 2.38% zinc, hopefully that will identify lithium 78.6g/t silver, 0.99% lead, 0.06% targets to drill later this year.” copper and 0.27g/t gold; while the Lill said the prospectivity was 1.2 million tonne Discovery deposit highlighted in a review of historic contains 2.34% zinc, 87g/t silver, stream sediment sampling which 0.94% lead and 0.8g/t gold. was carried out by CSR in the early Drilling is now complete at 1980s. Discovery to test its additional oxide “Until a few weeks ago, no signi- gold and base metal potential, test- ficant pegmatites were docu ment ed ing previous RAB drilling, including to occur on the tenements,” Lill said. 11m at 3.1g/t gold from 3m. “These early results are encourag- It is important to also highlight ing, based on the initial results that previous high-grade intercepts and our significant land holding in DE GREY MINING LTD at Orchard Tank include 4.9m at prospective ‘lithium country’. 331g/t silver at 2.54g/t gold, 12.7% “We are excited to continue adding AT A GLANCE zinc, 7.31% lead and 0.35% copper. shareholder value via increased A$ ASX:DEG Meanwhile, De Grey is also buoyed exploration activities targeting the 0.0030 by the pegmatite lithium-tantalum lithium potential within our land 0.0025 potential in its tenements. holding.” 0.0020 Pilbara Minerals’ Tabba Tabba He said the company’s large and 0.0015 project lies north of De Grey’s under-explored tenements held 100%-owned holding and the world- considerable upside. 0.0010 class Pilgangoora lithium-bearing “We’ll continue to drive our gold 0.0005 pegmatites, being developed by development strategy as our near- 0.0000 Pilbara Minerals, Altura Mining and est-term project, with the addition 6 months ending July 11, 2016 Dakota Minerals, lie only 50km to the of a specific exploration programme HEAD OFFICE south-east. focuses on lithium across the Turner De Grey Mining Ltd De Grey holds a large, strategic River Project,” he said. Level 2, Suite 9, 389 Oxford St 900sqkm landholding within one of “We’re building our baseline data Mt Hawthorn WA 6016 Australia’s major lithium tantalum to advance to a mining economics Tel: +61 8 9381 4108 provinces and has made additional study.” Fax: +61 8 9381 6761 tenement applications to secure He said De Grey represented an Email: [email protected] Web: www.degreymining.com.au further potential. undervalued investment opport- Only 5% of its Turner River unity, and compared the Turner DIRECTORS project has been assessed for River Gold Project to Pantoro Ltd’s Simon Lill, Davide Bosio, Steve Morris lithium potential but the recent Nicolsons gold mine and Doray reconnaissance sampling confirmed Minerals’ Andy Wells gold mine. COMPANY SECRETARY/CFO an 8.5km-long zone of prospective Nicolsons had an initial ore reserve Craig Nelmes pegmatites with elevated lithium, of about 80,000oz, while Doray’s tantalum and other indicator stake in Andy Wells’ maiden reserve QUOTED SHARES ON ISSUE elements. was about 200,000oz, he said. 2,888 million De Grey doesn’t hold the Both companies have been signi- MAJOR SHAREHOLDERS pegmatite rights on its tenement ficantly rerated by the market as the Pershing Australia Nominees 5.35% immediately south of Tabba Tabba. mining projects developed and Lill Pointdale Pty Ltd 3.47% However, Beckwith conducted has high hopes that the Turner River Redcode Pty Ltd 3.47% first pass reconnaissance rock chip gold project will create the same Aymon Pacific Pty Ltd 2.28% sampling on the adjacent tenement opportunity for De Grey. DJ Carmichael Pty Ltd 2.10%

Mining Journal • mining-journal.com • July 15-28, 2016 43

2pp_DeGrey_MJ160715.indd 43 13/07/2016 11:18 COMPANY PROFILE ALTO METALS LTD WESTERN AUSTRALIA

Explorer set to rise on high-grade gold The experienced exploration team behind Alto Metals Ltd (ASX: AME) has high hopes for its Sandstone Gold Project. Ngaire McDiarmid reports

ITH HISTORIC DRILLING results including 1m at 530g/t gold at a depth of 50m in the Lord Nelson pit,W Alto Metals executive director Dermot Ryan is understandably excited about the potential at the Sandstone Gold Project. Alto Metals completed its acquis ition of Sandstone Exploration in June and has wasted no time in assessing historic data, or as Ryan describes it, “putting Humpty Dumpty back together again”. Alto staff are creating 3D models of the numerous drilling results in the vast tenement area, based on publicly available information from the WA Department of Mines and Petroleum and ASX announcements by previous owners Troy Resources and Herald Resources. The Sandstone tenement package covers 723sqkm in the wellendowed Murchison goldfield, which has produced more than 1 million ounces of gold to date. Ryan said the volume of information, which included JORC 2004 Compliant resources, indicated there was both plenty of highgrade gold left beneath existing mined oxide pits, as well as further potential The company’s focus on the gold is currently under way to raise A$1.7 in brownfields areas including the project prompted a name change million to progress Sandstone. Indomitable prospect area. in May from Enterprise Uranium Ryan believes the Lord Nelson “The numbers will blow your socks Ltd, which had been spun out of and Lord Henry bodies are high off,” he says. Enterprise Metals. coefficient of variation deposits, His office is filled with newly Alto still holds a number of where very high grade quartz veins created, dining tablesized maps uranium projects but is turning its lie within a lower grade mineralised and charts plotting the historic full attention to Sandstone – a move envelope. stellar drilling results. that has been strongly supported in He said the previous owners had Grades of +15g/t gold are common, the market. mined the shallow oxide material and there are hits of between 36g/t It completed an A$1 million dollar but the mill, which is on a separate and 82g/t lying below the Lord capital raising in June and welcomed smaller lease acquired by Middle Above right and Nelson pit. Terry Wheeler, through his company Island Resources, was not designed below: old gold “Most junior companies just don’t Windsong Valley, as the company’s to handle hard fresh rock. workings at have these grades to start with,” he number one shareholder. “Lord Nelson was mined by Troy Maninga Marley notes. Wheeler is well known in the to about 60m depth, and drilling mining industry and worked for indicates that the shear zones Western Mining Corporation before containing highgrade gold in pyritic establishing Genalysis Laboratory quartz veins are open at depth,” Services in 1975, which he eventually Ryan said. sold to Intertek Group. “Troy mined 1.45 million tonnes Alto is a tightly held stock – the at 4.43g/t gold for 207,440oz, and top 20 shareholders held 77.31% in the grade was 45% higher than their early July. resource estimate. A shareholder purchase plan (SPP) Lord Nelson is just one of the

44 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Alto_MJ160715.indd 44 14/07/2016 11:10 highly prospective areas in the Above: looking tenements and its remaining high north at the “Lord Henry and grades are making it a top priority Lord Nelson pit. for Alto. Left: Alto Metals’ Lord Nelson were “At Lord Nelson along the vein, Dermot Ryan blind deposits and there are hits of 15g/t, 17g/t, and chipping at a vein another 20m along there’s 114g/t at Lord Henry they were discovered and 95g/t in the pit wall, and these during drilling. I think figures aren’t isolated,” Ryan said. “I believe the lowgrade there is the potential mineralisation (that was mined in the west of Lord Nelson. to find other blind pit together with the very high grade “Although the drilling to date is veins) are alteration zones, and we patchy, oxide mineralisation has deposits under need to target these alteration zones been discovered over 4km of strike, overburden” below the pit to locate the very high from Indomitable in the north to grade veins down dip.” Musketeer in the south,” Ryan said. – DERMOT RYAN Ryan says it is a similar case at the “The area is very deeply EXECUTIVE DIRECTOR nearby Lord Henry pit which was weathered down to 200m depth and only mined to a depth of about 40m. could contain multiple vein hosted “And at the Bulchina deposit, the deposits like Kalgoorlie’s Super Pit. bottom of the pit has a relatively At the time of going to press, narrow 45m wide trench with a Alto was still compiling the historic quartz vein containing high grades information to create one contiguous but they stopped mining at the base database for the Sandstone project. of oxidation because they couldn’t “We’re using the existing drilling ALTO METALS LTD process the hard rock,” he said. data and establishing targets along “Lord Henry and Lord Nelson strike and down dip,” Ryan said. AT A GLANCE were blind deposits and they were “Previous explorers undertook A$ discovered during drilling. some Induced Polarisation surveys 0.12 ASX:AME “I think there is the potential to and there are interesting anomalies 0.10 find other blind deposits under indicative of deeper sulphide overburden.” mineralisation along the Lord Henry 0.08 He sees a strong similarity and Lord Nelson trends that we’ll 0.06 between the planar structurally follow up. 0.04 controlled shear zones at Lord “We’re going to do careful drilling: 0.02 Nelson and the shear zones hosting I see myself more as a sniper than a 0.00 high grade gold at Jundee Deeps. machinegunner, there’s no point 6 months ending July 11, 2016 “I worked at Jundee in the 1990s doing a series of ‘drill and hope’ and we mined several hundred holes.” HEAD OFFICE thousand ounces of gold from the Having said that, Ryan said the Alto Metals Ltd oxide pits, but when we drilled exploration programme being Suite 2, 91 Hay St deeper below the depletion zone, planned would not hold back. Subiaco WA 6008 we found several million ounces “Once the approvals are in place, Tel: +61 8 9381 2808 within high grade shear zones,” he you can expect to see multiple drill Fax: +61 8 9381 5545 said. rigs at this project,” he said. Email: [email protected] Jundee is still producing gold “I used to work for Great Central Web: www.altometals.com.au from its underground operations for Mines and I’m not afraid to drill.” DIRECTORS new owner Northern Star Resources. Alto will work to establish new Anna Mao Ryan was general manager of JORC 2012 resource estimates Dermot Ryan exploration for Great Central Mines/ based on the remaining ore in the Bill Robertson Normandy Yandal Operations for Sandstone pits and establish its Stephen Stone five years to 2001, and has over 39 exploration program, targeting years’ experience in the discovery extensions of known resources and ISSUED SHARES and successful evaluation of gold, other prospects. 115,695,812 ordinary shares base metals, iron ore, diamond and “It’s very exciting times,” Ryan 25,000,000 performance shares uranium deposits. said. MAJOR SHAREHOLDERS Based on his experience, he is “We have a great exploration Windsong Valley Pty Ltd 15.79% also excited by the largescale oxide opportunity and I’m enthusiastic Sinotech (Hong Kong) Corp. Ltd 12.45% gold potential at the Indomitable, because we’ve got high grade Enterprise Metals 11.67% Piper,Tiger Moth and Musketeer gold, and continuity and numerous Stephen Stone 8.21% exploration targets to the north drilling targets.” BR Legendre 7.87%

Mining Journal • mining-journal.com • July 15-28, 2016 45

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1p_A4_MJwebsite_subscribers_ad_2016_generic.indd 1 22/03/2016 10:22 COMMODITIES LITHIUM Technology meets technology A breakthrough in processing method may transform burgeoning lithium sector

could come from within Plat- Chris Cann ypus’s international lithium portfolio but would more likely Platypus Minerals’ L-Max process come from an existing operation is set to become a disruptive already mining lithium-rich technology within a sector of micas. The location of the plant, the mining world in its own right meanwhile, may not necessarily proving disruptive to the global be near the feedstock but could energy mix. That’s if it works. be near the coast for ease of L-Max is a patented lithium shipping. processing technology based on How readily available the capi- a process originally designed for tal is will depend largely on how Potash West by Strategic Metal- much Platypus is asking for. lurgy to extract potassium from Though Becker was tight- micas (K-Max). Potash West lipped on the expected costs, allowed private company Lepidi- other comparable full-scale co access to the technology in processing plants mooted in re- exchange for a significant share- Lepidico previously proved L-Max using a mini-plant cent years have had price tags of holding 18 months ago, with a around A$200 million (US$252 view to adapting the process for chemicals and simple equipment cause they had no recognised million) and so one could specu- lithium extraction. – there are no fancy and unusual value. late that a plant 10% of the size Lepidico successfully achieved pieces of equipment needed “This technology makes those might cost about A$20 million. that goal, designing a hydromet- or difficult to obtain chemicals, materials economic.” Based on the enthusiasm allurgical process that involves catalysts etcetera,” he told Min- That is of course, if it works. among investors for lithium eq- direct atmospheric leaching of ing Journal. Lepidico previously proved uities over the past year, it does lithium mica impurity removal The absence of processing L-Max using a mi- not seem too stages with subsequent lithium bells and whistles, along with a ni-plant but Platy- much of a stretch carbonate precipitation. fertiliser by-product, has meant pus will need to “So impressed to raise this much Flotation of the micas produc- producing a tonne of Li2CO3 build a commer- from public eq- es a consistent concentrate as could cost as little as US$1,500. cial-scale phase by the potential uity markets, feed for L-Max, which starts with This is part of what makes L-Max one plant to gain of L-Max was while private eq- continued a sulphuric acid leach. Just about disruptive. industry recogni- uity firms are also on /from everything goes into solution, Currently, the large-scale brine tion. lithium junior known to be sniff- then a series of liquid-solid sepa- operations typically found in the That plant will Platypus, it ing around for ex- ration and pH adjustments re- southern US and Latin America probably be posure to the lith- move various impurities and by- are the lowest-cost producers at about 10% of the moved to ium space. products to be left with pure about US$2,000/t, while hard size of a full-scale acquire Lepidico There is of solution. A carbonate salt is rock spodumene operations facility. On that in March and course the option added to precipitate Li2CO3 from typically in Australia can attract scale, the compa- of partnering which a K2SO4 by-product can be operating costs up to US$6,000/t. ny reckons it closed the deal with an existing extracted. An extra step could On that basis, Platypus would could wash its last month to operation to pro- produce LiOH. be entering the market as one of face in terms of cess waste dumps So impressed by the potential the lowest-cost producers. economics and establish an on a profit-shar- of L-Max was lithium junior Platy- The other disruptive aspect of commercially integrated ing arrangement pus, it moved to acquire Lepidico L-Max is the nature of its feed- stress test L-Max, for financial assis- in March and closed the deal last stock. Working off micas intro- while also mini- small-cap tance setting up month to establish an integrated duces an entirely new resource mising risk. lithium player” the facility. small-cap lithium player. host to a lithium sector that has “That will give That style of ar- The beauty of the process, ac- to this point been targeting only us credibility as a rangement may cording to former Lepidico man- brines and spodumene-rich peg- lithium producer, not just a ‘wan- hold the key to Platypus’s future aging director, now Platypus matites. nabe’, and show we can do it at a growth: the ability to leverage consultant, Gavin Becker, is its “There are a number of pro- very low cost,” Becker said. “We into existing operations by offer- simplicity. jects that contain micas but they can then bring people round the ing L-Max to unlock lithium re- “It uses mainstream industrial typically go out to the tailings plant so they can touch and feel sources previously trapped in dam or dumps because they the technology and gain confi- what companies considered Key figure aren’t the primary source of tan- dence in what we’re doing.” waste rock. talum or lithium,” Becker said. To do this, there are three im- “We’re absolutely convinced A$200mn “There are also numerous pro- mediate challenges: decide on a when we can prove this technol- The price of other comparable jects around the world where ge- feedstock, decide on a location ogy at a reasonable scale, we’ll full-scale processing plants ologists have been tripping over for the plant, and raise the be on a very strong path forward mooted in recent years lithium micas for decades but money to build it. in terms of company growth,” they have never been drilled be- The first part of that equation Becker said.

Mining Journal • mining-journal.com • July 15-28, 2016 47

47MJ160715.indd 47 14/07/2016 15:45 COMPANY PROFILE PLATYPUS MINERALS AUSTRALIA, CANADA, SOUTH AMERICA

Global player has many lithium irons in the fire Platypus Minerals (ASX: PLP) is carving itself a niche in the global lithium market as unique as its Australian namesake. Ngaire McDiarmid reports

MERGING GLOBAL LITHIUM as potash and other compounds, m icas) and through joint ventures player Platypus Minerals is to effectively produce a clean, with companies with established well on its way to proving environmentally friendly waste.” experience in over seas jurisdictions it’s not just another lithium He said LMax® had produced (eg., Crusader Resources in Brazil; junior.E batterygrade lithium carbonate and Latin Resources in Argentina The company is exploring for with a purity of 99.5% in the lab and and Peru). traditional and unconventional was successfully tested in a mini Lemare covers about 70sqkm in a sources of lithium, in keeping with its plant run. The next step is to prove proven lithium district about 25km reasoning for its acquisition in May the lowcost LMax® process in a from Nemaska Lithium’s developing of public unlisted company Lepidico Phase 1 plant, a significant step that Whabouchi project. and its provisionally patented lith would put Platypus in the lithium Platypus exercised Lepidico’s ium extraction technology LMax®. producer ranks. option in May to acquire up to 75% As Platypus managing director Although it is yet to be tested on of Lemare from Critical Elements Tom Dukovcic explains, the lowcost a commercial scale, licences have Corporation, which is developing LMax® process has the potential to already been sold to third parties, the Rose lithium project in the same disrupt the industry by introducing a and European Metals Holdings has region, for $70,000 cash, $500,000 viable third source of lithium to the taken an option to use LMax® at its in scrip and future milestone market: Limicas, rather than hard massive Cinovec project, Europe’s payments. rock spodumene or brines. largest lithium deposit located in the “We’re keen get on the ground Like spodumene, Limicas such Czech Republic. and drill Lemare,” Dukovcic, a as lepidolite and zinnwaldite Dukovcic said LMax® could be the geologist, said. occur in pegmatites, sometimes in catalyst for a major change in the “Lemare is the first lithium Lithium carbonate association with spodumene, but are global lithium industry, potentially prospect that we’re going to drill. produced by the essentially discarded as waste in the adding value to existing operations We want to move quickly to define L-Max® process process of generating a spodumene and facilitating the development of the size and scope of Lemare with during the mini- concentrate. Elsewhere, these min greenfield opportunities. the hope of establishing a JORC plant run erals have been ignored because Meanwhile, after a successful fully codecompliant resource by the end they are not mainstream. underwritten A$3.7 million rights of the year. “With LMax®, we have the ability issue, Platypus is set to start drilling “Lemare is a walkup drill target to turn people’s waste into ore, that’s at its Lemare project in the James and we intend to start field work in the magic of it,” Dukovcic said. Bay region of Quebec, Canada. July. We know other spodumene “It’s a beautiful, elegant process This is part of Platypus’s three pegmatites in the region host with multiple benefits – it extracts pronged approach to exploring for lepidolite as well, including Rose, lithium while producing a range lithium: traditional sources (spod and we’re yet to determine the of valueadd byproducts, such umene), nontraditional sources (Li mineralogy of Lemare.” The company’s first nontrad itional lithium target is at the historical tin field at Euriowie in New South Wales, north of the mining centre of Broken Hill. Dukovcic said there was known lithium mineralisation within the project in the form of amblygonite in pegmatites. “Amblygonite is nice because it’s the highestgrade lithium mineral with 10% lithium oxide,” he said. “The challenge at Euriowie is to define large enough quantities of amblygonite, which is not known to occur in abundance – but is that a reality or is that because it has yet to L-Max® process in be specifically explored for?” operation during a Accordingly, Lepidico has also continuous closed- submitted an application for a system 10 day provisional patent for a lithium mini-plant run extraction process for amblygonite.

48 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_Platypus_MJ160715.indd 48 13/07/2016 11:05 Through Lepidico, Platypus has Dukovcic has been with Platypus Lepidolite-rich established joint ventures with two since 1999 and has overseen its pegmatite rocks ASXlisted companies to explore for evolution through a number of “Lemare is the first lithium in Brazil, Argentina and Peru. guises in that time to now be at the Dukovcic said the 50:50 joint cutting edge of the rise and rise of lithium prospect that venture with Crusader Resources lithium. we’re going to drill. was an ideal business model to He said it was pleasing to now be demonstrate how LMax® could in such a strong position, having We want to move potentially unlock value in projects weathered the market downturn quickly to define where lithiumbearing micas had and seizing the right opportunity to been overlooked as a primary source secure the company’s longerterm the size and scope of lithium. future. of Lemare with the “We provide LMax® and they “The acquisition of Lepidico was a bring local knowledge to the table great opportunity for both boards, hope of establishing a so we don’t have to waste time and and the timing was right,” Dukovcic JORC code-compliant resources in reinventing the wheel,” said. he said. “When we first started talking resource by the end The partners will initially explore in September there were maybe a of the year” the Manga project in Brazil for dozen lithium juniors on the ASX, zinnwaldite, a lithiumrich mica. whereas now there are over 50. If – TOM DUKOVCIC In a similar vein, Lepidico has also they each raise $23m that’s around MANAGING DIRECTOR set up two joint ventures with Latin $100m spent on lithium exploration Resources to explore for lithium in over the next 1218 months. Argentina and Peru. “I think some of these might fade “We want to increase our exposure away when they use up the funds to opportunities through joint raised in the current fervour but ventures with companies that have that could give those left standing local knowledge and we’re looking the pick of any resulting lithium to continue to expand that business discoveries.” PLATYPUS MINERALS model elsewhere,” Dukovcic said. The Platypus board comprises Lithium demand is forecast to Gary Johnson, Lepidico’s founder, AT A GLANCE rise from the growth in lithiumion as chairman, Dukovcic and Rocco A$ ASX:PLP batteries not just for electric vehicles Tassone. 0.030 and portable devices but also “Gary Johnson has a distinguished 0.025 rechargeable household storage career as an inventive metallurgist,” 0.020 batteries for solar power. Dukovcic said. “It’s not going to be a shortterm “He was behind the development 0.015 boom,” Dukovcic said. of the Activox process for treating 0.010 He added that brine projects had sulphide ores while he was with 0.005

high capital costs and long lead LionOre, which was apparently a 0.000 times, and spodumene deposits large reason for the takeover by 6 months ending July 11, 2016 were restricted by high operating Norilsk Nickel. costs. “Rocco Tassone brings experience HEAD OFFICE Unlocking the third major in equities markets, making for a Platypus Minerals supply of lithium to the market, by diverse and balanced board.” L1/254 Railway Parade processing lithiumrich micas via a Experienced metallurgist and West Leederville WA 6007 lowcost process, would help meet former Lepidico board member Tel: +61 8 9363 7800 Email: [email protected] the expected continued growing Gavin Becker is a business develop Web: www.platypusminerals.com.au demand. ment consultant to Platypus. “We’re not just another run of the Dukovcic said the board and man DIRECTORS mill lithium junior,” he said. agement would be augmented in Gary Johnson “We’re building a complete lith future in line with the company’s Tom Dukovcic ium business, from exploration expected growth. Rocco Tassone for traditional sources of lithium, “We have money in the bank and ie, spodumene, to brownfields opportunities galore,” he said. QUOTED SHARES ON ISSUE exploration to build an inventory of “We’re spreading the risk, and over 1,731 million lithium mica ‘waste’, and our point of the next six months we expect to MAJOR SHAREHOLDERS difference, the application of Max®L drill Lemare and Euriowie and aim to Strategic Metallurgy Pty Ltd 14.66% to either third party or our own Li demonstrate the viability of LMax® Potash West NL 5.6% mica resources. operating at a semicommercial Horn Resources Pty Ltd 3.73% “We’re keeping all our lithium scale. Venture Frontier Limited 3.64 irons in the fire.” “It’s a very exciting period.” R Crabb & related parties 2.5%

Mining Journal • mining-journal.com • July 15-28, 2016 49

2pp_Platypus_MJ160715.indd 49 13/07/2016 11:05 COMMODITIES LITHIUM A dose of lithium reality Things to bear in mind in the hottest sector in town

bigger part in a lithium-focused Daniel Gleeson investment decision than other more established sectors. Lithium has most certainly There are a number of new captured investor attention. extraction and processing meth- Producers, developers, explorers ods being explored by various and landholders have all bene- players, which may well help this fited from a rose-tinted view of but past advances in the field the market in 2016, yet not all have come with delayed ramp- projects are worthy of such ups, unforeseen complications adoration. Even with the building of Tesla’s Gigafactory, demand from Asia will and cost blowouts. It should not come as a still dominate the lithium market Orocobre made some miscal- surprise that speculators have culations at its Olaroz brine pro- jumped head first into this ers – the likes of Albermarle, lithium miner, I am also a boron ject in Argentina, causing a long- market. The sector has been call- SQM, Orocobre – have an advan- and potassium miner. I don’t er and more costly ramp-up to ing out for a metal or mineral to tage over earlier-stage rivals. necessarily want to be a magne- its lithium carbonate production get excited about after years of Still, offtake agreements like the sium miner – as it is hard to get process, even if the ASX-listed poor returns and false hope. ones Nemaska Lithium and out of lithium – but if that is the miner is in better shape now. But, while demand for the Baca nora Minerals signed are in case [and it is needed], I will be- Hard-rock projects in Canada metal is growing – from car a better position than most. come a magnesium miner also. and Australia will require new manufacturers to battery pro- Second, regardless of Tesla’s It all depends on innovations to ducers – not all of the billed Gigafactory, the real buyers are what the end extract lithium, supply will be needed. from the East. product is going “Product whereas brine Those moving into the lithium This leads onto the second to be.” flexibility will assets in Nevada, investment game need a few of point: According to a recent For a company or in the salars of the fundamentals spelt out. report by industrial metals as early stage as be important, Latin America First, one lithium product is research consultancy Roskill, American Lithium especially where operations not the same as another. Asia will continue to dominate this is easy to acc- as battery have been work- During the recent iron ore run, lithium demand in the future. ommodate, but ing to plan for miners and promoters gave the “The upstream and down- all lithium-fo- technology many years impression steel mills were will- stream battery supply chain cused companies evolves, with should have continued ing to take any product coming will remain a largely Asian need to allow more conven- on /from with more than 58% iron, but phenomenon, despite the Giga- some product sulphide tional flowsheets. end-users were very picky over factory and similar large-scale flexibility if their and metal Processing just what ore went into their fur- battery plants planned or under- projects are to is also likely to naces, issuing those that didn’t way elsewhere, meaning Asia stay relevant for potentially dict ate just meet the standards costly penal- will remain the growth engine the duration. becoming more how low- or high- ties, or asking for a refund. for lithium demand going for- Fourth, the grade a project The downstream lithium ward,” it said. price the product important should be. space is no different. Ties to Asian trading houses or achieves is funda- lithium products And, of course, The idea of Tesla, Volkswagen, end-users are important in sort- mental to invest- the last consid- or Johnson Matthey ringing ing the speculators from the se- ment. longer-term” eration for invest- up a trader in Singapore and rious companies in the explora- A recent report ors – or should asking them for 30,000 tonnes of tion space. Pilbara Minerals’ from Stormcrow Capital estimat- that be the first – is the stage of lithium hydroxide to be shipped recent Chinese binding offtake ed the price for 99.5% lithium product ion. to their port of destination in a gets the ASX-listed company carbonate would climb from Speculators will move into the week’s time is ludicrous. serious investment points on US$7,780/t in 2016 to $12,790/t exploration space where every Every gramme, let alone this front. in 2025, while lithium hydroxide drill hole or metallurgical test tonne, of lithium will be tested Third, carbonate and hydrox- – 96%+ with low sodium con- can see a huge share price move by consumers before any pur- ide are not the be all and end all. tent – is due for a 64% rise to with buying and selling oppor- chase is agreed. They will not “Product flexibility will be $14,330/t by 2025. tunities. It will be those compa- use just any old material to pro- important, especially as battery This is some price growth, but nies talking in tonnes of lithium duce their goods. technology evolves, with not the monumental ascent equivalent production, rather This is where existing produc- sulphide and metal potentially some have mooted. than hectares of land that garner becoming more important As a result, investors should most long-term investment, Key figure lithium products longer-term,” focus on all-in sustaining costs though. Roskill said. and consider a project’s capital There are always exceptions to $12,790/t This point has not been intensity before taking part in the rules, but while some compa- The price 99.5% lithium missed by TSX-V-listed junior raisings and not just blindly as- nies missing some of these carbonate is forecast to American Lithium. sume prices will rise indefinitely attributes will succeed in the average in 2025 CEO Michael Kobler told Min- making all supply economic. lithium game, failures will all be ing Journal: “Even though I am a Fifth, technology plays a lacking at least one element.

50 July 15-28, 2016 • mining-journal.com • Mining Journal

50MJ160715.indd 50 14/07/2016 10:24 OPINION CRITICAL PERSPECTIVE The core of exploration

Australian explorers have disrupted the niche minerals space

supply in the long term from the Simon Moores* next generation of mines. But this is never the case with The mining industry’s explorers the incumbents, which are so and developers have never quite focused on discrediting new gained the full respect of those entrants they usually come in that are in production. much later down the line and Those looking to bring on pay a much higher price. new supply of niche minerals In reality, without the junior such as graphite, lithium, cobalt, mining sector, at worst we and rare earth elements are would have no new mines and generally met with a three- at best we would have lower- phased approach: at first with grade, inefficient mines being raised eyebrows at their lack Syrah Resources has raised more than A$460 million for its Balama developed by the established of knowledge and specific graphite project in Mozambique order which do not specialise in experience; then with contempt early exploration. as the heavy promotion of the dumene, of which Australia has fund leftfield mineral assets even When market prices begin to asset kicks in; and, finally, if the an abundance. in a post-REE boom world. subside from the spike that has explorer progresses to a reason- For graphite, the story was You can analyse where the attracted a host of new explor- able stage, fear. similar. I remember the days bulk of Australian funding ers, those committed to the Big commodities such as iron when Northern Graphite’s comes from (Sydney, Melbourne, cause become apparent. ore, copper and gold have been Bissett Creek and Ontario Graph- Hong Kong and Singapore) As we have always said at part of the mining industry’s ex- ite’s Kearney project were the compared with Canada (Van- Benchmark Mineral Intelligence, ploration and development only two mainstream explora- couver, Toronto, New York and those still around years after the cycle for decades, but it has tion projects the industry had. to a lesser extent London). price spike are the ones to been a new concept to the niche Then, when the price spike of And I also think location plays watch. or speciality minerals space in 2010-11 kicked in and flake a key role: Australian explorers The long-term health of the recent years. graphite prices doubled in eight are far more willing to go wide mining industry relies on explor- For example, lithium was the months, the exploration sector and far to search ers uncovering first of the battery raw materials surged from single digits to for the next “There is a general the next gen- set to see an exploration surge triple digits in 18 months. ‘Pilbara of [insert eration of which began in 2009 and took REEs were a similar but even mineral]’. dislike for junior mines, offering off in 2010. In little under one more extreme story. This especially mining companies up vast quanti- year, the number of lithium When prices of these niche includes Africa, ties of free drill- explorers globally went from elements rocketed higher by a where pre-2011 in the active ing data to the nine – which included the likes hundred to a few thousand per- no one had producing industry. incumbent proof Rincon Lithium (Sentient cent over a six-month period, it looked for the ducers and, Group), Galaxy Resources, and reached the headlines of the likes of graphite And it is as much most impor- Western Lithium – to over 100. mainstream press, including the and now Syrah surprising as it is tantly, being The same lithium ‘gold rush’ front page of The New York Resources has entirely open to has now returned but Australia Times. This was mainly due to raised A$461 under standable” public scrutiny. alone accounts for the vast the politics behind the price hike million Explorers majority of companies, an – China initiated an REE block- (US$348 million) to build the also force existing producers estimated three-quarters of the ade on Japan in retaliation for world’s biggest mine. to re-evaluate their existing industry’s exploration sector. the capture of a fishing boat. There is a general dislike for operations, their supply chains The difference this time is that What all these examples have junior mining companies in the and the way they think – they the sky-high lithium carbonate in common is the role of Austral- active producing industry. And it have a fundamentally disruptive prices, which are three times ian explorers. is as much surprising as it is role on industries that have not higher than the last price spike, Though Australian explorers under standable. changed in decades. have allowed the focus to switch tend to be second out of the The dislike comes from a natu- That is not to say the explora- from brines to hard rock spo- blocks behind their Canadian ral reaction to an outside threat. tion sector does not have its is- counterparts, they usually get However, if the incumbent pro- sues – there are many. Key figure more traction and develop more ducers embraced the highest- But to tarnish all mineral ex- assets further down the line. quality projects from the outset plorers with the same ‘over-pro- 75% It’s a curious case as to why. and worked with these compa- motion’ or ‘lack of experience’ The proportion of global One can look at the cultural nies in some way, then they brush is not only harsh but you lithium explorers listed appetite for risk in what are would not only protect their do so at the producers’ peril. on the ASX niche industries – Australian business from new suppliers in And Australia has to take a lot invest ors seem more willing to the short term but also secure of credit for that.

*Simon Moores (@sdmoores) is managing director of Benchmark Mineral Intelligence, an international price data and intelligence firm specialising in critical minerals and disruptive technology

Mining Journal • mining-journal.com • July 15-28, 2016 51

51MJ160715.indd 51 14/07/2016 08:54 COMPANY PROFILE INDEPENDENCE GROUP NL AUSTRALIA

Independence to have its day Diversified Australian miner Independence Group NL (ASX: IGO) continues to scale up its operations and is on track to produce ore from its huge Nova nickel mine in December. Ngaire McDiarmid reports

IGO MD and CEO NDEPENDENCE GROUP (IGO) IS Peter Bradford reaping rewards from the biggest with Tropicana gold and nickel discoveries in Gold Mine general Western Australia in the past 15 manager Duncan yearsI and is systematically unlocking Gibbs (centre) value from all of its projects. and AngloGold It is increasing milling capacity Ashanti senior vice at the 7 million ounce Tropicana president Mike gold mine, a joint venture with Erickson (right) 70% partner AngloGold Ashanti, celebrating the and it is set to produce nickel at its 1 millionth ounce 100%-owned Nova project before produced at the end of the year. Tropicana just over “We’re a diversified miner with two years since exposure across the gold and base pouring first gold metal space and we’re currently IGO acquired Nova in 2015 and at ups and create opportunities for unlocking the value in the Nova the end of May had the project 90% employment.” project through the development, complete and started mining its first The nickel price is about half that is on time and on budget for the development ore in late June. what it was five years ago but it hit production of our first concentrate “Nova is going really well, it a nine-month high in early July and in December,” managing director demonstrates what can be achieved Bradford foresees a bright future and CEO Peter Bradford said. at the bottom of the market when for the traditional stainless-steel- The company held Tropicana at the best contractors, materials and making ingredient. its IPO in 2002 and following what labour are more readily available,” “You’ve got to look at the Bradford describes as the “long Bradford said. fundamentals and we’re currently in journey of discovery”, the project The low-cost, high margin project a supply deficit and working through commenced production ahead of has a 10-year minelife and lies about stockpiled nickel,” he said. schedule in 2013. 160km east of Norseman in WA’s “Once that disappears, we’ll start It has since produced well over 1 eastern Goldfields. to see the price rebounding – and on million ounces of gold and is set to IGO has three-year offtake top of that there are three key areas Through belt continue to deliver IGO more than agreements in place, with Trafigura for the outperformance of the nickel scale exploration 120,000oz a year going forward. taking its entire copper production price.” projects, Production from IGO’s 30% stake and the nickel being split 50:50 He said the supply deficit could Independence in Tropicana currently represents between BHP Billiton Nickel West deepen as high-cost producers went is targeting about half of IGO’s profits – but and Glencore. offline, while other opportunities provinces that can that steady income stream will be The 2km airstrip and 35km sealed could arise through socio-political deliver multiple dwarfed once the world-class Nova road to meet the Eyre Highway are events, such as the anti-mining gold and base nickel-copper mine comes into complete and the second phase of sentiments being expressed in the metal projects production. the power station was due to come Philippines. online progressively from July. The third is the new demand In addition, a solar power plant is being created for nickel – in electric to be installed, reducing the project’s vehicle batteries, for example – that carbon footprint and power costs. could help push up prices. Bradford said IGO was now Bradford pointed to the comments establishing its Nova workforce and made by electric car manufacturer had to increase its HR team to handle Tesla boss Elon Musk in June, who the strong level of interest. said Tesla’s batteries should be “We’re looking to the local skill referred to as “nickel-graphite” sets available in Norseman and because the lithium content was Esperance,” he said. akin to “the salt on the salad”. “If we reach a critical mass, we “There are projections these could establish a fly-in, fly-out batteries could represent about 5% service from Esperance to tap into of future nickel demand,” Bradford the strong mining experience in the said. region. “And as the price structures for “We’ve also been working with electric vehicles come down, we the local Ngadju people to identify expect the growth to far outweigh business opportunities for start- the conservative projections.”

52 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_IndependenceGroup_MJ160715.indd 52 13/07/2016 11:06 “We’re really mindful Meanwhile, IGO’s two other high- to find a high-grade copper-gold With the grade, high-margin mines, Long deposit like near-neighbour Sandfire Nova project of the amount at Kambalda and Jaguar in the Resources’ DeGrussa project. development of management Northern Goldfields, are continuing Exploration dollars were pulled tracking on budget to perform well. back in early 2016 to focus on getting and on schedule, time and funding IGO has mined nickel at Long since Nova up and running and sharing Independence that some of these 2002 but Bradford points out the in the cost of the plant expansion mined first ore in mine has been in operation for 35 at Tropicana, which will increase development in projects absorb, so years with an average grade of 3.8% capacity from 5.8 million tonnes per June 2016 we want to make sure nickel. annum to more than 7mtpa. The 1km-deep mine has a However, Bradford firmly expects we get the best bang remaining minelife of two years exploration spending to increase for our buck” and its future will depend on new again next year as the company exploration dollars being spent once continues to invest in its three core – PETER BRADFORD Nova is fully operational. pillars – its people, its assets and its MANAGING DIRECTOR AND CEO However, the future is more exploration. certain at Jaguar, where an updated It is currently assessing its reserve is imminent. 100%-owned copper-zinc Stockman IGO acquired Jaguar in June project in Victoria which is at the 2011 and the project has averaged permitting stage. grades of 9.4% zinc and 1.8% copper. Bradford said the project didn’t Concentrate produced is exported benefit from close proximity to via Geraldton. existing operations and management Bradford said drilling beneath presence. the existing reserve at the Bentley “We’re really mindful of the deposit was proving successful and amount of management time and he was excited about the potential funding that some of these projects INDEPENDENCE GROUP for additional reserves. absorb, so we want to make sure we AT A GLANCE “We firmly believe there are other get the best bang for our buck,” he A$ ASX:IGO VMS-style orebodies to be found in said. 5 the area,” he said. “It’s been our strategy to focus The company’s three main on high margin projects that have 4

greenfields exploration areas are in potentially long minelife, and we’ve 3 joint ventures – at the Fraser Range progressively improved the scale of belt, Lake Mackay in the Northern mines we’ve invested in, from Long 2

Territory and Byrah Basin in WA’s to Jaguar to Tropicana and Nova. 1 north-west. “There is still a lot to come for 0 “The Fraser Range is several Independence.” 6 months ending July 11, 2016 hundred kilometres of highly Bradford said building the prospective geology, that’s delivered business also included investing in HEAD OFFICE two of Australia’s best gold and base people, for example, through the Suite 4, Level 5 metals discoveries in the last 10-15 company’s structured graduate and 85 South Perth Esplanade years – Nova and Tropicana – and apprenticeship programmes. South Perth WA 6151 we’ve been able to benefit from “One of the benefits of being a Tel: +61 8 9238 8300 Fax: +61 8 9238 8399 being invested in both of those,” diversified business is that you’re Email: [email protected] Bradford said. exposed to a bit of upside every Web: www.igo.com.au “We consider exploring this area single year and if you’re going to as being in our own backyard and we be a strong company, you need to DIRECTORS want to leverage off our presence at be able to invest through all parts of Peter Bilbe, Peter Bradford, Keith Spence, Tropicana and Nova to generate the the commodity price life cycle,” he Geoffrey Clifford, Peter Buck, Neil best understanding of the geology said. Warburton and mineralisation and be the group “We’re enjoying strong cash flows that makes the next big discovery on from the gold side of the business at QUOTED SHARES ON ISSUE that highly prospective belt.” the moment but at a future point in 511.4 million Bradford said the Lake Mackay time, we expect the nickel price to MAJOR SHAREHOLDERS gold/base metals project had tenure be higher and that will allow us to Mark Creasy 18.88% covering about 400km of prospective continue to invest in the pillars of FIL Ltd 9.92% geology with many anomalies to our business – our assets, our people Van Eck 9.63% test, while at Byrah Basin IGO hoped and our exploration.” Australian Super 6.04%

Mining Journal • mining-journal.com • July 15-28, 2016 53

2pp_IndependenceGroup_MJ160715.indd 53 13/07/2016 11:06 COMMODITIES ENERGY Uranium back on Australia’s agenda

Three mines set to become more

Boss has been trying to solve Daniel Gleeson the problems the former owner identified, analysing and inter- When the federal government preting drill hole data to in- voted to abandon the ‘three crease the resource base and mine’ policy in April 2007, Aus- looking at the potential for in- tralia’s uranium sector was creasing throughput from ecstatic. Finally explorers and 880,000Ib per annum to more developers could make the than 1MIbpa. most of the land and dollars With 40MIb of resources al- they had invested and grab a ready added to the 16.57MIb it slice of the lucrative market. inherited, and a larger process- While the abolition led to the ing plant and use of resin tech- development of the Honey- nology being considered as part moon and Four Mile in-situ of a revised start-up plan, there leaching mines (ISL) in 2011, the is potential for Honeymoon rule change has not been the coming back online in today’s

catalyst many in the sector, and circa-US$27/Ib U3O8 market. politicians, hoped for. Today, the country has the Mulga Rock same amount of mines it had ERA is processing stockpiles to keep costs down at its Ranger uranium Not every company is blessed before lifting of the ban with deposit in the Northern Territory with as easy a development Ranger, Olympic Dam and Four decision as Boss. Mile making up the trio. up its energy policy, others like Then there is the Olympic Vimy Resources and Toro En- Uranium oxide prices have India shifting from coal-backed Dam expansion to put in the fu- ergy are fighting it out to be the proven to be the biggest hurdle power and Japan making some ture mix. first in the new crop of hard for explorers. symbolic moves to restart reac- If BHP Billiton pursues the rock mines coming into produc-

The price rally from 2003 on- tors, the future looks bright. Aus- multi-billion dollar expansion of tion in a US$65/Ib U3O8 market. wards would not have been tralia’s exploration industry is its mine in South Australia, its The former has been making missed by politicians backing a gearing itself up for this. uranium oxide capacity could significant headway in the past policy change in 2007. By the jump from 4,500 tonnes few years at its Mulga Rock pro- continued time they voted, spot uranium Expansions (9.9MIb) of U3O8 per annum to ject in Western Australia. on /from was above US$100 per pound, Those likely to react first to a ura- 19,000tpa. Led by former BC Iron front enough to make previously mar- nium price rise will be those The future of the privately- man Mike Young, who was ginal deposits shine. already producing. owned Four Mile mine is a bit quick to pick up the scent and This was short lived. Prices The longest continuing oper- harder to gauge, but the publi- profit from an iron ore bull run dropped to more moderate lev- ating uranium producer in Aus- cation of a 50MIb inferred re- back in 2006, Vimy shareholders els over the next two years, but tralia, Rio Tinto’s Energy Re- source from its northeast de- are hoping for big things. by the end of 2010 were rising sources of Australia, has been posit in June last year indicates Since his introduction on the again, with a bull market infused dealing with the fallout of a ra- it also has room to grow. executive management team of by increasing energy demand. dioactive spill at its Ranger mine Energy and Minerals Australia The Fukushima disaster of in the Northern Territory and Honeymoon (Vimy’s former name) in February 2011 put a blunt end to this, how to keep a margin in a peri- The first mine to come onto the 2014, the company has upgraded closing reactors od of weak prices. scene in Australia is likely to be the resource four times, pub- across Japan and “The price Its tactic has been one that previously operated. lished a maiden reserve calcula- making govern- to process existing ASX-listed Boss Resources, in tion, released two economic ments all over the rally from stockpiles from its combination with Wattle Min- studies, made significant head- globe reconsider 2003 onwards operation, defer- ing, acquired the Honeymoon way on permitting and initiated a the energy mix for ring mining until ISL project from Kazakhstan’s definitive feasibility study. In the their growing would not have prices recover. Uranium One in November last process, it has stolen a march on grids. As a result, been missed It hasn’t com- year in a deal that could rise to its state rival Toro Energy. the price has pletely abandoned A$15 million (US$11 million). It Vimy’s overall resource base

failed to get close by politicians growth, though, has been busy working on get- now stands at 76.2Mlb of U3O8 to the US$65/Ib backing a setting aside cash ting the asset ready for a re- grading 0.052%, making it the marker many in to keep its Ranger start since the deal closed. third largest undeveloped ura- the industry claim policy change” 3 Deeps and Jabi- Uranium One previously put nium deposit in Australia by its is needed to spur luka projects on the asset into production back own reckoning. This resource is on new mines. care and maintenance in case in 2011, but two years of falling close to surface, meaning it re- The country’s uranium re- the more than 400 million prices led to the company pull- quires simple openpit mining, sources, for the most part, have pounds of resources turns into ing the plug as the size and and acid leaching technology stayed in the ground. feasible pounds to extract down scope of operation quickly is the most likely processing With China looking to clean the line. made it non-core. route.

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A 2015 prefeasibility study in- ronmental review for Yeelirrie regulation hurdle to overcome tial capital expenditure of dicates it could cost A$362 mil- last year indicating the asset is (Queensland has a mining ban US$268 million returning a lion to start-up and provide a still part of its long-term plans. in place) before it can come to post-tax net present value (10% pre-tax net present value (10% Kintyre, owned 70% by Came- fruition. discount) of US$400 million. discount) of US$431 million at a co and 30% by Mitsubishi, is a A rising uranium price and The project just needs those

US$65/Ib U3O8 price. slightly smaller beast in the the prospect of increased royal- forecast prices to come to frui- If Vimy keeps making such state of Western Australia, with ties will put pressure on state tion to help the 4MIbpa, 13-year

headway, the company could 64.8MIb of U3O8 to its name. politicians to overturn such pol- operation make economic be in a position to decide on What it lacks in size it makes up icy for the second time in recent sense. development in the March for in grade, which at 0.58% history (it was reversed back in Of a long list of explorers

quarter of 2017. U3O8 in the indicated resource 2012 only to without eco- category is up there with the be reinstat- nomic stud- Wiluna best deposits Australia has to ed in 2015). “While Cameco has ies in Aus- While Young has been making offer. Also in tralia, waves in Western Australia with It already has environmental Queensland been clear about Cauldron En- Vimy, Toro Energy has been approval for development, is Laramide not investing in the ergy and preparing its Wiluna project for meaning it can be funded and Resources’ project during such Mega Urani- a favourable turn in the market. constructed quicker than Yeel- Westmore- um are the Toro already has two deposits irrie. land project, a weak period, it two most permitted for mining – Centi- Even early stage options in which back opened up the public readily cited pede and Lake Way – but this is Australia are being pursued by in April companies just a fraction of the 84MIb re- Cameco. It recently completed jumped environmental review making source it has delineated. its 51% earn-in to the Kintyre onto the for Yeelirrie last year” headway. The project’s unique selling Rocks project, close to Kintyre scene with a The for- points come in the form of a in Western Australia, and elect- revised PEA mer, chaired shallow resource, with the ma- ed to take another 19% of the marking it as a serious contend- by entrepreneur Tony Sage, jority located less than 10m project from junior Mega Ura- er for development. has two projects in the country; from surface, some high grade nium by spending A$4 million The company acquired the its Yanrey uranium asset in potential – beneficiation test (US$3 million) on exploration asset from Rio Tinto in late-2005 Western Australia and the work has recently got the ore over the next four years. and cobbled together all of the Marree joint venture in South

close to 1% U3O8 – and the po- information that came with the Australia. tential for selective mining from Looking further out purchase for the first PEA itera- Yanrey, which Cauldron class- four pits. Casting a line out further into tion in 2007. The updated ver- es as the “the new uranium What is letting it down is up- the uranium project pool, there sion is much improved. camp”, has a 30.9MIb indicated to-date economics. are a number of other Australia The resource has grown by and inferred resource to its Only a preliminary economic juniors near the surface await- 3.4MIb to 51.9MIb, with the mill name with ISL potential that assessment has emerged from ing an uptick in market throughput increasing to 2Mtpa could make it viable to develop the Toro camp and that was de- demand. from 1.5Mtpa previously. Ura- even in today’s price environ- livered in 2014. Newly spun out Samphire nium recoveries, nameplate ca- ment. Momentum is key in the min- Uranium’s 41MIb of inferred re- pacity and mine life have all Marree, which Korea Re- ing game and while the compa- sources at its namesake project been enhanced over the space source Corp, Daewoo and LG In- ny, led by Vanessa Guthrie, has in South Australia could gain of nine years, while the process- ternational own 40% of (Caul- done some sterling work ‘sell- momentum in a higher uranium ing technology has gone from dron owns 60%), is much earlier ing’ the project overseas, inves- price environment, while the solvent extraction to continu- stage yet has all the ingredients tors are awaiting new numbers more than 67MIb resources at ous ion exchange. for a modest capital start up to sink their teeth into. Paladin Energy’s joint-owned The economics stack up at and low operating costs, similar

Valhalla project has a price and US$65/Ib of U3O8, with the ini- to the nearby Beverley ISL mine, Cameco which was only recently closed. Canada-based Cameco could TSX-V-listed Mega Uranium have a say on just how big Aus- has two projects in Australia it is tralia’s uranium future is. actively pursuing. One of biggest uranium pro- The most promising is the ducers in the world by output Ben Lomond project in Queens- got its hands on two very prom- land, which has an indicated re-

ising uranium assets owned by source of 7.9Mlb of U3O8 and an

the two largest diversified min- inferred resource of 2.8Mlb U3O8 ers in the last decade, which will with grades in the 0.21-0.27%

come into the future produc- U3O8 range, plus a “substantial” tion mix if the mooted sea molybdenum credit that gives it change happens. an edge over fellow uranium

Hosting 127.3MIb of U3O8, the players. Yeelirrie project in Western Aus- With all of this uranium in re- tralia is one of the biggest un- serve, Australia has lots of po- developed deposits in the tential to further cement its sta- world. tus as the world’s third largest While Cameco has been clear uranium producer. about not investing in the pro- It, like so many other coun- ject during such a weak period, tries, just needs the uranium it opened up the public envi- Boss is preparing its Honeymoon ISL project for a re-start market to play ball.

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AUSTRALASIA New Zealand’s best and brightest New Zealand has its obstacles but industry is still alive and kicking

Richard Barker

The New Zealand economy is projected to grow at an annual rate of 2-3% for the next few years, supported by low interest rates, high net migration and a high level of construction activity. The Reserve Bank has continued to reduce its official cash rate from 3.25% in mid-2015 to 2.25% in March 2016 because of the deteriorating outlook for global growth and continuing challenges for the dairy industry, New Zealand’s largest merchan- dise export sector. House price inflation driven by low interest rates, land use planning restrictions, a high level of immigration and investor activ- The Martha open pit is part of the Waihi mines complex ity is emerging as a major issue, particularly in Auckland, New duction mainly in the west coast, Key figure 2.7Moz gold since 1990. Gold Zealand’s largest city. Southland and Otago regions. production in 2015 was The government’s plan when Estimated gold output was 143,000oz, up on the 2014 elected in 2008 to make more of about 395,000 ounces in 2015, 5.7million result. Production is now from New Zealand’s mineral resource compared to 385,000oz in 2014. The size (in km2) of the NZ’s underground workings on the potential has faced a series of Major developments during Exclusive Economic Zone for Correnso deposit that was setbacks. 2015 were the closure of Ocean- seafloor mining discovered in 2011 to the east of Initial moves that focused on aGold’s Reefton mine as expect- the Martha open pit. the resources beneath public ed, and the sale of Newmont’s the mine life to 2019 for the At the end of 2015, Waihi had land were abandoned following gold mining operations at Waihi open pit and 2018 for the under- limited reserves comprising un- strong opposition. The effects of to OceanaGold, which now ac- ground mine. The company will derground reserves of 300,000oz the Pike River coal mine disaster counts for over 90% of NZ’s total continue to drill targets located of gold and 520,000oz of silver, in 2010 and the financial col- gold output. along the 30km strike length of while the openpit reserves were lapse of government-owned OceanaGold’s Macraes mine in the gold mineralised Hyde-Mac- 760,000oz of gold and 770,000oz Solid Energy, the country’s larg- Otago is the country’s largest. It raes shear zone that hosts the of silver. Drilling of Correnso and est coal mining company in began operating in 1990 and has orogenic gold mineralisation. other targets at Waihi to expand 2013, were magnified by the consisted of several openpits The gold mines at Waihi, resources is continuing both prominence of the leaders of and the Frasers underground 110km southeast of Auckland on from the surface and under- those companies in promoting mine that started production in the North Island, have been ground. the development of New Zea- 2008. working an epithermal gold-sil- Alluvial gold is being pro- land’s mineral resources to the The company’s smaller gold ver deposit in an open pit on the duced from about 40 sites on government and the public. mine at Reefton on the west former Martha underground the South Island, mainly on the Ongoing declines in commod- coast of the South Island ceased mine since 1988. west coast. ity prices for export coal and iron production at the end of 2015 Over the past 10 years, mining Waikaia Gold’s operation at ore particularly, have contribut- and is now on care and mainte- operations have also extended Waikaia in Southland is the larg- ed to weakening sector activity, nance pending a rise in the gold into the nearby Favona, Trio and est producer with annual output though government-funded price. Concentrate produced Correnso underground mines as of about 15,000oz. South Island programmes by NZ Petroleum from the processing plant at the open pit has been largely lime producer Kokiri Lime Co is and Minerals (NZP&M) to acquire Reefton was being transported worked out. In 2015, Oceana- seeking consent for a new allu- new airborne geophysical data to Macraes for further treatment. Gold acquired Newmont’s Waihi vial gold mining operation near to encourage mineral explora- Combined output of both gold mine and other prospects the Clutha River at Roxburgh in tion are continuing. mines increased from 215,000 in the region for US$101 million Otago, where past exploration ounces in 2014 to 220,000oz in in cash. has established a resource of Gold production 2015. The Waihi mines have pro- about 2.5 million m3 of gold- Since the 1980s, hard rock mines At Macraes, proven and prob- duced more than 7Moz gold and bearing alluvial gravel. have accounted for most of the able reserves at the end of 2015 40Moz silver since production gold being produced in New were 1.22Moz of gold including first began from an under- Coal production Zealand, supplemented by 150,000oz of gold at the Frasers ground mine in 1883. Current Coal production is dominated by South Island alluvial gold pro- underground mine extending operations have produced about bituminous coking coal pro-

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duced for export from the west permit areas has declined from 45 coast of the South Island and NZ$40 million (US$29 million) in 40 sub-bituminous coal for domes- 2012 and 2013, to NZ$8 million 35 tic use from coalfields in the Wai- in 2014, due mainly to the col- 30 kato region of the North Island. lapse in seabed exploration in- 25 Total coal production was vestment (see chart). 20

3.4Mt in 2015, down about OceanaGold has acquired NZ$ million 15% on 2014. Open-cast mines Newmont’s interest in the WKP 15 accounted for about 93% of out- project located 10km north of 10 put. The country’s largest coal Waihi. It has inferred resources 5 mine, Solid Energy’s Stockton of 1.3Mt at a grade of 6.2g/t Au 0 2008 2009 2010 2011 2012 2013 2014 opencast mine on the South Is- for 260,000oz. OceanaGold is land, has reduced production planning further drilling here Mineral exploration spending onshore and offshore, 2008-14 from 1.9 million tonnes per over the rest of the year. Source: Ministry of Business, Innovation and Employment (NZP&M) annum to 1Mtpa over the past New Talisman Gold has raised two years. The Huntly East un- NZ$4.7 million via a share issue Northwest Nelson, MOD seabed phosphate mining pro- derground mine in the Waikato and is planning to start under- Resources has a joint venture posal in the EEZ 400km off the region closed in 2015 due to de- ground sampling and trial min- with OceanaGold. Recent drilling east coast of the South Island clining profitability. ing on the former Talisman mine has produced an indicated and was also refused by the EPA for Following its financial restruc- at Karangahake, 10km west of inferred gold resource of 20.5Mt similar reasons. turing and staff reductions last Waihi where it has defined a with a gold grade of 1.54g/t for Investment in these projects year, Solid Energy has been small ore reserve of 82,000t with 1.01Moz. In late 2015, MOD totals about NZ$100 million and placed in administration, ahead a gold grade of 10.8g/t and a sil- placed its equity in the Sams the refusals have cast doubt on of an asset sale. It continues to ver grade of 48.1g/t. Creek project on the market. the future of offshore mineral be New Zealand’s largest coal The company has a prelimi- South Island exploration activ- resource investigations any- producer. nary agreement with Chinese ity includes hard rock gold at the where within NZ’s EEZ, com- Bathurst Resources is a New group Amer International for it former Aorangi Mine (Strategic pounded by a government pro- Zealand mining company with to acquire a 70% stake in the Elements), gold and tungsten in posal to create a 600,000km2 four mines – Cascade and company, subject to approvals. the Reefton Goldfield (Siburan marine sanctuary covering most Escarpment in the Buller coal- In mid-2015, Newcrest en- Resources) and garnet sand on of the Kermadec Arc within the field near Denniston, Canterbury tered into a farm-in agreement the west coast (NZ Garnet and EEZ, where mining would theo- Coal, west of Christchurch and with Laneway Resources over an Whitesails Minerals). retically be prohibited. Takitimu, near Invercargill. area situated between the for- Mineral exploration and Bathurst plans to develop the mer Karangahake mines and the Offshore minerals research investigations have Escarpment mine into a full- Golden Cross mine that pro- New Zealand’s Exclusive Eco- identified a number of areas scale export operation once duced 600,000oz gold and nomic Zone (EEZ) is among the with seabed massive sulphide global coal prices recover. 1.7Moz silver between 1991 and largest in the world with exclu- potential along the arc. Mineral 1998. sive rights to seabed resources exploration activity in the EEZ Ironsand Newcrest has acquired an ex- over an offshore area of about has now ceased. Since the 1970s, titanomagnetite ploration permit over the adjoin- 5,700,000km2. Trans-Tasman Resources is placer black sand deposits have ing Rahu prospect, where it has Trans-Tasman Resources was seeking a permit over an area of been mined by Bluescope Steel an agreement with New Talis- granted a mining permit in 2013 4,400km2 of seabed off the west subsidiary NZ Steel at two loca- man. Drilling of several pros- to extract ironsand over an area coast of the South Island to in- tions on the west coast of the pects is under way. in the South Taranaki Bight area vestigate the potential for ilmen- North Island: at the mouth of the Evolution Mining is drilling at within the EEZ but in mid-2014 ite, zircon, garnet and gold in- Waikato River for making steel at the Puhipuhi epithermal gold- the newly created Environmen- shore of the EEZ boundary. the nearby Glenbrook steel mill silver exploration project in tal Protection Agency (EPA) south of Auckland with some Northland to test new targets refused consent for the opera- Government initiatives exported; and at Taharoa 130km developed within this former tion because of uncertainty The government is undertaking to the south for export by ship. mercury mining area, which has about its effects and the pro- a NZ$6 million multi-year Weak iron ore prices have led given encouraging results in the ject’s economic benefits. four-stage programme of air- to a slowdown in NZ iron sand past. The company is considering borne geophysical surveys to exploration both onshore and At the Sams Creek intrusion- making a new application. Con- promote mineral exploration in offshore. In February 2016, Blue- related gold prospect, some sent for Chatham Rock Phos- the Nelson-Marlborough and scope announced that it would 100km north of Reefton in phate’s Chatham Rise offshore Otago-Southland regions of the sell the Taharoa operation with South Island. ongoing losses forecast. The surveys are scoped to cover up to 29,000km2, com- Mineral exploration parable in size to the combined Onshore mineral exploration has area of the previous two surveys been dominated by the search carried out by NZP&M over the for gold near the operating Northland and west coast, South mines along the Hyde-Macraes Island regions. The resulting shear zone, in the Reefton Gold- survey data will then be made field and in the Waihi district. available to explorers for analysis Greenfields mineral explora- and should boost exploration tion spending outside mining Waihi tailings dam activity here.

*Richard Barker is a consulting geologist based in Auckland, New Zealand

Mining Journal • mining-journal.com • July 15-28, 2016 57

56-57MJ160715.indd 57 14/07/2016 16:05 WORLD AUSTRALIA The top 100 ASX risers ASX miners have enjoyed a strong 12 months leading into Diggers & Dealers

Top 100 ASX gold movers (to July 13) Ticker Company % Price Market cap Ticker Company % Price Market cap rise (US$) (US$) rise (US$) (US$) 1 PSC PROSPECT RESOURCES 1,598 0.04 45,124,500 51 AMI AURELIA METALS 302 0.12 47,173,520 2 GMM GENERAL MINING 1,473 0.61 193,560,208 52 CAZ CAZALY RESOURCES 302 0.06 9,490,455 3 MDI MIDDLE ISLAND RESOURCES 1,354 0.05 26,740,934 53 SAR SARACEN MIN HLDG 299 1.33 1,058,837,568 4 LKE LAKE RESOURCES 1,275 0.03 2,914,248 54 LTX LITHEX RESOURCES 294 0.04 Suspended 5 GXY GALAXY RESOURCES 1,266 0.37 483,401,568 55 DAF DISCOVERY AFRICA 292 0.01 2,761,066 6 AGY ARGOSY MINERALS 1,103 0.03 13,682,645 56 GMD GENESIS MINERALS 287 0.02 12,943,700 7 BAR BARRA RESOURCES 1,103 0.05 19,854,174 57 BYR BUREY GOLD 282 0.06 54,109,116 8 VRC VOLT RESOURCES 1,072 0.10 86,800,240 58 WWI WEST WITS MINING 278 0.02 8,666,723 9 HNR HANNANS 931 0.02 14,752,817 59 OGX ORINOCO GOLD 276 0.22 60,906,608 10 MOY MILLENNIUM MINERALS 869 0.18 135,128,000 60 BGS BIRIMIAN 267 0.24 43,309,824 11 BSM BASS METALS 866 0.02 14,682,167 61 AWV ANOVA METALS 267 0.12 44,336,224 12 DCN DACIAN GOLD 843 2.64 350,269,472 62 RIE RIEDEL RESOURCES 263 0.01 3,202,061 13 ORR ORECORP 828 0.34 59,299,380 63 ERM EMMERSON RESOURCES 261 0.08 30,185,282 14 AJM ALTURA MINING 729 0.14 172,600,192 64 RRL REGIS RESOURCES 260 3.04 1,511,759,872 15 PLH PLYMOUTH MINERALS 725 0.18 19,638,994 65 MTB MOUNT BURGESS 256 0.01 975,974 16 CMM CAPRICORN METALS 702 0.11 51,693,952 66 FEL FE LTD 253 0.03 Suspended 17 CNJ CONICO 673 0.03 10,095,995 67 AZS AZURE MINERALS 252 0.03 51,898,060 18 GCY GASCOYNE RESOURCES 652 0.47 119,033,288 68 CCZ CASTILLO COPPER 252 0.01 1,928,616 19 VAN VANGO MINING 625 0.04 14,270,309 69 AQQ APHRODITE GOLD 248 0.02 11,769,086 20 PDI PREDICTIVE DISCOVERY 611 0.02 23,178,378 70 KIN KIN MINING 244 0.23 20,503,140 21 SBM ST BARBARA 561 2.77 1,361,946,752 71 CRB CARBINE RESOURCES 241 0.16 25,653,810 22 EXC EXTERRA RESOURCES 550 0.05 13,163,472 72 AOP APOLLO CONSOLIDATED 234 0.07 10,386,621 23 BLK BLACKHAM RESOURCES 495 0.68 173,660,848 73 AHK ARK MINES 232 0.13 5,733,334 24 AXT ARGO EXPLORATION 471 0.06 10,010,801 74 MBK METAL BANK 224 0.02 8,518,331 25 CDV CARDINAL RESOURCES 467 0.25 55,689,004 75 SMR STANMORE COAL 222 0.19 42,268,948 26 PUN PEGASUS METALS 464 0.04 4,414,051 76 SMI SANTANA MINERALS 221 0.04 9,116,556 27 RMS RAMELIUS RESOURCES 453 0.45 213,066,976 77 GRY GRYPHON MINERALS 221 0.15 57,982,896 28 RSG RESOLUTE MINING 438 1.18 767,251,840 78 EAR ECHO RESOURCES 220 0.21 35,416,720 29 LIT LITHIUM AUSTRALIA 438 0.22 50,152,232 79 DRM DORAY MINERALS 220 0.93 287,387,104 30 ADV ARDIDEN 436 0.02 15,585,538 80 CAE CANNINDAH RESOURCES 214 0.02 1,977,236 31 AME ALTO METALS 416 0.08 9,231,310 81 AYR ALLOY RESOURCES 209 0.01 8,123,798 32 DMA DYNASTY RESOURCES 412 0.05 23,085,442 82 DHR DARK HORSE RESOURCES 209 0.00 3,349,944 33 SLR SILVER LAKE RESOURCES 404 0.50 252,626,496 83 BDR BEADELL RESOURCES 200 0.38 396,864,160 34 MGT MAGNETITE MINES 397 0.04 17,653,590 84 LTR LIONTOWN RESOURCES 196 0.02 12,172,351 35 PGO PRIMARY GOLD 391 0.08 34,332,812 85 IGS INTERNAT. GOLDFIELDS 195 0.00 Suspended 36 NIO NICKELORE 387 0.02 5,378,443 86 NTM NORTHERN MANGANESE 194 0.04 9,801,425 37 TAS TASMAN RESOURCES 382 0.12 44,800,400 87 KGM KALNORTH GOLD MINES 193 0.02 17,667,858 38 MOD MOD RESOURCES 381 0.02 30,019,626 88 ARM AURORA MINERALS 190 0.07 7,988,658 39 TRL TANGA RESOURCES 380 0.07 24,579,552 89 RMT RMA ENERGY 190 0.00 4,163,397 40 NAG NAGAMBIE MINING 370 0.12 41,370,404 90 HXG HEXAGON RESOURCES 184 0.13 29,318,328 41 NMT NEOMETALS 370 0.31 174,189,280 91 ERL EMPIRE RESOURCES 178 0.02 6,651,739 42 DKO DAKOTA MINERALS 364 0.07 21,911,100 92 NME NEX METALS EXPLORATION 177 0.01 1,276,546 43 IVR INVESTIGATOR RESOURCES 360 0.04 20,374,972 93 PLP PLATYPUS MINERALS 173 0.01 23,655,678 44 AZY ANTIPA MINERALS 357 0.05 42,536,068 94 PML PARMELIA RESOURCES 169 0.06 7,213,177 45 BRB BREAKER RESOURCE 352 0.15 15,136,619 95 TAM TANAMI GOLD 167 0.06 66,971,716 46 NMM NOBLE METALS 351 0.07 8,598,305 96 GBM GBM GOLD 164 0.01 10,528,569 47 CAY CANYON RESOURCES 348 0.13 22,769,492 97 NST NORTHERN STAR RES 161 4.39 2,618,824,960 48 DEG DE GREY MINING 342 0.00 6,585,262 98 PNN PEPINNINI MINERALS 160 0.028 8,465,904 49 BNR BULLETIN RESOURCES 341 0.06 10,490,850 99 EVN EVOLUTION MINING 159 2.25 3,280,254,464 50 AQI ALICANTO MINERALS 330 0.19 13,685,086 100 AEV AVENIRA 158 0.15 79,622,544

58 July 15-28, 2016 • mining-journal.com • Mining Journal

58-59MJ160715.indd 58 14/07/2016 11:27 WORLD AUSTRALIA Aussie investors bask in better year Gold and lithium juniors light up ASX as resources return to form

Chris Cann There were 110 mining com- but a couple of concerns – the panies over the past year that risks in that part of the world What a year it’s been for resource have shown share price gains of are only mounting. Elsewhere, equities across the world and, in greater than 150%. Almost 90 the most significant event on particular, those that call the have recorded gains of more the horizon is either the unpop- ‘Lucky Country’ home. than 200%. ular Hilary Clinton or dangerous Leading into the annual Dig- More than half of the top 100 Donald Trump being elected as gers & Dealers chin-wag last year, list appreciated more than 300%, US president. the table opposite looked vastly while about a quarter were up All this points to elevated gold different. Commodity prices had more than 500%. prices into the foreseeable fu-

been heading lower for more-or- The top 10 were almost exclu- Photo: Millennium Minerals ture. Indeed, just this week less three years and were show- sively plus-1,000% movers, with The view on Aussie mining stocks GFMS reported gold hedges ing few signs of putting the only Hannans and Millennium has changed markedly over the being placed at more than brakes on. Minerals disappointing with lazy past 12 months A$1,760 (US$1,343) per ounce The descent started to slow 931% and 869% rises respective- – not too far short of the record after Diggers & Dealers and, while ly. And at the top of the tree was l Galaxy Resources – lithium Australian dollar gold price of the mood was depressed at little-known Prospect Resources, l Argosy Minerals – lithium, A$1,825/oz. Christmas, the consensus was moving almost 1,600% higher. graphite and gold For lithium, the demand story we’d hit the bottom. What’s even more impressive l Barra Resources – gold has caught the imagination of Then, of course, the Chinese about this best-performed list is l Volt Resources – graphite investors, who show no signs of stock market imploded and we those on it started with a handi- l Hannans – gold letting go. all braced ourselves for yet an- cap. At the start of the period, l Millennium Minerals – gold. There have been concerns other rotten year. mid-July 2015, the trend on min- over the supply side of the equa- But with the Chinese New Year ing stocks was well and truly The key question at this point tion, which seems to be well ca- came mining’s new dawn. Short- downwards. Most of the stocks for those investors who have entered for, but there is no doubt ing of resources had finally, too that have made the list opposite joyed this run and those consid- as demand and therefore the many felt, gone far enough and and have registered big gains ering a move into resources, is: price rises, new entrants that can we entered an extended period have done so since September will the run continue. show they have lithium exper- of short-covering that – just as it last year. Most of them have put The Mining Journal view is, in tise and good management will was cooling – was greeted by an- on the Lion’s share of their short: yes. Not across the board prosper. There are plenty of ASX- other round of Chinese stimulus. weight in 2016. obviously but the factors that listed companies that fit that bill. Gold shone, silver glistened, Leading the charge has been have spurred on gold and lithi- The other area of immediate and iron ore showed a strength gold and strategic energy miner- um in particular show no signs opportunity is zinc equities, many thought lost. And of als (mainly lithium) equities, of abating. while on a two-to-three year ho- course, lithium motored (very which make up all of the top 10 Gold has been uplifted by fi- rizon, copper is looking likely to quietly and emission-free) ahead gainers for the year just gone: nancial and political uncertain- make a long-awaited return to of all others. l Prospect Resources – lithium ty, with the latest surge coming form. And all at a time when the Share prices rose with com- and gold on the back of the UK’s vote to weak Aussie dollar is keeping modity prices, which may sound l General Mining – gold leave the European Union. With costs at bay. like a given but – as many sea- l Middle Island Resources – further question marks in Eu- If such an environment con- soned resource company inves- gold rope over other states’ plans to tinues, this year’s top 100 gains tors will tell you – is not always l Lake Resources – copper and hold their own referendums may look modest by the time the case. gold and Italy’s finances – to name next year’s review rolls around.

Next issue’s feature Picking mining’s future leaders

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Mining Journal • mining-journal.com • July 15-28, 2016 59

58-59MJ160715.indd 59 14/07/2016 11:27 COMPANY PROFILE CSA GLOBAL WORLDWIDE

CSA Global still punching above its weight Australia-headquartered global consulting firm builds winning reputation as market forces knock down some rivals

N A TOPSY-TURVY DECADE FOR “Lead-zinc projects are also in among independent consult ing many mining consulting groups demand but despite improved firms signing off public-company around the world, one firm has prices for the base metals the exploration activity and resource moved inexorably up to the top equity performance has not been reports – some 5-10 times CSA Global’s tierI of the vital service sector. And anywhere near as remarkable as the size – underscores its ascendancy. CSA Global has every intention of gold and lithium companies. If there are three core tenets of cementing its place in the highest “Activity levels are definitely up the business ethos surrounding echelon of international firms. but this has been more around and complementing CSA Global’s A group with a 30-year pedigree resource evaluation drilling, deep technical competencies, they as a leading independent geological resource and mining studies, as well are “care, geological integrity and consultancy, CSA Global has as increased corporate and M&A collaboration”, according to Elliott. built high-level capability and action. Exploration drilling activity is “We genuinely care about what we become a force in the mining study improving, but it [generally] remains do and getting positive outcomes and operational improvement at low levels. for our clients by working with them segments of the market. On the “It seems it is very much a case of with a longer-term view,” he says. back of a growing pipeline of work being very careful with exploration “We are a geologically-strong in the region, it is expanding its dollars and trying to define the mining consultancy that focuses on capabilities in the American market best targets for selective testing getting good geology integrated by establishing a business base in rather than large-scale grid-drilling in to evaluation and development CSA Global Toronto to complement its existing programmes. This isn’t a bad thing studies, and as part of operational principal office in Vancouver and operations as hopefully it is a case of quality improvement. We operate globally consultant in Nicaragua. The latter came about over quantity and trying to be as one company, with a collaborative Simon Dorling after being awarded a key advisory smarter with investors’ funds. approach to our clients’ needs.” in Morocco role in 2015 in the US$50 billion “It also aligns with our service focus Indepth project reviews and client Nicaragua Canal project. in this sector, which is an integrated feedback drive service improvement Elsewhere CSA Global is in the geoscience approach rather than strategies. thick of surging gold exploration simple contract services.” “We target subject matter experts activity and resource reporting in So, while talk of boom conditions to join our team and we leverage Australia and other parts of the in precious and energy minerals these skills across the business via world such as Africa, central Asia and markets via some media channels internal training, mentoring and North America. And it has a busy, has added to an upbeat investment integrated working groups, across renowned specialty minerals team mood amid some fairly dire global disciplines,” Elliott says. working with a number of the high- economic warnings, Elliott says the “By promoting a culture of profile lithium, graphite and cobalt firm is prepared to “take the good teamwork and integration across our project proponents. sentiment while we can [while offices and investing in technology, Despite a significant improvement bracing for] a bumpy ride for the people can more easily collaborate in equity market sentiment around next 6-12 months”. both on client projects and on precious and some other metals, “The outlook is far more positive internal strategic initiatives. though, CSA Global managing direct- than it was this time last year but with “We started as a geological or Jeff Elliott says there is certain ly no strong volatility remaining,” he says. consultancy and we’ve gradually rush to reintroduce the ‘b-word’ into “The macro factors driving the gold expanded across the mining value any CSA Global strategy talks. price are also variably responsible for chain, but we’ve always kept the “There has been a significant lower business confidence. focus on getting the geology improvement in the availability of “Political uncertainty and civil right. We do build relationships risk capital,” he says. unrest is great for the gold price early, because, quite often, we get “This has been most prominent on but I think most would prefer to involved at a project review stage, the ASX and started with companies see a return to long-term economic before there is a discovery made, with gold operations or advanced growth and investor confidence. where we’re applying our geological development properties in the Once we get the US elections out of skills and so on, and we are then just second half of 2015. the way … maybe we will be moving leveraging our early relationship “In 2016 it heated up, got coupled towards more stable conditions.” into the resource and mining work. with a battery boom – particularly CSA Global grew like a lot of other “But we don’t want to stop the for lithium and graphite projects, but firms during the 2003-12 global min- integration of good geology at the cobalt is also on the shopping list [of ing boom but enhanced its reputation resource model and then just hand it companies] – and has now spread to and market position through the over to mining engineers. It still has the TSX and benefited the gold and subsequent downturn. Its leading to be integrated. And again, the way lithium explorers there, too. position over the past 18 months we operate with our mining team

60 July 15-28, 2016 • mining-journal.com • Mining Journal

2pp_CSA_MJ160715.indd 60 14/07/2016 10:44 in Perth and the UK, for example, is mark et conditions were better for Dennis Arne, CSA we bring them in as early as possible identifying and attracting talent,” he Global’s Canada to the discussion, even if we’re not says. director, on site in getting paid for that component. We “We implemented strategies to the Yukon introduce them to the exploration build on our existing precious and managers and see if we can get base metals capabilities targeting people thinking early about recruitment at the principal consult- geometallurgy, or production scale, ant level. so that exploration can be targeted “We have maintained a long- “We operate globally accordingly. Or you can do reverse term strategy to broaden our global economic analysis to say, what commodity capabilities and for as one company, grades are needed if it’s this deep; or several years now we have been with a collaborative there is this type of recovery issue; or developing our agri, industrial and we use this type of equipment. speciality minerals capabilities, which approach to our “So we try to get the mets and the has given us considerable project clients’ needs” engineers into the story as early as experience in commodities requiring possible, and we try to leave the geos specialist knowledge such as potash, – JEFF ELLIOTT MANAGING DIRECTOR in the process as late as possible. phosphate, graphite, lithium, etc.” “But despite the growing influence Maintaining an extensive network of geostatistics and modern of associates globally is also key to computing over the past 30 years CSA Global’s versatility and adapt- … defining the geological domains ability. It is “absolutely” a good time is still the single most important to be recruiting new key people, says part of mineral resource estimation. Elliott. And we’ve seen some consulting “We think it is always a good groups forget about that, saying time to recruit talented people but the geostats, or the computer, are it is definitely more of a buyers’ smarter than the geologists. And it’s market at present and therefore not the case. If you let the computer it is easier to agree on terms that decide, it might decide you’ve got work for our business model. And a Rolls-Royce when maybe you while good people are always in haven’t, or vice versa. demand, good people sometimes “So it’s got to be good geology get let go by companies who are that goes into a model. We’re not just reacting to market and this can lead button pressers and we don’t just to disenchantment with the lack of give you the numbers you want. We loyalty shown by such companies. CSA GLOBAL try to give the most reliable estimate “In my experience, private AT A GLANCE based on the data available, and companies have more ability to classify it based on our confidence make longer-term decisions about CORE FOCUS in all the components that go into staffing and generally have better CSA Global is a geological, mining and it, not on drill-hole spacing or a box- staff retention and lower turnover of management consultancy providing ticking method. personnel despite less ability to pay strategic mining services and advice. Its “People see us as being pragmatic, the big bucks.” geologists, engineers and technology and having a science base, but Some of CSA Global’s most professionals offer expertise across all stages of the mining cycle, from project we’re also very commercial and notable new-starts of recent times generation through to completion. entrepreneurial. We’ve had key CSA include Karl van Olden (mining), Global people play important roles Andrew Scogings (industrial HEAD OFFICE in the development of the industry’s and speciality minerals), Marcus CSA Global significant resource reporting and Willson (gold, structural geology), Level 2, 3 Ord Street, valuation codes and guidelines over Warren Potma (mineral systems, West Perth, WA 6005. many years, and we understand well geomet), Ivy Chen (corporate), PO Box 141, West Perth the principles underpinning those Belinda van Lente (resources), Matt Western Australia 6872 codes. Cobb (resources), Dale Harris (data Tel: +61 8 9355 1677 Email: [email protected] “So we know that if results – systems), Mark Pudovskis (potash), Web: www.csaglobal.com drilling, resources, etc – are going to Qingtao Zeng (China), Magda be seen in the best light, there has Fimmano (marketing), and Chris DIRECTORS got to be that associated materiality, Morrissey (technology). Jeff Elliott integrity, and transparency.” The company has also added a Peter Rossdeutscher Elliott says CSA Global’s business Spanish-speaking country manager Daniel (Stan) Wholley model and private ownership in Nicaragua to manage its activities Aaron Green structure, which have seen it fund in the region, and is building its Dr Neal Reynolds organic and corporate expansion associates network and trialling Brenton Siviour internally, with no debt taken on alliances in South America. Ryan Clarkson (co. sec) to date, have also left the firm on a “We have boosted our capabilities REGIONAL DIRECTORS strong growth footing. in our Vancouver office and are Patrick Maher “Over the last several years we progressing with some M&A activity Galen White have invested in building our cap- in Toronto to expand our capacity Dennis Arne ability and our capacity while and capability further,” Elliott says. Dmitry Pertel

Mining Journal • mining-journal.com • July 15-28, 2016 61

2pp_CSA_MJ160715.indd 61 14/07/2016 10:44 COMMODITIES IRON ORE It’s all about supply

Cost, not demand, will underpin the price

High-cost output from Aust- Daniel Gleeson ralia, Canada and Malaysia are likely to represent the marginal “It will never last,” read several tonnages at a $50/t price, headlines earlier this year. They accord ing to Macquarie’s Colin weren’t referring to Rupert Mur- Hamilton, while Bernstein’s Paul doch and Jerry Hall’s nuptials, Gait added South Africa-based but the iron ore price rally that miners to the marginal mix, too. had caught everyone by surprise in the first four months of Rising costs the year. This is now. It could be different At the end of 2015, you would in the future. struggle to find an analyst pre- The cost to mine and ship a tonne of ore is going up across the board While the cost per tonne of dicting a run up to the US$70 iron ore produced has been per tonne level, but increased will reach their respective ex- back to an annualised rate of coming down in recent years Chinese demand, catalysed by pansion run rates at some point 139 million tonnes in May, down thanks to weak local currencies, state-backed investment, caught in the future. At a $50/t iron ore from 156Mt per annum in April,” falling oil prices, cost cutting market forecasters off-guard. price they still more than break- the bank said. programmes and increased The price of iron ore started even and most of the infrastruc- There were exceptions, throughput, it is getting harder rising in mid-January and kept ture is already in place to allow though. India, which has only re- to shave costs off the bottom on going before reaching a peak for the increased throughput. cently been freed from the shack- line. of US$68.7/t on April 21. It Chinese iron ore demand will les that inhibited producers from Australia-based producers are dropped back in May and the also moderate back to more jus- exporting material, has started to unlikely to see further currency first few days of June, but it has tifiable levels after the stimulus increase its pres- depreciation, stabilised above $50/t, averag- plans have faded. Peak steel pro- ence on the “Our conclusion while oil prices ing $51.8/t year-to-date, and de- duction in the Asian nation has seaborne market, are up 25% on fying the bearish analyst predic- already been hit and there is no shipping 1.64Mt is that the longer the December tions spouted at the end of 2015. fundamental demand on the ho- to China in May, prices stay above 2015 low of $36 This is not just down to de- rizon to warrant another period its highest month per barrel. mand. Supply has also surprised of growth. since July 2012, $55/t in 2016, At the mine on the downside. while exporters the more likely a level, all of the continued In the lead up to the recent Exit stage left from Myanmar, low-hanging on /from price peak, the big three – Rio This means more iron ore supply Vietnam and the period of weaker fruit – in terms Tinto, BHP Billiton and Vale – all will need to come out of the US have also in- prices in 2017, of cost cutting scaled back their guidance for market in future years in order to creased their sup- possibly 2018 is – has been this or next year on infrastruc- balance the future supply- ply to China. picked and ture issues. demand equation. Even with re- likely to ensue” many miners While shipments in the three Deutsche Bank agrees with cord iron ore are facing in- months to the end of June have this, taking the view any more shipments from Australia’s Port creased strip ratios and higher been higher quarter-on-quarter price strength this year will kick Hedland to China in June, pro- costs in the medium to long from all three, they are still way the can down the road. duction from Vale’s S11D project term. off what was initially forecast last “Our conclusion is that the set to come on stream later this Cash costs may indicate these year before the Samarco tailings longer prices stay above $55/t in year and waning demand from companies are making healthy dam spill occurred and the iron 2016 the more likely a period of Chinese steel mills, Macquarie margins today, but like a duck ore price reached an index low weaker prices in 2017, possibly sees the market stabilising paddling frantically under the of $37/t. 2018 is likely to ensue,” the bank around the US$50/t mark for the water’s surface, their all-in cost In concert with these supply said. rest of the year. base, plus the cost to service issues, the government-backed There is no doubt more supply “We believe the risks of a near- their debt, means their margins investment programmes that needs to come out of the mar- term collapse below $50/t have will be squeezed at a price started soon after the Chinese ket, but there are differing opin- abated,” it said. Steel mill inven- below $50/t. New Year have proven to be ions on the price needed to tories in China are gradually de- The cost to ship a tonne of longer lasting. force this tonnage out. teriorating thanks to state- ore is likely to go up, not down, Still, it is inevitable the majors Deutsche Bank said prices backed policy and higher cost with only a few producers below $40/t were needed for supply is set to continue to exit based in financially troubled Key figure large swathes of higher cost the market. economies like Brazil and South tonnes to exit, while Macquarie The characteristics of iron ore Africa likely to buck the trend 139Mt said current prices have proven means supply will always come and receive any more positive The annualised amount of iron enough to cut supplies from in and out of the market on price tailwinds for their cost bases. ore China imported in May Ukraine, Iran, Mauritania and spikes and troughs, but the This, not Chinese steel de- from outside Australia, Brazil Canada to China. swing seaborne supply will mand, will prove the decisive and South Africa “Imports excluding Australia, come from more established factor for the market going for- Brazil and South Africa eased names. ward.

62 July 15-28, 2016 • mining-journal.com • Mining Journal

62MJ160715.indd 62 14/07/2016 10:28 MARKETS

Global Mining Index (Euromoney) Euromoney indices Twitter @euromoneyindex 300 Website www.euromoneyindices.com For more information, contact [email protected]

Euromoney Indices (EI) is the index compilation and calculation business of the London listed global financial and business media company Euromoney 250 Institutional Investor PLC. EI was originally established by James Capel & Co. (Stockbrokers) in 1987 as an index advisory business serving passive equity investment managers. In 1999, James Capel became part of HSBC Bank plc and the team became known as HSBC Quantitative Techniques, expanding its services into calculating indices across the FX, rates and credit asset classes. In 200 September 2013, as part of a larger restructuring of HSBC, the Quantitative Techniques business was acquired by Euromoney Institutional Investor PLC and renamed Euromoney Indices. Euromoney Global Mining Indices measure the returns of companies in the metal and mineral extraction industries. The Euromoney Global Mining indices 150 are market capitalisation weighted, free float adjusted and cover both Emerging July 2015 July 2016 and Developed Markets. Indices are calculated both at regional and sector level. The market capitalisations below are for end-June 2016. Index performance by sector (Euromoney) The Euromoney Global Mining Index comprises 159 constituents with a total (rebased July 15, 2015) market capitalisation of US$577 billion. The largest sectors of the index are 41% diversified, 32.4% gold, 7.8% copper, 6.7% silver and 4.6% coal. 200 Base metals Diversified mining: This index comprises 27 companies, with a combined Coal market capitalisation of some US$236 billion, with the largest four companies Gold accounting for 57.8% of the sector total. The Diversified sector contains the Diversiﬁed largest company within the Global Mining, BHP Billiton Ltd, with a weight of 150 Copper 30% in the sector and 12.3% in the overall index. Gold: An index of 53 companies (some US$187 billion), with the largest three companies accounting for 33% of the sector. Copper: This index of 11 companies has a market capitalisation of just over 100 US$45.3 billion. The copper sector contains the largest 2 companies within the sector, Freeport - McMoran Inc and Grupo Mexico B, with a weight of 62.9% in the sector and 4.9% in the overall index. Silver: The 12 companies have a market capitalisation of some US$38.7 billion, 50 with the largest company account for 26.5% of the sector market capitalisation.

Best-performing regions (June 29 - July 13) Region Performance (%) Stock count Weight 0 July 2015 July 2016 Australia 17.63 23 18.8 South Africa 16.76 11 3.9 USA 14.51 12 9 Ernst & Young Mining Eye Index Worst-performing regions (June 29 - July 13) 800 Region Performance (%) Stock count Weight Mining EYe represents the weighted Latin America 8.32 5 6.4 average market capitalisation of the top 20 Canada 8.41 45 26.0 700 mining companies on London’s AIM market Pan Europe 12.09 30 28.1 Source: Thomson Financial Datastream Best-performing sectors (June 29 - July 13) 600 Region Performance (%) Stock count Weight Nickel 39.35 3 0.2 500 Silver 18.60 12 7 Misc Base Metals 18.01 9 0.8 Platinum 15.93 5 1.1 400 Diversified 13.52 27 41.3 Copper 13.15 11 7.8 Industrial Minerals 12.86 3 0.7 300 Mining EYe Worst-performing sectors (June 29 - July 13) FTSE Mining (rebased) Region Performance (%) Stock count Weight 200 Uranium -0.37 3 0.7 July 2015 July 2016 Diamonds 2.80 5 0.9 Coal 8.67 20 4.5 Shipping rates (Representative dry cargo single voyage rates; July 6) Gold 9.40 53 32 Route/Size (’000 dwt) % change % change Zinc/Lead 12.66 1 0.9 Coal US$/t on week on year Aluminium 12.79 7 2.1 Richards Bay-ARA (100-150) 4.00 5.26 33.33 E Aus-South Korea (120-160) 6.70 – 0.00 – 0.00 Euromoney indices (June 29 - July 13) E Aus-ARA (100-150) 21.98 2.09 3.68 2-week performance (%) 1-year performance (%) Index Hay Pt-China (100-150) 5.45 9.00 26.35 Global mining 5.98 7.72 295.26 Iron ore Base metals 12.46 -12.15 296.20 Narvik-ARA (100-150) 3.25 3.17 22.62 Coal 6.91 -12.36 360.00 Brazil-ARA (100-150) 4.90 15.29 28.47 Copper 13.67 -19.53 1258.48 Brazil-China (100-150) 9.65 7.22 25.77 W Aus-China (120-160) Diversified 11.23 -15.96 429.44 4.70 8.05 17.11 W Aus-ARA (120-160)* 6.05 4.31 4.31 Gold -1.39 88.36 150.71 Saldanha Bay-China (100-150)* 7.10 1.43 24.47 Global Mining performance between June 29 and July 13: 12.11% Global Mining has 159 companies Source: Drewry Shipping Consultants Ltd

Mining Journal • mining-journal.com • July 15-28, 2016 63

63MJ160715.indd 63 14/07/2016 12:38 OPINION VIEW FROM THE WEST END The show must go on Board-level bureaucracy looks good but means little

simple smartphone app being “It is enough that people know A mechanism able to carry out the task for about there is an election. The people who to sack the A$11.50 (US$8.77), plus VAT. cast the votes decide nothing. The PM without Observers from Mars might people who count the votes decide recourse to wonder why we intentionally everything” the people choose the slowest, least accu- – Joseph Stalin eliminates that rate and most expensive of all constitutional the options available, in order to After the Brexit drama of a few checks and elect a few hundred people who weeks back, readers might be balances don’t actually do anything, but forgiven for noticing, but not nonsense show up to vote when and how giving a shit about, the general they are told and then head to election that was held down in and the ignorant get to have a of paper presents little challenge the parliamentary bar to get Australia just afterward. As an say, although the jury is still out to anyone with an AK47 and a hammered on our coin. Australian, I took a keen interest, on that one. team of enthusiastic box stuffers. Given we do this a lot, they or at least as much of an interest But even given all that, there All this is fair, but I feel the must think it’s a sport. as one can take when not in any is room for improvement, one of most cogent argument that will I had a little dig at the makeup way affected by the outcome. which being the actual voting be put forward against electron- of the boards of BHP and Rio I am proud of the Australian process, as bugger me wasn’t ic voting, is that of visibility – de- Tinto a few weeks back, so I system of government. Yes it’s the last one a palaver. The peo- mocracy must not only be done, won’t labour the point further, imperfect, and in recent years it ple spoke on a Saturday, but it it must be seen to be done. other than to say that at least has been a been a bit peculiar wasn’t until the following Friday Pressing a button on a screen they don’t insult us by actually with a new PM being sworn in that we had the faintest idea and then waiting for the result having a free election. every second Tuesday, but by what they said in the lower to flash up at one minute past But the charade of a dozen and large it works. house, and we still don’t know six that evening would be very over paid and under qualified At its heart is the Westminster what the hell is going on in the efficient, but oh so unsatisfying. mates of the chairman actually system, which has shown itself Senate other than being pretty Setting aside the not insignifi- providing anything remotely re- to be the most robust of all. Hav- sure it will be a shambles. cant economic impact of the sembling governance or useful ing the leader picked by his or How hard can it be to count a tens of thousands who have a advice must have the Martians her peers rather than the moron- few million scribbles on bits of vested interest in the event – scratching their heads. ic public is very sensible and pro- paper? Well, quite hard it seems. manufacturing pencils and piec- But company boards are but vides an excellent circuit breaker The job was made harder than es of paper, manning polling sta- one example where millions are in the event the leader wanders it needed to be as some of the tions, and of course the spent creating a smear of trans- too far off piste. Providing a sim- bits of paper were 6 feet long as thankless task of counting – we parency and accountability that ple mechanism to sack the PM every idiot with an opinion exer- need to see the show. actually achieves nothing. without recourse to the courts or cised their right to stand for par- Every TV station puts on an Tens of millions are spent draft- the people, eliminates the need liament. agonisingly drawn out event ing annual reports that contain for all of that constitutional Beyond that, the question is where panels of experts try to nothing of interest or value, but checks and balances nonsense now being asked: why on Earth make it seem more interesting as they are never read, that’s OK. the Americans seem so proud of are we not using an electronic than it really is by concocting AGMs are held to provide pen- despite the fact it is complete voting system that would have the myth that by sitting down sioners with tea and biscuits, but gibberish, and renders their na- provided the answer about four and watching, we continue to no decisions are ever taken. tion utterly ungovernable. seconds after the polls closed? impact the process. The truth is Board subcommittees meet to Although I guess the price we Refreshingly, this will now al- we would be all better served discuss risks, remuneration, pay is that by weeding out dan- most certainly be given serious heading to the pub and waking compliance and governance, but gerously unhinged weirdos at consideration, and just as cer- the next day with a sore head that’s just code for a jolly lunch the pre-selection stage, our elec- tainly there will be many reasons and a new government. and then signing off on what tion contests are never as enter- thrown up why scribbling re- But by watching the show, ap- they are handed by the CEO. taining. mains the best way to do it. parently, we are the essential People who have never been But we haven’t taken all of the First, there will be the argu- witnesses to the process, anoint- on a mine site draft intricate, un- Westminster system – we left ment that older folk like scrib- ing its legitimacy. intelligible policies about playing out some of the of the more hi- bling on paper, or may be unable But we are suckers – somehow nicely that no one ever reads. larious anachronisms that were to operate some electronic in our minds, we have formed the Legions of lawyers, account- put in place centuries ago. gizmo. My mother proves this view that scribbling on pieces of ants and bankers create struc- We have a preferential voting point, but love her as I do, I might paper and watching some poor tures to ensure that no-one ever system so votes actually count, suggest being unable to press a sod count them all treats our actually knows what is going on we have an elected upper house button on an iPad might be rea- opinions with the reverence they and blame is never pinned. rather than the preposterous sonable grounds for excluding deserve. Having a few bytes zip Like politics, The Corporate Lords, we vote on a Saturday so those who shouldn’t be allowed down a wire seems so tawdry. Show is demanded by a public working people can actually get to decide who runs the country. I don’t know what an election under the delusion it makes a there and then we make it com- And then there are security costs, but I’m guessing a lot, yet it difference. Yes it does, but not pulsory and so even the indolent concerns: but scribbling on a bit is a cost we happily bear despite a the difference they think.

64 July 15-28, 2016 • mining-journal.com • Mining Journal

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