Bargain Hunting in the Market Sell-Offs (David Franklyn)

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Biggest outflows in the fund, it
was in April last year,

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transition day, and then our
biggest inflows were February.

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The investor base picked the
very bottom of the market and

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the very top of the market, but
they did exactly the wrong

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thing, right?
They sold when they should have

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bought, and then they bought
when they should have sold.

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David Franklin, welcome back to
Money of Mine.

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We are, you know, in a heck of a
place the world is right now.

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Yeah.
Macro is informing everything,

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not just commodity markets, but
absolutely everything and and

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what commodities just so happen
to be at the absolute forefront

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of it.
The disruptions in the Middle

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East are are almost the market's
almost become kind of ambivalent

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to the the closure reopening of
the straight.

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We, you know, it's been JD was
telling me this morning, it's

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been 2 1/2 months now.
And at the beginning it would

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have it would have seemed pretty
dire if things have had

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prolonged that long yet.
Yet markets are resilient.

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Well, I, I think you're right.
It's been really surprising just

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how long the conflict has, has
has gone on.

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Given at the outset it was seen
as something they might drag out

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for a couple of weeks and then
it'll be back to normal.

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And, and what's fascinating is
that oil and gas prices, while

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they've risen, they haven't
risen anywhere near you would

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have expected.
And I think, you know, the key

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themes coming out of that.
I think security of supply for

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commodities and for energy is
really top of mind with, with

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everyone and with governments.
And I think that's, that's a, a

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strong signal going forward.
So, you know, I think it'd be

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fascinating to see where things
go from here.

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I mean, Trump's obviously saying
he's he's going to maintain the

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blockade until the nuclear
situation is resolved.

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So we'll see how things
progress.

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The reverse blockade, that one
never ceases to make me laugh.

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The looking back at quarter one
for every fund manager just

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about the week we speak with,
he's got to be up there with one

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of the wildest quarters on
record.

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No different on your end.
Curious to hear the the ups and

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downs, the emotions through it
all.

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Yeah.
Look, I think, you know,

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particularly coming up to up to
March, the resource fund

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managers and the resource sector
had been through a really

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buoyant time, you know, results
for the financial year to date,

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we're looking really strong and
and I guess that leads

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potentially to some complacency
in how you manage your

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portfolio.
And then all of a sudden whack,

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you know, March came along and,
and the indexes all all took a

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whacking.
So, you know, to me, it comes

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down to being prepared for the
unexpected.

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And, and, and a lot of that is
just having a plan.

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And I think we've, we've spoken
about this a bit before, but

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it's kind of saying, you know,
these things happen, you don't

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know when they're going to
happen and have a plan and work

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on it.
And, and what you find is that

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it never, your plan never works
100% right, but at least you got

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a plan that gives you some, some
comfort and, and a lot of things

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do work.
And you know, so I look, I think

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it at the end of February we had
3% cash, which is for, for the

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way we manage our fund is, is
pretty unheard of, very low.

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And then, and we were thinking
about some adjustments to the

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portfolio, but didn't quite get
there in time.

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But before this all kind of hit
the fan.

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But, but because we had some
things in place, we could go

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from 3% cash to 25% cash
literally within a day.

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And, and that, that makes you
feel better, right?

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Often, often you, you know,
often it, it works out to be

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best in hindsight that you just
sort of wait through these

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situations.
But the ability to go to cash

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and then reposition the
portfolio and perhaps better

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quality stocks that you might
not have been prepared to buy at

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higher levels, you know, creates
an opportunity.

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So, and then the second point
is, well, then you know, the

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world's changed a little.
How do we want to position the

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portfolio?
What you know, what commodities

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do we think will do best and
even that that's that mix

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between producers and
developers, how do you want the

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portfolio to be mixed and, and
where do you think the risk is?

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So, so we've kind of worked
through a lot of that.

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I really want to dive in on that
cash component because almost

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everyone we spoke with, I asked
no exception to this like could

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feel that bull market pulling,
pulling our money in.

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You know, we were seeing awesome
investment opportunities every

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day wanting to invest more and
more and it's, it's so.

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Enacted Buy stuff.
There was, there was always

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something every day that we
wanted to buy every day.

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But you've, you've got more
experience than we do you, you

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can recognize these these
emotions.

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I'm curious how how seeing those
continually over over time

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changes your approach to them.
Yeah, look, I mean human, you

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know, fear and greed, right?
It's all about fear and greed

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and it's obviously built in into
our genes because everyone is

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the same.
So I often give an analogy that

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if I look back over the last 12
months, right, our biggest

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outflows in the fund and and
they weren't very much right.

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We've been very lucky and we got
a good, you know, a good sticky

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investor base was in March last,
sorry, it was in April last

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year, you know, transition day,
right?

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So it was our biggest outflows,
right?

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And then our biggest inflows
were February, right?

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And so like, like the market,
the, the, the investor base

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picked the very bottom of the
market and the very top of the

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market, but they did exactly the
wrong thing, right?

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So they, they sold when they
should have bought and then they

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bought when they should have
sold, right?

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And I think it just shows that,
you know, just the investor

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mindset and and so I think you
got to try and take out that

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emotion and say, you know, when
things are looking really good,

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recognize that that perhaps it's
time to take a bit of money off

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the table and, and things.
Do you know, there are cycles to

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the market and, and be aware of
that, right?

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But it's easier said than done.
Happens every time, right?

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It does.
It really does happen every

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time, Dave, The, the, the, the
part of you know, what you were

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saying before on the, on the
commodity like selection as as a

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result of the, the here and now.
Yeah, I remember when he started

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the fund, there was a, a really
big, you know, battery metals

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thematic behind your initial
positioning.

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And and you were early, you were
definitely had, you know,

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heavyweights to the likes of
IGO, right as that stock, you

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know, court wind and big driver
of massive outperformance in in

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that period of time as well.
There's, there's, there's a lot

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of parallels to the portfolio
positioning again now.

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Yeah, it is.
We probably, I mean, again, you

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always look back and say I
should have done things better.

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So if you, if you look at
lithium, which I think is a real

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winner out of what's happening
in the Middle East, right.

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And that's obviously a a tragic
situation.

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But, but I think people are
realising that alternative

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energy sources and, and, and
things are important.

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And particularly with the EVs,
which had gone off the boil a

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little bit.
You know, I know a number of

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people that ran out and bought
second hand EVs, you know, when

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it happened because, you know,
they're worried about fuel and I

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think that's continuing.
And then you've got the the

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energy storage side of it as
well really ramping up.

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So, you know, so I think lithium
looks really good.

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Probably what we did with the
lithium market is I think we

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picked internally, we picked the
bottom of the lithium price

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pretty well.
But even at that stage people

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are still saying, look, you
know, spot your main above 1200

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bucks.
It's it's never going to get

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there, right?
This wasn't that long ago.

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And so we're a bit cautious on
some of the big ones like

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Pilbara and and Lyontown at the
very, very early stage, just

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thinking they're not cheap
enough.

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And I look back now and it's,
you know, like there's

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principles that you got to
adhere to when you're investing,

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right?
And basically in a decent sized

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market, if the market, if the
commodity price is below the

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cost of production for high
quality producers, you know,

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it's probably a good time to
buy.

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And it's and, and, and we didn't
at that point.

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And so, so we kind of missed the
boat.

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We, you know, we, we bought into
some of them at, at, at levels,

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but not at the prices we should
of.

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And so really we had to then
say, well, how do we best play

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this where the value
opportunities?

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And so we, we ended up with a, a
portfolio now that's quite

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different from the kind of one
we we would have owned, you

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know, in the past.
So you know, our big three

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holdings are lithium Argentina,
which which you think's really

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exciting and really a stand out
value wise, You know, Q2, which

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is a, a great development asset
and more recently a lever, which

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is, you know, damaged and
recovering, right.

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And you know, their, their last
quarterly was a a lot better

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than the previous one.
And you know, so, so we've,

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we've had to maybe take a bit
more risk but but, but that's

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worked pretty well.
Notable that they're not Aussie

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names Aussie listed but the
projects aren't in Australia.

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Why is that?
Well, it just comes down to

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value.
You know, I mean you look at

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Pilbara's market cap now it's 20
billion I think.

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And and so you're back
calculating you go, well, what

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kind of earnings do they need to
be making to justify that?

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And to give them credit, like I
think the Pilbara result was

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probably the stand out of the
quarterlies that have just come

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through.
I think what it shows is their,

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their commitment to CapEx during
the down cycle has really

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positioned them really well.
And in an environment where

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you'd probably don't have a lot
of scale squad domain producers

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coming, you know, growing, you
know, they, they, they're going

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to be going from, you know,
900,000 tons to, to potentially

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2 million tons, you know, over
the next little while.

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So you know they're ideally
placed.

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And then I mean Lyntown is the
other one in in Australia.

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I have to ask you about Lyntown
quickly because they're, I think

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they're now a $7 billion company
and they're talking about

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expansion again, they were
really up against the balls.

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The credit to them, they've
worked their way through it.

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But again, it's hard on on a
valuation basis.

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But I guess it depends what what
spot you mean price you put into

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the model.
Well, exactly.

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And you, I mean, you've got to
give the management team there a

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lot of credit for what they've
been able to achieve.

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And they've still got challenges
in front, right, to ramp up to

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even greater scale and you know,
potentially get to 4 million

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tons per annum.
You know, that's, that's a big

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underground mine and it's going
to take challenges.

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I think that, you know, they
brought costs down to a

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reasonable level, but I think
they need to need to demonstrate

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that they can continue to lift
production and get costs down to

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justify the, the, their current,
their current market price.

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I think you're right.
And, and maybe the, the, the

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other point, which kind of I
think plays into all that and

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it's a similar discussion with
uranium and some of the other

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commodities is, is the market is
very momentum and, and passive

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driven nowadays.
And so when people are looking

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for a thematic, you know,
they're buying the ETFs and then

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the ETFs are buying the big
market cap companies.

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And so there's a bit of a
disconnect between sort of value

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and and price and, and, and as a
fund manager, the question is

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how you deal with that, right?
Do you just sort of go along for

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the ride or do you try and eke
out sort of the value

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opportunities with the view that
the momentum will get there

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ultimately and, and the passive
investors will come and you

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know, and you'll and you'll get
more upside.

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So that's, that's a big part of
the market now.

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It's a really big part.
Of that that disconnect leads to

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opportunities in the in the
developers.

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And Q2 you mentioned their their
maiden resource yeah, came out

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for Cisco and it's off the page.
And I mean literally like if

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00:11:31,600 --> 00:11:34,520
you, if you, if you comp the
bubble chart of the of the

223
00:11:34,520 --> 00:11:38,120
maiden resource, it's it's, it's
truly, you know, it's truly a

224
00:11:38,120 --> 00:11:40,240
special deposit that one.
Yeah, that's right.

225
00:11:40,240 --> 00:11:44,800
It's a, you know, it's global
scale, well located close to

226
00:11:45,280 --> 00:11:49,960
infrastructure.
It's an asset that that won't be

227
00:11:49,960 --> 00:11:51,680
independent for longer.
You wouldn't have thought,

228
00:11:51,680 --> 00:11:53,280
right.
So in this environment where

229
00:11:53,560 --> 00:11:56,560
where the lithium market is, is
looking really good and the the

230
00:11:56,560 --> 00:12:00,680
longer term outlook is, is
looking very strong, there's not

231
00:12:00,680 --> 00:12:03,000
many assets like this and
someone else is going to have to

232
00:12:03,000 --> 00:12:04,640
own it.
You would have thought so, Yeah,

233
00:12:04,640 --> 00:12:07,000
we're happy to own that.
Are you, are you open to sharing

234
00:12:07,000 --> 00:12:09,480
a a potential buyer?
Any any ideas on that front?

235
00:12:09,480 --> 00:12:11,160
I mean, it's always very hard,
but.

236
00:12:11,360 --> 00:12:16,760
Yeah, it is very hard.
I mean, you'd have to say it's

237
00:12:16,760 --> 00:12:21,120
someone that's involved in the
industry already, potentially a

238
00:12:21,120 --> 00:12:23,480
Rio or they're probably I mean,
I think they've gone through a

239
00:12:23,480 --> 00:12:27,200
phase when Simon Trott came in
where they'll probably re

240
00:12:27,200 --> 00:12:28,880
evaluating their commitment to
the sector.

241
00:12:28,880 --> 00:12:31,160
But now it's looking like it's a
genius move.

242
00:12:31,160 --> 00:12:37,560
So do you go big or or or not,
you know, even a Pilbara at

243
00:12:37,560 --> 00:12:40,840
Lyontown?
I think if you're, you know, if

244
00:12:40,840 --> 00:12:44,200
you're if you're a lithium
player with with one asset,

245
00:12:44,200 --> 00:12:46,640
maybe you want to have a couple,
I don't know, you know, Lontown

246
00:12:46,720 --> 00:12:49,200
have talked about that a bit.
So it'd.

247
00:12:49,600 --> 00:12:51,280
Be remarkable buy for Lontown
like that would be.

248
00:12:51,880 --> 00:12:53,760
Yeah, that'd be that'd be truly
exciting.

249
00:12:53,760 --> 00:12:55,000
I think Lontown.
Yeah.

250
00:12:55,360 --> 00:12:57,640
Yeah, exactly.
For anyone, really, yeah.

251
00:12:57,960 --> 00:13:00,280
It it kind of ties in with a big
change you made in the funds

252
00:13:00,280 --> 00:13:03,440
that I'm keen to explore.
You previously I think you said

253
00:13:03,760 --> 00:13:06,360
25% was your Max exposure
overseas.

254
00:13:06,680 --> 00:13:10,000
You've lifted that to 40 and
that's a pretty big indictment

255
00:13:10,000 --> 00:13:12,480
of of what you're seeing in
Australia and your enthusiasm to

256
00:13:12,800 --> 00:13:15,000
to look at other opportunities.
So I'd love to just step through

257
00:13:15,000 --> 00:13:16,400
that.
Yeah.

258
00:13:16,640 --> 00:13:18,720
So there's there's really two
reasons.

259
00:13:18,920 --> 00:13:22,440
One is as the fund gets bigger,
you're going to allocate more

260
00:13:22,440 --> 00:13:26,200
capital and, and again, you want
to be able to invest it where

261
00:13:26,200 --> 00:13:29,440
the, where the value is there
rather than just being forced to

262
00:13:29,440 --> 00:13:31,160
buy what everyone else is
buying.

263
00:13:32,400 --> 00:13:34,840
And there's probably there's,
you know, so that to me, there's

264
00:13:34,840 --> 00:13:38,160
2 two reasons to go offshore.
The first is that whole momentum

265
00:13:38,160 --> 00:13:40,280
thing, right?
So in the Australian market, you

266
00:13:40,280 --> 00:13:42,200
look at, you know, Pilbara line
town.

267
00:13:42,200 --> 00:13:44,600
And then similarly with the,
with the uranium stocks, there's

268
00:13:44,600 --> 00:13:46,560
a lot of money going into a
small number of stocks that

269
00:13:46,560 --> 00:13:49,240
forces up the prices and it's
really hard to find value.

270
00:13:49,240 --> 00:13:53,320
So if you, if you can broaden
the pool, you can, you can find

271
00:13:53,360 --> 00:13:55,640
better value.
But and then, but then there's

272
00:13:55,640 --> 00:13:59,240
also a geology issue, right.
So you know, copper is, is a

273
00:13:59,240 --> 00:14:02,080
commodity that we really like.
It's one of our bigger holdings,

274
00:14:02,080 --> 00:14:05,600
you know, roughly 20% of the
portfolio in copper, but we

275
00:14:05,600 --> 00:14:11,720
always struggled to, to find the
quality and value in Australia

276
00:14:11,720 --> 00:14:15,000
that we wanted to, to find.
And when I look at the, the, you

277
00:14:15,000 --> 00:14:17,520
know, if I look at a sand fire,
you can't fault what they've

278
00:14:17,520 --> 00:14:18,960
done, right.
So notwithstanding their

279
00:14:18,960 --> 00:14:22,160
projects are offshore, but you
know, the management team there,

280
00:14:22,160 --> 00:14:24,560
Brendan Harris done a great job
in tidying up the business,

281
00:14:24,840 --> 00:14:29,240
maximizing the current projects.
And even I think the, you know,

282
00:14:29,240 --> 00:14:31,760
Kalkuru opportunity looks really
good.

283
00:14:32,000 --> 00:14:36,000
But again, value wise it, it,
you know, it, it trades in line

284
00:14:36,000 --> 00:14:39,880
with the sort of global majors
and I'm not sure that, that,

285
00:14:39,880 --> 00:14:43,000
that's justifiable.
So, so you know, if I look at

286
00:14:43,000 --> 00:14:46,720
what we've invested in in
offshore, it's, it's typically

287
00:14:46,720 --> 00:14:51,200
in the copper space and in the
in the lithium space because

288
00:14:51,400 --> 00:14:55,440
and, and uranium because they're
the quantities where there's

289
00:14:55,440 --> 00:14:57,480
better value.
And you mentioned a few of those

290
00:14:57,480 --> 00:15:00,880
copper names when we when we
spoke recently, I think Faraday,

291
00:15:01,160 --> 00:15:06,360
Arizona, Sonoran and
Merrimacker, was that the?

292
00:15:06,360 --> 00:15:09,880
Other one, Yeah, yeah.
Which of the three, or if you

293
00:15:09,880 --> 00:15:11,800
want to talk about all of the
three, I'd love to hear you,

294
00:15:12,480 --> 00:15:16,440
your thoughts on value in those
opportunities like developers

295
00:15:16,440 --> 00:15:18,160
and where they're kind of at.
Yeah.

296
00:15:18,160 --> 00:15:21,000
Well, so, so I mean maybe
stepping back a bit.

297
00:15:21,000 --> 00:15:25,240
So the way we view copper is, is
I think there's two great

298
00:15:25,240 --> 00:15:27,920
opportunities in copper.
One is to buy the really big

299
00:15:27,920 --> 00:15:31,600
global producers.
So you know, a tech or a Anglo

300
00:15:31,760 --> 00:15:34,360
Freeport notwithstanding the
recent downgrade Ivanhoe at the

301
00:15:34,360 --> 00:15:36,680
right time because I think
there's a copper in, you know, I

302
00:15:36,680 --> 00:15:39,520
mean copper is a fundamental
commodity and I think it's going

303
00:15:39,520 --> 00:15:43,000
to be critically important for
the next, you know, 10/20/50

304
00:15:43,000 --> 00:15:45,800
years, right?
And what we're seeing is, is

305
00:15:45,800 --> 00:15:48,720
constrained supply and very
strong demand.

306
00:15:49,080 --> 00:15:53,920
And so if you've got a big
abundant resource of coppers

307
00:15:54,000 --> 00:15:56,080
sitting in the ground, which you
haven't developed yet, but you

308
00:15:56,080 --> 00:15:59,120
can develop over the next 20
years and you're paying the same

309
00:15:59,120 --> 00:16:01,320
price for that as if you if
you're buying someone in

310
00:16:01,320 --> 00:16:05,120
Australia that might have a A5
or 10 year my life right then I

311
00:16:05,120 --> 00:16:07,560
think it's pretty compelling.
So I think those big projects

312
00:16:07,760 --> 00:16:11,360
are you know are undervalued in
the current market and you know

313
00:16:11,360 --> 00:16:14,680
you got copper price pushing 6-6
bucks a pound or a bit over.

314
00:16:15,400 --> 00:16:17,320
So that's pretty, pretty
exciting.

315
00:16:17,320 --> 00:16:20,080
So I think that's one area.
But then the other area is

316
00:16:20,120 --> 00:16:24,080
projects that can produce
between say 50,000 tons and

317
00:16:24,080 --> 00:16:28,880
100,000 tons say with 10 year
plus mine life where the CapEx

318
00:16:28,920 --> 00:16:32,200
isn't too extraordinary.
So typically they're not poor

319
00:16:32,200 --> 00:16:34,800
for your underground kind of
developments where you CapEx is

320
00:16:34,800 --> 00:16:37,880
out of out of whack.
And and so you know the ones we

321
00:16:37,880 --> 00:16:42,880
talked about there, Faraday,
Merrimack, Arizona, Sonoran, you

322
00:16:42,880 --> 00:16:45,520
know all kind of fit into that
into that area.

323
00:16:45,760 --> 00:16:48,640
So if you look at Faraday,
Faraday had had their Copper

324
00:16:48,640 --> 00:16:53,160
Creek project, which was kind of
OK, but probably just lacking a

325
00:16:53,160 --> 00:16:56,640
bit of scale, you know,
earmarked at about 50,000 tons

326
00:16:56,640 --> 00:17:01,280
per annum.
But BHP San Manuel project was

327
00:17:01,280 --> 00:17:04,000
20 KS away, been kind of
mothballed for a long period of

328
00:17:04,000 --> 00:17:08,079
time, but it had been a long
term, you know, sizable producer

329
00:17:08,400 --> 00:17:11,960
has infrastructure, access to,
to power, etcetera, and a lot

330
00:17:11,960 --> 00:17:15,359
of, you know, approvals to, to
mine.

331
00:17:15,359 --> 00:17:18,240
So you bang the two together.
So what's happening is those two

332
00:17:18,240 --> 00:17:19,880
projects are being merged
together.

333
00:17:19,880 --> 00:17:22,000
BHP will emerge with a 30%
holding.

334
00:17:22,319 --> 00:17:24,040
Lundeen are also on the
register.

335
00:17:24,599 --> 00:17:27,280
So suddenly it's a it's a really
exciting story.

336
00:17:27,880 --> 00:17:32,320
The market cap of Faraday is
something like, you know, 1 to 1

337
00:17:32,320 --> 00:17:34,760
1/2 billion, you know, which put
it out in context.

338
00:17:34,760 --> 00:17:40,160
That's, that's probably a bit
less and develop and you kind of

339
00:17:40,160 --> 00:17:42,560
go, you know, which one has the
better long term potential

340
00:17:42,760 --> 00:17:45,320
notwithstanding, I love
developing and Bill, if you go

341
00:17:45,320 --> 00:17:47,840
back anyone he's got it back.
But but you know, relative

342
00:17:47,840 --> 00:17:49,640
value, I think there's this
better value there.

343
00:17:50,000 --> 00:17:53,440
Merrimacker is also interesting,
you know, in Chile, basically

344
00:17:53,440 --> 00:17:56,760
more coastal than up in the in
the mountains, which which is

345
00:17:56,760 --> 00:18:00,280
good.
It's looking at 50,000 tons per

346
00:18:00,280 --> 00:18:03,520
annum project.
It's got a new development

347
00:18:03,520 --> 00:18:06,480
Pamper Medina, which which could
add quite a bit to that.

348
00:18:07,600 --> 00:18:10,760
Again, CapEx won't be too
extraordinary, should be able to

349
00:18:10,760 --> 00:18:13,520
come on relatively quickly.
Again, capped it, you know, 1

350
00:18:13,520 --> 00:18:14,680
1/2 billion, something like
that.

351
00:18:14,960 --> 00:18:19,600
So Merrimacker, I think they
trade like 1.21 point three

352
00:18:19,600 --> 00:18:22,960
times NAV maybe I don't know
that's consensus copper or spot

353
00:18:22,960 --> 00:18:26,760
copper.
But so, so there's, there's

354
00:18:26,760 --> 00:18:29,520
already this kind of like, you
know, premium dynamic at play in

355
00:18:29,520 --> 00:18:33,000
terms of the, you know, the PNAV
for an undeveloped project.

356
00:18:33,280 --> 00:18:35,920
However, it's, it's, it's a
simple operation to put online

357
00:18:36,240 --> 00:18:39,280
and it's and there's growth.
So like tick, tick.

358
00:18:40,160 --> 00:18:44,160
Yeah, the the one thing I did
hear about it is check the

359
00:18:44,160 --> 00:18:45,880
reagent cost assumptions in the
study.

360
00:18:45,880 --> 00:18:48,400
Though Yeah, right it.
Might be a bit off, which might

361
00:18:48,400 --> 00:18:50,000
make a.
Bit of a difference for them,

362
00:18:50,160 --> 00:18:52,400
yeah.
So I'll have a look at that.

363
00:18:54,000 --> 00:18:58,120
So I am probably the final one
is Arizona Sonoran, which which

364
00:18:58,120 --> 00:19:00,600
we bought a little while ago and
is now under takeover from Hub

365
00:19:00,600 --> 00:19:03,120
Bay.
But again, it just, it just

366
00:19:03,120 --> 00:19:05,200
gives you a couple of cards to
play.

367
00:19:05,200 --> 00:19:09,560
You know, either the project
gets developed and and I think

368
00:19:09,560 --> 00:19:14,120
will be rated well or
alternatively you get taken out

369
00:19:14,120 --> 00:19:17,400
by by someone close by or or
someone wanting to add another

370
00:19:17,400 --> 00:19:19,600
asset to the portfolio.
Mate, there's no doubt the macro

371
00:19:19,600 --> 00:19:21,320
environment incredibly volatile
right now.

372
00:19:21,760 --> 00:19:24,000
However, do you know what is not
volatile?

373
00:19:24,760 --> 00:19:26,640
Australian property.
Australian property?

374
00:19:26,640 --> 00:19:29,800
Well, see The thing is a lot of
people, they just if they don't

375
00:19:29,800 --> 00:19:31,720
like the volatility, they Chuck
the money in the bank account

376
00:19:31,760 --> 00:19:34,200
earning what, like 4% interest
per hour?

377
00:19:34,240 --> 00:19:36,080
You're losing money because of
inflation.

378
00:19:36,120 --> 00:19:37,520
We know that.
We speak about it all the time.

379
00:19:37,520 --> 00:19:39,480
You're losing money just sitting
on a pile of cash.

380
00:19:39,640 --> 00:19:41,280
You know what captures the
upside of inflation?

381
00:19:41,720 --> 00:19:43,160
Property.
Real assets.

382
00:19:43,160 --> 00:19:44,440
And most people think you'd buy
a house.

383
00:19:44,440 --> 00:19:45,880
Don't.
Well, you can buy a second house

384
00:19:45,880 --> 00:19:47,920
if you want to, or you can
invest in commercial property.

385
00:19:47,920 --> 00:19:50,600
And the interesting way to do
invest in commercial property

386
00:19:50,800 --> 00:19:53,480
exceed Capitals, the collective
commercial property fund.

387
00:19:53,680 --> 00:19:56,760
It's a really interesting
vehicle, strong alignment, 8%

388
00:19:56,880 --> 00:19:59,800
cash distributions paid monthly
like a divvy.

389
00:20:00,000 --> 00:20:02,880
And on top of that, you get the
capital uplift of the portfolio

390
00:20:03,000 --> 00:20:05,680
growth over time.
Which property Mate property?

391
00:20:05,840 --> 00:20:07,760
Yeah, I couldn't agree more than
you don't have to go through all

392
00:20:07,760 --> 00:20:10,200
the effort, jumping through the
holes, getting a mortgage,

393
00:20:10,200 --> 00:20:12,400
speaking with the brokers, all
that sort of stuff.

394
00:20:12,760 --> 00:20:15,160
Just call up exceed capital,
find the details in the show

395
00:20:15,160 --> 00:20:18,240
notes and take it from there.
Where do you think we're kind of

396
00:20:18,240 --> 00:20:21,880
at with that consolidation,
particularly in in the copper

397
00:20:21,880 --> 00:20:23,920
space?
We've seen a lot of the juniors

398
00:20:23,920 --> 00:20:26,480
here in Australia start to get
gobbled up deals like Sapphire

399
00:20:26,760 --> 00:20:30,080
you mentioned earlier, but what
sort of innings are are you

400
00:20:30,080 --> 00:20:32,760
thinking we're in there?
Well, you have to everyone

401
00:20:32,760 --> 00:20:35,200
wants, everyone wants another
copper asset, right?

402
00:20:35,280 --> 00:20:38,640
So, so it's early days.
The the problem is there aren't

403
00:20:38,640 --> 00:20:40,920
many around.
It's a scarcity issue.

404
00:20:41,560 --> 00:20:44,880
So you know, what do you do?
I mean, I think Anglo at the big

405
00:20:44,880 --> 00:20:49,000
end, Anglo is pretty interesting
in that is a very convoluted

406
00:20:49,000 --> 00:20:51,160
merger that's going on with tech
and there's probably still

407
00:20:51,160 --> 00:20:53,720
another year or more to go right
on consuming that.

408
00:20:54,240 --> 00:20:56,480
And you kind of think, well, is
that the best way?

409
00:20:56,480 --> 00:20:58,840
You know, maybe someone in
particularly when copper then

410
00:20:58,840 --> 00:21:01,040
pushes through 6 bucks a pound,
you know, maybe someone will

411
00:21:01,040 --> 00:21:03,640
come and have another crack.
So I think you're going to see

412
00:21:03,640 --> 00:21:06,760
it, but the problem is there's
just a lack of quality assets

413
00:21:06,760 --> 00:21:08,360
out there.
Can I pitch a different one at

414
00:21:08,360 --> 00:21:11,000
the big end for you?
Yeah, best quantum.

415
00:21:11,560 --> 00:21:13,080
Yeah.
Well, I think that's that's

416
00:21:14,080 --> 00:21:17,760
that's similar.
On demanding valuation and

417
00:21:17,760 --> 00:21:21,280
probably one of the most
impressive mining businesses of

418
00:21:21,800 --> 00:21:25,320
of this era, yeah.
Yeah, I think that's in, that's

419
00:21:25,320 --> 00:21:26,800
in that in that group,
absolutely.

420
00:21:26,800 --> 00:21:29,600
Obviously it's got a bigger
exposure to parts of Africa that

421
00:21:29,600 --> 00:21:32,680
other people might not want to
go, but I think you guys have

422
00:21:32,680 --> 00:21:34,520
just been up there and stomping
around.

423
00:21:34,520 --> 00:21:38,000
With bias operations.
But you're right.

424
00:21:38,000 --> 00:21:41,720
I mean, I put them all in that
same group and then it's a, it's

425
00:21:41,760 --> 00:21:43,360
a, it's a value discussion.
Yeah.

426
00:21:43,760 --> 00:21:45,000
How do you not kill that culture
though?

427
00:21:45,000 --> 00:21:46,760
When you when you buy it, that's
the most important.

428
00:21:46,760 --> 00:21:48,720
Thing well, you're not going to
be able to buy a first quantum.

429
00:21:48,720 --> 00:21:51,360
I mean young, she's going to
stop anything but but it's just

430
00:21:51,360 --> 00:21:53,360
like, you know, if you just want
to play the copper thematic, I

431
00:21:53,360 --> 00:21:57,400
think like you've got you've got
on demand evaluation on an

432
00:21:57,400 --> 00:22:01,520
earnings basis already.
You've got like an operating

433
00:22:01,520 --> 00:22:02,960
model.
That is a truly competitive

434
00:22:02,960 --> 00:22:04,640
advantage because they do the
engineering in house.

435
00:22:05,120 --> 00:22:08,080
They, you know, they fast track
development, but when they're

436
00:22:08,080 --> 00:22:10,560
only doing, you know, like a PFS
study as opposed to all of the

437
00:22:10,560 --> 00:22:13,760
delays and things that happened
with normal minor, they've got a

438
00:22:13,760 --> 00:22:16,640
BD like geology team that like
assesses every one of their

439
00:22:16,640 --> 00:22:18,600
things and they'll like as
opposed to kind of, you know,

440
00:22:19,720 --> 00:22:21,120
people have accountability and
autonomy.

441
00:22:21,120 --> 00:22:23,040
They've got in government
support in Zambia where there's

442
00:22:23,040 --> 00:22:25,840
great, you know, longevity to
their their operations.

443
00:22:25,960 --> 00:22:28,320
Yeah.
And the biggest part, the

444
00:22:28,320 --> 00:22:30,200
catalyst of COBRA Panama coming
back.

445
00:22:30,240 --> 00:22:32,040
Yeah.
And there's a bunch of leverage,

446
00:22:32,080 --> 00:22:33,520
like it's there's a bunch of
dead in there.

447
00:22:33,520 --> 00:22:36,360
So, yeah, you know, how could
you, how could you, how could

448
00:22:36,360 --> 00:22:38,600
you, how could you not want the
upside of the the talk that

449
00:22:38,880 --> 00:22:41,840
comes with that Anyway, Yeah,
that's how my little turn.

450
00:22:42,040 --> 00:22:44,800
Of fish, I think you're right
and, and there's not many

451
00:22:44,800 --> 00:22:47,360
companies like that.
And maybe Agnico and Gold is is

452
00:22:47,360 --> 00:22:53,360
similar where they've got a very
clear modus operandi of how they

453
00:22:53,360 --> 00:22:56,560
do what they do and it's and
it's very differentiated from

454
00:22:56,840 --> 00:22:59,720
the peer group and and it's
really the driver of their

455
00:22:59,720 --> 00:23:01,720
success.
Agnico's deal up in Finland was

456
00:23:01,720 --> 00:23:05,800
really interesting, like as far
from a vanilla deal as you can

457
00:23:05,800 --> 00:23:10,600
kind of get all all-encompassing
33 deals in a day.

458
00:23:11,560 --> 00:23:13,240
Awesome to see.
And they've been, they've been

459
00:23:13,240 --> 00:23:16,000
so disciplined throughout.
So it's very interesting to see

460
00:23:16,400 --> 00:23:18,080
to see them make that move, I
think.

461
00:23:18,640 --> 00:23:20,400
Well, it's really dominate
regions, right?

462
00:23:20,400 --> 00:23:23,640
And, and most of that's, you
know, most of that's been in the

463
00:23:23,640 --> 00:23:27,720
in the US, but, but I think what
they're saying is this, this is

464
00:23:27,840 --> 00:23:28,800
yeah.
And they're obviously been

465
00:23:28,800 --> 00:23:32,400
operating there for a long time,
but they they see that as an

466
00:23:32,400 --> 00:23:35,120
area where they can build scale,
which what they're all about.

467
00:23:35,280 --> 00:23:37,320
Yeah.
The the scale, the scale portion

468
00:23:37,320 --> 00:23:40,600
is, is super important.
I want to talk about uranium as

469
00:23:40,600 --> 00:23:42,720
well.
I think as we were sort of

470
00:23:42,800 --> 00:23:46,920
touching on before we started
recording that the ramifications

471
00:23:46,920 --> 00:23:49,640
of of what we're saying in Iran
are going to be felt for a long

472
00:23:49,640 --> 00:23:52,000
time to come.
Not that the situation is close

473
00:23:52,000 --> 00:23:55,520
to being resolved just yet
anyway, but nuclear has got to

474
00:23:55,520 --> 00:23:58,680
have huge ramifications.
How are you thinking about the

475
00:23:58,800 --> 00:24:01,880
the future of that and uranium
in the portfolio right now?

476
00:24:02,880 --> 00:24:06,040
Yeah.
So, so I think, I think if

477
00:24:06,040 --> 00:24:08,160
there's one theme when you look
at what's happening in the

478
00:24:08,160 --> 00:24:10,360
Middle East and you look at
what's happening with AI and,

479
00:24:10,360 --> 00:24:13,480
and the role of that is the
demand for energy is only going

480
00:24:13,480 --> 00:24:15,760
to increase and it's increasing
at a rapid rate.

481
00:24:16,160 --> 00:24:21,240
And the demand for stable base
load is going to be huge.

482
00:24:21,280 --> 00:24:24,120
And so I think we're going to
need uranium, but we're going to

483
00:24:24,120 --> 00:24:28,000
need gas and we're going to
need, we're going to need

484
00:24:28,000 --> 00:24:30,720
battery, we're going to need
whatever we can get, probably

485
00:24:30,720 --> 00:24:34,360
coal and which, which you could
argue, unfortunately, because

486
00:24:34,360 --> 00:24:36,880
the environmental impact of
thermal coal in particular, but

487
00:24:36,880 --> 00:24:39,120
the demand for energy is not
going away.

488
00:24:39,120 --> 00:24:42,680
And in fact, it's accelerating.
And, and uranium has to be part

489
00:24:42,680 --> 00:24:45,440
of that mix.
And to their credit, you know,

490
00:24:45,440 --> 00:24:48,000
if you look at the, the big tech
companies, they've recognized

491
00:24:48,000 --> 00:24:50,880
that early and they're really
promoting it.

492
00:24:50,880 --> 00:24:55,080
And I think and, and you know,
the US more recently, but most,

493
00:24:55,480 --> 00:24:59,560
most global western and most
global economies now have

494
00:24:59,560 --> 00:25:02,160
switched and, and are very
supportive, which you go back

495
00:25:02,160 --> 00:25:04,160
even 2 years, that's a massive
change.

496
00:25:04,240 --> 00:25:08,520
And so you know, so we're, we're
very bullish on, on uranium.

497
00:25:09,160 --> 00:25:13,120
The challenge is, as we touched
on is, is what do you buy and

498
00:25:13,120 --> 00:25:16,120
how do you get good, good
quality exposure at, at at a

499
00:25:16,120 --> 00:25:17,480
reasonable price?
So.

500
00:25:20,040 --> 00:25:22,360
One of the top five holdings is
is ISO energy.

501
00:25:22,400 --> 00:25:26,720
What we like about ISO is it's,
it's got a really good

502
00:25:26,720 --> 00:25:31,080
development pipeline.
So firstly, it's got some

503
00:25:31,080 --> 00:25:35,280
projects in Utah which are kind
of near term production, but

504
00:25:35,280 --> 00:25:37,880
high cost.
So you know, prices of uranium

505
00:25:37,880 --> 00:25:39,400
keep going high.
They can bring that on pretty

506
00:25:39,400 --> 00:25:41,720
quickly.
But then they've got the, the

507
00:25:41,720 --> 00:25:45,720
hurricane project in the East
Athabasca, which which is a

508
00:25:45,720 --> 00:25:50,760
cracking deposit and, and, and
you know, very close to the

509
00:25:50,760 --> 00:25:54,160
McLean mill owned by, by
Chemico.

510
00:25:54,280 --> 00:25:58,240
And you know who need more, more
or so we think that

511
00:25:58,240 --> 00:26:02,480
strategically that asset should
be owned by, by Chemico.

512
00:26:02,520 --> 00:26:05,280
And you know, ideally something
will happen, but if it doesn't,

513
00:26:05,680 --> 00:26:08,880
the, the scale and the grade of
it means that it's a, it's a

514
00:26:08,880 --> 00:26:12,880
highly developable project.
And then really the free kick

515
00:26:12,880 --> 00:26:16,080
is, is the Virginia asset in the
US.

516
00:26:16,800 --> 00:26:20,640
Again, US is, is looking for
local production.

517
00:26:20,880 --> 00:26:23,040
It's been a project that's been
around for a long period of

518
00:26:23,040 --> 00:26:26,960
time, had a few political and
environmental kind of question

519
00:26:26,960 --> 00:26:29,080
marks as a lot of your earning
projects did.

520
00:26:29,800 --> 00:26:31,960
But that kind of seems to be
easing.

521
00:26:31,960 --> 00:26:34,880
And you know, potentially that's
a massive value kicker.

522
00:26:34,880 --> 00:26:38,040
So you kind of Add all that up
and the company's market cap's

523
00:26:38,040 --> 00:26:41,240
now about a billion dollars.
You know, I don't think there's

524
00:26:41,240 --> 00:26:45,760
any other sort of developer that
has a similar portfolio and

525
00:26:46,040 --> 00:26:50,880
ability to to to capitalize.
So that's that's why we like it,

526
00:26:51,160 --> 00:26:54,000
yeah.
As the day we're recording, I

527
00:26:54,000 --> 00:26:56,680
think Lotus withdrew, they've
withdrawn their their garden

528
00:26:56,680 --> 00:26:59,880
stocks down to six percent, 16%
on open, I think.

529
00:27:00,200 --> 00:27:03,560
Yeah, yeah, the the the pathway
to get back into production is

530
00:27:03,800 --> 00:27:06,040
proving to continue to be a bit
a bit troublesome for

531
00:27:07,000 --> 00:27:09,840
Thankfully, Paladin seems to
have hit their straps and and,

532
00:27:09,920 --> 00:27:12,680
and and seen the light.
Boss down grading as well.

533
00:27:13,320 --> 00:27:15,080
Yeah, yeah, I mean, it's
difficult.

534
00:27:15,120 --> 00:27:19,040
I mean, the the issue with a lot
of the the ASX list of projects

535
00:27:19,040 --> 00:27:22,440
that are coming into production
is their production is still

536
00:27:22,440 --> 00:27:25,680
pretty small, right?
And their costs are still

537
00:27:25,680 --> 00:27:28,160
relatively high.
And I think, you know, going

538
00:27:28,160 --> 00:27:30,960
back 12 years, 12 months ago,
you know, I think what you saw

539
00:27:31,040 --> 00:27:34,320
when the Paladin and Boss and
all these guys started to, to,

540
00:27:34,360 --> 00:27:37,720
to come on stream was, you know,
coming on stream just

541
00:27:37,720 --> 00:27:41,000
highlighted that they weren't
particularly good value, right?

542
00:27:41,000 --> 00:27:45,440
Because because their costs
relative to their production

543
00:27:45,440 --> 00:27:48,280
meant that there wasn't enough
free cash spitting out the other

544
00:27:48,280 --> 00:27:50,000
end.
And their market caps are being

545
00:27:50,000 --> 00:27:52,280
pushed up to a high level.
And I think that's still kind of

546
00:27:52,280 --> 00:27:55,000
the issue, right?
They need to get scale

547
00:27:55,000 --> 00:27:57,720
production, They need to get
their operating costs down.

548
00:27:58,000 --> 00:28:01,400
And you probably need, you know,
higher uranium prices.

549
00:28:01,400 --> 00:28:05,400
And I, I noticed I was reading
some reports the other day and

550
00:28:05,640 --> 00:28:08,400
you know, a number of analysts
now are looking at at uranium

551
00:28:08,400 --> 00:28:13,040
prices, you know, 130 plus, you
know, 3 or 4 years out, right?

552
00:28:13,040 --> 00:28:17,520
So, so to to kind of make the
numbers work, you kind of need

553
00:28:17,520 --> 00:28:19,200
to be factoring in some big
prices.

554
00:28:20,120 --> 00:28:26,440
The yeah, the the recent
addition on the ASX set, that

555
00:28:26,440 --> 00:28:29,480
Atomic Eagle, which is
backdoored in Govi X.

556
00:28:29,480 --> 00:28:31,240
Have you taken a look at that?
No, I haven't.

557
00:28:31,240 --> 00:28:32,240
Yeah.
Interesting.

558
00:28:32,400 --> 00:28:36,360
Yeah, yeah.
Anyway, we'll, I do want to talk

559
00:28:36,360 --> 00:28:40,680
about Aussie gold, yeah, because
as far as exposure to diesel

560
00:28:40,680 --> 00:28:42,640
prices goes, they're they're
high up there on the list.

561
00:28:43,000 --> 00:28:44,440
How's the portfolio reflecting
that?

562
00:28:44,880 --> 00:28:46,560
Yeah.
So in the Natural Resources

563
00:28:46,560 --> 00:28:49,680
Fund, we've we've reduced our
exposure to gold really this

564
00:28:49,680 --> 00:28:51,480
month.
So, you know, been sitting most

565
00:28:51,480 --> 00:28:54,120
of the month at about 8:00 or
9%, which is probably the lowest

566
00:28:54,120 --> 00:28:56,680
it's been pretty much forever,
right?

567
00:28:57,840 --> 00:29:01,520
And, and a lot of that is, is 1
again, that whole momentum theme

568
00:29:01,520 --> 00:29:03,840
where I think gold was the
momentum buy and then became the

569
00:29:03,840 --> 00:29:05,720
momentum sell people looking for
liquidity.

570
00:29:06,760 --> 00:29:09,920
And so that's had an impact.
But secondly, you know what,

571
00:29:09,960 --> 00:29:15,520
what is the impact of, you know,
of the Middle East crisis on,

572
00:29:16,080 --> 00:29:18,040
on, on the resource sector in
Australia in particular.

573
00:29:18,040 --> 00:29:20,000
And I think, you know,
everyone's been talking about

574
00:29:20,000 --> 00:29:22,760
diesel and jet fuel, you know,
and there's really 2 steps to

575
00:29:22,760 --> 00:29:24,760
that.
First is, is it just a cost

576
00:29:24,760 --> 00:29:26,880
impact, right, where you, you
can still get it, but you just

577
00:29:26,880 --> 00:29:28,440
got to pay more.
And that's really where we're at

578
00:29:28,440 --> 00:29:30,760
now.
But the longer that goes, you

579
00:29:30,760 --> 00:29:34,520
know, the risk of, of
constrained supply or reduced

580
00:29:34,520 --> 00:29:37,280
supply, you know, increases and
then that will flow through to

581
00:29:37,280 --> 00:29:39,520
producers.
So you know, we, we probably

582
00:29:39,520 --> 00:29:43,200
being in fact we have been
overly cautious on, on Gold's

583
00:29:43,200 --> 00:29:47,120
coming into, into this month in
that we've, we've done two

584
00:29:47,120 --> 00:29:50,000
things. 1 is where possible
we've switched our producer

585
00:29:50,000 --> 00:29:52,680
exposure from Australian
producers to North American

586
00:29:52,680 --> 00:29:55,520
producers.
And two, we've probably

587
00:29:56,440 --> 00:30:00,560
maintained or increased our
exposure to, to developers over

588
00:30:00,560 --> 00:30:03,480
producers.
Because I think if you're a

589
00:30:03,480 --> 00:30:05,480
developer and you've got to, you
know, you're impacted by a

590
00:30:05,480 --> 00:30:07,000
couple of months doesn't really
matter.

591
00:30:07,360 --> 00:30:10,800
Whereas if you if you adjust in
your guidance as a producer then

592
00:30:10,800 --> 00:30:14,840
it then it becomes an issue.
Is there a layer of being a bit

593
00:30:14,840 --> 00:30:18,720
more bearish on the the overall
macro outlook of gold as well in

594
00:30:18,720 --> 00:30:21,200
in your rationale for going down
to 9% exposure?

595
00:30:22,280 --> 00:30:24,360
No, not really.
I think the tailwinds for gold

596
00:30:24,360 --> 00:30:27,160
are still huge, right?
I mean, you know, the world's

597
00:30:27,160 --> 00:30:29,200
still a dangerous place and
we're seeing that, you know,

598
00:30:29,200 --> 00:30:33,600
we're seeing that play out.
You got U.S. debt levels, you

599
00:30:33,640 --> 00:30:38,200
know, continuing to ratchet up,
you know, everyone's crying out

600
00:30:38,200 --> 00:30:40,200
for a store of value.
And, and I, I don't think

601
00:30:40,200 --> 00:30:43,200
there's, you know, and you can
look at the US currency

602
00:30:43,200 --> 00:30:45,240
debasement.
I think the issue is, you know,

603
00:30:45,240 --> 00:30:48,440
people would like a, a, a
logical currency that they could

604
00:30:49,120 --> 00:30:51,720
rely on, but you know, they're,
they're questioning the US, but

605
00:30:51,720 --> 00:30:56,440
they don't really want to go to,
you know, to the, to, to China

606
00:30:56,440 --> 00:31:00,600
rather, right.
So, so gold has a place and, and

607
00:31:00,600 --> 00:31:02,480
I think it's becoming more and
more evident.

608
00:31:02,480 --> 00:31:06,280
So what we see is there's an
opportunity to switch back into

609
00:31:06,280 --> 00:31:08,400
gold.
So, you know, I think, I think

610
00:31:08,400 --> 00:31:11,640
the gold price got pushed up by
passive investing momentum.

611
00:31:12,240 --> 00:31:13,800
I think that flows through to
equities.

612
00:31:14,560 --> 00:31:17,600
Free cash was was very strong,
but I think you've had a reset

613
00:31:17,600 --> 00:31:20,880
where most of the gold producers
are down probably 25 or 30% from

614
00:31:20,880 --> 00:31:23,880
their peak.
So, you know, we're we're

615
00:31:23,920 --> 00:31:25,840
waiting for that opportunity
when there's some kind of

616
00:31:25,840 --> 00:31:30,800
resolution or at least we get a
view that the resolution is

617
00:31:30,800 --> 00:31:33,840
insight and, and switch back
into those, you know, good

618
00:31:33,840 --> 00:31:37,640
quality mid tier producers,
which like.

619
00:31:38,000 --> 00:31:40,520
It's, it's remarkable how
quickly these these adjustments

620
00:31:40,520 --> 00:31:43,280
kind of take place.
And I think that I feel I've

621
00:31:43,280 --> 00:31:45,880
noticed particularly with, with
gold, with you saw it with

622
00:31:45,880 --> 00:31:51,040
silver too, a bit of a, a bit of
unlinking of the underlying

623
00:31:51,040 --> 00:31:55,080
commodity from the the producers
at times in, in the chaos that

624
00:31:55,080 --> 00:31:57,880
we've seen.
Like a specific spelling out of

625
00:31:57,880 --> 00:32:00,560
that would be when, when gold
launched from 5000 up to like

626
00:32:00,560 --> 00:32:05,160
5600, the the gold names didn't
didn't follow it quite as much.

627
00:32:05,160 --> 00:32:06,440
Is that something you've noticed
as well?

628
00:32:06,600 --> 00:32:08,600
Yeah, totally.
There was a long period of time

629
00:32:08,600 --> 00:32:11,800
where, you know, gold, the gold
physical gold prices was

630
00:32:11,800 --> 00:32:14,040
outperforming the gold indices
and the gold stocks.

631
00:32:14,840 --> 00:32:18,680
And then that switched you, you
know, really, really quickly.

632
00:32:18,760 --> 00:32:21,760
You know, I think, you know, I,
I think the metrics on the gold

633
00:32:21,760 --> 00:32:27,920
price were I think between
August 25 and January 26, the

634
00:32:27,920 --> 00:32:33,720
gold price rose by about 59%.
And now it's about 12% off, off

635
00:32:33,720 --> 00:32:36,240
that peak.
And it has been a bit, a bit

636
00:32:36,240 --> 00:32:39,720
lower, probably 50.
The bottom was probably 15% fall

637
00:32:39,720 --> 00:32:44,080
from that peak.
So and I think gold equities

638
00:32:44,080 --> 00:32:49,040
then probably recovered that and
then, you know, went a bit too

639
00:32:49,040 --> 00:32:50,200
high.
I mean, one of the things we

640
00:32:50,200 --> 00:32:54,240
look at is and we ask ourselves
is what's a free cash yield that

641
00:32:54,240 --> 00:32:56,360
you should be expecting from a
gold company?

642
00:32:56,840 --> 00:33:00,600
And, and there's very few that
were yielding more than 8%,

643
00:33:00,640 --> 00:33:01,800
right?
And you're going well, gold

644
00:33:01,800 --> 00:33:08,240
prices have had this massive,
this massive gain and is 8%

645
00:33:08,240 --> 00:33:10,240
enough, right?
And, and what the market has

646
00:33:10,240 --> 00:33:12,040
shown more recently is perhaps
it wasn't.

647
00:33:12,680 --> 00:33:15,720
And so they've come back.
So now, now you know, the, the

648
00:33:15,720 --> 00:33:17,520
yields across the sector have
improved.

649
00:33:18,600 --> 00:33:21,720
There's always been, I think
good capital discipline, good,

650
00:33:22,040 --> 00:33:24,880
you know, most of the groups
have, have good, good amounts of

651
00:33:24,880 --> 00:33:27,440
cash.
So we think that there's a

652
00:33:27,440 --> 00:33:30,400
renewal there and and there's an
opportunity to get back in once

653
00:33:31,000 --> 00:33:34,200
things settle down, you know,
once that that cost and fuel

654
00:33:34,200 --> 00:33:37,200
issue resolved.
Do you anticipate a wave of

655
00:33:37,200 --> 00:33:40,080
buying, just referring to the
cash balances there, they're

656
00:33:40,080 --> 00:33:43,480
pretty bunchy like it's, it's
either MA or it's starting to

657
00:33:43,480 --> 00:33:45,720
distribute more and more and we
have seen pickups in dividends

658
00:33:45,720 --> 00:33:47,920
and and the like as well.
Yeah, you.

659
00:33:48,320 --> 00:33:50,960
Yeah, I think so.
But again, it's always hard to

660
00:33:50,960 --> 00:33:54,320
find good assets.
So I think what you'll see is,

661
00:33:55,520 --> 00:33:57,960
you know, the easiest way to add
values for the drill bit as

662
00:33:57,960 --> 00:34:00,840
there's no doubt you'll hear.
So I think you'll see an uptick

663
00:34:00,840 --> 00:34:04,120
in in expiration spend.
I think dividends, you know,

664
00:34:04,480 --> 00:34:06,800
dividends and buybacks will also
come back into the mix.

665
00:34:06,800 --> 00:34:10,120
So I think it's really
interesting that you know that

666
00:34:10,120 --> 00:34:15,679
Capricorn have paid an interim
dividend, I think Remelius

667
00:34:16,560 --> 00:34:20,800
similar and and doing a buyback,
you know, I think that actually

668
00:34:20,800 --> 00:34:23,400
makes sense, right.
I think the discipline of giving

669
00:34:23,400 --> 00:34:25,440
money back to shareholders when
things are going well and you

670
00:34:25,440 --> 00:34:27,639
got free cash makes a whole lot
of sense.

671
00:34:27,840 --> 00:34:31,440
Now, if there's a logical
acquisition, that's good, but

672
00:34:31,960 --> 00:34:35,800
you know they're hard to find.
Yeah, there's, there's, there's

673
00:34:36,400 --> 00:34:39,880
an observation in the, you know,
the gold space in the last last

674
00:34:39,880 --> 00:34:45,360
month specifically, I want to
say 22 enormous deals, 1 is G

675
00:34:45,360 --> 00:34:49,280
min buying G2 and the other one
is Agnico buying Rupert.

676
00:34:49,440 --> 00:34:53,199
Both of these are truly world
class development projects.

677
00:34:53,440 --> 00:34:56,760
Both of these are enormous
premiums for multibillion dollar

678
00:34:57,640 --> 00:35:02,400
companies.
And I think what it says is that

679
00:35:02,400 --> 00:35:06,000
the place to be is in those
truly spectacular world class

680
00:35:06,000 --> 00:35:09,680
assets right now in particular
because the inquiries have never

681
00:35:09,680 --> 00:35:13,440
had such a, you know, such such
expensive script.

682
00:35:13,440 --> 00:35:17,400
They've got this ability to use
their paper and cache as forms

683
00:35:17,400 --> 00:35:21,080
of consideration.
And you know, before maybe the

684
00:35:21,080 --> 00:35:23,200
world looks different, They
should, they should totally use

685
00:35:23,200 --> 00:35:23,920
that.
Yeah.

686
00:35:24,560 --> 00:35:26,800
So I, I wonder what else fits in
that category.

687
00:35:26,880 --> 00:35:29,800
Like, you know, I, I look around
and I think Snow Line is a great

688
00:35:29,800 --> 00:35:31,120
candidate.
Yeah, Yeah.

689
00:35:31,400 --> 00:35:33,040
We just never looked
particularly cheap.

690
00:35:33,040 --> 00:35:35,080
I mean, an incredible asset, but
you know.

691
00:35:35,080 --> 00:35:39,280
I think it's still shape, yeah.
I think it's a like a 3G per

692
00:35:39,280 --> 00:35:41,880
ton, like an open pit from
surface.

693
00:35:41,880 --> 00:35:45,520
It's just a you like you, it's a
dream to mine.

694
00:35:45,800 --> 00:35:48,400
You pay it back in no time.
It's just, it's just what are

695
00:35:48,400 --> 00:35:50,640
your assumptions on timeline to
develop because the permitting

696
00:35:50,640 --> 00:35:51,960
uncertainty, but that's getting
better, yeah.

697
00:35:52,120 --> 00:35:54,560
It is getting better, yeah.
I mean, the other take away has

698
00:35:54,560 --> 00:35:57,680
got to be the synergies.
Those two examples, they're

699
00:35:57,680 --> 00:36:00,960
really like, they didn't just
buy Rupert, they bought two

700
00:36:00,960 --> 00:36:04,520
other things and it's going to
be one beast of a 500,000 plus

701
00:36:05,040 --> 00:36:08,040
type thing and G2 and G men
border on one another.

702
00:36:08,120 --> 00:36:11,800
Yeah, well, that's right.
I I think if you can dominate a

703
00:36:11,800 --> 00:36:15,440
region, you can get the
synergies and and economies of

704
00:36:15,440 --> 00:36:20,440
scale by by building out those
kind of assets makes perfect

705
00:36:20,440 --> 00:36:25,640
sense.
Yeah, Dave, gas, oil and gas,

706
00:36:25,640 --> 00:36:26,760
Yeah.
Is it creeping into the

707
00:36:26,760 --> 00:36:28,400
portfolio?
Yeah.

708
00:36:28,440 --> 00:36:33,560
So, so oil and gas is is is
about 20% of the fund.

709
00:36:33,600 --> 00:36:35,600
More than creeping.
It's more than creeping, yeah.

710
00:36:35,600 --> 00:36:38,880
So I mean maybe just so stepping
back up portfolio at the moment

711
00:36:38,880 --> 00:36:43,960
is sort of 20% copper, 20%
lithium, 20% oil and gas, 10%,

712
00:36:43,960 --> 00:36:48,000
you know, just under but 10%
gold and 10% uranium.

713
00:36:48,400 --> 00:36:52,040
So that's kind of and then 20
percent, 15% cash and and a few

714
00:36:52,040 --> 00:36:54,720
other bits and pieces, right.
So that's, and that's the way we

715
00:36:54,720 --> 00:36:57,480
like to construct the portfolio
is, is what commodities do we

716
00:36:57,480 --> 00:37:00,800
want to expose closure to.
And and the big change as you

717
00:37:00,800 --> 00:37:05,160
alluded to earlier is, is just
that lift in, in lithium to

718
00:37:05,160 --> 00:37:06,880
begin with, but also oil and
gas.

719
00:37:07,160 --> 00:37:11,200
Oil and gas we've liked, but
it's been very focused in the

720
00:37:11,200 --> 00:37:15,600
past on domestic gas.
So the East Coast where you

721
00:37:15,840 --> 00:37:19,200
know, looming shortage and which
which I'm sure you know,

722
00:37:19,800 --> 00:37:23,160
everyone's, everyone's aware of
our main position there has been

723
00:37:23,160 --> 00:37:26,480
Amplitude Energy which which had
a good run until it didn't,

724
00:37:26,600 --> 00:37:29,320
right.
What I like about it is it's an

725
00:37:29,320 --> 00:37:31,320
operating business generating
good cash, right.

726
00:37:31,320 --> 00:37:36,120
So you know, EBITDA or EBITDA X
is something like 250 mill a

727
00:37:36,120 --> 00:37:39,920
year as my caps 500.
So it's you know, it's so it's

728
00:37:39,920 --> 00:37:43,040
not expensive.
And the reason that the price

729
00:37:43,040 --> 00:37:47,160
has come back is some of their
evaluation wells in the, in the

730
00:37:47,200 --> 00:37:52,280
Opway Basin, it really came up,
came up a duster Isabella and

731
00:37:52,280 --> 00:37:57,160
Eleanora, which which given the,
the prospectivity was a bit

732
00:37:57,160 --> 00:37:58,640
disappointing and a bit
unexpected.

733
00:37:58,640 --> 00:38:01,440
And the I think the market
treated them pretty harshly for

734
00:38:01,440 --> 00:38:02,960
that.
But if you look at the cash

735
00:38:02,960 --> 00:38:05,920
flow, you look at what they've
been able to do at the all boss

736
00:38:05,920 --> 00:38:09,480
plant, which is now running
ahead of nameplate, which is

737
00:38:09,480 --> 00:38:12,720
pretty incredible.
You know, you know, just just

738
00:38:12,720 --> 00:38:15,400
the existing operations really
more than support the current

739
00:38:15,400 --> 00:38:17,000
price.
And then you've still got a

740
00:38:17,000 --> 00:38:20,800
couple more wells to be drilled
and they've also got the any

741
00:38:21,000 --> 00:38:23,680
development which is, which is
already proven right, which they

742
00:38:23,680 --> 00:38:26,160
can bring on.
So the, the, the issue for them

743
00:38:26,160 --> 00:38:31,200
is the Gibson Basin assets are,
are cranking along well, but

744
00:38:31,200 --> 00:38:34,480
they're Otway Basin assets, you
know, need volume and that's

745
00:38:34,480 --> 00:38:36,760
really what they're trying to do
with this joint venture with IG

746
00:38:36,760 --> 00:38:41,440
Energy and their drill campaign.
So, you know, I'm optimistic

747
00:38:41,440 --> 00:38:43,680
they'll have a bit more success.
They've got a couple more drill

748
00:38:44,680 --> 00:38:48,360
drills or, or, or wells in the
second-half of the year, but we

749
00:38:48,360 --> 00:38:49,840
kind of like that.
And I think the East gas

750
00:38:51,120 --> 00:38:52,920
thematic is, is still very
strong.

751
00:38:52,920 --> 00:38:55,200
You know, I mean, it wasn't long
ago where the, the government

752
00:38:55,200 --> 00:38:58,760
were thinking about building LNG
import terminals to bring in LNG

753
00:38:58,760 --> 00:39:00,480
for the rest of the world.
And I think, you know, what's

754
00:39:00,480 --> 00:39:02,240
happened in the Middle East
really highlights that.

755
00:39:02,560 --> 00:39:04,080
That's not really a strategy,
right?

756
00:39:04,960 --> 00:39:07,560
Just expect everyone else to
deliver the, the oil to your

757
00:39:07,560 --> 00:39:09,560
doorstep, oil or gas to your
doorstep.

758
00:39:09,640 --> 00:39:15,000
So, so we like that.
We've also got a, a, a small

759
00:39:15,000 --> 00:39:20,160
position in, in Emperor Energy,
which is a high risk, high

760
00:39:20,160 --> 00:39:22,640
return development project, you
know, also in, you know,

761
00:39:23,360 --> 00:39:26,560
offshore Vic.
And and Woodside makes up a a

762
00:39:26,560 --> 00:39:28,000
decent portion.
Yeah.

763
00:39:28,000 --> 00:39:30,720
And then Woodside is really a
reflection of, you know, how do

764
00:39:30,720 --> 00:39:35,040
you get good quality exposure to
oil and gas, particularly LNG

765
00:39:35,040 --> 00:39:39,040
where they've got a, you know, a
bigger than than the normal

766
00:39:39,040 --> 00:39:42,240
exposure to the spot market,
which which we think is a good

767
00:39:42,240 --> 00:39:45,320
thing, but also it's big and
it's liquid, right.

768
00:39:45,320 --> 00:39:50,240
So what we're seeing in, in the
Middle East and, and you know,

769
00:39:50,560 --> 00:39:53,440
under a Trump sort of control is
that things can change really

770
00:39:53,440 --> 00:39:55,280
quickly.
So, so the good thing about a

771
00:39:55,280 --> 00:39:58,520
Woodside is we've got exposure,
but we can change the exposure

772
00:39:58,520 --> 00:40:02,600
immediately.
You know, we can, it's about 9%

773
00:40:02,600 --> 00:40:05,400
of the portfolio now.
It has been as high as 15%, but

774
00:40:05,440 --> 00:40:08,480
you know, we can go to 0, we can
go to 15 really quickly and and

775
00:40:08,480 --> 00:40:09,880
increase or decrease our, our
exposure.

776
00:40:11,080 --> 00:40:12,800
I love the, I love the
concentration you play with.

777
00:40:13,600 --> 00:40:16,360
Yeah, the, the, the commodities
we've we've talked about so far

778
00:40:16,360 --> 00:40:20,440
and the way you frame the, the
portfolio there, they're kind of

779
00:40:20,440 --> 00:40:21,720
like them.
You know, a lot of them are, are

780
00:40:21,880 --> 00:40:23,640
main commodities people would
play with.

781
00:40:23,640 --> 00:40:26,960
But the, the really sexy stuff
of light has been in the the

782
00:40:26,960 --> 00:40:30,280
Nisha commodities, specifically
defence medals, rare earths,

783
00:40:30,280 --> 00:40:33,160
tungsten, Yeah.
How do you, how do you, how do

784
00:40:33,160 --> 00:40:34,160
you watch?
What is going there?

785
00:40:34,160 --> 00:40:36,720
Do you have exposure to, to some
of the upside there?

786
00:40:37,000 --> 00:40:39,800
How do you how do you feel about
not being exposed if it's if

787
00:40:39,800 --> 00:40:42,440
it's not a big position?
Yeah, look, the view we take is

788
00:40:42,440 --> 00:40:44,200
you don't need to own
everything, right?

789
00:40:44,240 --> 00:40:46,960
And, and, and if you don't
understand it or you're worried

790
00:40:46,960 --> 00:40:52,000
about the market and a lot of
the, the smaller boutique, you

791
00:40:52,000 --> 00:40:57,120
know, metals, you, you wonder
about the impact of a massive

792
00:40:57,120 --> 00:41:00,160
supply increase having on, on
the, on the economic set, right.

793
00:41:00,480 --> 00:41:03,320
But it, but in general, you
know, we will go into those

794
00:41:03,320 --> 00:41:06,840
markets if, if we think it makes
sense, but there's enough of

795
00:41:06,960 --> 00:41:10,840
opportunities elsewhere that if
we miss an opportunity commodity

796
00:41:10,840 --> 00:41:14,560
we're not familiar with or we're
uncomfortable with them, then

797
00:41:14,560 --> 00:41:16,560
we'll just leave it.
So we don't feel that, hey, this

798
00:41:16,560 --> 00:41:19,040
is a trading opportunity and
let's get in and let's get out.

799
00:41:19,400 --> 00:41:21,960
You know, that's not really the
way we we want to play.

800
00:41:22,400 --> 00:41:25,920
So in rare earth, you know,
we've been in and out, in and

801
00:41:25,920 --> 00:41:28,040
out of that a bit.
You know, what you're saying is

802
00:41:28,040 --> 00:41:31,000
there's a huge competitive
advantage to someone like a

803
00:41:31,000 --> 00:41:32,880
Linus.
But again, same kind of issue.

804
00:41:33,200 --> 00:41:34,960
What do you have to pay to get
that exposure?

805
00:41:35,880 --> 00:41:42,560
And then it's probably a Luca,
which which you know, history

806
00:41:42,560 --> 00:41:46,360
would suggest you probably want
to wait and see how any other

807
00:41:46,360 --> 00:41:49,800
comes on, right?
Like an Lt. 5 yeah.

808
00:41:50,560 --> 00:41:53,120
And.
With a bit of MacDonald you want

809
00:41:53,120 --> 00:41:55,440
assumption of ramp up.
And then there's dead on top of

810
00:41:55,440 --> 00:41:57,240
that and stuff.
You know, I think they

811
00:41:57,240 --> 00:41:59,520
positioned themselves pretty
well and it's now all about

812
00:41:59,520 --> 00:42:02,400
execution.
So we're not there.

813
00:42:02,400 --> 00:42:05,360
So then then it's really the
Brazilian rare earth projects,

814
00:42:05,640 --> 00:42:08,600
Brazilian rare earths and
meteoric are probably a big two

815
00:42:08,600 --> 00:42:13,760
and you know, they look pretty
good, but and we have been in

816
00:42:13,760 --> 00:42:17,960
and out of them a little bit,
but you know, the Brazilian

817
00:42:17,960 --> 00:42:20,720
government have been talking
about, you know, wanting to get

818
00:42:20,720 --> 00:42:24,320
more involved in the sector.
So, so, so we kind of pulled

819
00:42:24,320 --> 00:42:27,680
back a little bit.
We, you know, we own a little

820
00:42:27,680 --> 00:42:30,800
bit of Brazilian critical
minerals, which which is

821
00:42:30,800 --> 00:42:33,720
adopting an ISR type approach.
So that's kind of all or

822
00:42:33,720 --> 00:42:35,880
nothing.
We'll see what happens there.

823
00:42:37,160 --> 00:42:39,760
So we kind of we're not really
in rarest.

824
00:42:39,800 --> 00:42:42,040
I'd like to be in it, but
there's nothing compelling

825
00:42:42,040 --> 00:42:45,600
enough that.
Shall we finish with a game of

826
00:42:45,600 --> 00:42:47,640
underrated, Overrated?
Let's do it man, for.

827
00:42:47,640 --> 00:42:48,880
Your game, Dave.
Yeah.

828
00:42:49,000 --> 00:42:53,440
All right.
First up, a bit of a, a bit of a

829
00:42:53,520 --> 00:42:57,760
kind of particular one, but
underrated or overrated, the

830
00:42:57,760 --> 00:43:02,000
likelihood that we're going to
see SPOD in the four thousands

831
00:43:02,000 --> 00:43:03,840
this cycle.
I'll say overrated.

832
00:43:03,840 --> 00:43:06,440
Well, what I'd say is if there's
one thing that we've learned

833
00:43:06,440 --> 00:43:10,960
from lithium is commodity
forecasters have no idea, right.

834
00:43:10,960 --> 00:43:15,040
So I remember when it was 400
bucks a tonne and if you'd said

835
00:43:15,040 --> 00:43:18,040
it's going to, you know, 6 or
$8000 a tonne, they would have,

836
00:43:18,040 --> 00:43:19,800
you know, no one would have
believed you.

837
00:43:19,800 --> 00:43:21,760
And then when it was the six or
eight, if you said it's going

838
00:43:21,760 --> 00:43:25,360
back to 600, no one would said.
And even when it was the 600,

839
00:43:25,360 --> 00:43:27,600
you know, every expert in the
world was saying there's no way

840
00:43:27,600 --> 00:43:30,200
it's ever going above 1200
because of all the production

841
00:43:30,200 --> 00:43:32,720
coming out of Africa.
And suddenly it's at, you know,

842
00:43:32,760 --> 00:43:36,200
222 and a half thousand.
And and I think it will go

843
00:43:36,200 --> 00:43:38,440
higher right in the short term.
ASX Silver.

844
00:43:38,520 --> 00:43:40,720
I think it's overrated.
Yeah, yeah.

845
00:43:41,320 --> 00:43:44,760
You know, with, with resource
sector investing is all about

846
00:43:44,760 --> 00:43:48,680
quality, right?
So you need scale and, and

847
00:43:48,680 --> 00:43:50,560
qualities, you need grade and,
and all that.

848
00:43:50,560 --> 00:43:54,200
And I think we struggle with
with the really high quality.

849
00:43:54,400 --> 00:43:59,840
Tungsten to stay at these levels
for the the next couple years.

850
00:43:59,920 --> 00:44:07,080
Is that overrated or underrated?
So I'd probably say overrated

851
00:44:07,680 --> 00:44:10,600
has had a huge run, you would
expect that it'll come down.

852
00:44:10,960 --> 00:44:16,000
Vanadium redox flow batteries.
Probably, probably underrated,

853
00:44:16,040 --> 00:44:18,560
right?
So again, it just comes down to

854
00:44:19,040 --> 00:44:20,480
energy demand, doesn't it,
Right.

855
00:44:20,560 --> 00:44:25,560
And battery storage, I think, I
think everyone's going to be a

856
00:44:25,560 --> 00:44:27,680
winner to some extent, right?
There's going to be demand.

857
00:44:27,720 --> 00:44:33,400
Are you bullish or bearish on
ESS as a as a part of that

858
00:44:33,400 --> 00:44:35,760
market right now?
I'm bullish, Yeah, absolutely,

859
00:44:36,040 --> 00:44:39,040
absolutely thermal.
Coal as an investment?

860
00:44:39,160 --> 00:44:43,320
If you say energy demand is
going up right, then I think

861
00:44:43,320 --> 00:44:45,960
thermal coal is going to be
around longer than

862
00:44:46,520 --> 00:44:51,000
environmentalists would like it
to be, right, Because it's, it's

863
00:44:51,000 --> 00:44:54,000
cheap and it's embedded already
in our fund.

864
00:44:54,200 --> 00:44:56,640
You know, we, we, we've got a
mandate that says we can't

865
00:44:56,640 --> 00:44:59,520
invest in thermal coal projects.
So.

866
00:44:59,640 --> 00:45:01,960
So it's not for us.
Do you think it's overrated or

867
00:45:01,960 --> 00:45:06,560
underrated that that many many
investors are are mandated out

868
00:45:06,560 --> 00:45:10,760
of expose exposure thermal coal?
I think it's overrated in going

869
00:45:10,760 --> 00:45:13,360
back five years ago when we, you
know, 5 or 6 years ago when we

870
00:45:13,360 --> 00:45:15,040
started the fund.
Would have been maximally ESG

871
00:45:15,120 --> 00:45:16,320
compliant.
Well, everyone was ESG

872
00:45:16,320 --> 00:45:18,600
compliant, everyone was saying
this is what we're going to do

873
00:45:18,600 --> 00:45:22,600
and then thermal prices start to
rally and stuff and they said

874
00:45:22,600 --> 00:45:23,960
well, maybe we can buy it,
right.

875
00:45:24,120 --> 00:45:27,880
So, you know, we've just taken
the view that it's it's a

876
00:45:27,880 --> 00:45:29,760
condition that we had and we're
going to stick to it, right.

877
00:45:29,800 --> 00:45:32,120
So so you.
Have changed some conditions at

878
00:45:32,120 --> 00:45:35,000
the fund over time though.
Both sides, yeah, size, but I

879
00:45:35,000 --> 00:45:36,880
think it needs the.
Ability to short sell as well.

880
00:45:37,120 --> 00:45:39,640
I think no.
So we no, I haven't changed

881
00:45:39,640 --> 00:45:41,000
that.
Yeah, somewhere else.

882
00:45:41,000 --> 00:45:43,480
Yeah.
So, so really the only what

883
00:45:43,480 --> 00:45:46,480
we've done is, is give us more
opportunity to invest in the

884
00:45:46,480 --> 00:45:49,520
areas that we want to invest in.
So we can, we've increased the

885
00:45:49,520 --> 00:45:52,600
number of stocks we can own,
it's gone from 25 to 40 and and

886
00:45:52,600 --> 00:45:55,160
we've increased the proportion
we can own internationally from

887
00:45:55,760 --> 00:45:59,400
25% to 40%.
But what we can invest in and

888
00:45:59,440 --> 00:46:02,960
you know, like, like we do have
some hard and fast kind of ESG

889
00:46:05,520 --> 00:46:08,520
factors that we look at and and
we just think you can't really

890
00:46:08,520 --> 00:46:12,240
just change them because,
because there's good

891
00:46:12,240 --> 00:46:13,720
opportunities there, right.
So yeah, what do?

892
00:46:15,200 --> 00:46:18,120
What do you think of the future
of underground spot minds?

893
00:46:18,160 --> 00:46:22,920
Underrated or overrated?
Probably underrated.

894
00:46:23,480 --> 00:46:26,640
Again, it comes down to to cost,
right?

895
00:46:26,640 --> 00:46:31,640
So and and and scale.
I think Liontown would be, you

896
00:46:32,200 --> 00:46:35,000
know, a good test case.
The cost base of of doing

897
00:46:35,000 --> 00:46:37,400
business as a minor in in
Australia.

898
00:46:38,680 --> 00:46:41,320
Yes, don't you me start it on
government.

899
00:46:41,400 --> 00:46:48,240
God, I mean to stand back.
Australia has a huge opportunity

900
00:46:49,360 --> 00:46:53,800
and is, is probably best placed
resource wise and location wise

901
00:46:53,800 --> 00:46:55,440
than any country in the world,
right?

902
00:46:55,440 --> 00:47:00,920
And the only thing holding us
back is, is, is, is, is

903
00:47:00,920 --> 00:47:03,680
government policy and you know,
and, and commitment, right.

904
00:47:03,680 --> 00:47:05,720
So, and we've seen that in the
East Coast gas market.

905
00:47:07,840 --> 00:47:11,320
It's it's, it's disappointing,
yeah.

906
00:47:12,520 --> 00:47:14,520
Copper over 7 bucks in the next
two years.

907
00:47:15,080 --> 00:47:16,800
Underrated.
So I think I think it's it's

908
00:47:16,800 --> 00:47:18,400
possible.
Yeah, Dave, that is.

909
00:47:18,560 --> 00:47:20,840
That's all I've got for you.
Is there anything else you

910
00:47:20,840 --> 00:47:24,080
wanted to talk about?
No, I think that's it's all

911
00:47:24,080 --> 00:47:25,480
good.
Any quarterlies that you just

912
00:47:25,480 --> 00:47:27,760
thought, well that was that was
really interesting.

913
00:47:27,760 --> 00:47:33,080
I learned something from that.
Look, I think the stand out ones

914
00:47:34,280 --> 00:47:37,400
Pilbara we've touched on, I
think Grateland is a is is been

915
00:47:37,400 --> 00:47:39,560
an incredible story and talking
about tungsten, just having an

916
00:47:39,560 --> 00:47:42,200
old o'callaghan's in your back
pocket that you got for nothing

917
00:47:42,200 --> 00:47:44,640
is is pretty good as well.
But you know that you got to

918
00:47:44,640 --> 00:47:48,480
give those guys credit and it
comes down to the buyer

919
00:47:48,480 --> 00:47:49,440
decision, doesn't it?
Right.

920
00:47:49,440 --> 00:47:50,920
You buy an asset at a good
price.

921
00:47:51,640 --> 00:47:57,600
It also highlights that you know
big mages selling off non core

922
00:47:57,600 --> 00:48:00,000
assets is is a happy hunting
ground.

923
00:48:00,680 --> 00:48:03,440
Imagine if they imagine if they
spun out O Callahan's or sold O

924
00:48:03,440 --> 00:48:05,960
Callahan's for, you know, a
comparable number to what they

925
00:48:05,960 --> 00:48:07,760
ended up paying.
I think they will.

926
00:48:07,920 --> 00:48:10,520
I mean, they've already got,
they've already received more in

927
00:48:10,520 --> 00:48:13,320
cash than what they paid, right?
It's truly remarkable.

928
00:48:13,320 --> 00:48:15,160
And and they've got O
Callahan's, yeah.

929
00:48:15,760 --> 00:48:19,400
Special it's yeah crazy.
It's a it's a it's a it's a it's

930
00:48:19,400 --> 00:48:23,560
an amazing story to see the, the
the price in, in, in pence, you

931
00:48:23,560 --> 00:48:26,720
know, return to its all the time
high from which, which, which

932
00:48:26,720 --> 00:48:29,920
was truly like, you know,
epitome of kind of like mania

933
00:48:29,920 --> 00:48:32,960
and and crash back in the day.
But the the retail Baggies are

934
00:48:32,960 --> 00:48:35,560
back in the money.
So good on Dave.

935
00:48:35,560 --> 00:48:37,440
It's been absolutely wonderful
speaking with you as always.

936
00:48:37,440 --> 00:48:40,680
And yeah, Congrats on on on the
funds performance.

937
00:48:40,680 --> 00:48:43,720
We continue to follow your work
and look forward to chatting

938
00:48:43,720 --> 00:48:44,880
next time.
Thanks, Trav.

939
00:48:45,080 --> 00:48:46,000
Thanks, JD.
Thank you.

940
00:48:46,240 --> 00:48:48,640
A mining stock spectacular.
I must have talked about 20 or

941
00:48:48,640 --> 00:48:50,640
30 different names.
I always love chatting with Dave

942
00:48:50,640 --> 00:48:52,880
and going through how he's
thinking about the portfolio.

943
00:48:52,880 --> 00:48:57,040
Trav, huge thank you to Sandy
Ground Support Focus, the

944
00:48:57,040 --> 00:49:00,600
platform by Market Tech,
Intralinks, exceed capital and

945
00:49:00,600 --> 00:49:02,840
metal sub.
Hooteru money monis hooteru.

946
00:49:03,920 --> 00:49:06,760
Now remember, I'm an idiot.
JD is an idiot.

947
00:49:07,080 --> 00:49:09,200
If you thought any of this was
anything other than

948
00:49:09,200 --> 00:49:11,840
entertainment, you're an idiot
and you need to read out

949
00:49:11,840 --> 00:49:12,360
disclaimer.