Booms, Busts & Billion-Dollar Builds (Zimi Meka)

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You go from rooster to feather
dusted pretty quickly in the in

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the equities area.
But the only people who wanted

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to talk to us, we're we're short
seller hedge funds, you know,

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yeah, I always say to people,
you get broke in the.

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Big.
Jobs you don't know you're going

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broke.
Mate, what a guest you lined up.

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What a conversation we got to
have with Zinni Meka, who is the

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chief executive officer and
founder of engineering firm with

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a big name Asenco.
I I this, this was this was just

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a wicked combo wealth of
experience, 40 years of

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experience in design,
construction, operation of

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minerals, processing plants and
a Senko mate.

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He founded it when there was
obviously no one.

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And now it's a giant global
organization with 4000 people

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and they've built so many plants
from that.

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We had just this wonderful
conversation with Jimmy.

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Yeah, he he shared a story on a
podcast he did about five years

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ago that that we listened to and
it was gripping, it was

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engaging.
It was building a mine in the

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far-flung, you know, corners of
the, the world.

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And he's done that more than one
time.

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You know, some of the mines his
company has built or worked on

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QB 2, Las Bambas, La Muana,
Fruta del Norte, Carapatine,

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Acadia, the the list just goes
on and on.

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And it's people like this that
have that wealth of experience

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that I think need to need to
share it, right.

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And he's been to the very highs
and and lows of Aussie business

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and it was so candid in in
presenting that all with us.

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So I'm thrilled to share this
conversation.

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It's it's inside about building
Asenko, obviously, but also just

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inside about.
Yeah, like what what should

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investors be looking out for or
aware of through that lens of of

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an engineering firm like Asenko
building in all parts of the

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world?
We, you know, we got into the

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geopolitical climate of
different countries and, of

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course, concluded with a fan
favorite.

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Overrated, underrated.
Yeah.

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Can't can't wait to bring this
to the audience mate. 100% no

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doubt listening to this episode
will make you a a better

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investor and and more thoughtful
about the mining industry and

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and what it takes to get
projects done.

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And just a super enjoyable
conversation as well, eh?

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Let's go to Zimi.
Let's do it, Zimi Mecca, thanks

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a bunch for taking the time and
catching up with us.

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We are, we're thrilled to talk
to you and we, we want to start

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this conversation casting our
minds back to the, the 2000's,

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the mid 2000's, the commodity
super cycle, the China bull run.

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Osenko goes public in in 2006
and, and it goes on a hell of a

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run.
What was it sort of like being

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in the industry, being one of
the biggest names in the

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engineering part of the business
in in that era?

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It's a little, actually, it's a
little surreal.

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You had to sort of sit back and
go, is this really the mining

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industry?
Because, you know, for a long,

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long time, it'd been pretty
steady and lean.

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I mean, copper had stayed at
50-60 cents a pound for 10-15

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years that I'd been in the
industry.

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And all of a sudden it's $1.50
and, and climbing and the, and

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the Chinese are investing and
things are happening.

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And so given that we'd had such
a dry run for such a long time,

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it was a little surreal.
And you, you know, the, I guess

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the, the press was saying it's
going to last 20 or 30 years.

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And so everyone got wrapped up
in that and, you know, we grew,

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we grew.
We so when we listed we were two

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or 300 people and by 2000 and
sort of 10, we were, I don't

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know, 4 1/2 thousand something
like that globally.

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And that was just too much for
us.

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You know, it was just happening
too quickly and, you know, hard

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to keep up.
And their stock went from a

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dollar at flight to I think it
peaked at, you know, just under

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18 dollars, 1760 or something.
And yeah, it was hard to sort of

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control, you know, it started to
sort of feel the culture

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starting to suffer a little bit
because you got all these new

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people.
And you know when it hit hard

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that the other way it hit really
hard, you know when everything

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came off.
Yeah.

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And and along that sort of
massive growth journey, you do a

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few acquisitions as well pre
2008.

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Yeah.
We'd in total we've done about

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14 or 15 acquisitions and then
we listed to get capital so we

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could grow through acquisition,
right.

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So that's that was the main
reason for the listing.

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It wasn't an exit strategy or
anything like that, may have

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been for some of our
shareholders, but certainly not

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for me.
And so oh wait, we, we did three

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really, really key acquisitions.
We spent about 250 Australian

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$1,000,000.
That's the decent amount of

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money.
And we picked up a big present

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presence in the Americas, North
America, South America, you

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know, Chile, Peru, Brazil and
Canada.

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And the US We had all of a
sudden 1500 people opened up the

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service offering different
client base.

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And you know that that was a big
thing for us.

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I mean, we're still living off
it today, to be honest with you.

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These jurisdictions are, yeah, a
staple of it, you know, the the

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locations and jurisdictions that
are Senko services to this day.

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But kind of just going back
again to that, that 2008, the

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Senko stock peaks 16 yeah, 1660
odds like you say. 17 bucks or

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something?
It must have been both like

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absolute like a crazy elation
given the 20X from in a short

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period of time, but then also a
a, a, a pretty emotional kind of

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thing.
It's not the the entire

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industry, not just the Senko
share price, you know, falls

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amid the the crash, but like
balancing the the financial like

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weight of all of that would have
been tumultuous.

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It, it was, it was Travis, you
know, we were trading in a 54

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PE.
You know that's sustainable.

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For money services.
That's tech, tech stuff, right?

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And, and yeah, yeah.
And you try and control best as

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you could manage, I guess better
word than the market and the

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analysts and such.
We're not, we, we just can't

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grow at those sort of levels.
But they were all wrapped up.

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Everyone was just wrapped up in
the euphoria.

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So, you know, we're sitting with
a market cap of, I don't know,

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1.71 point 8 billion.
And and I'm thinking we've got

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to raise money when we can at
these sort of levels because I

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just thought it's just not
sustainable.

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But no one wanted to listen, eh,
Back then, though, no one wanted

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to listen.
They all had this.

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Yeah.
We're on a rocket ride.

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When you think about the the
growth strategy at that point in

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time, if you look back it, is it
a, am I right in thinking it's a

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more Aussie and Asia focused
business and you're turning the

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dial because there are bigger
CapEx projects, there's bigger

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work to be done in the Americas
and from that point on it grows

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to a business that does like 85%
of its revenue in the Americas.

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Is that right?
That's right.

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So what what happened
strategically was it was pretty

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obvious that you couldn't make a
long term growth agenda out of

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Australia and, and Asia and to a
degree Africa, you know, it's a

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bit hit and miss, you know,
depending on what country's got

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things happening in Africa, you
know, what governments are

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doing, etcetera.
And Australia is very cyclical,

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very competitive.
So it was really obvious that we

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had to be in the Americas.
We are strong in copper.

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And if you're not in Chile, Peru
in, in the copper and you're not

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in the copper industry, you
know, and I've been going there

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for 10 years to try and sell
business and no one, no one was

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listening.
But we've done this great

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project called the Moana in
Zambia.

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You should see it's amazing.
It's not in Chile.

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We're not interested.
So how do we, how do we get to

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Chile?
You have to be here and you

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know, you can send one or two
guys and build up over time, but

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you'll be there 5 generations.
So we had to, to go all out with

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some really good acquisitions to
get a strategic presence and to

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get us that technical
capability.

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So that's the, that was the
strategic focus.

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And you know, for, for example,
you know, in Chile we're 1800

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people now almost 2000.
We're the largest service

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provider in Chile and it came
off all the back of those

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acquisitions.
We wouldn't have been able to do

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it any other way.
And that allowed us to grow and

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allowed us to go through the
hard times, but better than

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probably most.
But we, we were very focused,

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Australia, Asia, very.
I'm fascinated to to take us

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back even further and and hear
the inkling because you from

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what I understand, started this
business when you were were 31

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years old and before that.
Am I right in thinking you're

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done five years at Mount Isa?
Yeah, I started my career at

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Mount Isa Mines at the copper
refinery in Townsville.

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So yeah, you know, bit topical
at the moment is your career.

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Going to end at the same time as
the refinery.

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It's a look, it's, it was world
leading technology, right.

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So it's a it was a great spot
to, to, to work as a graduate.

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And then I, I went to work for a
Perth based company called

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Mining and process Engineering
Services and they call Min Proc

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Engineers that that was started
here in WA and I worked in the,

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the Brisbane office of that
essentially, you know, building

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gold plants in WA and
Queensland.

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And then, as you say, Jonas 31.
I thought, I always felt I

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needed to have my own business
or have a crack at least.

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And, and when you're 31, you're
done.

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You don't, you don't know much
can go wrong.

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You sort of feel yourself
bulletproof.

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So off we went in the worst
recession in the history of

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Australia.
Gold price, I think at that

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stage was probably less than 200
bucks an ounce.

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Capital was hard to raise.
So the first ten years a pretty

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big slog.
The recession we had to have.

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That was the one, Yeah.
I was going to say it, but.

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Yeah.
So I mean, I want to understand

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what why you kind of did had you
had you run a, you know, full

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scope engineering project to
build a mine on your own at that

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point in time?
When I was at Min Proc, I did

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you.
So I was the engineering manager

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at Min Proc in Brisbane and I'd
worked on a variety of different

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projects from go to way.
So I had a project delivery

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background, engineering
background, but I hadn't really

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run a business, you know, I
hadn't been AP and L owner or,

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you know, an operations kind of
person.

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So that was a fair bit of
learning in all of that, you

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know, and, and sort of, you
know, managing cash and doing

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all those sorts of things.
As they say, happiness is a

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positive cash flow.
And so, yeah, that, you know, it

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was just a matter of trying to
build a client base and I tell a

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story.
I sitting in this office in

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Toowong, which is just a, you
know, suburb, 4 or 5K from the

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city of centre of Brisbane.
And the first couple of days,

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you know, sitting there in an
office, empty desk phone feeling

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pretty.
And what do I do now and bring

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get all excited, pick it up.
And it was, you know, my wife

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saying, hey, can you bring some
bread home when you come home

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sort of thing.
Yeah, I thought, I thought it

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might have been more than that.
Anyway, it was, it was, it was

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pretty, it was pretty fun.
It was, you know, fun in a weird

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sort of a way.
But like I said, you, you know,

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the, the experience I, I had in
project delivery at, at min proc

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really set me up well to, to do
that.

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But I wasn't set up to run a
business and to be a leader, you

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know, I had to sort of evolve
and learn and all that sort of

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stuff.
And and you started the business

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with a business partner?
Yeah, Bob Thorpe, he was my boss

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at Mintrop.
And yeah, we we went out

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together.
And and for how long was it that

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sort of Co founder dynamic
between between.

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You, Bob and myself.
Yeah, Bob, Bob retired off the

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Asynco board about a year ago
and he came off the, you know,

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being a full time executive
probably 1520 years ago.

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Yeah, well before the flight.
Yeah.

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And, and through that period in
the in the 90s, early 2000s,

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00:11:48,680 --> 00:11:50,040
you're just running the business
together.

223
00:11:50,040 --> 00:11:51,320
Would you focus on different
types of?

224
00:11:51,320 --> 00:11:54,440
Things and yeah, Bob would sort
of, he was really good at, you

225
00:11:54,440 --> 00:11:57,280
know, making sure the invoices
went out and people paid their

226
00:11:57,280 --> 00:12:02,520
bills and I was, you know, out
driving the engineering, doing

227
00:12:02,520 --> 00:12:04,760
business development, you know,
winning new business.

228
00:12:04,760 --> 00:12:08,960
So we had a pretty good kind of
delineation, didn't overlap

229
00:12:08,960 --> 00:12:11,320
much.
And you know, we never had a

230
00:12:11,320 --> 00:12:13,120
blue.
We got on pretty well still to

231
00:12:13,120 --> 00:12:15,720
this day.
So I can't, a lot of people

232
00:12:15,720 --> 00:12:18,120
can't say that, you know?
Yes, it's fantastic.

233
00:12:18,400 --> 00:12:21,960
You're you're a new kind of
company and you're trying to win

234
00:12:22,080 --> 00:12:23,960
work.
You've got you know, you can you

235
00:12:23,960 --> 00:12:26,760
can speak to capability.
I've done this for a different

236
00:12:26,760 --> 00:12:29,840
outlet, But how does, like was
there one, one job that I

237
00:12:29,840 --> 00:12:34,440
suppose you you won and
delivering that gave you and and

238
00:12:34,440 --> 00:12:36,920
the brand of Senko like I
suppose it gave it a brand.

239
00:12:36,920 --> 00:12:38,400
Do you remember?
Do you remember?

240
00:12:38,400 --> 00:12:40,440
That job, yeah, no, totally.
And that's a really good

241
00:12:40,440 --> 00:12:44,560
question, Travis, because you
know you're going out and all

242
00:12:44,560 --> 00:12:48,560
you're selling is yourself and a
few people, not this track

243
00:12:48,560 --> 00:12:49,880
record.
And I say to our business

244
00:12:49,880 --> 00:12:52,200
development guys today, you guys
got it easy.

245
00:12:52,200 --> 00:12:56,400
You got so, so much you can sell
and history and you know it's

246
00:12:56,400 --> 00:12:59,520
it's a lot different.
But there was, there was a

247
00:12:59,520 --> 00:13:02,560
couple of, there was a couple of
things that happened.

248
00:13:03,600 --> 00:13:07,960
One of them was the Chattery
gold mine in Thailand was a very

249
00:13:07,960 --> 00:13:12,920
big turning point for us.
You know, we were, we won it.

250
00:13:13,720 --> 00:13:17,560
It's a very difficult thing to
one why there was 9 bidders.

251
00:13:17,560 --> 00:13:19,120
You don't.
Want to be bidding on?

252
00:13:19,520 --> 00:13:21,640
Those ones, no.
Today we would say we're not

253
00:13:21,680 --> 00:13:26,480
bidding, right?
And, and Macquarie were funding

254
00:13:26,480 --> 00:13:29,440
it.
And so they were big decision

255
00:13:29,440 --> 00:13:33,160
maker because Macquarie funding
at 100% debt, no equity.

256
00:13:33,440 --> 00:13:36,320
It was such a good project.
I'd never seen that before in my

257
00:13:36,320 --> 00:13:39,600
life, right?
And so there's this guy in

258
00:13:39,720 --> 00:13:42,920
Macquarie called David
Woodhouse, lived in Sydney,

259
00:13:43,960 --> 00:13:48,720
right guy, he was a geologist.
He was leading the push and 9

260
00:13:48,720 --> 00:13:51,800
bidders, Macquarie sitting there
funding 100%.

261
00:13:51,800 --> 00:13:54,000
So you think about it, they're
not going to, they're going to

262
00:13:54,000 --> 00:13:56,920
risk their, their, their lot
with people that don't know.

263
00:13:56,920 --> 00:13:59,600
So I flew down Sydney, got to
know David.

264
00:13:59,600 --> 00:14:03,520
We got on really well.
We had put in a good bid first

265
00:14:03,520 --> 00:14:06,560
job we're doing offshore and
that's that's a big deal.

266
00:14:06,640 --> 00:14:13,680
And we, we, we, we were awarded
the project and and David rings

267
00:14:13,680 --> 00:14:17,720
me and he says I've invited you
to my wedding.

268
00:14:17,720 --> 00:14:19,720
And I said, yeah, I know we're
looking forward to be there

269
00:14:19,720 --> 00:14:22,120
tomorrow.
He said I need a best man.

270
00:14:23,120 --> 00:14:26,800
I said, what do you mean day
before your wedding and you

271
00:14:26,800 --> 00:14:29,280
haven't got a best man?
He goes no, but he said, can you

272
00:14:29,280 --> 00:14:31,880
be my best man?
I said, well, I guess so.

273
00:14:31,880 --> 00:14:33,520
He said that's what he got, what
I got to do.

274
00:14:33,520 --> 00:14:36,680
He said just sit next to me and
and he was getting married to an

275
00:14:36,680 --> 00:14:38,720
Indonesian.
They said there's a lot of, you

276
00:14:38,720 --> 00:14:45,560
know, ceremony, but from going
from not, no one knewest and

277
00:14:45,560 --> 00:14:47,680
best man.
David Woodhouse's wedding was

278
00:14:47,680 --> 00:14:51,560
quite, quite surreal.
So we we did chattery and

279
00:14:52,840 --> 00:14:56,000
started up well.
Produced at $53 an ounce.

280
00:14:56,760 --> 00:14:58,760
All in cost.
I mean who does that right?

281
00:14:59,280 --> 00:15:01,880
53 bucks an ounce, 250 gold
price.

282
00:15:02,200 --> 00:15:03,880
It's a big plant too, right?
Like.

283
00:15:04,320 --> 00:15:07,160
We expanded it four or five
times, you know, it started its

284
00:15:07,160 --> 00:15:09,200
life as a couple of million
tonne a year.

285
00:15:09,520 --> 00:15:14,120
And and then from that, you
know, Owen Hegarty gave a Sep on

286
00:15:14,120 --> 00:15:17,840
because as he said, it's only up
the road, you know, in the Namco

287
00:15:17,840 --> 00:15:22,040
Valley, no big deal, unexploded
ordinances, you know, 4 meters

288
00:15:22,040 --> 00:15:24,840
of rainfall a year, but very
just a suburb, you know.

289
00:15:25,560 --> 00:15:30,040
So we did that.
And at the same time a a, a

290
00:15:30,040 --> 00:15:31,720
really good guy called Jeff
Stewart.

291
00:15:33,000 --> 00:15:38,120
Jeff has unfortunately passed
now, but he founded N Flinders

292
00:15:38,120 --> 00:15:45,400
gold mines and that's now the
Cali granites that that Normandy

293
00:15:45,400 --> 00:15:46,760
owned.
Sorry, Newmont.

294
00:15:46,760 --> 00:15:48,600
Normandy did own it, but now
Newmont.

295
00:15:49,200 --> 00:15:51,840
So Jeff, Jeff developed the
first one there, which was the

296
00:15:51,840 --> 00:15:55,160
Granites and I was the
commissioning engineer mint prop

297
00:15:55,360 --> 00:15:58,360
at at the Granites.
So I got to know Jeff.

298
00:15:58,680 --> 00:16:02,840
Anyway, they found the N Mara
Mara gold mine in Tanzania,

299
00:16:02,880 --> 00:16:07,320
which is now owned by Barrick.
So he said, hey, do you want to

300
00:16:07,320 --> 00:16:10,760
do you want to build my project
in Tanzania?

301
00:16:10,760 --> 00:16:15,200
And this would have been about
98, 2002, 1001.

302
00:16:15,320 --> 00:16:18,600
So we went along and, and you
know, we, we, we did the job.

303
00:16:18,600 --> 00:16:21,480
It's a great job.
We expanded it and I think it

304
00:16:21,480 --> 00:16:24,760
was a one or 2 million oz was 10
million oz.

305
00:16:24,760 --> 00:16:28,280
They've extracted out of it.
But those two or three projects

306
00:16:28,280 --> 00:16:32,280
then just set us up and each one
of them there was a

307
00:16:32,280 --> 00:16:34,800
serendipitous connection.
You know it.

308
00:16:34,800 --> 00:16:37,200
It just wasn't a straightforward
walk up start.

309
00:16:38,840 --> 00:16:41,600
But there's an appetite like
immediately from the beginnings

310
00:16:41,600 --> 00:16:46,880
there to to take on a desire to
do things in an exotic

311
00:16:46,880 --> 00:16:50,240
locations, right, Yes, you, you
weren't shying away from that.

312
00:16:50,240 --> 00:16:51,000
No.
Why?

313
00:16:52,040 --> 00:16:58,280
Well, I, I guess you know that
mining tends to be in remote

314
00:16:58,280 --> 00:17:01,240
locations, but, and we don't shy
away from that.

315
00:17:01,920 --> 00:17:07,359
We kind of like the challenge to
be honest with you and the our

316
00:17:07,359 --> 00:17:11,040
people like doing it, you know,
like delivering an outcome in a

317
00:17:11,040 --> 00:17:14,079
difficult environment.
And the competition's a lot less

318
00:17:14,079 --> 00:17:15,680
as well.
You know, there aren't a lot of

319
00:17:15,680 --> 00:17:19,520
companies that want to do that,
whereas for us it's stock in

320
00:17:19,520 --> 00:17:22,599
trade.
You know, if, if I'm not

321
00:17:22,599 --> 00:17:27,560
comfortable to go myself to a
location, we don't we don't go,

322
00:17:28,200 --> 00:17:30,360
you know.
So you know, we've done some

323
00:17:31,240 --> 00:17:34,560
difficult Congo, we've done a,
you know, consevering Congo,

324
00:17:34,560 --> 00:17:40,360
Zambia, Kenya, Tanzania.
And you know that in South

325
00:17:40,360 --> 00:17:43,640
America we've, we've done 2
projects at 4500 meters above

326
00:17:43,640 --> 00:17:48,520
sea level, you know, the
Instantia and now Zafranel.

327
00:17:49,080 --> 00:17:51,440
And these are all to have
challenging, you know,

328
00:17:51,800 --> 00:17:55,680
executions to them.
But that's what we do.

329
00:17:55,960 --> 00:17:58,440
That's that's our lot.
Hearing all those names, all

330
00:17:58,440 --> 00:18:01,240
those countries ratted off, it
really makes me think of none

331
00:18:01,240 --> 00:18:02,560
other than standard ground
support.

332
00:18:02,920 --> 00:18:06,360
But they know as as good as
anyone out there that to be at

333
00:18:06,360 --> 00:18:08,880
the top of the game, the top of
the ground support game, you've

334
00:18:08,880 --> 00:18:11,600
just got to be offering you
services everywhere around the

335
00:18:11,600 --> 00:18:13,160
globe and you've got to be close
to the mind.

336
00:18:13,440 --> 00:18:16,400
They make that that customer
support part of their business

337
00:18:16,720 --> 00:18:19,960
both enjoyable and seamless.
Whether you are, you know,

338
00:18:19,960 --> 00:18:21,960
you're just picking up the
phone, calling Derek heard that

339
00:18:21,960 --> 00:18:24,960
the champion here in the APEC
region or you're ordering from

340
00:18:24,960 --> 00:18:26,360
the ground floor mate.
Ground floor?

341
00:18:26,360 --> 00:18:28,240
You mean ground the the ground
support app?

342
00:18:28,520 --> 00:18:30,720
The ground support app Derek's
latest convention.

343
00:18:30,880 --> 00:18:33,880
The app will help you calculate
your mesh and resin requirements

344
00:18:33,880 --> 00:18:36,720
amongst a plethora of other
amazing pieces that are in there

345
00:18:36,720 --> 00:18:38,400
mate.
Simply, they are all about

346
00:18:38,400 --> 00:18:41,080
making life easier for
underground operators.

347
00:18:41,440 --> 00:18:43,440
We all know that they lead the
way on the latest, you know,

348
00:18:43,640 --> 00:18:45,400
bolts and cable options out
there mate.

349
00:18:45,400 --> 00:18:49,000
But but don't forget, forget, we
don't shine enough light on the

350
00:18:49,000 --> 00:18:52,360
digital systems part of this
phenomenal business. 100% mate,

351
00:18:52,360 --> 00:18:54,320
you've seen the excel cyclops
right?

352
00:18:55,320 --> 00:18:56,800
Excel.
You mean like Microsoft Excel?

353
00:18:57,120 --> 00:19:00,800
Even better, this thing just
hooks in to the end of any

354
00:19:00,800 --> 00:19:02,640
standard bolt you might have
underground.

355
00:19:03,000 --> 00:19:05,840
Straightaway plugs into your
monitoring services

356
00:19:05,960 --> 00:19:10,320
instantaneous connection, so
your workforce is both safer and

357
00:19:10,320 --> 00:19:11,840
the mine is running more
efficiently.

358
00:19:12,480 --> 00:19:14,640
I've learned something new that
blows me away in the most

359
00:19:14,640 --> 00:19:17,560
positive way every single time
we talk about sandwich ground

360
00:19:17,560 --> 00:19:19,160
support.
Call Derrick Kurd for all your

361
00:19:19,160 --> 00:19:20,520
ground support needs.
No matter where you're

362
00:19:20,520 --> 00:19:22,200
operating.
Go sandwich ground support.

363
00:19:22,480 --> 00:19:24,920
Go Derrick Kurd any any
jurisdictions you wouldn't go

364
00:19:24,920 --> 00:19:30,800
back to.
Probably not, not we, no, we go

365
00:19:30,800 --> 00:19:34,360
back to pretty much all of the
ones that we we've gotten

366
00:19:34,360 --> 00:19:38,360
involved with.
Probably, you know, recently we

367
00:19:38,360 --> 00:19:41,360
were asked to do something in
Western Pakistan.

368
00:19:42,240 --> 00:19:43,720
Yeah, with, with a lot of
controls.

369
00:19:43,720 --> 00:19:47,480
We're comfortable there,
wouldn't go into Afghanistan and

370
00:19:47,480 --> 00:19:50,160
some of those countries.
But generally speaking, you

371
00:19:50,160 --> 00:19:53,200
know, where we don't, We've had
pretty good experiences wherever

372
00:19:53,200 --> 00:19:55,680
we've been.
How do you, how do you think

373
00:19:55,680 --> 00:19:59,200
about the alignment that comes
with, you know, these, these

374
00:19:59,200 --> 00:20:02,960
contracts winning work building,
building a, a plant or you're

375
00:20:02,960 --> 00:20:05,920
delivering, delivering on that
engineering front because.

376
00:20:07,080 --> 00:20:09,120
That kind of happens.
It's construction, it's defined

377
00:20:09,120 --> 00:20:12,440
period of time, defined scope
often and then, and then you,

378
00:20:12,560 --> 00:20:14,480
you're, you're gone.
So like, how do you have

379
00:20:14,480 --> 00:20:17,560
alignment for the longevity of
of outcomes when you're, when

380
00:20:17,560 --> 00:20:19,280
you're, when you, when you're
coming into, you know, the

381
00:20:19,280 --> 00:20:23,120
initial process?
It it depends with it's a junior

382
00:20:23,120 --> 00:20:26,520
or mid tier or major.
I mean, it's very interesting.

383
00:20:26,520 --> 00:20:30,200
You know, juniors 1 mine
operation, but eventually with

384
00:20:30,200 --> 00:20:33,800
good management teams, they,
they end up being multi mine and

385
00:20:33,800 --> 00:20:37,640
becoming a mid tier.
So you look beyond that initial

386
00:20:37,640 --> 00:20:41,120
contract, you know, you, you see
the development pipeline and,

387
00:20:41,440 --> 00:20:45,040
and the people behind it have,
have the driving capability and

388
00:20:45,040 --> 00:20:48,120
enthusiasm to build a company.
And so you, you align yourself

389
00:20:48,120 --> 00:20:50,760
with that.
But I mean, if we start from the

390
00:20:50,760 --> 00:20:54,120
feasibility study, early stage
feasibility study, that

391
00:20:54,120 --> 00:20:58,640
relationship can be 6-7 years,
you know, then the last two

392
00:20:58,640 --> 00:21:00,200
being the construction
component.

393
00:21:00,760 --> 00:21:04,040
And, you know, we're doing
environmental panel landing and

394
00:21:04,040 --> 00:21:06,720
permitting.
And, you know, mine, mine

395
00:21:06,720 --> 00:21:09,480
studies it.
It's, yeah, it's a long, it's a

396
00:21:09,480 --> 00:21:11,840
long, long relation and a long
gestation.

397
00:21:12,920 --> 00:21:15,000
Yeah.
And how how competitive is the

398
00:21:15,160 --> 00:21:16,720
the engineering part of the
business now?

399
00:21:16,720 --> 00:21:18,920
Are there were there more
players back then to compete

400
00:21:18,920 --> 00:21:20,400
with than there are now?
Or how's that kind of?

401
00:21:20,400 --> 00:21:24,200
Evolved, I think, I think
offshore it's probably less and

402
00:21:24,280 --> 00:21:27,840
here there's more, you know,
especially in in Wawa is

403
00:21:27,840 --> 00:21:31,600
probably the most competitive
spot in the whole world when it

404
00:21:31,600 --> 00:21:35,760
comes to engineering.
Now offshore, you know, the

405
00:21:35,760 --> 00:21:37,720
bigger companies have probably
shield away from it.

406
00:21:37,840 --> 00:21:41,200
You know, everyone didn't want
to do mining 10 years ago when,

407
00:21:41,440 --> 00:21:44,760
you know, things came off and
they exited from the Super cycle

408
00:21:44,760 --> 00:21:47,480
and they haven't come back.
Some of the larger companies.

409
00:21:47,760 --> 00:21:50,640
Creates A margin opportunity.
For us, yeah, we're, we're,

410
00:21:50,680 --> 00:21:54,720
we're, you know, our, our
competitive base in in South

411
00:21:54,720 --> 00:21:57,040
America in particular is, is
quite small.

412
00:21:57,080 --> 00:22:01,840
You know, three players, four
players Max on the larger big

413
00:22:01,840 --> 00:22:04,480
copper projects.
And, and we've got a pretty good

414
00:22:04,480 --> 00:22:07,320
track record on copper.
So, you know, we we generally

415
00:22:07,320 --> 00:22:11,160
get get in and around the hoop
and you know, have A at least on

416
00:22:11,200 --> 00:22:14,600
a bid list final two and we've
won quite a lot of copper

417
00:22:14,600 --> 00:22:16,720
business.
I'd I'd love to hear a couple

418
00:22:16,720 --> 00:22:19,720
more details about the the Sep
on contract that you you

419
00:22:19,760 --> 00:22:22,840
mentioned winning that going to
a a part of the world that gets

420
00:22:22,840 --> 00:22:25,080
4 metres of rain with
unexploded.

421
00:22:25,600 --> 00:22:28,000
Land mines, Yeah.
Gee, I'll tell you what.

422
00:22:28,000 --> 00:22:29,400
It was interesting.
Have you?

423
00:22:29,480 --> 00:22:30,880
You haven't.
You guys haven't spoken now on

424
00:22:30,880 --> 00:22:33,680
Hegarty at all, have you?
We actually did have a chat with

425
00:22:33,680 --> 00:22:34,960
him about a year ago.
Yeah, so.

426
00:22:35,120 --> 00:22:36,840
You know the sort of individual
I'm talking about.

427
00:22:36,840 --> 00:22:40,360
Yes, yes.
Just glass is half full and it's

428
00:22:40,360 --> 00:22:42,560
probably more than half full.
It's probably overflowing,

429
00:22:42,560 --> 00:22:43,800
right?
He was the one I thought you

430
00:22:43,800 --> 00:22:45,640
were hinting at with commodity
prices.

431
00:22:45,640 --> 00:22:47,480
What did he say?
Higher forever was, that was.

432
00:22:47,480 --> 00:22:50,560
That his Yeah, a longer long.
Longer and higher.

433
00:22:50,560 --> 00:22:52,040
Forever.
Something like that.

434
00:22:52,040 --> 00:22:55,680
Yeah.
So you know that that project

435
00:22:56,280 --> 00:22:58,280
been around for a while.
It's Rio's.

436
00:22:58,360 --> 00:23:02,800
It was Rio's project.
And it had a oxide copper cap

437
00:23:02,800 --> 00:23:07,640
and, you know, Chuck, acidic
secondary copper sitting

438
00:23:07,640 --> 00:23:12,360
underneath it.
And no one had built a project

439
00:23:12,360 --> 00:23:14,240
in Laos before on the mining
side.

440
00:23:14,320 --> 00:23:17,640
And, you know, he said, look,
rings me up.

441
00:23:17,640 --> 00:23:19,640
He said, look, you got to you
got to come and have a look at

442
00:23:19,640 --> 00:23:23,320
this scrap project you just
finished in Thailand.

443
00:23:23,600 --> 00:23:25,280
And I was a bit wary, I must
admit.

444
00:23:26,200 --> 00:23:29,520
And normally I'm car charge.
Let's go.

445
00:23:30,200 --> 00:23:33,600
And I said, look, I'll come up
with one of my guys and we'll

446
00:23:33,600 --> 00:23:36,000
have a look.
We'll see what we reckon.

447
00:23:36,000 --> 00:23:42,000
So First things first, we fly
into Thailand, we go up to the

448
00:23:42,000 --> 00:23:45,720
border on the Mekong River.
Again, you got to catch a catch

449
00:23:45,720 --> 00:23:49,240
a ferry across the Mekong.
Mekong like flows like pretty,

450
00:23:49,240 --> 00:23:52,240
pretty tense and it's quite
wide.

451
00:23:52,920 --> 00:23:55,840
And you get to outside, you got
a whole heap of steps to climb

452
00:23:55,840 --> 00:24:00,320
to get through Savannah kit to
do the customs clearance.

453
00:24:00,400 --> 00:24:06,400
And I'm sitting on this ferry,
which was a rectangular steel

454
00:24:06,560 --> 00:24:08,800
tub, really with a whole bunch
of people on it.

455
00:24:09,240 --> 00:24:13,880
And people had gone into
Thailand to buy land suites and

456
00:24:13,880 --> 00:24:16,120
dining room suites.
And they're all on the roof.

457
00:24:16,400 --> 00:24:19,320
They fall off and they're
floating down the river.

458
00:24:19,680 --> 00:24:21,800
And, you know, we're on the
ferry, we're chasing these

459
00:24:21,800 --> 00:24:24,520
things to try and get them back
on for these these people who

460
00:24:24,520 --> 00:24:27,880
were just just on on a, on a
shopping trip.

461
00:24:28,480 --> 00:24:32,040
And we drive to site and it's 42
kilometers up the Ho Chi Minh

462
00:24:32,040 --> 00:24:34,640
Trump.
So the Ho Chi Minh Trail was the

463
00:24:34,640 --> 00:24:38,160
most bombed, bombed piece of
land during the Vietnam War,

464
00:24:38,320 --> 00:24:43,280
about four and a half million
tons of explosives and 30%

465
00:24:43,280 --> 00:24:46,600
didn't go off.
So we're on this, we're on this

466
00:24:46,760 --> 00:24:51,400
trail, 80 Creek crossings, the
jungle's kind of over us.

467
00:24:51,760 --> 00:24:54,360
And that 42 kilometers takes us
7 or 8 hours.

468
00:24:55,160 --> 00:25:00,840
So we get to site after that
journey and all of a sudden it

469
00:25:00,840 --> 00:25:04,720
starts raining and I'm talking,
you know, golf balls of water

470
00:25:04,720 --> 00:25:08,040
just bucketing down.
No one comes out and he goes

471
00:25:08,040 --> 00:25:14,600
well, So what do you think boys?
Piece of you know what, right.

472
00:25:14,600 --> 00:25:18,640
OK, yeah, OK, So I turned him
up, my guy Roxy.

473
00:25:18,640 --> 00:25:20,920
I said, well, what do you think?
He said, ah, let's have a crack.

474
00:25:22,240 --> 00:25:29,480
So, so we started and clearing
the unexploded ordinances you

475
00:25:29,480 --> 00:25:32,800
had to get specialists in
because you know, there's sort

476
00:25:32,800 --> 00:25:36,520
of £500 a 1000 LB bombs.
And inside the bombs is these

477
00:25:36,520 --> 00:25:40,160
little tennis balls filled with
ball bearings that, you know,

478
00:25:40,440 --> 00:25:44,360
there's stuff everywhere.
And so we, we got these

479
00:25:44,360 --> 00:25:47,200
specialist guys, they'd find
them, they'd blow them up, clear

480
00:25:47,200 --> 00:25:48,640
the land and then we'd dig
right.

481
00:25:50,080 --> 00:25:53,720
And and then we had to upgrade
the road, which was a big deal.

482
00:25:55,360 --> 00:25:58,800
I sent I sent one of one of my
best earthworks guys up there.

483
00:25:58,800 --> 00:26:01,440
And I remember going up for a
visit once and there were a

484
00:26:01,440 --> 00:26:03,640
couple of trucks on the side
because they'd slipped in the

485
00:26:03,640 --> 00:26:06,760
mud during the rain.
And he comes out of his office

486
00:26:06,760 --> 00:26:10,880
and he said, what have I ever
done to you to deserve coming up

487
00:26:10,880 --> 00:26:12,920
here?
I said, you want to come home?

488
00:26:12,920 --> 00:26:15,760
He goes, no, he said, I'm not
going to let it beat me, right.

489
00:26:15,760 --> 00:26:24,640
And we, we buried bulldozers,
diggers in water and creeks, you

490
00:26:24,640 --> 00:26:26,600
know, flash flooding, you know,
the whole bit.

491
00:26:27,600 --> 00:26:31,880
And so we, we built the, the,
the gold project first that did

492
00:26:31,880 --> 00:26:33,840
that in a year, which was quite
amazing really.

493
00:26:34,160 --> 00:26:36,520
I'm surprised we managed to do
that.

494
00:26:37,200 --> 00:26:40,680
And then we went straight into
this amazing copper project

495
00:26:41,000 --> 00:26:45,400
using novel technology as a
acidic pressure oxidation leach

496
00:26:46,200 --> 00:26:48,360
producing 80,000 tonne of metal
a year.

497
00:26:48,360 --> 00:26:52,360
It was just a real work of art
for where it was.

498
00:26:52,800 --> 00:26:56,880
You know, we had to bring in
pressure, pressure oxidation

499
00:26:56,880 --> 00:26:58,920
vessels.
We had to upgrade bridges.

500
00:26:59,280 --> 00:27:02,520
Logistically a real big deal.
And you know, all through it,

501
00:27:02,560 --> 00:27:05,320
you know, Owen, Owen just was so
positive.

502
00:27:05,320 --> 00:27:08,520
You know, his company went to 7
billion market cap from 20

503
00:27:08,520 --> 00:27:12,360
million and you know, everyone's
happy and and we still got an

504
00:27:12,360 --> 00:27:14,720
amazing relationship with him.
We've probably done four or five

505
00:27:14,720 --> 00:27:18,520
projects for him since then.
But it that was a that

506
00:27:18,520 --> 00:27:21,280
logistically that was that was
probably one of the most more

507
00:27:21,280 --> 00:27:22,800
challenging ones we've done, I
think.

508
00:27:23,160 --> 00:27:26,120
And then we followed on did poo
Cam for Pan Aust straight

509
00:27:26,120 --> 00:27:28,400
afterwards, which was another
copper project there a couple

510
00:27:28,400 --> 00:27:31,040
$100 million worth.
So yeah.

511
00:27:31,400 --> 00:27:35,320
In in terms of the sort of new
experience, the the learning,

512
00:27:35,400 --> 00:27:39,040
the sort of newness about the
whole thing, are there other

513
00:27:39,600 --> 00:27:41,080
builds that compare with that
one at all?

514
00:27:42,360 --> 00:27:46,640
I think the the one lumwana in
Zambia be be there.

515
00:27:47,520 --> 00:27:49,040
Love to hear more about about
that one.

516
00:27:49,280 --> 00:27:52,280
Lumwana was Equinox, it's Craig
Williams.

517
00:27:53,600 --> 00:27:56,520
Interesting.
When we started that project had

518
00:27:56,520 --> 00:28:00,400
a market cap of a hundred, 150
million and they ended up

519
00:28:00,400 --> 00:28:02,960
selling the company to Barrack
for about 7 billion.

520
00:28:03,480 --> 00:28:09,160
It's quite incredible that was
that was the largest concentrate

521
00:28:09,160 --> 00:28:12,120
ever built in Africa.
What was the initial throughput?

522
00:28:13,440 --> 00:28:17,360
25,000,000 tonne a year.
And now, now Barracks talking

523
00:28:17,360 --> 00:28:19,080
about doubling that to 50.
Correct.

524
00:28:19,360 --> 00:28:25,160
Yeah, exactly.
And we, we, we had an

525
00:28:25,160 --> 00:28:28,440
interesting close to that
project because they were on a

526
00:28:28,440 --> 00:28:31,320
tight time frame with massive
liquidated damages.

527
00:28:31,320 --> 00:28:36,760
This is it was a fixed price
project and we had a had a rat

528
00:28:36,960 --> 00:28:44,360
eat a wire in substation control
panel and the the the

529
00:28:44,360 --> 00:28:48,200
transformer caught on fire.
Destroyed it with a week to go

530
00:28:48,200 --> 00:28:51,200
to commissioning.
I've read about the insurance

531
00:28:51,800 --> 00:28:55,560
damages that that came up for
AFR articles, but I've no idea

532
00:28:55,560 --> 00:28:58,000
if this is where it came.
From I did, yeah.

533
00:28:58,560 --> 00:29:00,880
So you have to downgrade
earnings I think on.

534
00:29:01,000 --> 00:29:03,560
We downgraded earnings.
Then we were, you know, two or

535
00:29:03,560 --> 00:29:06,600
three months late.
We copped a big swag of

536
00:29:06,600 --> 00:29:09,640
liquidated damages, which
couldn't recover from anybody.

537
00:29:10,160 --> 00:29:12,840
Yeah, wow.
But you did a fixed price

538
00:29:12,840 --> 00:29:15,440
contract for 25,000,000 tonne
per annum?

539
00:29:16,200 --> 00:29:20,280
A copper project, yeah, it's a
total contract value is 310 US.

540
00:29:20,400 --> 00:29:23,600
That's a, that's a, that's a
big, big quantum to to deliver

541
00:29:23,600 --> 00:29:25,640
with certainty at a fixed price.
Correct.

542
00:29:25,640 --> 00:29:28,040
Yeah.
And we did, we still may still

543
00:29:28,040 --> 00:29:30,960
did OK out of it even with with
that ending.

544
00:29:30,960 --> 00:29:35,000
Yeah.
But yeah, it was quite a

545
00:29:35,040 --> 00:29:38,800
horrible end to it could have
been a fantastic outcome.

546
00:29:38,800 --> 00:29:43,760
It was just a good outcome.
How do you think about risk like

547
00:29:44,480 --> 00:29:46,200
especially when it comes to to
contracts?

548
00:29:46,200 --> 00:29:48,760
I mean, there's, you know,
histories is is littered with

549
00:29:49,920 --> 00:29:53,840
contractors of all shapes and
sizes, which which come on

550
00:29:53,880 --> 00:29:58,760
undone by, you know, a thinly, a
thin margin, large fixed, fixed

551
00:29:58,760 --> 00:30:00,880
price contract and then
inflation or something comes

552
00:30:00,960 --> 00:30:03,440
that's unforeseeable.
Yeah, it's, it's all around

553
00:30:03,440 --> 00:30:07,200
people getting the right people
and doing the work upfront.

554
00:30:07,200 --> 00:30:12,040
And you know, the, the thing
that that we have I guess is a

555
00:30:12,240 --> 00:30:14,640
fairly big database of
information.

556
00:30:14,840 --> 00:30:18,040
You know, if you want a
25,000,000 tonne of copper

557
00:30:18,040 --> 00:30:20,800
project, probably now got three
or four of them that we can pull

558
00:30:20,800 --> 00:30:24,320
out and use the quantities to
estimate it up and those sorts

559
00:30:24,320 --> 00:30:28,560
of things.
So you know, you just, you just

560
00:30:28,560 --> 00:30:30,880
got to break it down and break
the risk down and get the right

561
00:30:30,880 --> 00:30:34,160
people around it.
We, we've, we've modified our

562
00:30:34,200 --> 00:30:36,480
approach to it.
It's not, you know, some of

563
00:30:36,480 --> 00:30:40,280
these countries labor laws are
difficult, practices are

564
00:30:40,280 --> 00:30:43,240
difficult.
So we, we've tended to be very

565
00:30:43,240 --> 00:30:49,360
selective around it and because
you can blow the place up if

566
00:30:49,360 --> 00:30:53,320
you're not careful, you know,
when we were smaller, you could

567
00:30:53,520 --> 00:30:56,640
control it better.
Now we're sort of 4000 people.

568
00:30:56,640 --> 00:30:59,040
You got to.
It's pretty hard to control that

569
00:30:59,160 --> 00:31:01,920
on a daily basis where when
you're a smaller organization,

570
00:31:01,920 --> 00:31:06,040
you tend to have more oversight
over those styles of contracts.

571
00:31:06,840 --> 00:31:09,880
Have you ever felt that there
there was a particular contract

572
00:31:09,880 --> 00:31:13,120
that that might have got you a
bit too close along the way?

573
00:31:13,200 --> 00:31:16,960
Not really, no.
No, we've, we've always done

574
00:31:16,960 --> 00:31:20,440
what we thought we were going to
do when we thought it'd end up.

575
00:31:20,440 --> 00:31:25,600
But, you know, we've never had
anything that's, you know, taken

576
00:31:25,600 --> 00:31:30,520
us, you know, to the point of
collapse or anything like that.

577
00:31:30,520 --> 00:31:33,280
No, nothing at all.
But, you know, if you look back

578
00:31:33,280 --> 00:31:36,760
at those years that when
revenues fell off, that was

579
00:31:36,760 --> 00:31:40,560
because there was no revenue to
have, you know, between 12 and

580
00:31:40,840 --> 00:31:45,440
16, the industry came off so
much that no one was not.

581
00:31:45,480 --> 00:31:47,160
You couldn't.
You couldn't get contracts, you

582
00:31:47,160 --> 00:31:49,000
couldn't get revenue, you
couldn't get studies, you

583
00:31:49,000 --> 00:31:52,000
couldn't get anything, you know?
So that's the other side of the

584
00:31:52,480 --> 00:31:55,960
the China cycle, that's the.
That's the bad side of the coin,

585
00:31:55,960 --> 00:31:56,560
yeah.
Yeah.

586
00:31:56,560 --> 00:31:58,640
And does does that just feel
like it goes on for?

587
00:31:59,400 --> 00:32:02,880
Yeah, never.
Exactly I you know, if you

588
00:32:02,880 --> 00:32:07,960
remember Rio then brought in
Chinese shareholding that did

589
00:32:07,960 --> 00:32:14,240
raise Janalko comes in Anglo's
balance sheet was just about

590
00:32:14,240 --> 00:32:15,960
shot.
Their share price went down to,

591
00:32:15,960 --> 00:32:18,160
you know, 3 to 5, whatever it
was, I.

592
00:32:18,160 --> 00:32:20,240
Had to sell the farm.
I had to sell the farm.

593
00:32:20,400 --> 00:32:22,240
Yep.
So, you know, they're clamping

594
00:32:22,240 --> 00:32:23,840
up, They're not spending
capital, they're not doing

595
00:32:23,840 --> 00:32:25,640
feasibility, so it's not doing
anything.

596
00:32:26,120 --> 00:32:29,920
And, you know, the service
providers are in, you know, in a

597
00:32:29,920 --> 00:32:32,480
horrible spot.
And that that's when we sort of

598
00:32:32,480 --> 00:32:36,000
thought you kind of got to get
some sustainable earnings and

599
00:32:36,360 --> 00:32:38,320
variety of earnings.
And that's why we bought an

600
00:32:38,320 --> 00:32:41,360
environmental consulting
business, grew our consulting

601
00:32:41,360 --> 00:32:45,000
practices, you know, not just
the project delivery side, the

602
00:32:45,040 --> 00:32:48,760
project delivery side's now
probably only 25% of our

603
00:32:48,760 --> 00:32:51,840
business, you know, 30% of our
business rather than a big

604
00:32:51,840 --> 00:32:55,400
dominant part is there.
Everyone's always doing studies,

605
00:32:55,440 --> 00:32:59,920
you know, sort of doing
environmental, especially

606
00:32:59,920 --> 00:33:02,200
environmental stuff.
You can't do a drill hole unless

607
00:33:02,200 --> 00:33:05,760
you permit the drill hole.
So, so that's why we changed our

608
00:33:06,240 --> 00:33:11,920
total revenue mix from 2016.
The, the, the project delivery

609
00:33:11,920 --> 00:33:16,680
piece, while it's a diminishing
part of the total revenue, I do

610
00:33:16,680 --> 00:33:18,000
still find it so interesting,
right?

611
00:33:18,000 --> 00:33:22,040
Because the, the, is there ever
a project you delivered in, in

612
00:33:22,040 --> 00:33:24,800
the process of like, you know,
building the plant or executing,

613
00:33:26,720 --> 00:33:29,640
you kind of realised that maybe
the geology wasn't too crash hot

614
00:33:29,640 --> 00:33:32,840
that all of this is based on,
but you finished the job, turn

615
00:33:32,840 --> 00:33:34,280
the mine on.
Mine doesn't work, but it's not

616
00:33:34,280 --> 00:33:35,560
the plant's fault.
It was the geology.

617
00:33:35,560 --> 00:33:39,360
If you had that experience and
could you see the signs as it's

618
00:33:39,360 --> 00:33:41,440
coming together?
I've observed that experience.

619
00:33:41,440 --> 00:33:45,400
Yeah, there was a a project in
northern NSW called Mount

620
00:33:45,400 --> 00:33:47,680
Carrington.
This guy's back 30 years, right?

621
00:33:47,960 --> 00:33:53,720
And we did 7 feasibility studies
on it, and every feasibility

622
00:33:53,720 --> 00:33:56,400
study showed the same answer.
There were it wasn't worth

623
00:33:56,400 --> 00:34:01,040
doing, but they elected to build
it and finance it.

624
00:34:02,440 --> 00:34:04,040
It's done by another company,
not us.

625
00:34:04,240 --> 00:34:07,080
And it shut down after six
months because it wasn't

626
00:34:07,080 --> 00:34:08,480
economic.
There was no goal there,

627
00:34:08,480 --> 00:34:10,280
fundamentally.
But the contractor got paid

628
00:34:10,280 --> 00:34:12,080
upfront.
Yeah, yeah, all of that.

629
00:34:12,080 --> 00:34:18,520
So I've seen it once, maybe
twice, but we've never, you

630
00:34:18,520 --> 00:34:24,800
know, we've seen companies
overestimate grade in the 1st 6

631
00:34:24,800 --> 00:34:30,880
or 12 months and do poor grade
controls, which has resulted in,

632
00:34:31,400 --> 00:34:34,280
you know, early capital raises
to cover off low cash flow.

633
00:34:34,280 --> 00:34:38,880
I've seen that several times,
stuff that we've built where,

634
00:34:38,880 --> 00:34:43,920
you know, the geology is complex
and the mining needed to be very

635
00:34:43,920 --> 00:34:47,360
selective and they just didn't
get on it early enough.

636
00:34:48,080 --> 00:34:52,760
That can be very, you know,
doing a dilutive rise in the 1st

637
00:34:52,760 --> 00:34:54,920
12 months, 18 months can really
impact.

638
00:34:54,920 --> 00:34:58,080
I've seen that a lot.
There's, there's another topic

639
00:34:58,080 --> 00:35:00,440
I'd love to, to sort of hear
your thoughts on because the

640
00:35:01,360 --> 00:35:04,760
perennial challenge and, and
desire as well for a mining

641
00:35:04,760 --> 00:35:07,440
company is to, to build the
plant and build the whole thing

642
00:35:07,720 --> 00:35:10,320
cheaper.
And I've, I've heard you speak

643
00:35:10,320 --> 00:35:12,920
about this to an extent.
I think you were talking about

644
00:35:12,920 --> 00:35:17,520
an example in Peru where you
were able to build for 1.3 and

645
00:35:17,520 --> 00:35:20,720
it other others had priced up a
similar style thing for for 2

646
00:35:20,720 --> 00:35:21,440
billion.
Yeah.

647
00:35:22,080 --> 00:35:25,040
What does that actually look
like without cutting corners,

648
00:35:25,440 --> 00:35:27,840
making a project that does the
job?

649
00:35:28,160 --> 00:35:32,000
Yeah, I think it there's a whole
list of things, but that's, I

650
00:35:32,000 --> 00:35:35,680
think you're referring to
Constantia, yeah, which is owned

651
00:35:35,680 --> 00:35:42,480
by HUD Bay and that's Constantia
is 85,000 tonne a day.

652
00:35:42,480 --> 00:35:44,680
So they talk tonne a day over
there.

653
00:35:44,800 --> 00:35:47,600
And so, yeah, what's that,
30,000,000?

654
00:35:47,600 --> 00:35:48,840
Close the wires of an
Australian.

655
00:35:48,960 --> 00:35:51,920
Just don't.
Tell me per hour.

656
00:35:53,640 --> 00:35:59,160
Yeah, that's right.
And so a lot of it stems from

657
00:35:59,480 --> 00:36:04,040
the initial quantities of of
steel, concrete, piping, cable,

658
00:36:04,040 --> 00:36:07,840
etcetera.
A lot of bad designs are around

659
00:36:07,880 --> 00:36:11,080
a compact footprint.
So we bring things you know,

660
00:36:11,080 --> 00:36:16,680
very tight, very small and as a
result you save significantly on

661
00:36:16,680 --> 00:36:19,120
commodity.
So that's one thing.

662
00:36:19,120 --> 00:36:22,920
If you have less commodity, you
know, you save on, on

663
00:36:23,000 --> 00:36:28,080
construction costs and and then
the others around schedule, we

664
00:36:28,200 --> 00:36:32,760
tend to deliver things to a
minimum schedule with, you know,

665
00:36:33,560 --> 00:36:37,280
the long lead items being, you
know, the long lead delivery

666
00:36:37,640 --> 00:36:40,520
items being the critical path.
And we, you know, we work off

667
00:36:40,520 --> 00:36:42,720
that.
Be sure on the schedule you save

668
00:36:42,720 --> 00:36:46,800
money and being selective about
the flow sheet, you know, how we

669
00:36:46,800 --> 00:36:50,840
actually process what, you know,
what equipment we use and all

670
00:36:50,840 --> 00:36:53,640
good quality equipment, but how
it's arranged.

671
00:36:54,160 --> 00:36:57,280
And that, that if you're smart
enough that that can save you

672
00:36:57,280 --> 00:37:00,600
lots of money, not putting
contingency on top of

673
00:37:00,600 --> 00:37:08,600
contingency, you know, using,
you know, low cost construction

674
00:37:08,600 --> 00:37:10,280
fabrication centers around the
world.

675
00:37:11,040 --> 00:37:13,720
Sometimes it's cheaper to
fabricate in Asia.

676
00:37:13,720 --> 00:37:16,000
Sometimes it's cheaper to
fabricate in South America.

677
00:37:16,000 --> 00:37:19,760
Hunting all that down and you
know you eventually get a good

678
00:37:19,760 --> 00:37:23,920
saving.
Yeah, the comment you make your

679
00:37:23,920 --> 00:37:25,560
bad.
Yeah, the materials being a huge

680
00:37:25,560 --> 00:37:27,760
component of this of course like
that.

681
00:37:28,640 --> 00:37:31,200
I suppose that might be a
shortfall of, of a, of a, you

682
00:37:31,480 --> 00:37:36,640
know, typical cost plus model in
in some ways there's like a the

683
00:37:37,640 --> 00:37:40,360
how does, how, how does the, you
know, the engineering company

684
00:37:40,360 --> 00:37:44,040
who's been outsourced maybe
maybe have the incentive all of

685
00:37:44,040 --> 00:37:46,120
the time with the cost plus
model to minimize footprint

686
00:37:46,120 --> 00:37:48,000
other than just winning the work
in the first place.

687
00:37:48,000 --> 00:37:51,120
Yeah, obviously reputation's a
key part of it.

688
00:37:51,120 --> 00:37:52,640
So for us, that's a key part of
it.

689
00:37:52,640 --> 00:37:56,480
But you know, you try and roll
in in financial incentives into

690
00:37:56,480 --> 00:37:58,680
it, financial penalties as well.
Yeah.

691
00:37:58,680 --> 00:37:59,880
So you got some skin in the
game?

692
00:38:00,120 --> 00:38:02,800
Yeah.
So you you get a an incentive if

693
00:38:02,880 --> 00:38:05,640
if the material cost comes in
like lose.

694
00:38:05,640 --> 00:38:07,960
Some budget or save the
contingency.

695
00:38:07,960 --> 00:38:08,760
That makes sense.
Yeah.

696
00:38:08,800 --> 00:38:12,440
You look at it many different
ways and you you don't want to

697
00:38:12,440 --> 00:38:14,800
get a reputation for being over
budget all the time.

698
00:38:14,960 --> 00:38:17,560
You know God.
No.

699
00:38:17,560 --> 00:38:20,400
How do you think about growing
the the margin of a business

700
00:38:20,400 --> 00:38:22,200
like this?
Like I understand you, you break

701
00:38:22,200 --> 00:38:24,080
out on your own.
You want to just, you know,

702
00:38:24,080 --> 00:38:27,040
you're excited to, to get
started and create a new

703
00:38:27,040 --> 00:38:30,560
business on your own and then
you think about improving the

704
00:38:30,560 --> 00:38:33,640
business once you bed down those
first contracts that we we spoke

705
00:38:33,640 --> 00:38:36,240
about and you, you build that
reputation.

706
00:38:36,240 --> 00:38:38,360
You don't have to compete as as
much on margin.

707
00:38:39,000 --> 00:38:41,480
Where I guess in along that
journey, do you, do you start

708
00:38:41,480 --> 00:38:44,240
thinking about it or is it just
growing the scale, growing the

709
00:38:44,240 --> 00:38:47,400
jurisdictions, that type of
thing, growing your offerings?

710
00:38:47,400 --> 00:38:52,320
I think obviously top line
growing revenue, but I'm I like

711
00:38:52,320 --> 00:38:56,160
growing margin, but not at the
expense of being competitive.

712
00:38:56,160 --> 00:39:02,000
It's more around technology, you
know, using, using technology

713
00:39:02,280 --> 00:39:07,040
to, to, to deliver outcomes, you
know, can save you a lot of

714
00:39:07,040 --> 00:39:09,000
money and make more margin and
reduce overhead.

715
00:39:09,080 --> 00:39:11,840
So in a business like this,
you're just so conscious of

716
00:39:11,840 --> 00:39:15,920
overhead, continually watching
the overhead and you're looking

717
00:39:15,920 --> 00:39:21,120
at ways to incorporate AI or,
you know, whatever it is to to

718
00:39:21,120 --> 00:39:25,680
try and, you know, save time,
save money and make more margin.

719
00:39:26,400 --> 00:39:29,120
So a lot of people focus on top
line revenue, but there's no

720
00:39:29,120 --> 00:39:31,160
point in doing that if the
margins are off, you know?

721
00:39:32,880 --> 00:39:37,000
So in the I, I would imagine in
the depths of that sort of

722
00:39:37,000 --> 00:39:42,000
downturn 2016 RCF comes in and
and and you do a deal.

723
00:39:42,000 --> 00:39:43,520
Can you, can you talk us through
that, that whole?

724
00:39:43,520 --> 00:39:47,360
Process yeah so RCF were
shareholders when we were

725
00:39:47,360 --> 00:39:51,840
private the first time and
during the public years they

726
00:39:51,840 --> 00:39:57,840
exited they exited at the float
and then about 6-12 months later

727
00:39:57,840 --> 00:40:05,480
they exited their total holding
and they you know we weren't no

728
00:40:05,480 --> 00:40:08,680
one was loving us at that point
you know they you go from here

729
00:40:08,680 --> 00:40:13,000
here I to what's the rooster to
feather dust it pretty quickly

730
00:40:13,000 --> 00:40:18,080
in the in the equities area and
the only people who wanted to

731
00:40:18,080 --> 00:40:22,600
talk to us we're we're short
seller hedge funds you know so.

732
00:40:23,560 --> 00:40:26,320
I talk to you.
I love talking to us.

733
00:40:26,840 --> 00:40:30,680
You know, there was a queue of
them, but I think we were

734
00:40:31,280 --> 00:40:35,960
heavily shorted top two or three
there at 1 stage when things

735
00:40:35,960 --> 00:40:41,760
started to come off.
But yeah, James, just the

736
00:40:42,200 --> 00:40:45,400
managing partner, founder of the
fund, he just said, look, if you

737
00:40:45,400 --> 00:40:48,000
ever want to go private, you
know, we'd be interested.

738
00:40:48,000 --> 00:40:51,440
So I bought the debt.
We had some debt.

739
00:40:51,560 --> 00:40:54,000
That was the, that was the
horrible part here.

740
00:40:54,000 --> 00:40:57,840
It was the first time in the
history of the company we had

741
00:40:57,840 --> 00:41:01,600
some debt.
I'd always been companies in the

742
00:41:01,600 --> 00:41:05,560
service area shouldn't have
debt, not a lot, maximum 20%

743
00:41:05,560 --> 00:41:09,880
gearing, that sort of thing.
And you know, we'd just done

744
00:41:09,880 --> 00:41:13,160
these acquisitions.
The Astoria should have raised

745
00:41:13,160 --> 00:41:18,920
more money, didn't have ACFO or
accountant come and tell you

746
00:41:18,920 --> 00:41:21,960
about ratios and can do this and
do that and we don't have to

747
00:41:21,960 --> 00:41:25,440
dilute and raising money at 13
or 14 bucks.

748
00:41:25,560 --> 00:41:27,280
I'll take that every day of the
week.

749
00:41:27,280 --> 00:41:31,480
But anyway, so so you know,
let's get a bit of debt, get

750
00:41:31,480 --> 00:41:34,560
some debt, then you all of a
sudden dealing with covenants

751
00:41:34,560 --> 00:41:37,040
and you know, we're in a
cyclical business.

752
00:41:37,680 --> 00:41:42,160
And so, you know, they weren't
going to, they weren't going to,

753
00:41:43,920 --> 00:41:46,400
this was 2015.
They weren't going to, you know,

754
00:41:46,600 --> 00:41:50,200
renew the debt 12 months out.
So we had to do something about

755
00:41:50,200 --> 00:41:51,960
it.
So James came in, bought the

756
00:41:51,960 --> 00:41:59,400
debt and made an offer to public
shareholders and scheme of

757
00:41:59,400 --> 00:42:01,080
arrangement and we took the
company private.

758
00:42:01,840 --> 00:42:05,040
And that debt had been in the
business since the.

759
00:42:05,040 --> 00:42:07,120
Since we had our way.
Oh yeah, since the financial

760
00:42:07,120 --> 00:42:10,400
crisis was that debt used as
well as the the funds from from

761
00:42:10,400 --> 00:42:11,080
the.
Phrase.

762
00:42:11,760 --> 00:42:14,360
To make those acquisitions.
And raise some more.

763
00:42:14,720 --> 00:42:15,840
And raise some more along the
way.

764
00:42:15,840 --> 00:42:16,640
Yeah, yeah.
Yeah.

765
00:42:18,520 --> 00:42:23,080
Do you, do you, do you think
differently about balance sheet

766
00:42:23,080 --> 00:42:24,560
and debt as a result of that
experience?

767
00:42:24,720 --> 00:42:26,280
100%, yeah.
What?

768
00:42:26,280 --> 00:42:28,240
What are the lessons for for?
Yeah.

769
00:42:28,280 --> 00:42:31,120
I, I, I mean stress testing
balance sheet, you know, on the

770
00:42:31,120 --> 00:42:36,200
downside, I think, you know, I
have, I, I have a very, very

771
00:42:36,200 --> 00:42:40,600
strong view around that.
And it's all great when things

772
00:42:40,600 --> 00:42:42,840
are humming along, but when
things turn like they do in our,

773
00:42:43,240 --> 00:42:46,480
our, our industry, just
understanding what those trigger

774
00:42:46,480 --> 00:42:50,080
points are.
And so, you know, we have

775
00:42:50,080 --> 00:42:54,960
minimal debt and that might take
it up to a point.

776
00:42:54,960 --> 00:42:58,160
Like I said, 2025% gearing, no
more.

777
00:42:58,240 --> 00:43:02,080
And you know, just continually
watching cash flows like you

778
00:43:02,080 --> 00:43:05,480
know, back then I think our DSO
days were they were out to

779
00:43:05,480 --> 00:43:13,720
probably 125 30.
Now we operate, you know 5055 S

780
00:43:14,000 --> 00:43:19,400
big focus on cash flow, working
capital, complete learnings that

781
00:43:19,400 --> 00:43:22,680
we take away.
Would you, would you sort of

782
00:43:22,680 --> 00:43:27,120
guide any anyone in that sort of
cyclical type similar business?

783
00:43:27,120 --> 00:43:31,200
I know you've mentioned the 20%
top gearing for that.

784
00:43:31,200 --> 00:43:33,160
That is sort of enduring lesson
through.

785
00:43:33,640 --> 00:43:36,760
Yeah, yeah, yeah.
Or, or try not to have it.

786
00:43:36,760 --> 00:43:41,160
I mean, businesses like ours,
it's working capital, you know,

787
00:43:41,280 --> 00:43:44,560
that's the that's the thing that
you've got to fund and you just

788
00:43:44,560 --> 00:43:47,840
manage your working capital and
try and have your money in your

789
00:43:47,840 --> 00:43:49,560
bank account rather than someone
else's.

790
00:43:51,160 --> 00:43:54,000
And if you're going to do
acquisitions, you know, get in

791
00:43:54,000 --> 00:43:58,320
there and you know, pay them off
as quickly as possible.

792
00:43:58,320 --> 00:44:01,400
If you're going to take a bit of
debt and you know, in, in equity

793
00:44:01,400 --> 00:44:04,400
markets, you know, you've then
got a balance of dividend,

794
00:44:04,400 --> 00:44:07,200
right?
And, and same time when you're

795
00:44:07,440 --> 00:44:09,840
when you're a people business
and you're in a downturn, you're

796
00:44:09,840 --> 00:44:12,640
exiting people.
So there's redundancy payments

797
00:44:12,640 --> 00:44:15,800
going out, you know, so there's
cash going everywhere and you

798
00:44:15,800 --> 00:44:18,800
need to need to be thinking
about that.

799
00:44:20,520 --> 00:44:23,800
It's, it's tricky.
It's the animal spirits are at

800
00:44:23,800 --> 00:44:25,960
work in the good times and they
you don't always think about the

801
00:44:25,960 --> 00:44:28,320
downside, right?
Yeah, I always say to people,

802
00:44:28,320 --> 00:44:30,320
you go broke in the good.
Yeah, yeah, yeah.

803
00:44:30,320 --> 00:44:31,280
Yeah, you don't know you're
going.

804
00:44:31,280 --> 00:44:33,960
No, no, no.
Yeah, yeah, It's a great

805
00:44:33,960 --> 00:44:37,680
reflection.
In 2023, RCF then sell the

806
00:44:37,680 --> 00:44:39,640
business to another private
equity group.

807
00:44:40,080 --> 00:44:42,960
We didn't.
We didn't actually close that.

808
00:44:43,240 --> 00:44:46,160
It's still pending but we didn't
close it after the DD.

809
00:44:46,160 --> 00:44:47,920
That's Eldridge Capital.
OK.

810
00:44:50,080 --> 00:44:53,080
We didn't, we didn't get an
agreement on, on final terms

811
00:44:53,080 --> 00:44:56,760
and, and they've come in as a
financier of our balance sheet.

812
00:44:56,760 --> 00:45:01,040
So they're still involved but in
a, in a different capacity.

813
00:45:01,360 --> 00:45:06,760
But it's, you know, it's still
out there and RCF closed in fund

814
00:45:07,520 --> 00:45:10,800
it it, you know, they would be
keen over the, you know, next

815
00:45:11,200 --> 00:45:14,520
couple of years to see an exit
because they can only stay so

816
00:45:14,520 --> 00:45:16,880
long.
Do you like not doing the the

817
00:45:16,880 --> 00:45:22,120
calls and all the the road shows
as leading a a listed company?

818
00:45:23,000 --> 00:45:24,280
No more short seller hedge funds
to.

819
00:45:25,600 --> 00:45:30,200
You know it, I got back 30% of
my time, Janice, so, you know, I

820
00:45:30,200 --> 00:45:32,800
could spend on the business and
clients, which is what I like

821
00:45:32,800 --> 00:45:36,520
doing.
Something else I'm involved

822
00:45:36,520 --> 00:45:39,280
with.
I've just watched what someone

823
00:45:39,320 --> 00:45:43,600
has taken 100 meetings in the
last six weeks on a, on a public

824
00:45:43,600 --> 00:45:48,400
company situation.
I mean that that's, that's

825
00:45:48,400 --> 00:45:52,480
intense, you know, yeah.
So no, I, I don't, I don't miss

826
00:45:52,480 --> 00:45:57,760
that part of it at all.
It it because, you know,

827
00:45:57,760 --> 00:46:02,560
sometimes you take a meeting and
no one buys stock for three

828
00:46:02,560 --> 00:46:06,080
years or doesn't buy stock at
all, you know, whereas I think I

829
00:46:06,080 --> 00:46:11,160
like, you know, in what I'm
doing, achieving outcomes, you

830
00:46:11,160 --> 00:46:17,040
know, you're talking to people
and things are happening, but

831
00:46:17,160 --> 00:46:19,440
I'm not, you know, it was good
for us right at the time.

832
00:46:19,440 --> 00:46:21,480
It was really good for us, some
of it.

833
00:46:23,360 --> 00:46:26,000
How do you think about the sort
of the world of commodities,

834
00:46:26,000 --> 00:46:29,280
everything happening kind of
going going forward from from

835
00:46:29,280 --> 00:46:33,920
where we are now like here on
the on the one hand, minds of

836
00:46:33,920 --> 00:46:37,560
the future, more going
underground styles are changing

837
00:46:38,280 --> 00:46:41,400
autonomy, all these sorts of
things like opportunity and

838
00:46:41,960 --> 00:46:44,920
excitement, potential disruptors
coming in.

839
00:46:45,320 --> 00:46:47,960
Yeah, I think, I think, and we
think about the mind of the

840
00:46:47,960 --> 00:46:52,200
future a lot.
And yeah, underground obviously,

841
00:46:52,200 --> 00:46:55,640
you know, keeping as much as you
can away from public eye.

842
00:46:55,800 --> 00:46:59,120
Yeah.
But you know, I think, I think

843
00:46:59,120 --> 00:47:01,400
technology is just the exciting
bit.

844
00:47:01,400 --> 00:47:04,720
You know, you, you look at in
the processing area, you know,

845
00:47:04,720 --> 00:47:08,320
of course particle flotation
where you can, you can grind

846
00:47:08,320 --> 00:47:10,840
A200 Micron and float off
product.

847
00:47:11,000 --> 00:47:14,880
You know, in, in the, in the, in
the rougher part of the course,

848
00:47:14,880 --> 00:47:16,520
particle flight part of the
circuit.

849
00:47:17,040 --> 00:47:20,760
You know, you can take a, a
plant now doing, you know, 30

850
00:47:20,760 --> 00:47:23,880
million tonne a year at a 75
Micron grind course in the grind

851
00:47:23,880 --> 00:47:28,920
of 200 Micron, push more tons
through not very much capital

852
00:47:29,280 --> 00:47:32,840
and, and achieve the same, you
know, basic recovery and

853
00:47:32,840 --> 00:47:35,760
performance.
That's super exciting stuff and

854
00:47:36,480 --> 00:47:40,200
that's where I see the advances
in the in coming in mining and

855
00:47:40,200 --> 00:47:43,640
things like that in AI
utilization process performance

856
00:47:43,640 --> 00:47:47,720
improvements, etcetera that
that's where it's going to come

857
00:47:47,720 --> 00:47:50,960
from I reckon.
And autonomy, obviously, right?

858
00:47:52,760 --> 00:47:53,960
What is engineering to you,
Jimmy?

859
00:47:54,680 --> 00:47:59,360
Me engineering is doing
something for a dollar that

860
00:47:59,360 --> 00:48:04,360
takes the person on the street
$10 to do, being innovative to

861
00:48:04,360 --> 00:48:09,360
be able to come up with
solutions that are either time

862
00:48:09,360 --> 00:48:15,120
or cost advantageous or add
value along the way.

863
00:48:15,240 --> 00:48:16,600
That's how I look at
engineering.

864
00:48:16,600 --> 00:48:20,600
That's been a Cinco's value
proposition since we started.

865
00:48:21,240 --> 00:48:24,120
Our purpose is to find a better
way and we live it.

866
00:48:25,160 --> 00:48:27,840
And that's what I live that, you
know, to find a better way.

867
00:48:27,840 --> 00:48:32,000
And that's how I see engineers
to take up those challenges and

868
00:48:32,000 --> 00:48:35,120
and run with them.
I find this fascinating.

869
00:48:35,120 --> 00:48:37,680
I find this so fascinating
coming into the, the industry

870
00:48:37,680 --> 00:48:41,480
from a finance background, don't
have that, that skill set at

871
00:48:41,480 --> 00:48:43,760
all, but on, on two different
fronts, the processing where

872
00:48:43,760 --> 00:48:47,560
you're, you're skilled in me and
the, the actual mining.

873
00:48:47,960 --> 00:48:50,800
And you think like, what is the
difference between a good miner

874
00:48:50,800 --> 00:48:53,920
and a bad miner?
How much cheaper could a plant

875
00:48:53,920 --> 00:48:56,960
be built, you know, or how much
more expensive could it be

876
00:48:56,960 --> 00:49:00,560
built?
And the margins are enormous is

877
00:49:00,920 --> 00:49:03,840
I think what I've learned along
the way, like how do you sort of

878
00:49:03,840 --> 00:49:06,760
think about like a bad
engineering firm and, and a good

879
00:49:06,760 --> 00:49:09,080
engineering firm and, and what
that can kind of cost a mining

880
00:49:09,080 --> 00:49:14,120
business and an investor?
Yeah, I think there's a couple

881
00:49:14,120 --> 00:49:18,840
of things if you like, if you're
this focus on the junior end may

882
00:49:18,840 --> 00:49:22,320
just don't have to raise money.
So it's, you know, junior has to

883
00:49:22,320 --> 00:49:28,240
scrap for every cent, right.
It's debt equity and they have

884
00:49:28,240 --> 00:49:30,160
a, they have a finite amount of
money.

885
00:49:31,040 --> 00:49:33,400
Like they raise their money and
that's it.

886
00:49:33,560 --> 00:49:37,160
And if someone comes along and
says, I'm really sorry, but I'm,

887
00:49:37,560 --> 00:49:42,560
you know, 30% over budget here,
they have to scrap to find it,

888
00:49:42,920 --> 00:49:46,200
then generally speaking, they're
going to dilute everyone at low

889
00:49:46,200 --> 00:49:48,480
equity, right?
Because their price has done

890
00:49:48,480 --> 00:49:50,040
this, because everyone knows
what's happening.

891
00:49:50,880 --> 00:49:53,360
And that's not going to make a
lot of shareholders happy.

892
00:49:53,440 --> 00:49:55,280
The dead guys are going to get
nervous.

893
00:49:55,280 --> 00:49:57,160
They're probably going to either
put a little bit more in there

894
00:49:57,160 --> 00:49:59,520
to prop it up.
And all of a sudden the MPV

895
00:49:59,520 --> 00:50:02,920
changes, the, the, the cash
flows change, everything

896
00:50:02,920 --> 00:50:05,960
changes.
And I think that's the

897
00:50:05,960 --> 00:50:09,200
difference between good one and
a bad one.

898
00:50:09,440 --> 00:50:12,320
You know, be able to be
conscious of the fact that

899
00:50:12,320 --> 00:50:17,960
there's a finite amount of money
here and it's hard to get mid

900
00:50:17,960 --> 00:50:21,040
tiers are probably lesser of a
problem with that because they

901
00:50:21,040 --> 00:50:24,680
have got cash generating assets.
But you know, you can destroy

902
00:50:24,680 --> 00:50:29,280
MPV in the first six months of a
mining operation if you're not

903
00:50:29,280 --> 00:50:33,000
careful.
So what it means to me is is is

904
00:50:33,000 --> 00:50:39,280
just being super focused on the
outcome, on what your parameters

905
00:50:39,280 --> 00:50:43,520
are and work within it.
Was it, was it always going to

906
00:50:43,520 --> 00:50:46,160
be an engineering firm for you?
Yeah.

907
00:50:47,200 --> 00:50:48,880
Nothing else sort of took the
took the fancy.

908
00:50:49,280 --> 00:50:54,520
Mate, I can't spell so wouldn't
be a good lawyer and those Excel

909
00:50:54,520 --> 00:50:56,920
spreadsheets, they bamboos or
me.

910
00:50:56,920 --> 00:50:59,840
So yeah, no, it's just always
going to be an engineer and.

911
00:50:59,960 --> 00:51:02,480
And do you think the
entrepreneurship side of it was

912
00:51:02,480 --> 00:51:05,240
just innate or sort of nurtured
through the family?

913
00:51:05,240 --> 00:51:08,520
It came through my dad.
I think, you know, dad's dad's

914
00:51:09,120 --> 00:51:13,280
family entrepreneurs where they
came from in Europe, they're

915
00:51:13,800 --> 00:51:17,520
always trading, you know?
Yeah, yeah.

916
00:51:17,520 --> 00:51:21,280
So yeah, that's always going to
eat.

917
00:51:21,520 --> 00:51:23,600
From a young age, it always used
to say you got to own your own

918
00:51:23,600 --> 00:51:25,800
business.
So you hear that every day of

919
00:51:25,800 --> 00:51:26,320
your life.
You're.

920
00:51:28,200 --> 00:51:32,760
Yeah.
Yeah, the the one segment we

921
00:51:32,760 --> 00:51:36,520
kind of often do in our in our
interviews and these interviews

922
00:51:36,520 --> 00:51:39,360
a bit different, but overrated,
underrated, right.

923
00:51:39,400 --> 00:51:41,520
And we haven't prepared this, so
we're kind of just going to do

924
00:51:41,520 --> 00:51:44,400
it on the fly.
But in a succinct number of

925
00:51:44,560 --> 00:51:48,720
words, you've got to justify if
something is overrated or, or or

926
00:51:48,720 --> 00:51:51,960
underrated, like a one sentence
kind of response as as opposed

927
00:51:51,960 --> 00:51:55,040
to, yeah, a, a, a big long
response.

928
00:51:55,280 --> 00:51:59,360
We should be succinct anyway.
You you reckon we can we can

929
00:51:59,440 --> 00:52:00,800
whip up some topics on the fly
mate.

930
00:52:00,800 --> 00:52:02,200
I know we can edit it to make it
sound.

931
00:52:02,560 --> 00:52:04,280
Good, so it.
Doesn't matter all.

932
00:52:05,640 --> 00:52:05,920
Right.
Hello.

933
00:52:06,040 --> 00:52:10,720
OK, let's let's give it a go.
Yep, it'll in in in life in

934
00:52:10,720 --> 00:52:11,920
general?
Or is it related?

935
00:52:11,920 --> 00:52:15,240
To the mine industry in.
The topics we'll compose like.

936
00:52:15,240 --> 00:52:19,520
OK, engineering in the industry.
OK, the Philippines.

937
00:52:20,360 --> 00:52:23,560
Overrated.
Do you want to know why?

938
00:52:23,560 --> 00:52:24,200
Yeah.
Yeah.

939
00:52:24,760 --> 00:52:28,080
Geologically amazing, but so
hard.

940
00:52:28,080 --> 00:52:32,920
Heavily populated.
You've got the church, you know,

941
00:52:33,000 --> 00:52:35,760
really embedded in local
community permitting.

942
00:52:35,920 --> 00:52:40,760
You know, I've been in and out
of there for 30 years and I

943
00:52:40,760 --> 00:52:42,840
think it's just too hard,
unfortunately.

944
00:52:42,880 --> 00:52:45,080
I think it's an amazing
geological setting.

945
00:52:46,360 --> 00:52:48,760
In South America, Ecuador
specifically.

946
00:52:51,080 --> 00:52:54,720
Is there one in the middle where
you kind of like instead of

947
00:52:54,760 --> 00:52:55,680
like?
Neutrally rated.

948
00:52:55,680 --> 00:52:57,240
Neutrally rated.
Neutrally rated.

949
00:52:57,360 --> 00:52:59,320
Watch.
Watch this space, I reckon.

950
00:52:59,360 --> 00:53:00,320
Yeah, OK.
Yeah.

951
00:53:00,320 --> 00:53:02,280
Yeah, it's definitely attracting
a lot of.

952
00:53:02,600 --> 00:53:03,880
I think it's right now.
Yeah, yeah.

953
00:53:04,280 --> 00:53:08,560
You know, and, and you know, we,
we worked on Fruta del Norte,

954
00:53:08,600 --> 00:53:11,320
which is Lundin's gold operation
there.

955
00:53:11,320 --> 00:53:16,120
So we, you know that that's been
very successful.

956
00:53:16,240 --> 00:53:19,520
But you know, the Casco Bell's a
bit.

957
00:53:20,120 --> 00:53:24,640
This one is a bit slow, but
still great geological setting.

958
00:53:24,640 --> 00:53:29,680
But I think it's one to watch.
Rare earth processing.

959
00:53:33,000 --> 00:53:37,960
At the moment.
Oh that, that's a hard 1.

960
00:53:38,280 --> 00:53:40,880
You know what?
I've never been a rare earths

961
00:53:40,880 --> 00:53:42,200
fan.
You're allowed to say it.

962
00:53:43,040 --> 00:53:44,680
I'm not.
I'm allowed to say it, right?

963
00:53:47,040 --> 00:53:50,440
I'll tell you why.
I mean, it's really interesting.

964
00:53:50,440 --> 00:53:52,720
Do do you guys know Nick Curtis?
Yeah.

965
00:53:52,880 --> 00:53:54,280
Yeah.
Do you know?

966
00:53:54,320 --> 00:53:56,320
You know who Nick is, right?
Yeah, at Linus, right.

967
00:53:56,720 --> 00:53:59,440
So Nick comes into the office in
Brisbane.

968
00:54:00,000 --> 00:54:06,360
It would have been 9098, I
reckon 99, somewhere like that.

969
00:54:07,080 --> 00:54:10,520
And he comes in and he says
Zoom, you know, raising, raising

970
00:54:10,520 --> 00:54:15,280
some money for Linus, and it's
going to be rare earths and

971
00:54:15,560 --> 00:54:19,000
Mount Weldon.
Oh God, heck, rare earths.

972
00:54:19,000 --> 00:54:21,720
He can fill this glass up with
the amount of rare earths

973
00:54:21,720 --> 00:54:25,400
that'll be, mate.
It's never going to go anywhere.

974
00:54:25,760 --> 00:54:29,040
Well, look at that.
Yeah, we.

975
00:54:29,040 --> 00:54:30,440
But it's taken a long time,
right?

976
00:54:30,440 --> 00:54:32,560
It's taken 30 years.
What a journey that's been.

977
00:54:32,560 --> 00:54:37,520
Yeah, what a journey.
So from a, from a just looking

978
00:54:37,520 --> 00:54:41,480
at it, they're not as rare as we
all feel, right?

979
00:54:41,480 --> 00:54:45,240
That's one thing.
But I think if it wasn't for

980
00:54:45,240 --> 00:54:49,240
that geopolitical twist, it
maybe be a different dialogue

981
00:54:49,240 --> 00:54:50,920
we're having around it at the
moment, right?

982
00:54:50,920 --> 00:54:55,080
Because you know, the whole
processing technology piece is

983
00:54:55,080 --> 00:55:00,080
really, you know, sitting in
China, Chinese done a great job

984
00:55:00,080 --> 00:55:03,360
of, you know, setting up a
mineral strategy 40 years ago

985
00:55:03,360 --> 00:55:04,800
and just working through it.
All right.

986
00:55:04,800 --> 00:55:10,080
And, and now it's, you know, you
have to have it to do, you know,

987
00:55:10,120 --> 00:55:12,080
smartphones and this that and
the other.

988
00:55:12,080 --> 00:55:13,720
And you know, you guys know as
well as I do.

989
00:55:13,720 --> 00:55:19,960
So, you know, I think, I think I
think it's time is in the sun.

990
00:55:21,200 --> 00:55:25,880
But you know, it's a tough, it's
a really tough commodity to

991
00:55:25,880 --> 00:55:30,200
extract and refine.
It's not straightforward, doable

992
00:55:30,200 --> 00:55:34,520
and all the rest of it, a lot of
that no house sits with Linus

993
00:55:34,520 --> 00:55:38,440
and the Chinese.
So it's pretty hard to get

994
00:55:38,440 --> 00:55:40,840
through all of that.
But all again, all possible.

995
00:55:43,320 --> 00:55:47,880
So I'm sitting like 30 years ago
it was that.

996
00:55:48,120 --> 00:55:50,720
Now it's yeah, it's kind of
might be real.

997
00:55:52,320 --> 00:55:53,840
In a nutshell.
I thought you're going to tell

998
00:55:53,840 --> 00:55:56,640
me lithium.
I thought about it but.

999
00:55:58,240 --> 00:56:03,760
Lithium, the floor is yours.
Lithium demand not going to go

1000
00:56:03,760 --> 00:56:06,520
away.
So you know what are we up

1001
00:56:06,600 --> 00:56:10,560
million tonne a year at the
moment globally, 80,000 tonne

1002
00:56:10,560 --> 00:56:13,760
five years ago, so.
That's a tremendous growth rate.

1003
00:56:13,840 --> 00:56:17,000
Incredible, right.
So if you look at the next few

1004
00:56:17,000 --> 00:56:19,440
years and maybe 4 to 5 million
tonne, it's got to come from

1005
00:56:19,440 --> 00:56:22,920
somewhere and it'll come from
the lowest cost producers.

1006
00:56:23,280 --> 00:56:26,760
So where I think where I think
the shift is going to be is

1007
00:56:27,160 --> 00:56:30,640
progressively over the next
three to five years, technically

1008
00:56:31,080 --> 00:56:33,600
Hard Rock lithium's going to
going to suffer a little bit.

1009
00:56:33,920 --> 00:56:37,800
You know, you your, your brines,
which are dependent on solar

1010
00:56:37,800 --> 00:56:41,400
drying at the moment, which is
very, very difficult to control.

1011
00:56:41,720 --> 00:56:44,240
There's a whole raft of
technical issues around that.

1012
00:56:44,880 --> 00:56:49,840
But with the advent of DLE, you
know, and we're doing quite a

1013
00:56:49,840 --> 00:56:54,000
number of DLE projects in the
Americas, early phase studies,

1014
00:56:54,000 --> 00:56:55,480
pilot plants, that sort of
thing.

1015
00:56:56,160 --> 00:56:58,640
And there's that technology is
going to develop.

1016
00:56:59,240 --> 00:57:02,240
And so you're going to see,
you're going to see a whole

1017
00:57:02,240 --> 00:57:06,840
bunch of brine lithiums at low
grade, you know, be economic and

1018
00:57:06,840 --> 00:57:08,520
be down the lower end of the
cost curve.

1019
00:57:08,840 --> 00:57:11,680
What that I think is going to do
is impact obviously the hard

1020
00:57:11,680 --> 00:57:18,640
rocks in WA which are good
grade, not great recovery, you

1021
00:57:18,640 --> 00:57:21,880
know, producing a 6%
concentrate, which you then ship

1022
00:57:21,880 --> 00:57:24,480
around the world.
You know, it's, it's, it's

1023
00:57:24,480 --> 00:57:27,160
trying to compete then with
what's happening with the

1024
00:57:27,160 --> 00:57:31,240
brines.
And then if you introduce brines

1025
00:57:31,240 --> 00:57:34,640
coming out of oil wells, you
know, people like Exxon,

1026
00:57:34,760 --> 00:57:39,640
Chevron, etcetera, Saudis with
Aramco, now they've got 400 PPM,

1027
00:57:40,000 --> 00:57:43,680
you know, coming out of there,
out of their wells and they got

1028
00:57:43,680 --> 00:57:45,160
a lot of money to do
development.

1029
00:57:45,160 --> 00:57:49,840
So I, I think we're going to see
a real change there over the

1030
00:57:49,840 --> 00:57:54,280
next three to five in what's
going to be the preferred

1031
00:57:54,280 --> 00:57:56,320
extraction because it's not rare
commodity.

1032
00:57:56,520 --> 00:57:59,040
I don't think demand's going
away, it's just how we get it.

1033
00:58:00,360 --> 00:58:03,280
Pressure oxidation.
Yeah, of what?

1034
00:58:03,280 --> 00:58:12,760
Overrated or underrated?
Yeah, I think a bit overrated.

1035
00:58:13,160 --> 00:58:14,360
I'll tell.
I'll tell you why.

1036
00:58:14,360 --> 00:58:19,400
I mean, you know when when you
when you put something in a

1037
00:58:19,600 --> 00:58:23,880
pressure oxidation, there's so
everything goes in a solution,

1038
00:58:24,040 --> 00:58:27,560
every, everything.
And you then got to treat this

1039
00:58:27,560 --> 00:58:32,280
the the whole bunch of streams.
It's expensive and all that sort

1040
00:58:32,280 --> 00:58:34,920
of stuff.
Good old fashioned smelting.

1041
00:58:34,920 --> 00:58:43,240
Just burn everything when you,
oh, roasted, burn it all.

1042
00:58:45,360 --> 00:58:49,720
Did I really say that?
I mean, you're an engineer, you

1043
00:58:49,760 --> 00:58:52,920
think in terms of costs, you
know, for an outcome, you're not

1044
00:58:53,080 --> 00:58:56,960
going to ask about Biox or, or,
or the Albion process.

1045
00:58:57,040 --> 00:59:00,960
Yeah, I think and we, we built a
Biox in China, Jingfeng.

1046
00:59:00,960 --> 00:59:02,680
So I know gold worked well
there.

1047
00:59:05,400 --> 00:59:08,520
Yeah, they're always going to be
around the edges, I reckon.

1048
00:59:08,520 --> 00:59:11,360
Yeah, yeah.
Bespoke application to a

1049
00:59:11,360 --> 00:59:12,200
solution.
Yeah, yeah, yeah.

1050
00:59:16,840 --> 00:59:20,920
Gold companies wanting to be a
copper company.

1051
00:59:21,040 --> 00:59:22,640
Yeah, I think it makes good
sense.

1052
00:59:23,080 --> 00:59:26,400
Yeah, really good sense.
And, you know, generally

1053
00:59:26,400 --> 00:59:30,440
speaking, if you look at a lot
of ore bodies, you know,

1054
00:59:30,440 --> 00:59:32,400
sulfides, there's always a
combo.

1055
00:59:32,480 --> 00:59:37,960
You know, you'll have a copper
mine with a gold stream, you'll

1056
00:59:37,960 --> 00:59:40,400
have a gold mine with a copper
stream, which is a bit of a pain

1057
00:59:40,400 --> 00:59:43,600
in that scenario.
But yeah, I think that that kind

1058
00:59:43,600 --> 00:59:45,760
of works for me.
And I'm going to flip the

1059
00:59:45,760 --> 00:59:47,920
segment a little bit and ask you
what the most underrated

1060
00:59:47,920 --> 00:59:52,120
jurisdiction is right now from a
mining investment perspective

1061
00:59:52,240 --> 00:59:54,520
that is?
Yeah, maybe off the radar of

1062
00:59:54,520 --> 00:59:57,920
some.
Yeah, and most underrated.

1063
01:00:01,040 --> 01:00:08,360
Yeah, I, I, I, I think Peru,
Yeah, yeah, yeah, I think

1064
01:00:08,360 --> 01:00:13,600
people, people kind of give it a
bit of a bad reps 15, almost 15%

1065
01:00:13,600 --> 01:00:15,880
of the world's copper.
It's a phenomenal deposit there.

1066
01:00:15,880 --> 01:00:18,120
It's a great job.
Great minds, yeah.

1067
01:00:18,240 --> 01:00:23,440
Doesn't always get a good Rep.
Doesn't and we've got about 7 or

1068
01:00:23,440 --> 01:00:26,560
800 people in Lima.
We can operate there really

1069
01:00:26,560 --> 01:00:28,600
well.
I actually like the place a lot.

1070
01:00:28,920 --> 01:00:32,040
You know, they have these
presidents come in who are kind

1071
01:00:32,040 --> 01:00:35,320
of, you know, going to shut
mining down and do this and do

1072
01:00:35,320 --> 01:00:36,280
that.
They never do it.

1073
01:00:36,600 --> 01:00:38,240
You know it.
Means so much to the economy

1074
01:00:38,240 --> 01:00:39,800
there.
Yeah, exactly.

1075
01:00:39,800 --> 01:00:43,520
And and so, you know, people
come in and out and, but it, it

1076
01:00:43,520 --> 01:00:46,240
just functions, you know, and
the people are good, well

1077
01:00:46,240 --> 01:00:47,680
skilled.
The quality of the engineers.

1078
01:00:47,680 --> 01:00:49,840
Yeah, very good.
Yeah, Yeah, really good.

1079
01:00:49,960 --> 01:00:51,400
And and they've got a good
attitude.

1080
01:00:51,400 --> 01:00:55,200
You know, they kind of like the
party and have a, you know, have

1081
01:00:55,200 --> 01:00:56,920
a good time.
It's it's a good place.

1082
01:00:57,600 --> 01:00:58,800
Yeah.
Good mix.

1083
01:00:59,080 --> 01:01:03,240
How about the the the old sort
of stands to to Group A few

1084
01:01:03,360 --> 01:01:10,320
countries together.
We Kazakhstan's OK, We've done a

1085
01:01:10,320 --> 01:01:14,400
lot of stuff.
Kazakhstan, I think Azerbaijan,

1086
01:01:14,880 --> 01:01:16,480
it's not a stand, but it's
close.

1087
01:01:16,480 --> 01:01:18,520
I think it's got one letter
missing on the end there, isn't

1088
01:01:18,520 --> 01:01:25,800
it?
So Uzbekistan, yeah, OK, that'd

1089
01:01:25,800 --> 01:01:27,920
probably be my Kazakhstan in
Uzbekistan.

1090
01:01:27,920 --> 01:01:31,960
Be my 2 picks, I think.
I think the Balkans is an area

1091
01:01:31,960 --> 01:01:35,120
that's, you know, a little
underrated as well.

1092
01:01:36,960 --> 01:01:40,800
You know, I know Rio's had
issues with the Aidar in in

1093
01:01:40,800 --> 01:01:46,200
Serbia, but you know, Adriatic
did that project in Bosnia and

1094
01:01:46,840 --> 01:01:50,480
you know, Macedonia, there's
good geology in there.

1095
01:01:50,480 --> 01:01:53,600
Turkey.
Yeah, they've all got rich

1096
01:01:53,600 --> 01:01:56,560
mining histories as well.
For a long time, yeah, they

1097
01:01:56,560 --> 01:01:57,800
have.
Exactly.

1098
01:01:58,280 --> 01:02:00,120
Exactly.
I know you've probably got a

1099
01:02:00,120 --> 01:02:05,600
vested interest in in the answer
to this, but the like mining

1100
01:02:05,600 --> 01:02:10,360
companies that do all the
engineering in house overrated

1101
01:02:10,360 --> 01:02:13,880
or underrated?
I'm not going to answer.

1102
01:02:20,760 --> 01:02:23,720
Timmy, this has been fantastic.
We've learnt a bunch from you.

1103
01:02:23,720 --> 01:02:26,480
Really appreciate you making the
time and and sharing your your

1104
01:02:26,480 --> 01:02:27,840
history and your your journey
with us.

1105
01:02:28,240 --> 01:02:29,560
No worries.
Great to be here.

1106
01:02:29,560 --> 01:02:31,480
Thank you very, very much.
Thanks so much for sharing your

1107
01:02:31,480 --> 01:02:32,600
insights.
No problem.

1108
01:02:33,200 --> 01:02:35,240
Phenomenal conversation mate,
I'm going to listen back to that

1109
01:02:35,240 --> 01:02:37,680
one again.
Thoroughly enjoyed that one mate

1110
01:02:37,680 --> 01:02:40,240
and a massive thank you to our
fantastic partners.

1111
01:02:40,240 --> 01:02:42,400
First and foremost Sandvik
Ground support who we had in the

1112
01:02:42,400 --> 01:02:44,720
show.
More than mesh and bolts access

1113
01:02:44,720 --> 01:02:47,840
mineral services, more than
crushing and screening cross

1114
01:02:47,840 --> 01:02:51,200
boundary energy powering you up
to 0 cap X and the focus

1115
01:02:51,200 --> 01:02:53,840
platform brought to you by
market Tech Pro level trading

1116
01:02:54,160 --> 01:02:58,960
for a retail price.
Now remember, I'm an idiot.

1117
01:02:59,240 --> 01:03:01,680
JD is an idiot.
If you thought any of this was

1118
01:03:01,680 --> 01:03:04,240
anything other than
entertainment, you're an idiot

1119
01:03:04,600 --> 01:03:05,760
and you need to read out a
disclaimer.