Buybacks, Cost Curves & Dingo’s Picks

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How did you actually join Nero?
Mate it's actually quite a cool

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story.
Rusty and I like have known each

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other my whole career.
Basically I was an engineer but

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basically quickly jumped into
corporate finance and he's

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working for a boutique out of
Melbourne.

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I.
Remember Rusty saying it was the

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best presentation you'd ever
seen?

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From the worst, from the worst
company.

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Worst company?
Yeah, yeah, yeah.

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The quote was something along
the lines of that is the best,

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most institutional presentation
I've ever seen for a bucket of

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shit.
That's a banger.

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That's a banger, JD.
Another week, another big

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mining.
This week there's a lot

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happening.
And this week, the wonderful

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Daniel Gingo.
Harrogonzo Gozo.

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How do you say his last?
Name Aaron Gozo.

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I'd never say his last name.
It's Dingo.

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We've got Dingo.
Dingo Gozo.

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Yeah, Anyway, just what what it
Gozo?

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Tell me how to say your your
surname.

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I love a correction on that one.
But the wonderful Dingo who is a

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a true thoughtful genius at at
the very the very smart Nero

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Resource fund.
He he's titled the Ceoi.

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Think you're right?
Yeah, yeah.

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Stoked to have him on the show
and very excited to unpack with

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him all the big events from this
week because we had a heap going

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on from anti involution
discussions in China to what's

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happening in the midcap gold
space, all the way through to

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resolution rare earth movements
and then going through the the

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best deals with a bunch of hot
takes throughout.

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Mate so came to share this one.
Very keen.

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You said big events and that
reminded me of a big event in

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our calendar.
You know what I'm going to I'm

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going to call our friend Dom
about this big event.

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Trav, how are you, man?
It's.

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Very well, Dom.
Dom, you were.

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Came to hear why people should
come down to Adu.

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Come down to Adu.
I mean, that's probably the

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simplest question to answer in
the world, lads.

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I mean it's the, you know,
Africa Down Under is other than

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the mining in Dhaba, which I
know you guys have been to in

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Cape Town.
This is the largest African

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mining event in the world, which
is pretty remarkable given that

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it's all the way over the Indian
Ocean here in little old Perth.

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But you know, 20 years ago when
we started this conference that

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we could have had it in a phone
box.

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And now there's well over 1000
people coming to the conference.

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So look, I think it's a, it's,
it's one of the main events on,

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on the Australian mining
calendar these days.

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I'm so, I'm so back.
You've got me, I mean.

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I haven't even got to the
program yet really about.

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Unpacking, the program told.
You how big it was.

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I mean, I think your blokes have
talked a lot in, in a recent

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past about, about the African
scene and the complications of

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it.
I mean, there's no hiding away

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that, that there's an African
discount for a reason.

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You know, there's, there's,
there's a high level of risk

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associated with some
jurisdictions.

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But if you look at the cold, how
hard facts, I mean, you see some

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of the companies that are on, on
the programme on the 3rd, the

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5th of September and, and you
realise just how well they're

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performing on the A6 at the
moment.

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You've got Purses Mining and
West African Resources, probably

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the two best performers in the
last three years amongst the

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gold miners on the ASX, both now
multibillion dollar companies

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and I think both would argue
still undervalued in comparison

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to their peers.
Even in the last couple of weeks

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we've seen companies like Taraco
Gold and Cote d'Ivoire raise

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65,000,000 on the market.
Then even just in the last

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couple of days, a company like
Lindian Resources with the Kunga

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kinda rare earth project in in
Malawi, a country that doesn't

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have any mining really as such
in a commodity that we all

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thought a bust raised more than
90 million for that project.

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So I mean they, you know, these
are up and coming companies, a

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host of others of course that
we've got on a program and we

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look forward to having you
blokes there as well.

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That's the the bread and butter
of what you guys do regularly

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now.
You find those sort of bombed

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out or deep in the cost curve
commodities that are not getting

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all that much love.
Yeah, yeah, we love hunting in

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the ugly places where nobody
else is at times.

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And yeah, it's not easy.
It takes a bit of takes a bit of

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belief at times.
It takes a lot of luck.

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Yeah.
I think anybody who who denies

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that is, is probably lying.
But equally, yeah, there's

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method to the madness in that.
And often it's it is a strict

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discipline to cost curves.
It is a strict discipline to the

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cyclicality, the cyclical nature
of of what we invest in and

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being comfortable with that,
being comfortable with

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volatility.
Volatility is your friend as

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long as you can use it to your
advantage.

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So you.
Have to be patient.

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You have to be patient and
equally volatility creates value

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opportunities.
So you have to be brave enough

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sometimes or willing enough to
make that investment at that

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valuation because the risk
return is there.

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So then yes, you might have to
be patient in how it's realized

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or or whatnot.
And not always simple, but

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typically, yeah, if you've got a
commodity in the cost curve,

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it's been there for a long time.
The equities are implying A

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commodity price that is
reflective of spot or lower and

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and there's an A real asset base
there or an asset base to be de

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risked.
They're wonderful opportunities

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that tend to be not liked by the
market at the time.

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Yeah, I love the style.
Hopefully we can peel more into

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into it today.
Dingo, we're stoked to have you

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on for the the the weekly
wrapped.

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We're going to start with all
the big stories in the mining

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industry, the money miners.
You start to get familiar with

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this style and yeah, to start
up, we've got China anti

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involution.
The the big thing that I think

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is sort of playing out slowly.
Firstly from a sort of cultural

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perspective in in China.
I think it really sort of

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started to take shape through
the early twenty 20s and now in

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the last couple years from a
sort of policy setting.

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And I think in the last couple
months in particular, this one

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has really sort of exploded into
the the consciousness, of

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course, for for resource
investors, because the

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ramifications across the full
sweep from items that are

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produced manufactured all the
way to the raw materials are

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pretty sort of a pretty eye
watering, I think.

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So how have you guys at at Nero
to to start with this?

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One thing I've been been
thinking about this is this the

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theme you think is is real or a
bit of a flash in the pan?

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Yeah, I think Chinese anti
involution, I think it's a real

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theme.
I think that we're seeing

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evidence of it occurring
probably stop short of

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necessarily being in the
headspace yet that this is the

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supply side reform of the the
mid twenty 10s or whatever which

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led to a radical repricing of
the entire sector necessarily.

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But I think there's good
credible evidence of it

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occurring in in, in isolation
with a particular focus on

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sectors that are unprofitable.
So, you know, I think we've seen

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it perhaps in in the coal sector
with some of the environmental

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sort of strictness or regulation
that they're they're placing

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around some of the miners there.
I think we're seeing evidence of

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it in lithium, perhaps in
bauxite and these types of

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unprofitable commodities, if you
like equally, I'm not sure that

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the idea of this is to see those
commodities like, you know,

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price 3-4 times higher than what
they are today in quick

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formation.
I still think there's probably a

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rationalism there.
And so I'm constructive, you

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know, I'm, I'm optimistic around
each of those sectors in

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isolation cautiously, but I
think at the moment as well,

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it's not necessarily being
coupled with a demand side

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stimulus that you'd probably
like to see.

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So how do, how do you think
about the, the demand side

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there?
Do you expect stimulus to to

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come in in that form because the
the interest rate side of it and

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all of that, it just operates so
differently in in China to the

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to the way it has historically
here in the West at least.

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Yeah, I think it, it, I think
it's still a massive opportunity

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on the policy side for China.
I I still think they're holding

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that sort of gun in the holster,
if you like.

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They can do more to stimulate
demand.

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And the real stimulatory unlock
will be if they can get the

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consumer to start pulling out of
the savings which have been

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continuing to accumulate in
China over the last five to 10

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years now and commit that into
either investment.

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And whether that be in in equity
markets, which promotes a

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capital cycle or into capital
itself or even into consumption,

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they've still got that in the
arsenal if they need a pull on

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it.
They they at the moment appeared

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to be comfortable with how the
stimulus is as sort of supported

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or provided a safety net to the
economy there.

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So I fall very short of being
being bearish on China, even

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though I think there's a little
bit of sogginess in the data at

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the moment.
We've had a ton of a ton of

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conversations on this theme this
this week, JD, but like, you

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know, various, various fund
managers or commodity guys or

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the likes and how, how, how
this, you know, anti involution

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policy shift plays out.
There's so much money to be made

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if you are, if you can kind of
read the tea leaves, you know,

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accurately here.
And it's it's kind it's it's

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kind of a little bit ironic and
perplexing as well.

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Because at the exact same time
as the rest of the world has

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come to the realization that we
should be, we should be more

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like China.
We should have we should have

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more government control and
strategic priorities and more

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socialism.
China's doing the opposite and

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say, no, we should be more
profitable out our enterprises

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should be yeah, yeah, we should
have like less, less, less, less

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price wars and more, more
profitability in the enterprise

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to to, to have, you know, better
health of the of the private

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business dynamism, which is
incredible.

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The the irony is, is is so rich.
I actually remember listening to

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a podcast maybe 3-4, five years
ago and they were talking about,

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it was a resource fund manager
talking about China stimulus and

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and getting along behind it.
And I think the same could be

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said by much more experienced
people that there's for a long

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time being a hope that this
China stimulus sort of comes in.

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And you know, from the, from the
very first signs of the property

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market slowing down through
2020-2021, people sort of hoped,

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but they've really let that kind
of cool out.

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So it's, it's fascinating to see
where it goes.

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And they've got lots of levers.
Like for one, savings rates are

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much higher because they don't
have the type of welfare system

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that we kind of have in the
West.

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So there's lots of ways in which
they could implement that to

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pull it back more to, to
resources though.

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Dingo Lithium is the big one
that's captured the, the

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imagination because it's run up
like 3040% in, in 60%.

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Yeah, it's run up a long way in
a, in a very short time.

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But you guys love to, to hunt
around in, in the fringes and

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stuff.
You mentioned books out there.

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Are there more medals or other
sort of esoteric ways that

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you've thought about playing
this theme at all?

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I don't think it's changed our
investment thesis or

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philosophies or approaches too
much to be honest.

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I think we have had
fundamentally at a really

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structural level, have certainly
had a view that China is kind of

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safety netting the economy and
the bazooka is not coming.

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However, they maintain enough
levers that if it got

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sufficiently dire, if it got
systemic, then yes, like they

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can go back to the old playbook,
they can go back to property

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and, and, and being more
outright in in stimulating that

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to promote the wealth effect,
which could then bring the

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consumer back.
Bring it back to the to the

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question with that as our
baseline, and that's been our

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baseline now for for several
years.

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Anti involution is kind of a
helpful extension of that, that

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policy process that hasn't
necessarily changed how we

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invest.
So, you know, lithium was a

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00:12:26,560 --> 00:12:29,320
really interesting place to do a
little bit of hunting when

226
00:12:29,320 --> 00:12:31,680
you're deep in the cost curve.
And I reckon that's been the

227
00:12:31,680 --> 00:12:34,640
difficult thing in lithium.
So it's been difficult to find

228
00:12:34,640 --> 00:12:37,520
attractive valuation even within
that context.

229
00:12:37,920 --> 00:12:40,680
So you've been able to find it
in in the fringes in some of the

230
00:12:40,680 --> 00:12:44,240
developers and some of the best
sort of new assets coming to

231
00:12:45,040 --> 00:12:47,240
market in the next cycle.
Because one thing is for sure,

232
00:12:47,360 --> 00:12:50,560
it is cyclical, it will recover
structurally.

233
00:12:50,560 --> 00:12:52,960
That industry is very
complicated, much more

234
00:12:52,960 --> 00:12:54,560
complicated than when I used to
work in it.

235
00:12:55,000 --> 00:13:00,440
And there is latent capacity and
we haven't necessarily seen the

236
00:13:00,440 --> 00:13:04,640
level of physical product or or
or investment come out of the

237
00:13:04,640 --> 00:13:08,320
market that would have make it
structurally more attractive.

238
00:13:08,320 --> 00:13:10,520
Do you know what I mean, where
you could really get behind I

239
00:13:10,520 --> 00:13:13,680
think a 60% reprice in the
commodity and say maybe we're

240
00:13:13,680 --> 00:13:15,800
just finding a new, a new level
here?

241
00:13:15,840 --> 00:13:17,040
Yeah, yeah.
Totally agree.

242
00:13:17,040 --> 00:13:20,720
I think that the valuations on
the, the bigger end of town, you

243
00:13:20,720 --> 00:13:23,200
always kind of wanted to get
them, you know, a little a

244
00:13:23,200 --> 00:13:26,320
little cheaper, a little cheaper
like sort of Pilbara and in line

245
00:13:26,320 --> 00:13:27,680
town sort of sort of comes to
mind.

246
00:13:27,680 --> 00:13:30,200
But all of a sudden they've
they've sort of rolled away from

247
00:13:30,200 --> 00:13:33,600
us once more.
And you know, like in this

248
00:13:33,600 --> 00:13:39,200
commodity downturn, quite
unusually, I wouldn't say

249
00:13:39,200 --> 00:13:43,400
investment really stopped.
Pilbara expanded in RES have

250
00:13:43,400 --> 00:13:48,560
light and capacity, IGO green
bushes expanded, Africa kept

251
00:13:48,560 --> 00:13:51,520
growing.
Argentina is now just getting

252
00:13:51,520 --> 00:13:53,720
those brands into a place where
they're going to start coming

253
00:13:53,720 --> 00:13:55,480
into the market in larger
volumes.

254
00:13:56,080 --> 00:14:00,720
So despite the price signal not
being there, investment still

255
00:14:00,720 --> 00:14:05,200
was.
And that is, you know, that will

256
00:14:05,200 --> 00:14:09,080
have a consequence, right,
Whether it's just it caps prices

257
00:14:09,080 --> 00:14:12,760
out at a lower level or we still
need to work through a bit of

258
00:14:12,760 --> 00:14:18,840
that capacity before we get to a
more sustained balance totally.

259
00:14:19,360 --> 00:14:22,320
Let's talk about Regis, guys.
Trav, this is this is right in

260
00:14:22,480 --> 00:14:25,880
in your wheelhouse.
Regis have been rumoured to be

261
00:14:25,880 --> 00:14:27,320
hunting, looking around, doing a
deal.

262
00:14:27,320 --> 00:14:30,840
I think, I think they've been
named to be in every single data

263
00:14:30,840 --> 00:14:33,160
room that's existed in the in
the last couple years.

264
00:14:33,280 --> 00:14:36,680
Yeah, they've, they've found
themselves in the news again and

265
00:14:37,000 --> 00:14:38,440
the wording has been kind of
interesting.

266
00:14:38,560 --> 00:14:40,240
Yeah, well, they.
Rebutted the Street Talk

267
00:14:40,240 --> 00:14:40,720
article.
St.

268
00:14:40,720 --> 00:14:44,240
Talk article basically said that
they're they're doing their work

269
00:14:44,440 --> 00:14:47,000
to pick up the other 70% of
Tropicana.

270
00:14:47,760 --> 00:14:50,640
There's been rumours swirling
about and like old Ashanti's you

271
00:14:50,640 --> 00:14:52,960
know future in Australia.
Sunrise Dam is rumoured to be on

272
00:14:52,960 --> 00:14:55,040
the chopping block.
Regis also pole position there

273
00:14:55,040 --> 00:14:56,600
too.
Mate if you are read all the

274
00:14:56,600 --> 00:14:58,760
Regis rumours.
Regis actually the most off if

275
00:14:58,760 --> 00:15:02,720
you look at the just like the
the focus focus chart today,

276
00:15:02,800 --> 00:15:05,240
they're the gold miners.
I think there are 4% this

277
00:15:05,240 --> 00:15:07,440
morning which for all the
Goldies, they just stood out

278
00:15:07,440 --> 00:15:08,800
like a sore thumb.
So on.

279
00:15:08,800 --> 00:15:10,960
The back of the the rumors
earlier, they came out with the

280
00:15:10,960 --> 00:15:13,720
full year results today as well
and about 38,000,000 bucks out

281
00:15:13,720 --> 00:15:17,320
in the dividend and then yeah,
it costs to sort of very much

282
00:15:17,320 --> 00:15:20,640
now in the high 2000s going
forward so.

283
00:15:20,640 --> 00:15:22,560
They come out with this response
to the speculation.

284
00:15:22,560 --> 00:15:25,960
They say we're, you know, we're
not in not in advanced

285
00:15:25,960 --> 00:15:28,760
discussions.
Do you read into that Dingo?

286
00:15:28,760 --> 00:15:30,960
I think they're in discussions,
just that with every intention

287
00:15:30,960 --> 00:15:32,680
of them becoming advanced.
Do you think, do you think

288
00:15:32,680 --> 00:15:34,360
there's a deal to be done with
Anglo Gold?

289
00:15:34,360 --> 00:15:36,480
Do you, do you think you know
what is just going to buy?

290
00:15:36,480 --> 00:15:38,040
They're going to buy something
they buy.

291
00:15:38,080 --> 00:15:39,560
How do they get the deal done
in?

292
00:15:39,560 --> 00:15:42,560
Some regards I feel a little bit
sorry for Regis because they

293
00:15:42,560 --> 00:15:44,800
feel like they're just the kid
in the playground getting picked

294
00:15:44,800 --> 00:15:48,880
on, but like they've got a big.
Pile of cash.

295
00:15:48,880 --> 00:15:51,440
It's not all they do.
Every journalist who wants to,

296
00:15:51,440 --> 00:15:53,600
he can throw something at me
when it's a slow.

297
00:15:53,600 --> 00:15:59,160
Newsday I write about.
Where you submit now, I think,

298
00:15:59,160 --> 00:16:02,040
you know, but again, where
there's smoke, there's fire and,

299
00:16:03,120 --> 00:16:08,560
and perhaps it's reflective of,
you know, where valuations on a

300
00:16:08,560 --> 00:16:10,680
lot of these Australian gold
miners are, right.

301
00:16:10,720 --> 00:16:14,920
And, and their portfolio
probably looks like it needs

302
00:16:15,680 --> 00:16:19,920
something else or, or, or, you
know, it's repriced to a certain

303
00:16:19,920 --> 00:16:22,320
level that, that, that their
paper has value.

304
00:16:22,320 --> 00:16:24,920
And So what are the things you
would look at the things that

305
00:16:24,920 --> 00:16:27,960
are for sale, obviously, and
then the things you already own.

306
00:16:27,960 --> 00:16:33,160
So I'd be absolutely shocked if
they weren't in a discussion for

307
00:16:33,160 --> 00:16:36,880
me more broadly, if I step it
back to, is it interesting for

308
00:16:36,880 --> 00:16:39,720
us?
Well, at this point in the

309
00:16:39,720 --> 00:16:44,480
cycle, people paying up for
assets is exactly what we don't

310
00:16:44,600 --> 00:16:46,920
want to be invested in.
You know, I don't think that

311
00:16:46,920 --> 00:16:51,200
that's good capital allocation
policy and maybe it is better to

312
00:16:51,200 --> 00:16:53,840
distribute more of that cash out
and a dividend, right.

313
00:16:53,960 --> 00:16:58,080
And, and this is what I think
the sector often gets wrong.

314
00:16:58,720 --> 00:17:03,240
There is a you know, I think
Zeppy said the other day, you

315
00:17:03,240 --> 00:17:06,800
know M&A is this kind of a
matter of timing if you like,

316
00:17:06,800 --> 00:17:09,520
like it's when you can do a deal
necessarily as opposed to is it

317
00:17:09,520 --> 00:17:11,720
the best part.
And so and I can I sympathize

318
00:17:11,720 --> 00:17:15,000
with that in some regards like
you need buyers and sellers to

319
00:17:15,000 --> 00:17:17,400
agree those bid are spreads need
to meet.

320
00:17:19,079 --> 00:17:23,599
But the best guys or the best
capital investment that we see

321
00:17:23,599 --> 00:17:26,240
in the space is done.
It is done counter cyclically.

322
00:17:26,240 --> 00:17:31,640
You find a way or you find a way
to find the cheap assets that

323
00:17:31,640 --> 00:17:36,200
can be unlocked.
And that that's the challenge

324
00:17:36,200 --> 00:17:39,000
Regis has got, I think.
And to their credit, they, they,

325
00:17:39,240 --> 00:17:43,000
you know, they not to date, we
haven't seen, they haven't

326
00:17:43,000 --> 00:17:47,200
announced anything on, on the,
the very public asset sales that

327
00:17:47,200 --> 00:17:50,080
have been out there and
discipline and discipline, yeah.

328
00:17:50,400 --> 00:17:52,480
And they, they probably didn't
have a license to do M&A for

329
00:17:52,480 --> 00:17:55,240
quite a while just because of
the way the market reacted to

330
00:17:55,240 --> 00:17:57,440
the acquisition of the initial
30% of job.

331
00:17:57,480 --> 00:17:58,880
Yeah.
Exactly right an interesting.

332
00:17:58,880 --> 00:18:01,680
Part of that deal and that was
like I think early 2021 that

333
00:18:01,680 --> 00:18:07,480
came out because they've got 30%
of job now they actually have a

334
00:18:07,480 --> 00:18:10,040
a pre emptive right over the
other 70%.

335
00:18:10,040 --> 00:18:12,200
So in the same way that were
these kind of favourable

336
00:18:12,960 --> 00:18:16,760
dynamics for for great land
gold, you know, getting hold of

337
00:18:17,120 --> 00:18:20,920
of of Telfer and other part of
Haveron at a reasonable enough

338
00:18:20,920 --> 00:18:24,320
price because the pre emptive
right they had Regis has kind of

339
00:18:24,320 --> 00:18:26,160
got the same.
And because of the exact

340
00:18:26,160 --> 00:18:28,400
procyclical you know thing
you've talked about.

341
00:18:28,400 --> 00:18:30,880
No, no gold miner really wants
to do procyclical M&A.

342
00:18:31,360 --> 00:18:34,480
And if you if if Anglo Gold
makes a decision that they are

343
00:18:34,480 --> 00:18:36,840
going to leave Australia in
their entirety, the whole

344
00:18:37,520 --> 00:18:42,000
Australian gold portfolio is for
sale, who who he's going to,

345
00:18:42,000 --> 00:18:44,520
who's going to throw in a bid
for for Trump, knowing that

346
00:18:44,520 --> 00:18:47,760
Regis has a pre emptive and he's
going to pay is would happily

347
00:18:47,760 --> 00:18:49,240
pay overs.
It actually gives them a kind of

348
00:18:49,400 --> 00:18:53,200
a favourable, you know, sales
dynamic to participate in and

349
00:18:53,200 --> 00:18:56,600
maybe buy at a reasonable price
just because the pre emptive is

350
00:18:56,600 --> 00:18:59,960
there and the apprehension of
the peers to to pay overs.

351
00:19:00,520 --> 00:19:03,880
Definitely the original 30%
acquisition came with a lot of

352
00:19:04,320 --> 00:19:06,840
criticism big time and and what
they paid for it.

353
00:19:06,960 --> 00:19:12,200
And it's ironic that we're back
there years later on the other

354
00:19:12,200 --> 00:19:14,920
70%.
But yes, like in doing that

355
00:19:14,920 --> 00:19:19,520
deal, they now have probably a
good strategic position on the

356
00:19:19,520 --> 00:19:23,760
other 70%.
And you know, if they've got

357
00:19:23,760 --> 00:19:27,680
time to be patient and you, you
probably can be.

358
00:19:28,120 --> 00:19:31,480
I'm not intimately intimately in
the detail around either the

359
00:19:31,480 --> 00:19:34,120
asset or, or, or their strategy
or anything like that.

360
00:19:34,200 --> 00:19:36,920
It always helps to have that
last rite of user because then

361
00:19:36,920 --> 00:19:38,280
you get, you can't be
disciplined.

362
00:19:38,800 --> 00:19:42,360
You can you get the final look.
So you made the comment when you

363
00:19:42,360 --> 00:19:46,440
when you started there Dingo
about looking at the valuations

364
00:19:46,440 --> 00:19:50,120
across the like, let's focus in
on the midcap Goldies to to

365
00:19:50,120 --> 00:19:52,480
start.
And this will tie in with our

366
00:19:52,480 --> 00:19:55,080
next story about Vault doing,
doing a buyback.

367
00:19:55,080 --> 00:19:58,120
But are you, are you sort of
seeing value in that, you know,

368
00:19:58,120 --> 00:20:01,960
call it one to to $5 billion
space with, with the Goldies

369
00:20:01,960 --> 00:20:04,080
like the gold prices run
massively.

370
00:20:04,080 --> 00:20:07,040
Their earnings have showed up.
Most of them have appreciated

371
00:20:07,120 --> 00:20:10,920
pretty healthily, but there's,
there's still debate out there

372
00:20:10,920 --> 00:20:13,480
about sort of are they being
priced appropriately?

373
00:20:13,480 --> 00:20:15,400
Where do you kind of fall in on
on that debate?

374
00:20:17,160 --> 00:20:19,040
I think it, yeah, I think
there's a bit of a spectrum out

375
00:20:19,040 --> 00:20:22,920
there across valuations.
I think overall the sector feels

376
00:20:22,920 --> 00:20:26,120
pretty reasonably priced to be
honest and it and it's repriced

377
00:20:26,120 --> 00:20:28,800
pretty well.
You know, what's your your

378
00:20:28,800 --> 00:20:30,640
overall view on where the
commodity goes?

379
00:20:30,640 --> 00:20:33,640
I think we'll probably dictate
that in the shorter term if you

380
00:20:33,640 --> 00:20:35,800
believe.
Spot gold price is the new gold

381
00:20:35,800 --> 00:20:37,640
price then.
My God they're criminally

382
00:20:37,640 --> 00:20:38,400
undervalued.
Well.

383
00:20:38,400 --> 00:20:39,520
Exactly right.
Yeah.

384
00:20:39,920 --> 00:20:43,040
If you run that out in
perpetuity, yeah.

385
00:20:43,160 --> 00:20:46,040
You can you.
Can mount the argument yeah I

386
00:20:46,040 --> 00:20:51,120
think names like Vault to be
fair they they did look cheap

387
00:20:51,120 --> 00:20:55,120
relative to the sector and there
was a a fundamental argument to

388
00:20:55,120 --> 00:20:58,400
to run there probably as well
you know fascinating to see what

389
00:20:58,400 --> 00:21:01,480
they they did yesterday in the
market and the.

390
00:21:01,480 --> 00:21:04,920
Market loved it as well like
they jumped up 1112% finally

391
00:21:04,920 --> 00:21:07,840
putting in that sort of Capital
Management yeah piece into the

392
00:21:07,840 --> 00:21:11,680
into play I mean.
It was a bit of a it was very

393
00:21:11,680 --> 00:21:13,640
interesting day.
They had three announcements, 1

394
00:21:14,000 --> 00:21:16,920
and earnings beat.
You know, there's a part of the

395
00:21:16,920 --> 00:21:22,120
market that loves that in
isolation, ACEO stepping away

396
00:21:22,720 --> 00:21:24,960
and at the same time putting in
a buyback.

397
00:21:25,080 --> 00:21:31,440
So, you know, I think if I'm, if
I'm ACEO stepping away, what a,

398
00:21:31,440 --> 00:21:33,600
what a beautiful day to do it
when I've just beat earnings and

399
00:21:33,600 --> 00:21:35,080
I'm putting a buyback in place.
Yeah.

400
00:21:36,160 --> 00:21:38,240
I think you're right, but you
have to sort of think that's

401
00:21:38,240 --> 00:21:43,360
like a 300 odd million, you
know, total sum of what they're

402
00:21:43,360 --> 00:21:46,680
sort of guiding that will spend
buying back stock over over the

403
00:21:46,680 --> 00:21:49,360
next 12 months.
That's that's a pretty healthy

404
00:21:49,360 --> 00:21:52,080
dent in the cash power that they
have if they end up fully

405
00:21:52,080 --> 00:21:54,080
deploying that and buying all
the shares back.

406
00:21:54,320 --> 00:21:56,040
Yeah.
I mean, look, it's a good, it's

407
00:21:56,040 --> 00:21:59,120
a good signal, I think on, on
how they view the value of their

408
00:21:59,120 --> 00:22:00,440
equity.
If they're willing to commit

409
00:22:00,440 --> 00:22:02,720
that much money to buying it
back, I find it.

410
00:22:02,720 --> 00:22:05,360
Disappointing that they they
come to this realization now

411
00:22:05,360 --> 00:22:10,400
where they had every opportunity
to to cancel the shares that

412
00:22:10,400 --> 00:22:12,400
Silverlake owned in red 5 at the
time of the deal.

413
00:22:12,400 --> 00:22:14,160
Remember, they owned, I think it
was like a 10 cent stake.

414
00:22:14,440 --> 00:22:17,480
They didn't they monetized it
just, you know, effectively like

415
00:22:17,720 --> 00:22:20,000
cap price is ish Oh for the
fact.

416
00:22:20,000 --> 00:22:23,240
So, but now they're doing a
buyback like in what's changed

417
00:22:23,240 --> 00:22:25,440
between now and then?
Well, the hedge book is now more

418
00:22:25,440 --> 00:22:27,880
out of the money.
The CapEx profile is maybe

419
00:22:27,880 --> 00:22:32,920
building, you know, like I, I
just, I'm, yeah, I, you know,

420
00:22:33,160 --> 00:22:36,000
commend them if they've, if
they've wanted to explore a deal

421
00:22:36,000 --> 00:22:37,400
and now that deal doesn't look
possible.

422
00:22:37,400 --> 00:22:39,240
And so they've had to
reconfigure their capital

423
00:22:39,240 --> 00:22:41,280
allocation.
But I don't understand why they

424
00:22:41,800 --> 00:22:45,240
they didn't come to a similar
decision at the time of the deal

425
00:22:45,240 --> 00:22:46,960
with Red 5.
Yeah.

426
00:22:46,960 --> 00:22:52,400
Look, I think hindsight vision
is 2020, So I'm somewhat

427
00:22:52,400 --> 00:22:56,360
cautious, yeah, in these types
of backwards looking analysis.

428
00:22:56,360 --> 00:23:01,840
But you know, look it could they
have foreseen this?

429
00:23:01,840 --> 00:23:03,720
And so therefore did they, you
know, could they have just

430
00:23:03,720 --> 00:23:05,720
cancelled the shares back then
at a much lower price?

431
00:23:05,720 --> 00:23:07,880
Could they have been buying back
shares a lot earlier?

432
00:23:09,280 --> 00:23:11,840
Possibly.
You know, so there's I suppose

433
00:23:11,880 --> 00:23:15,840
you can mount an argument.
Equally the gold price has

434
00:23:16,160 --> 00:23:18,960
significantly rewrited in the
last two years.

435
00:23:19,960 --> 00:23:23,760
They feel like they've been, you
know, working through a process

436
00:23:23,760 --> 00:23:26,960
of getting the capital stack
clear to the market.

437
00:23:29,440 --> 00:23:31,920
King of the Hills has been
through several downgrades.

438
00:23:32,720 --> 00:23:36,120
And yeah.
And so maybe they maybe they

439
00:23:36,120 --> 00:23:38,320
needed to work through that
process to get to a place of

440
00:23:38,320 --> 00:23:42,880
comfort in, in being able to
allocate the capital the way

441
00:23:42,880 --> 00:23:44,760
that they now have in the stack.
I mean that would be the

442
00:23:44,760 --> 00:23:48,080
optimistic way of of looking at
it fault.

443
00:23:48,080 --> 00:23:51,400
Makes me think about manga,
makes me think of mines in the

444
00:23:51,400 --> 00:23:53,760
gold fields.
Makes me think of the one

445
00:23:53,760 --> 00:23:57,080
organization I trust to turn big
rocks in the gold fields into

446
00:23:57,080 --> 00:23:59,280
the little rocks because they've
been doing it forever.

447
00:23:59,280 --> 00:24:01,400
Superbly.
Axis Mineral.

448
00:24:01,400 --> 00:24:04,000
Services.
Absolutely phenomenal.

449
00:24:04,160 --> 00:24:06,320
We know that they turn big rocks
into little rocks.

450
00:24:06,320 --> 00:24:09,720
We know that they've got this
enhanced backing from from Robex

451
00:24:09,760 --> 00:24:13,280
now to embark on on bigger
things in more broad locations.

452
00:24:13,640 --> 00:24:15,840
But we haven't talked about the
quality of their people before

453
00:24:15,840 --> 00:24:19,360
JD because they've got some of
the the the most dynamic people

454
00:24:19,360 --> 00:24:22,440
who are so solution oriented to
the client throughout that

455
00:24:22,440 --> 00:24:24,840
business 100.
Percent mate Jason O'Rourke,

456
00:24:24,880 --> 00:24:27,760
these this team has heaps of
experience you mentioned that

457
00:24:27,920 --> 00:24:30,400
the takeover they've got the
engineering capability behind

458
00:24:30,400 --> 00:24:34,640
them, the financial backing.
I think all of that is the the,

459
00:24:34,680 --> 00:24:37,200
the suite or the keys to the
success that they're gonna have

460
00:24:37,200 --> 00:24:40,000
in pushing themselves outside
the gold fields with all these

461
00:24:40,000 --> 00:24:42,560
goldies that we spoke about.
But we know they've worked on

462
00:24:42,800 --> 00:24:45,200
pretty much every project in
that area and pushing the

463
00:24:45,200 --> 00:24:49,760
horizons out to the Pilbara, to
the southwest and beyond, mate.

464
00:24:50,920 --> 00:24:52,320
Solutions.
What does making, what does a

465
00:24:52,320 --> 00:24:54,560
solution look like?
When you're when you turn big

466
00:24:54,560 --> 00:24:56,400
rocks into little rocks, we'll
make stuff goes wrong all the

467
00:24:56,400 --> 00:24:58,680
time.
You're breaking parts, you think

468
00:24:58,680 --> 00:25:01,040
things are getting jammed in all
these different places.

469
00:25:01,360 --> 00:25:04,360
Equipment goes down.
But with someone like Axis

470
00:25:04,600 --> 00:25:08,480
operating kit, they know what
they're doing to make sure that

471
00:25:08,480 --> 00:25:10,360
you're always turning big rocks
into little.

472
00:25:10,360 --> 00:25:12,680
Rocks in a.
Predictable way and they come up

473
00:25:12,680 --> 00:25:14,840
with unique solutions to make it
all happen 100%.

474
00:25:14,840 --> 00:25:17,640
Mate, whether it's a bit of
civil work, airstrips, mobile

475
00:25:17,640 --> 00:25:20,120
crushing solutions, their bread
and butter, they'll look after

476
00:25:20,120 --> 00:25:21,560
you quality.
People axis.

477
00:25:21,560 --> 00:25:25,200
Mineral services go Axis.
To do great control guys, let's

478
00:25:25,200 --> 00:25:27,520
do.
It mate, this is got to give a

479
00:25:28,000 --> 00:25:31,800
letter grade A to F of a major
corporate move or policy or or

480
00:25:31,960 --> 00:25:34,480
whatever that we've come across
this week commodity trend

481
00:25:34,560 --> 00:25:37,520
explain your reasoning debate.
You know, we're, we're all for

482
00:25:37,520 --> 00:25:38,440
it, Punchy.
Views.

483
00:25:38,480 --> 00:25:40,000
Punchy views.
Yeah, All right, let's start

484
00:25:40,000 --> 00:25:43,840
with Peabody terminating their
deal with Anglo.

485
00:25:43,840 --> 00:25:46,360
So we we actually spoke about
this one last week.

486
00:25:46,360 --> 00:25:48,080
Trev, kick us off, mate.
What do you what do you give

487
00:25:48,080 --> 00:25:49,040
this one?
It's not just.

488
00:25:49,080 --> 00:25:51,520
It's not just that they've
terminated like Anglo in

489
00:25:51,520 --> 00:25:53,440
response to saying they're going
to, you know, they're going to

490
00:25:53,440 --> 00:25:54,640
sue them.
Sue, sue them for.

491
00:25:55,000 --> 00:25:56,720
Yeah.
I mean, just as a result of it,

492
00:25:56,720 --> 00:26:00,840
they disagree with the with the
ability to terminate it given

493
00:26:01,360 --> 00:26:03,760
they disagree on whether or not
what's going on there is a

494
00:26:04,120 --> 00:26:06,520
material adverse event.
Mate.

495
00:26:06,520 --> 00:26:09,240
I actually think, like if I
think about it from, from, from

496
00:26:09,320 --> 00:26:11,960
from anybody's perspective, I'm
going to actually give them,

497
00:26:12,600 --> 00:26:16,560
give them a, you know, AB here.
I, if they couldn't, if they

498
00:26:16,680 --> 00:26:18,880
didn't think value was there
anymore, even though their stock

499
00:26:18,880 --> 00:26:22,320
is rebounded, like, like good on
them for actually not having so

500
00:26:22,320 --> 00:26:24,360
much deal commitment.
There's a lot of momentum in a

501
00:26:24,360 --> 00:26:25,760
deal.
There's so much momentum to just

502
00:26:25,760 --> 00:26:27,680
get a deal done.
And for them, they came to

503
00:26:27,680 --> 00:26:32,280
market, you know, all of a
sudden the asset did change.

504
00:26:32,720 --> 00:26:36,400
And also the response to the
deal in the 1st place, like for

505
00:26:36,400 --> 00:26:38,560
Peabody was like, no one was
expecting this.

506
00:26:38,560 --> 00:26:40,640
They hadn't guided the market
that they were going to be in

507
00:26:40,640 --> 00:26:43,160
and around the hoop here.
The price was probably higher

508
00:26:43,160 --> 00:26:46,280
than the market thought, you
know, you had to pay for for on

509
00:26:46,280 --> 00:26:49,120
a multiple basis for coal assets
as well at the time and the

510
00:26:49,120 --> 00:26:51,240
stock tanked because there was a
funding concern.

511
00:26:51,240 --> 00:26:55,640
So they've probably got a bunch
of shareholder feedback and if

512
00:26:55,640 --> 00:26:59,600
they've actually, you know, like
been able to pull themselves out

513
00:26:59,600 --> 00:27:02,200
of them and the deal momentum
and and and, you know,

514
00:27:02,200 --> 00:27:06,280
reconfigure on that basis, then,
you know, I'll give them AB on

515
00:27:06,280 --> 00:27:09,280
Anglo.
Like I think it's also a you

516
00:27:09,280 --> 00:27:14,520
must see, just because there's I
think they'll find an outcome

517
00:27:14,520 --> 00:27:17,120
here.
It'll sell for less, but they'll

518
00:27:17,120 --> 00:27:18,400
get an outcome here.
They'll sell the assets.

519
00:27:18,800 --> 00:27:19,160
Yeah.
I.

520
00:27:19,160 --> 00:27:20,400
Think I think you're right
Dingo.

521
00:27:20,720 --> 00:27:23,600
Got a rating for this one mate?
Really interesting.

522
00:27:23,600 --> 00:27:28,840
So initially I'd give Peabody
like an EI think that

523
00:27:28,840 --> 00:27:33,960
transaction was history, almost
history repeating itself.

524
00:27:34,000 --> 00:27:37,080
Yeah.
And that was, it was crazy to

525
00:27:37,080 --> 00:27:40,000
think that it might occur again,
right?

526
00:27:40,040 --> 00:27:44,840
The last time Peabody made a
major transaction like that was

527
00:27:44,840 --> 00:27:47,160
at the top of the market.
They end up going into Chapter

528
00:27:47,160 --> 00:27:49,560
11 bankruptcy, right?
It was the deal.

529
00:27:49,560 --> 00:27:53,480
It was poor deal discipline that
played a major role there.

530
00:27:54,040 --> 00:27:57,840
And then here we are again
several years later at the top

531
00:27:57,840 --> 00:28:02,680
of the coal market, playing a
top price like a multiple of

532
00:28:02,680 --> 00:28:05,240
their market cap almost.
Well, certainly once the the

533
00:28:05,240 --> 00:28:09,640
shares derated what they had to
fund, which just seemed

534
00:28:11,440 --> 00:28:17,440
radically illogical to me.
And the market obviously agreed

535
00:28:17,440 --> 00:28:21,160
with that.
Now it's almost like, you know,

536
00:28:21,200 --> 00:28:24,840
you failed your exam and your
your professor or whatever

537
00:28:25,000 --> 00:28:26,840
really likes you.
So it gives you a second chance.

538
00:28:27,200 --> 00:28:31,280
And the way and the way that
they've responded here by

539
00:28:32,520 --> 00:28:37,400
pulling the levers at their
disposal to try and walk away

540
00:28:37,400 --> 00:28:42,000
from the deal be because of the,
the risk that it poses, I think

541
00:28:42,000 --> 00:28:45,800
is sensible.
Like it it, it's good to see

542
00:28:45,800 --> 00:28:50,400
them going down with a fight.
I don't have a view on the

543
00:28:50,400 --> 00:28:54,600
grounds which they've got here.
And and there's still a risk at

544
00:28:54,600 --> 00:28:56,320
what that liability might look
like.

545
00:28:56,320 --> 00:29:01,560
They've pulled the, you know,
the Mac clause, the infamously,

546
00:29:03,840 --> 00:29:07,040
you know, uncertain clause that
that you could, you get to

547
00:29:07,040 --> 00:29:09,320
basically interpret in your, in
your own way.

548
00:29:11,360 --> 00:29:14,320
You'd have to refer to lawyers
as to how you fight this one

549
00:29:14,320 --> 00:29:16,760
out.
But yeah, I, I, I think there's

550
00:29:16,760 --> 00:29:19,440
still a little bit of risk
associated with that, but it's

551
00:29:19,440 --> 00:29:23,240
good to see them pulling that
lever, particularly if it's less

552
00:29:23,240 --> 00:29:26,760
dilutive or less costly than
actually having to complete at

553
00:29:26,760 --> 00:29:27,920
that price.
Totally.

554
00:29:27,960 --> 00:29:29,880
Yeah, I, I, I think you're,
you're spot on.

555
00:29:29,880 --> 00:29:35,320
So this deal got announced like
November 2024 and straight away

556
00:29:35,320 --> 00:29:37,720
like the the share price starts
plummeting.

557
00:29:37,960 --> 00:29:40,960
So the the share price had
pretty much halved by the time

558
00:29:40,960 --> 00:29:45,520
there's the fire end of March,
early April at at Moranbah.

559
00:29:45,560 --> 00:29:49,560
And this would have been the the
thing that like Peabody were

560
00:29:49,720 --> 00:29:53,240
praying for this gave them the
out and they were, they were

561
00:29:53,240 --> 00:29:56,520
begging for begging and praying,
I reckon every single night for

562
00:29:56,520 --> 00:29:58,400
for an out on this deal.
And.

563
00:29:59,640 --> 00:30:01,520
I reckon, I reckon.
This so much.

564
00:30:01,880 --> 00:30:06,040
Like I, I do think there's a lot
of push back, but many, like the

565
00:30:06,040 --> 00:30:08,160
world is full of empire
builders, empire building

566
00:30:08,160 --> 00:30:10,320
management teams, especially US
listed companies, because the

567
00:30:10,320 --> 00:30:11,920
bigger your company, the more
assets you own, the more you pay

568
00:30:11,920 --> 00:30:14,680
yourself.
And yeah, and it scales insane.

569
00:30:14,920 --> 00:30:17,600
I just think, like, I think my
default assumption is that

570
00:30:17,600 --> 00:30:20,360
management teams want to build
empires.

571
00:30:20,360 --> 00:30:22,920
And even though it would have
been bad for shareholders, it

572
00:30:23,000 --> 00:30:24,680
could have been better for
management.

573
00:30:24,840 --> 00:30:26,720
And so like, I feel like there's
so much commitment to go through

574
00:30:26,720 --> 00:30:28,720
with it, like.
Agreed, agreed.

575
00:30:28,720 --> 00:30:31,200
But within six months, they'd
realized this wasn't the right

576
00:30:31,200 --> 00:30:34,200
move and they were praying for
an out and like praying for a

577
00:30:34,200 --> 00:30:36,440
second go at that, at that move.
And they got it.

578
00:30:36,440 --> 00:30:39,720
And who knows what the, the, the
liability ends up being.

579
00:30:39,720 --> 00:30:43,600
But like, I, I can't, I cannot
give them a, a positive rating

580
00:30:43,600 --> 00:30:45,000
at all.
You know, it's going to be AD or

581
00:30:45,000 --> 00:30:49,160
an E for the discipline going
into the initial transaction

582
00:30:49,400 --> 00:30:52,040
like that, that that was very
poor.

583
00:30:52,040 --> 00:30:54,640
And you know, like you said
earlier, Dingo, like Hansard's

584
00:30:54,640 --> 00:30:58,960
2020, but it proved to be very,
very poor timing to to Trav's

585
00:30:58,960 --> 00:31:03,200
point.
This type of diverse capital

586
00:31:03,200 --> 00:31:08,480
allocation from executives, it
is really poor.

587
00:31:08,720 --> 00:31:10,920
Do you know what I mean?
And, and at a point in time,

588
00:31:11,600 --> 00:31:15,440
they made a decision, either
they hadn't consulted

589
00:31:15,440 --> 00:31:19,120
shareholders or they just had a
radically different view to the

590
00:31:19,120 --> 00:31:21,640
reality of, of how this would be
perceived.

591
00:31:22,160 --> 00:31:23,560
And they kind of went with it
anyway.

592
00:31:24,000 --> 00:31:27,520
And that's the difficult bit.
If you're looking at Peabody now

593
00:31:27,520 --> 00:31:30,120
as like, you know, can you,
could it, could it be a good

594
00:31:30,120 --> 00:31:31,280
investment?
And it would have been.

595
00:31:31,280 --> 00:31:33,240
If we went into Chapter 11 again
and you could buy it out of

596
00:31:33,320 --> 00:31:36,880
chapter. 11 It would have been
fantastic they wanted to do it

597
00:31:36,880 --> 00:31:38,200
with.
So much debt as well.

598
00:31:38,240 --> 00:31:42,240
So sort of like ridden with risk
the the whole way through, yeah

599
00:31:42,240 --> 00:31:45,880
and that.
Like the best guys I think that

600
00:31:45,880 --> 00:31:48,840
have long term success in this
industry.

601
00:31:49,080 --> 00:31:51,760
Like there's a lot of guys that
do this industry and I'm talking

602
00:31:51,760 --> 00:31:55,440
about now that's anyone, whether
you're where you're running a

603
00:31:55,440 --> 00:31:57,400
company or you're a fund manager
or whatever.

604
00:31:57,600 --> 00:32:00,040
There's a lot of guys that do
this industry and there's only

605
00:32:00,040 --> 00:32:01,720
so many guys that I think do it
well.

606
00:32:02,160 --> 00:32:03,520
And there's a big, big
difference.

607
00:32:03,880 --> 00:32:07,280
And doing it well is about being
a disciplined capital allocator.

608
00:32:07,800 --> 00:32:12,200
You know that is where you will
get you will get reward in the

609
00:32:12,200 --> 00:32:14,720
long run and there are guys that
trade on the A6 with huge

610
00:32:14,720 --> 00:32:19,760
premiums because of of you know
that characteristic speaking.

611
00:32:19,760 --> 00:32:21,280
Of discipline capital allocation
mate.

612
00:32:21,280 --> 00:32:24,360
The next thing to give a great
control to you see this one,

613
00:32:24,360 --> 00:32:30,720
this stock Kaylee resources KLR
extraordinary very disciplined

614
00:32:30,720 --> 00:32:33,040
capital allocation which.
Quick, whoever was.

615
00:32:33,040 --> 00:32:36,720
Buying stock on market but
clearly just wanted to.

616
00:32:36,800 --> 00:32:39,800
I mean 94% was controlled by the
top 20 shareholders.

617
00:32:39,800 --> 00:32:43,640
It's very interesting.
Curious register and clearly a

618
00:32:43,640 --> 00:32:46,720
liquid micro cap but sword an
astronomical intraday

619
00:32:46,720 --> 00:32:48,200
percentage.
I've never seen anything like it

620
00:32:48,200 --> 00:32:50,000
before.
What was the number?

621
00:32:50,000 --> 00:32:54,080
Like 8600% or something.
I was watching it in real time

622
00:32:54,080 --> 00:32:56,840
when somebody clued me on to it
just for 10 minutes.

623
00:32:57,680 --> 00:33:00,880
I was trading up 6000%.
That's crazy.

624
00:33:00,880 --> 00:33:04,520
Yeah, I put it on Iris and I
watched it trade in 15 minutes

625
00:33:04,520 --> 00:33:07,480
to 9000%.
So it was a great buy there at

626
00:33:07,520 --> 00:33:09,880
6000.
Percent up good if you can get

627
00:33:09,880 --> 00:33:12,280
it.
Only $2,000,000 worth of shares

628
00:33:12,280 --> 00:33:13,560
traded hands.
The whole is that.

629
00:33:13,560 --> 00:33:14,640
Right.
Yeah, the.

630
00:33:14,640 --> 00:33:18,840
Whole day and then so it it
broke a high of over 3 bucks

631
00:33:19,520 --> 00:33:23,720
dropped by yesterday afternoon
when I checked in on it to $0.19

632
00:33:24,040 --> 00:33:26,720
and this morning up another
healthy 350%.

633
00:33:27,080 --> 00:33:30,640
So went into a pause in trading
because the assets put in a

634
00:33:30,640 --> 00:33:34,880
pause at like $0.82.
I don't know how to to to rate

635
00:33:34,880 --> 00:33:36,440
this one.
Not not a big fan of that.

636
00:33:36,440 --> 00:33:37,960
The pump and dump.
I'll give that one.

637
00:33:38,080 --> 00:33:43,360
Yeah, probably an F, but a for
entertainment like eye-catching

638
00:33:43,360 --> 00:33:44,400
sort of stuff.
What do you guys reckon?

639
00:33:44,400 --> 00:33:47,920
Yeah, I think.
Like markets will be like funny

640
00:33:47,920 --> 00:33:50,120
games will happen on markets to
the extent they're allowed to

641
00:33:50,120 --> 00:33:52,760
happen.
So I just give ASX an an an F.

642
00:33:56,760 --> 00:33:59,640
For the yeah, it's very hard to
it's very hard to say much more

643
00:33:59,640 --> 00:34:01,440
than that.
It there's a very curious

644
00:34:01,440 --> 00:34:04,640
register, there's clearly some
very suspicious things going on

645
00:34:04,640 --> 00:34:07,400
there of absolutely no insight.
Let's.

646
00:34:07,400 --> 00:34:10,000
Change tack and go to America
for a second.

647
00:34:10,000 --> 00:34:13,719
So resolution couple was in the
news again this week and it was

648
00:34:13,719 --> 00:34:16,440
actually a few different things
all kind of coalescing on on the

649
00:34:16,440 --> 00:34:19,520
same day.
So on the day that the heads of

650
00:34:19,520 --> 00:34:22,639
both BHB and Rio went to the
White House, got a photo with

651
00:34:22,679 --> 00:34:29,880
with Mr. Trump, you had another
appeal lodged by a group of

652
00:34:29,880 --> 00:34:32,719
environmentalists as well as
Native American groups.

653
00:34:33,239 --> 00:34:35,880
Now this had come a couple
months after what was supposedly

654
00:34:35,880 --> 00:34:39,920
the the final approvals needed
for this project that's been in

655
00:34:39,920 --> 00:34:43,199
the works for well over kind of
20 years now.

656
00:34:43,199 --> 00:34:48,920
So maybe I'll go 1st and give a
give a rating and explanation.

657
00:34:49,199 --> 00:34:52,880
I think this one's AD in my mind
and how I sort of thought about

658
00:34:52,880 --> 00:35:00,640
it is like the ability to build
mines in in the US because like

659
00:35:00,640 --> 00:35:03,480
mines always come with with
trade-offs, as we all know.

660
00:35:03,480 --> 00:35:06,000
And there will be, you know,
land disturbance because of this

661
00:35:06,000 --> 00:35:08,920
mine of the sort of block cave
kilometer and a half, but below

662
00:35:08,920 --> 00:35:11,120
the ground.
But it's a trade off.

663
00:35:11,200 --> 00:35:15,040
And if they're going to be
serious about having this copper

664
00:35:15,040 --> 00:35:18,600
come from the States, then
there's no sort of perfectly

665
00:35:18,600 --> 00:35:21,760
desolate part of America where
there's going to be copper there

666
00:35:21,760 --> 00:35:24,040
for them to kind of take.
So you're going to have to pick

667
00:35:24,040 --> 00:35:25,600
and choose and it's going to
have to come from somewhere.

668
00:35:25,600 --> 00:35:28,880
Otherwise it's going to come
from elsewhere in the world or

669
00:35:28,960 --> 00:35:32,240
prices will go up and it was
sort of adjust with that pricing

670
00:35:32,240 --> 00:35:36,440
sort of mechanism.
So the the way in which the US

671
00:35:36,440 --> 00:35:39,760
is just so litigious these days
and even after final approval is

672
00:35:39,760 --> 00:35:43,280
given for a mine, it still gets
bogged down is kind of mind

673
00:35:43,280 --> 00:35:45,160
blowing.
But it's kind of been that way

674
00:35:45,160 --> 00:35:48,360
for the best part of 50 years.
And that's why I think capital

675
00:35:48,360 --> 00:35:51,520
will keep going to to other
jurisdictions where you can

676
00:35:51,520 --> 00:35:52,760
actually get kind of things
done.

677
00:35:52,760 --> 00:35:55,040
I'm not sure if you guys think
about this one in a kind of

678
00:35:55,040 --> 00:35:58,640
different light, but yeah, I
don't think any of us are

679
00:35:58,680 --> 00:36:01,240
massively surprised on on this
front.

680
00:36:03,360 --> 00:36:08,800
Probably not surprised in a very
controversial asset this one

681
00:36:08,800 --> 00:36:11,280
over the journey.
It's been through a long a long

682
00:36:11,280 --> 00:36:14,960
journey.
I would take a different route

683
00:36:14,960 --> 00:36:17,520
just to start here.
And I would say I'm going to

684
00:36:17,520 --> 00:36:22,960
give the US probably AB plus
here on where they're trying to

685
00:36:22,960 --> 00:36:28,240
take policy because I think
investment, often what I reckon

686
00:36:28,240 --> 00:36:32,080
the market misses here is that
commodities are long lead,

687
00:36:32,400 --> 00:36:34,040
right?
They're long lead investment.

688
00:36:34,240 --> 00:36:37,920
They require vision, they
require the ability to think

689
00:36:37,920 --> 00:36:40,280
long term.
And arguably that's why China

690
00:36:40,280 --> 00:36:43,000
has pulled the West pants down
and spanked it so hard in the

691
00:36:43,000 --> 00:36:47,000
last 1020 years.
Just taking a step back, back to

692
00:36:47,000 --> 00:36:48,840
that last point, you need two
things.

693
00:36:48,840 --> 00:36:52,080
Therefore, to invest.
You need a price signal or a or

694
00:36:52,080 --> 00:36:56,480
a view on a price signal and you
need a policy setting that you

695
00:36:56,480 --> 00:37:00,160
can you can get behind because
you need to make investment and

696
00:37:00,160 --> 00:37:03,880
you're not going to see the
reward from that investment or

697
00:37:03,880 --> 00:37:06,760
the detraction from that
investment until a point in the

698
00:37:06,760 --> 00:37:09,720
future, right?
So those two things need to

699
00:37:09,720 --> 00:37:12,960
marry up.
And the USI think are trying to

700
00:37:12,960 --> 00:37:18,280
get this policy setting much
more stable, much more clear at

701
00:37:18,280 --> 00:37:23,000
least like here is the pathway.
If you go down this path and you

702
00:37:23,000 --> 00:37:25,640
tick all the right boxes, you
will get permitted.

703
00:37:26,160 --> 00:37:30,960
And I mean, it's partly
existential to what they want to

704
00:37:30,960 --> 00:37:33,880
do, right?
They need these localized supply

705
00:37:33,880 --> 00:37:37,040
chains if they're really serious
about having local

706
00:37:37,040 --> 00:37:41,240
manufacturing, about
reinvigorating the refining part

707
00:37:41,240 --> 00:37:45,280
of the supply chain, if they are
serious about reducing China's

708
00:37:45,280 --> 00:37:50,160
leverage over them, which is,
you know, hugely concentrated in

709
00:37:50,160 --> 00:37:52,640
metals processing.
And you've seen it at the tip of

710
00:37:52,640 --> 00:37:55,040
the spear in rare earths.
But it's so much bigger than

711
00:37:55,040 --> 00:37:57,960
that, which I think most people
don't understand.

712
00:37:58,960 --> 00:38:04,120
So I give the US sort of AB plus
in, in the way that they're

713
00:38:04,120 --> 00:38:09,760
trying to in very QuickTime get
sharper and better at, at

714
00:38:09,880 --> 00:38:14,400
getting these processes going in
terms of the judicial nature of

715
00:38:14,920 --> 00:38:19,880
the system in the US, I've got
no issue with the process in in

716
00:38:19,880 --> 00:38:21,640
some ways that it's there as a
check.

717
00:38:22,280 --> 00:38:25,320
The extent to which it's
exercised in the US just feels

718
00:38:25,320 --> 00:38:32,560
excessive and yeah and and can
get things bogged down and in an

719
00:38:32,680 --> 00:38:35,880
asset like this.
And then if I even go another

720
00:38:35,880 --> 00:38:43,640
angle, I'll give the sector an E
in the way that it promotes

721
00:38:43,640 --> 00:38:46,840
itself, right?
The way that it is generating

722
00:38:46,840 --> 00:38:51,920
groundswell or, or going back to
grass roots and educating people

723
00:38:51,920 --> 00:38:55,480
on the significance and
importance of these of this

724
00:38:55,480 --> 00:39:01,240
industry to their livelihoods,
to, you know, all the things

725
00:39:01,240 --> 00:39:09,560
that they consume to, to growth.
They're so scared of coming out

726
00:39:09,560 --> 00:39:15,280
from behind the veil, right?
And for the last 20-30 years

727
00:39:15,280 --> 00:39:18,000
they've stayed behind there.
They haven't wanted to rock the

728
00:39:18,000 --> 00:39:21,400
boat, you know, and I think it's
done them a disservice.

729
00:39:21,840 --> 00:39:26,120
I think a lot of people, the
easiest place for people to go

730
00:39:26,120 --> 00:39:29,600
and pick on, you know, from an
ideological point of view is

731
00:39:29,600 --> 00:39:33,160
mining because they've been told
and taught it's bad.

732
00:39:34,280 --> 00:39:39,200
But it's that is a fundamental
misunderstanding that it is

733
00:39:39,200 --> 00:39:43,120
fundamental.
If it wasn't grown, if it wasn't

734
00:39:43,120 --> 00:39:47,400
like the food and grains and
wood timber that we grow, it was

735
00:39:47,400 --> 00:39:51,120
mined, you know, absent
recycling, which is just no way

736
00:39:51,120 --> 00:39:54,040
that recycling can ever support
the level of consumption that we

737
00:39:54,040 --> 00:39:57,320
have on, on materials it was
mined.

738
00:39:58,400 --> 00:40:00,320
So how can you love a farmer and
hate a miner?

739
00:40:00,360 --> 00:40:05,680
It's illogical, right?
And the overall footprint on

740
00:40:06,280 --> 00:40:10,920
the?
Like on a, on a, on a area basis

741
00:40:11,120 --> 00:40:16,200
versus mining is a fraction.
But you never hear BHP or Rio

742
00:40:16,200 --> 00:40:21,160
Tinto talking about that.
You never hear them trying to

743
00:40:21,160 --> 00:40:26,560
promote this sort of education
within school systems or or

744
00:40:26,560 --> 00:40:29,760
communities.
And instead we end up in these

745
00:40:29,760 --> 00:40:35,640
very complicated places where
ideology drives the outcome.

746
00:40:37,640 --> 00:40:40,360
You know, this is a copper mine
that we're talking about here

747
00:40:40,680 --> 00:40:42,920
that is a kilometer underground,
right?

748
00:40:43,480 --> 00:40:46,680
Yes, the ground disturbance,
there will be some, but it will

749
00:40:46,680 --> 00:40:50,640
be tiny in terms of area.
And as far as I've I've

750
00:40:50,640 --> 00:40:53,360
understood and, and, and again,
I'm no expert on this asset in

751
00:40:53,360 --> 00:40:57,440
particular, it's not really
where we hunt is that, you know,

752
00:40:57,440 --> 00:41:01,120
the indigenous lands that are
recognized, the closest one is

753
00:41:01,120 --> 00:41:03,720
20 miles or something from where
this will have a disturbance.

754
00:41:03,720 --> 00:41:11,120
So we're not, they're not very
good at presenting or marketing

755
00:41:11,120 --> 00:41:15,680
those facts to the community
and, and generating support.

756
00:41:15,680 --> 00:41:17,320
And this is much bigger than
just an asset.

757
00:41:17,600 --> 00:41:20,800
This is about reshaping how
people think about this industry

758
00:41:21,160 --> 00:41:22,800
and coming out from behind the
valve.

759
00:41:22,800 --> 00:41:28,160
So being so scared of, of people
criticizing and asking and, and

760
00:41:28,160 --> 00:41:31,240
having the conversation.
So in that regard, I think these

761
00:41:31,240 --> 00:41:33,760
guys have been their own worst
enemy over a 20 year period.

762
00:41:34,480 --> 00:41:37,480
The next one I'm going to talk
about is the NDPR price.

763
00:41:37,480 --> 00:41:42,400
So this nearly hit US 90 bucks
this week, which is a huge 50%

764
00:41:42,640 --> 00:41:45,840
plus rally, very similar to to
the lithium price since about

765
00:41:46,200 --> 00:41:50,360
late June.
So as as Tom O'Leary at Luca

766
00:41:50,360 --> 00:41:53,760
called it this this might be the
the inklings of a non China or

767
00:41:53,760 --> 00:41:56,960
bifurcated price.
The the reason we've seen this

768
00:41:56,960 --> 00:41:59,760
kick up is actually a confluence
of a hyper factors.

769
00:41:59,760 --> 00:42:03,920
So you've got this peak
production season from a, from a

770
00:42:03,920 --> 00:42:06,960
manufacturing sense in China
occurring right now.

771
00:42:06,960 --> 00:42:08,760
So that that gives a bit of a
demand boost.

772
00:42:08,760 --> 00:42:12,360
Then you've got pretty strong
home appliance numbers coming

773
00:42:12,360 --> 00:42:16,080
out of of China and and globally
in in pockets as well, which

774
00:42:16,320 --> 00:42:20,000
boosts that demand.
Hence more magnet production is

775
00:42:20,000 --> 00:42:22,840
is taking place.
And then on the supply side,

776
00:42:22,840 --> 00:42:26,600
you've got a, a supply
contraction very similar to the,

777
00:42:27,000 --> 00:42:29,840
the license sort of debate that
we spoke about with, with YJ

778
00:42:29,840 --> 00:42:32,840
and, and last week in the
lithium world, the Chinese are

779
00:42:32,840 --> 00:42:35,640
taking a a stricter sort of view
on environmental licenses.

780
00:42:35,640 --> 00:42:38,480
And of course they're, they're
huge producers of rare earths as

781
00:42:38,480 --> 00:42:43,280
well as processes.
So this adds to a bit of a, a

782
00:42:43,280 --> 00:42:46,880
self fulfilling thing with big
cargo holders of of rare earth

783
00:42:47,560 --> 00:42:50,840
of rare earths in China saying,
hey, maybe won't sell, we'll

784
00:42:50,840 --> 00:42:53,760
hold on a little bit longer.
Prices run up, you're pulling

785
00:42:53,760 --> 00:42:56,800
more supply out and then traders
have jumped on board and pushed

786
00:42:56,800 --> 00:42:58,520
this up.
So you've had a kind of

787
00:42:58,520 --> 00:43:03,160
beautiful confluence and a run
up of a price from, you know,

788
00:43:03,160 --> 00:43:06,640
really in in the doldrums for a
pretty long period around 50

789
00:43:06,640 --> 00:43:09,760
bucks, which is not economic for
for anyone.

790
00:43:09,760 --> 00:43:13,160
So all of a sudden there's a lot
of love and a lot of the names,

791
00:43:13,160 --> 00:43:16,400
which I'm sure you're very
familiar with Dingo have no,

792
00:43:16,640 --> 00:43:19,280
they've run up sort of 5X from
the beginning when all this MP

793
00:43:19,280 --> 00:43:21,600
materials announcement started
taking place.

794
00:43:21,600 --> 00:43:24,000
So it's a, it's a hard one to
kind of write, but if I take the

795
00:43:24,000 --> 00:43:28,200
perspective of the junior, you
know, battlers in the, on the

796
00:43:28,200 --> 00:43:31,600
ASX in the railroad space, I'd
love to give them an A because

797
00:43:31,600 --> 00:43:33,360
they're finally getting a bit
more attention on them.

798
00:43:34,000 --> 00:43:36,160
The the importance of what
they're doing is kind of being

799
00:43:36,160 --> 00:43:39,720
highlighted and hopefully along
the way a few projects get a bit

800
00:43:39,720 --> 00:43:42,160
more capital they need and the
the sort of cream rises to the

801
00:43:42,680 --> 00:43:43,680
to the top there.
Yeah, for the.

802
00:43:43,680 --> 00:43:45,320
Sector I'll give this one an eye
as well.

803
00:43:45,320 --> 00:43:50,880
I think you know like it it's
great to see that that the

804
00:43:50,880 --> 00:43:53,200
theory works across all
commodities.

805
00:43:53,200 --> 00:43:56,840
You know, like these rare earths
has been in the cost curve for a

806
00:43:56,840 --> 00:43:58,880
while and, and the rare earths
cost curve is very hard to

807
00:43:58,880 --> 00:44:05,480
decipher with any real accuracy,
as I would say, But it, it is

808
00:44:05,480 --> 00:44:06,640
certainly felt like it's been
there.

809
00:44:06,640 --> 00:44:09,040
It's been a, the incentive price
hasn't been there.

810
00:44:09,040 --> 00:44:11,640
And there's a very big
geopolitical overlay on this

811
00:44:11,640 --> 00:44:13,240
one.
Like this is right at the tip of

812
00:44:13,240 --> 00:44:17,480
that spear and and China love to
put the foot on the throat and I

813
00:44:17,480 --> 00:44:20,160
think they still maintain a fair
level of leverage there.

814
00:44:20,880 --> 00:44:25,760
So, but equally, it's good to
see the commodity price

815
00:44:25,760 --> 00:44:29,400
responding in such a way to meet
these funny supply demand

816
00:44:29,400 --> 00:44:35,040
dynamics, I think, which then
enable the sector to, to raise

817
00:44:35,040 --> 00:44:36,640
the capital to advance the
assets.

818
00:44:38,320 --> 00:44:41,360
That doesn't, my opinion doesn't
mean that I think all these

819
00:44:41,360 --> 00:44:43,720
assets are good assets and that
they're all going to get there.

820
00:44:45,680 --> 00:44:50,520
I, I, I think you have to be
selective in this space to, to

821
00:44:50,520 --> 00:44:53,760
protect your downside, right?
But I think a few of these

822
00:44:53,760 --> 00:44:56,080
assets will get built.
They need to be at the right end

823
00:44:56,080 --> 00:45:00,640
of the cost curve, but we don't
need 100 rare earth assets.

824
00:45:01,320 --> 00:45:02,160
Well said.
Well said.

825
00:45:02,360 --> 00:45:04,680
I think I've got one more for
for grade control, unless we

826
00:45:04,680 --> 00:45:07,920
want to Chuck in a few more.
This one was plucked out of the

827
00:45:07,920 --> 00:45:09,880
Endeavour Minings conference
call.

828
00:45:09,880 --> 00:45:12,360
It was actually a few weeks ago,
but it sort of come onto our

829
00:45:12,360 --> 00:45:14,760
radar just just recently.
You can hear it.

830
00:45:14,760 --> 00:45:16,560
Straight from horses now, I
don't know if there's a CFO or

831
00:45:16,560 --> 00:45:20,360
the CEO.
Ones just on, on the hedge, you

832
00:45:20,600 --> 00:45:22,840
make the point that's been quite
financially painful to you,

833
00:45:23,200 --> 00:45:25,520
although I understand the
reasons why you, you put it in

834
00:45:26,120 --> 00:45:29,600
fair to assume that as we go
into 26 you'll comment that

835
00:45:29,760 --> 00:45:32,520
you'll be unhedged means that we
won't be expecting to see any

836
00:45:32,520 --> 00:45:35,520
hedging goes through the
accounts in the into the into

837
00:45:35,520 --> 00:45:40,960
the next year.
Anybody who proposes A hedging

838
00:45:40,960 --> 00:45:45,200
program for 2026 will have to
deliver the proposal along with

839
00:45:45,200 --> 00:45:52,000
their resignation slip.
Excellent.

840
00:45:52,000 --> 00:45:56,680
Who wants to go?
I'll give the comment and I just

841
00:45:56,680 --> 00:45:59,120
for the for the.
Yeah, make it, make it a joke.

842
00:45:59,120 --> 00:46:00,600
It was pretty funny.
I like the character in a

843
00:46:00,600 --> 00:46:02,440
conference call.
They're usually pretty dull.

844
00:46:03,360 --> 00:46:05,200
Yeah.
But I just thought that I think

845
00:46:05,200 --> 00:46:07,440
I think the same.
The CEO also made a comment in

846
00:46:07,440 --> 00:46:09,560
the same call.
Use the word bum fight.

847
00:46:09,560 --> 00:46:12,120
There's going to be a bum fight.
Just.

848
00:46:12,400 --> 00:46:14,520
You know, implore, implore all
of that kind of stuff that you

849
00:46:14,520 --> 00:46:16,600
said a bit of character in the
conference calls on, on hedging

850
00:46:16,600 --> 00:46:18,240
itself.
You know, like of course you

851
00:46:18,240 --> 00:46:21,480
want to be unhedged in what what
in these good times.

852
00:46:21,480 --> 00:46:25,760
I do think it's, it's you can,
you can easily see and interpret

853
00:46:25,760 --> 00:46:28,280
how we have procyclical capital
allocation in the sector.

854
00:46:28,280 --> 00:46:32,760
It's like in, in the times where
gold price is really high,

855
00:46:33,000 --> 00:46:34,640
everyone, everyone wants to be
fully unhedged.

856
00:46:34,640 --> 00:46:36,280
And then it's like when the
times times are low, then

857
00:46:36,280 --> 00:46:38,080
everyone's putting hedging in
place because they've been,

858
00:46:38,320 --> 00:46:40,800
they've got that, you know,
short term bias of, of history

859
00:46:40,800 --> 00:46:42,200
in the head.
And also it's what all the

860
00:46:42,200 --> 00:46:43,840
investors are talking to them
about, right.

861
00:46:43,880 --> 00:46:48,920
So I just think more long term
thinking and long term kind of

862
00:46:48,920 --> 00:46:51,240
thinking about this sort of
stuff in a counter cyclical way

863
00:46:51,560 --> 00:46:54,680
like you invest every day dingo
like would be welcome in the

864
00:46:54,720 --> 00:46:57,680
capital allocation front.
Yeah, no arguments on that

865
00:46:57,680 --> 00:46:59,760
front.
I mean, and we don't always get

866
00:46:59,760 --> 00:47:02,560
it right, but it's certainly a
framework of thinking that we

867
00:47:02,560 --> 00:47:04,920
work within.
I love conviction.

868
00:47:04,920 --> 00:47:08,880
I love, you know, I give that an
A he's he's, he's telling the

869
00:47:08,880 --> 00:47:12,320
entire world clearly what he's
telling his employee, I think.

870
00:47:12,320 --> 00:47:14,960
But structurally gold looks
pretty reasonable.

871
00:47:16,320 --> 00:47:20,880
You know, the best hedge that
they could have is to focus on

872
00:47:20,880 --> 00:47:22,720
costs, right?
And that's probably doesn't get

873
00:47:22,720 --> 00:47:26,400
enough focus in the gold world.
Best hedge you can have here

874
00:47:26,480 --> 00:47:29,240
with a really healthy commodity
price, whether it whether it

875
00:47:29,240 --> 00:47:34,640
trades at this level or, or
around 3000 or, or or up is to

876
00:47:34,800 --> 00:47:37,600
get your costs down.
Yeah, you maximise those

877
00:47:37,600 --> 00:47:38,440
margins.
Yeah.

878
00:47:38,440 --> 00:47:41,680
And and have that discipline at
the top of the commodity.

879
00:47:42,200 --> 00:47:45,160
Is this a top at A at a healthy
commodity price?

880
00:47:45,880 --> 00:47:48,080
You can if that's an interesting
point too, because you can hedge

881
00:47:48,080 --> 00:47:50,720
your diesel like those are those
are options to lock in your cost

882
00:47:50,720 --> 00:47:52,720
for a long duration.
Let's let's try a sweet deal

883
00:47:52,720 --> 00:47:54,360
sale deal.
There's been a few deals this

884
00:47:54,360 --> 00:47:56,640
week.
Yeah, some some interesting

885
00:47:56,640 --> 00:47:59,200
different kind of deals.
Again, the cap raises are are

886
00:48:00,000 --> 00:48:02,680
horrific.
You must just be, yeah, getting

887
00:48:02,800 --> 00:48:05,640
getting crossed on the regular
for a cap raise or you know the

888
00:48:05,640 --> 00:48:07,320
likes at the moment, dingo, I've
been busy.

889
00:48:07,320 --> 00:48:09,040
For a couple of months, yeah,
yeah.

890
00:48:09,240 --> 00:48:12,160
So let's start there.
I mean, the the ones that kind

891
00:48:12,160 --> 00:48:15,320
of come to mind this week.
I mean, it's just big in the

892
00:48:15,320 --> 00:48:18,920
rare earth space like Lindian
and an Arif Euro.

893
00:48:18,920 --> 00:48:21,400
You know, it was $180 million
together between the two.

894
00:48:21,400 --> 00:48:23,840
They're just kind of massive,
massive on the cap raise front.

895
00:48:24,200 --> 00:48:26,280
Did you participate in in either
of them?

896
00:48:26,840 --> 00:48:31,000
So we deal with Saudi.
I think overall suite it's good

897
00:48:31,000 --> 00:48:35,160
to see capital being injected
back into the sector to to

898
00:48:35,160 --> 00:48:38,000
advance the assets and and of of
decent quantums.

899
00:48:38,240 --> 00:48:43,400
Yeah, participate in Lindian,
Yeah, Yeah, happy to to, you

900
00:48:43,400 --> 00:48:45,640
know, ring the bell on that one
if you like and.

901
00:48:45,840 --> 00:48:49,200
Got a pathway to yeah, I mean
it's it's fid it's getting it's

902
00:48:49,200 --> 00:48:52,840
a.
Fantastic asset, right to the to

903
00:48:52,840 --> 00:48:54,680
the point I think we've made
just before.

904
00:48:55,560 --> 00:48:57,200
Very happy to be asset selective
here.

905
00:48:57,480 --> 00:49:00,960
Yeah, very happy to, to take a,
a, a sort of stock pickers view

906
00:49:00,960 --> 00:49:04,240
of different things.
And it's low capital intensity,

907
00:49:04,240 --> 00:49:08,840
it's low cost, it's in a, you
know, it's not in the simplest

908
00:49:08,840 --> 00:49:13,160
of jurisdictions, but this
runway should see it fully

909
00:49:13,160 --> 00:49:15,960
funded.
And you know, they've got the

910
00:49:15,960 --> 00:49:18,040
relationship and agreement with
Iluka.

911
00:49:18,040 --> 00:49:21,080
So commercial pathway to
production has a lot to like

912
00:49:21,080 --> 00:49:22,160
about this one.
Yeah.

913
00:49:22,880 --> 00:49:25,800
Yeah, you didn't say it, but I,
my, my views on Nolan's are very

914
00:49:25,800 --> 00:49:29,840
public.
So I'll say that then in the

915
00:49:29,840 --> 00:49:33,280
cold space we we are magnetic
came to mind.

916
00:49:33,280 --> 00:49:35,320
I don't know if there are any
other ones on your on your radar

917
00:49:35,320 --> 00:49:38,760
that came up this week that were
were worthy of your of your

918
00:49:38,760 --> 00:49:41,440
participation, but I think they.
Were the two big ones?

919
00:49:41,440 --> 00:49:43,560
Yeah, again, I think both of
them are sweet deals.

920
00:49:43,560 --> 00:49:46,440
Both of them will enable those
companies to go and advance

921
00:49:46,440 --> 00:49:49,240
their assets further and and
they have very credible places

922
00:49:49,240 --> 00:49:51,280
to to commit the capital.
Beautiful.

923
00:49:52,000 --> 00:49:57,200
Then on the on the strangely
royalty front, Regal's royalty

924
00:49:57,200 --> 00:50:00,600
Fund so that they, you know,
they, they are raising money to

925
00:50:00,600 --> 00:50:05,080
acquire this royalty over
Malabar's Maxwell Underground.

926
00:50:05,080 --> 00:50:07,680
So it was coal royalty NSW
$94,000,000 so.

927
00:50:08,640 --> 00:50:12,680
It's pretty interesting, right?
So 1.25% life of mine royalty,

928
00:50:12,680 --> 00:50:16,560
just another demonstration here
that money is going to go into

929
00:50:17,040 --> 00:50:21,440
NSW assets and continue to to
look away from Queensland coal

930
00:50:21,440 --> 00:50:25,400
assets because we're in a pretty
tough environment.

931
00:50:25,400 --> 00:50:28,520
And I think sort of the the
White Haven team really

932
00:50:28,520 --> 00:50:31,680
emphasizes this week, but in a
tough environment and it's still

933
00:50:31,680 --> 00:50:34,760
only 5 bucks away from the
royalty marketing.

934
00:50:35,320 --> 00:50:39,440
Incrementally 40% on your
earnings means capital is going

935
00:50:39,440 --> 00:50:43,120
to be starved from from that
space until there's a shifting

936
00:50:43,600 --> 00:50:45,560
of the of the rules.
This is.

937
00:50:45,560 --> 00:50:49,240
This is a massive issue, right?
This I think we sort of semi

938
00:50:49,240 --> 00:50:52,800
touched on it when we were
talking about BHP brio Tinto

939
00:50:52,800 --> 00:50:58,920
resolution.
This short termism of policy for

940
00:50:58,920 --> 00:51:05,600
which our political system seems
to support is so damaging to

941
00:51:05,600 --> 00:51:09,160
industry and it's so damaging to
capital.

942
00:51:10,000 --> 00:51:13,680
And The thing is that you don't
see it straight away.

943
00:51:14,280 --> 00:51:18,640
So, and the political cycle
isn't long enough for them to

944
00:51:18,640 --> 00:51:20,600
bear the consequences of it
either.

945
00:51:21,160 --> 00:51:25,680
And so you, you, you have to
have that long term vision.

946
00:51:25,680 --> 00:51:28,200
You have to understand that the,
you're having long term

947
00:51:28,200 --> 00:51:30,080
implications by these policy
settings.

948
00:51:30,440 --> 00:51:34,120
I think, you know, a key take
away from BH PS earnings this

949
00:51:34,120 --> 00:51:36,920
week and BHP is not necessarily
a place where we hunt either,

950
00:51:37,440 --> 00:51:41,840
was what they weren't saying,
you know, it was where are they

951
00:51:41,840 --> 00:51:44,280
allocating their marginal dollar
going forward?

952
00:51:44,360 --> 00:51:51,240
It wasn't into Australia, right?
And nowhere is this more this

953
00:51:51,240 --> 00:51:55,640
idea that the, so the if the
commodity price signal is there,

954
00:51:56,040 --> 00:51:57,880
the policy setting clearly
isn't.

955
00:51:58,880 --> 00:52:01,920
And this is so evident in the
oil and gas sector who've been

956
00:52:01,920 --> 00:52:06,200
saying this and acting or
behaving with their feet leaving

957
00:52:06,960 --> 00:52:11,880
and capital not coming in for
the last 10 years and it's now

958
00:52:11,880 --> 00:52:14,320
just starting to come to
materials.

959
00:52:15,520 --> 00:52:19,520
And it completely is.
It's a completely disrespectful

960
00:52:19,520 --> 00:52:22,600
to the fact that over the last
20 years, the majority of our

961
00:52:22,600 --> 00:52:26,960
GDP growth here in Australia has
come from the material sector.

962
00:52:27,400 --> 00:52:30,760
But it impacts everybody.
Whether you work in services on

963
00:52:30,760 --> 00:52:33,200
the East Coast or whether you
work in a mine in the Pilbara,

964
00:52:33,600 --> 00:52:37,720
it impacts you.
And this is the bit that the

965
00:52:37,720 --> 00:52:41,800
politicians I I don't think have
are they, are they don't care

966
00:52:41,800 --> 00:52:44,720
for or they, or they don't have
an understanding of.

967
00:52:44,920 --> 00:52:48,120
And you know, we've just had
this policy, this productivity

968
00:52:48,120 --> 00:52:53,520
roundtable this week.
And to me, it's frightening what

969
00:52:53,520 --> 00:52:57,480
what's coming out of that?
It's not surprising that BHP to

970
00:52:57,480 --> 00:53:00,760
me are committing capital
offshore, you know, and and

971
00:53:00,760 --> 00:53:06,040
ironically enough into Argentina
than they are into SA copper.

972
00:53:06,720 --> 00:53:09,120
And mining barely had a seat at
the table at the at the

973
00:53:09,120 --> 00:53:10,040
productivity.
Barely.

974
00:53:10,040 --> 00:53:14,040
Had a seat in the table and and
more more commentary.

975
00:53:14,040 --> 00:53:17,840
Let's increase taxes more, let's
increase royalties more.

976
00:53:18,400 --> 00:53:24,240
Despite the fact in Queensland
quite starkly, they have

977
00:53:24,240 --> 00:53:28,160
railroaded the Met metallurgical
coal industry.

978
00:53:28,160 --> 00:53:31,720
I mean, they were some of the
lowest cost, highest grade,

979
00:53:32,000 --> 00:53:37,320
highest quality assets globally
going into, you know, primarily

980
00:53:37,320 --> 00:53:39,480
going into steel production for
for metallurgical.

981
00:53:39,480 --> 00:53:43,120
And yes, there is some thermal
up there Who those assets at

982
00:53:43,120 --> 00:53:47,160
this price point now are, are,
are uneconomic and nobody's

983
00:53:47,160 --> 00:53:50,280
investing in them.
And that's going to have a

984
00:53:50,280 --> 00:53:56,120
radical impact on Queensland.
And you know, again, in if you

985
00:53:56,120 --> 00:53:59,480
want more evidence of this,
Victor and and Sam Barrage talks

986
00:53:59,480 --> 00:54:00,920
to this a lot.
You guys spoke about this last

987
00:54:00,920 --> 00:54:03,000
week.
Victorian gas, yeah.

988
00:54:03,920 --> 00:54:09,000
What you're seeing now in terms
of the cost of living pressures,

989
00:54:09,480 --> 00:54:14,600
the the price of of utilities,
the price of the gas, the

990
00:54:14,760 --> 00:54:19,640
uneconomic nature of industry.
There is a function and a direct

991
00:54:19,640 --> 00:54:22,600
impact of policy that was put in
place 5 or 6 years ago and

992
00:54:22,600 --> 00:54:28,640
you're only just like seeing the
consequences of that now and

993
00:54:29,120 --> 00:54:32,760
it's damaging, right.
It takes a long time to fix and

994
00:54:33,760 --> 00:54:36,240
you know, it takes a lot longer
than a three-year political

995
00:54:36,240 --> 00:54:40,680
cycle to fix.
And so it it is going to require

996
00:54:41,520 --> 00:54:44,760
people to be more aware of these
things, to understand what it is

997
00:54:44,760 --> 00:54:47,720
that you're the consequences of
what what's occurring.

998
00:54:48,320 --> 00:54:51,520
I think to tie in what you said
earlier as well, Dingo, it's the

999
00:54:51,640 --> 00:54:54,520
the advertising of what the
industry does for the country.

1000
00:54:55,120 --> 00:54:59,200
It's not present in the minds of
the people, the value add to the

1001
00:54:59,200 --> 00:55:03,280
country that that these
companies bring from operations

1002
00:55:03,280 --> 00:55:04,720
that are on the other side of
the country.

1003
00:55:04,720 --> 00:55:08,200
And that advertising needs to be
more present to to highlight the

1004
00:55:08,960 --> 00:55:11,080
the positivity of of what the
industry does.

1005
00:55:11,160 --> 00:55:13,200
Yeah, like where?
In this Productivity Roundtable,

1006
00:55:13,200 --> 00:55:19,120
has anybody spoken about cost,
about economic growth, about an

1007
00:55:19,120 --> 00:55:22,480
understanding that, you know, if
we stay on energy for a second,

1008
00:55:22,520 --> 00:55:26,000
fundamentally economic growth is
energy converted.

1009
00:55:27,280 --> 00:55:33,720
So you have, we have invested
all of this capital and seen all

1010
00:55:33,720 --> 00:55:37,600
of this capital not come right
because of a policy setting that

1011
00:55:37,600 --> 00:55:40,360
is just sending the price higher
and higher and higher and for

1012
00:55:40,360 --> 00:55:42,880
some reason we think we're going
to get productivity out of that.

1013
00:55:43,520 --> 00:55:46,480
It's the exact opposite.
At a very, very fundamental

1014
00:55:46,480 --> 00:55:49,040
level, economic growth is just
energy converted.

1015
00:55:50,000 --> 00:55:53,800
We have to be competitive on a
global scale with the inputs

1016
00:55:53,800 --> 00:55:55,520
that we're putting into our
industry, whether they're

1017
00:55:55,520 --> 00:55:58,200
service based or whether they're
primary industry.

1018
00:55:59,400 --> 00:56:01,840
I think we've, we've done
ourselves no favours with this

1019
00:56:01,840 --> 00:56:08,280
like marketing or like framing
or siloing out of what we what

1020
00:56:08,320 --> 00:56:10,880
we classify as critical minerals
from the rest.

1021
00:56:10,880 --> 00:56:15,560
And I just think it's that get
such a hugely unwarranted

1022
00:56:15,840 --> 00:56:20,560
political focus compared to like
especially relative to what like

1023
00:56:20,560 --> 00:56:24,120
Australia's GDP composition is
from the mining sector.

1024
00:56:24,320 --> 00:56:26,240
Every mineral, mineral is
critical.

1025
00:56:26,240 --> 00:56:28,440
That's why we mine it.
We mine it because we need it.

1026
00:56:28,440 --> 00:56:32,240
We don't mine it for fun.
It's absurd that, you know, if,

1027
00:56:32,320 --> 00:56:35,640
if, if we just like reframed
mining is critical.

1028
00:56:35,800 --> 00:56:39,600
All of the minerals is critical.
And I just think that that you

1029
00:56:39,600 --> 00:56:43,400
get like a better focus on what
matters because iron ore costs

1030
00:56:43,400 --> 00:56:45,600
matters a lot.
Coal mining costs matters a lot,

1031
00:56:46,040 --> 00:56:46,680
yeah.
Totally.

1032
00:56:46,680 --> 00:56:50,040
And I'm so sympathetic to the
the person, the general person

1033
00:56:50,040 --> 00:56:53,160
on the street is feeling the
financial repression that has

1034
00:56:53,160 --> 00:56:55,560
been here for a while, right,
that they are feeling it.

1035
00:56:55,800 --> 00:56:58,600
They don't quite, I don't think
everybody fully grasp it and

1036
00:56:58,600 --> 00:57:00,280
understands it, but they can
feel.

1037
00:57:00,280 --> 00:57:05,640
I'm so sympathetic to that and
but where we land, I think

1038
00:57:05,640 --> 00:57:08,240
politically is we try and just
we keep just keep band aiding

1039
00:57:08,240 --> 00:57:10,280
things, right.
If we change this policy over

1040
00:57:10,280 --> 00:57:12,760
here, hopefully that will work.
Or if we give you some subsidy

1041
00:57:12,760 --> 00:57:16,320
over there or we change this
singular thing in the tax

1042
00:57:16,320 --> 00:57:21,400
system, none of that stuff is is
going to fundamentally work.

1043
00:57:22,120 --> 00:57:25,400
What about the idea of growing
the pie, right?

1044
00:57:25,400 --> 00:57:29,440
We're so fixated on the pie is
fixed, whether it's the economy

1045
00:57:29,440 --> 00:57:34,080
or or investment or never.
What about the old adage that I

1046
00:57:34,080 --> 00:57:36,600
think we had, we, we did very
well in this country, which is

1047
00:57:36,600 --> 00:57:40,240
let's grow the pie, right?
And how do we be economic and

1048
00:57:40,240 --> 00:57:43,920
how do we be competitive?
And as we grow that pie, how

1049
00:57:43,920 --> 00:57:47,840
does our our well-being as a
community grow with it?

1050
00:57:48,480 --> 00:57:52,240
And we've just moved so far away
from that in the rhetoric and it

1051
00:57:52,400 --> 00:57:57,200
because it's hard on the street,
it's hard for people to get away

1052
00:57:57,200 --> 00:58:00,000
from the real short termism of
it.

1053
00:58:00,200 --> 00:58:06,280
And that's where our politics,
you know, that's where really

1054
00:58:06,280 --> 00:58:10,400
ambitious people who who are
strong leaders, I think could be

1055
00:58:10,400 --> 00:58:12,960
very powerful.
Unfortunately, it's not what I

1056
00:58:12,960 --> 00:58:15,640
think we've got at the moment,
yeah.

1057
00:58:15,920 --> 00:58:18,200
I mean, we've done such a great
job in this in this country for

1058
00:58:18,200 --> 00:58:21,040
so many years.
Just hopefully we can kick back

1059
00:58:21,040 --> 00:58:24,720
some of their own goals and and
keep going in a in a positive

1060
00:58:24,720 --> 00:58:28,160
direction to to round out with
one more sweet and sour deal.

1061
00:58:28,600 --> 00:58:32,160
There was talk about Tianchi
potentially proposing to take

1062
00:58:32,160 --> 00:58:36,400
over IGO stake in Kwinana.
And there's a few sort of policy

1063
00:58:36,400 --> 00:58:38,560
tie insurance in this one as
well, because it ties in with

1064
00:58:38,560 --> 00:58:41,960
that whole downstream narrative,
which our government was very

1065
00:58:42,240 --> 00:58:46,720
big on and still, you know, not
quite as loud, but there's

1066
00:58:46,720 --> 00:58:48,880
things like the tax credits that
are supposedly going to kick in

1067
00:58:48,880 --> 00:58:53,680
in in a few years time.
Now, IGO wrote down this

1068
00:58:53,680 --> 00:58:56,200
investment to to nothing a short
while ago.

1069
00:58:56,720 --> 00:59:00,200
The last quarter alone, it
operated I think about 35% of

1070
00:59:00,200 --> 00:59:04,720
nameplate capacity and they
still lost $29 million in the

1071
00:59:04,720 --> 00:59:07,680
quarter.
So it throws up a whole heap of

1072
00:59:07,680 --> 00:59:10,560
questions about, you know, would
Ferb even approve any, any deal

1073
00:59:10,560 --> 00:59:12,240
like this?
But it was a very interesting

1074
00:59:12,240 --> 00:59:15,040
catch, which I only saw right at
the end from Frank Hart, who's

1075
00:59:15,040 --> 00:59:20,480
the CEO of Tianchi saying, hey,
Yep, we would be interested in

1076
00:59:20,480 --> 00:59:24,160
buying your stake in Kwinana.
We're very keen to keep going

1077
00:59:24,480 --> 00:59:29,800
and keep putting in money and
there would be a catch that you

1078
00:59:29,800 --> 00:59:34,120
would have to sort of sell your
stake in green bushes if you

1079
00:59:34,120 --> 00:59:36,640
were wanting to sell your stake
in Konana to us.

1080
00:59:36,640 --> 00:59:40,600
So yeah, I love the balls from
Frank there.

1081
00:59:41,280 --> 00:59:44,040
He knows what he's sort of
playing with and the dynamic in

1082
00:59:44,040 --> 00:59:49,400
that that JV, as with most JV's
is, is kind of fraught, or at

1083
00:59:49,440 --> 00:59:52,840
least starts out friendly enough
and then ends up being fraud.

1084
00:59:53,040 --> 00:59:55,160
I love the commentary that came
out of Tianchi.

1085
00:59:55,160 --> 00:59:57,120
I think it's so loaded.
Yeah.

1086
00:59:59,640 --> 01:00:04,600
You know, on one hand, it's it's
so almost funny.

1087
01:00:04,600 --> 01:00:06,800
It's hard to say.
It's not to say you've been

1088
01:00:06,800 --> 01:00:08,480
ramping up this plant for five
years.

1089
01:00:08,480 --> 01:00:11,440
I still committed to it.
It's still nowhere near even

1090
01:00:11,440 --> 01:00:15,080
half of its capacity.
So.

1091
01:00:16,800 --> 01:00:19,600
You know, looking deeper, like,
why, why are they doing that?

1092
01:00:19,640 --> 01:00:23,440
And I think maybe that last
comment that you made there,

1093
01:00:23,440 --> 01:00:26,560
maybe that's the rub.
Maybe it's like, yeah, we

1094
01:00:26,560 --> 01:00:29,400
wouldn't mind squeezing IGO out
of green bushes.

1095
01:00:29,400 --> 01:00:34,000
And how do we do that, You know,
and whether that's going to

1096
01:00:34,000 --> 01:00:37,800
work, I've probably not, right?
And that's not what I'm saying.

1097
01:00:37,800 --> 01:00:40,000
And I'm not expressing an
opinion on IGO here.

1098
01:00:40,560 --> 01:00:43,520
I know why I agree with them.
I would want out of that

1099
01:00:44,160 --> 01:00:46,400
downstream processing it as
well, yeah.

1100
01:00:46,760 --> 01:00:49,520
Doesn't it, doesn't it just
really highlight the, the

1101
01:00:51,200 --> 01:00:55,480
limitations of a of a, of a
joint venture agreement where,

1102
01:00:56,520 --> 01:00:59,040
Yeah, where like when you buy
into a joint venture and you

1103
01:00:59,040 --> 01:01:01,360
don't have control like
effectively and that's a.

1104
01:01:01,360 --> 01:01:04,120
Complicated run, right, That's a
JV on a JV, Yeah, yeah, yeah,

1105
01:01:04,120 --> 01:01:05,560
big.
Time, big time.

1106
01:01:06,600 --> 01:01:10,480
It's it's yeah, you, you managed
to buy a stake in the lowest

1107
01:01:10,480 --> 01:01:14,160
cost lithium ion in the world,
but it came with its, it came

1108
01:01:14,160 --> 01:01:17,680
with its attachments and those
attachments where a a joint

1109
01:01:17,680 --> 01:01:20,600
venture that is, it is
incredibly onerous.

1110
01:01:20,680 --> 01:01:24,240
And yeah, you don't have the
ability to curtail, you know,

1111
01:01:24,760 --> 01:01:28,440
the capital that is going
towards like it's literally just

1112
01:01:28,440 --> 01:01:29,560
a money hole.
Yeah.

1113
01:01:29,560 --> 01:01:34,200
Exactly real.
Like very logically, like, yeah,

1114
01:01:34,200 --> 01:01:37,800
I think RGL, like we are wasting
the value of one of the best

1115
01:01:37,800 --> 01:01:41,560
resources in the world by just
plugging it into this downstream

1116
01:01:41,560 --> 01:01:44,320
processing facility that is loss
making.

1117
01:01:44,720 --> 01:01:48,120
That is very rational.
You know that that's entirely

1118
01:01:48,120 --> 01:01:49,520
rational where they're coming
from.

1119
01:01:50,880 --> 01:01:53,640
Absolutely.
Last but not least fellas, any

1120
01:01:53,640 --> 01:01:56,640
any hidden gems, any any
Nuggets, any podcasts, any

1121
01:01:56,640 --> 01:02:00,480
movies, any concerts or anything
sticking out in your mind

1122
01:02:00,720 --> 01:02:02,480
something you want to shine a
shine a light on?

1123
01:02:04,440 --> 01:02:07,160
I can't stop.
Well, I'll let you go first, JD,

1124
01:02:07,600 --> 01:02:08,640
All right.
I'll kick off.

1125
01:02:08,800 --> 01:02:13,520
I went down to found which is
the the brewery in a in a spot

1126
01:02:13,520 --> 01:02:15,720
that's seen a few breweries go
through that in in the middle of

1127
01:02:15,720 --> 01:02:19,800
Subi there and they've good
little spot, good pizza and

1128
01:02:19,800 --> 01:02:22,320
stuff, but they've got this
wicked new beer called Zest West

1129
01:02:22,720 --> 01:02:24,600
and I've I've punched a good few
of them lately.

1130
01:02:24,600 --> 01:02:27,240
So go down to your local and
support them because that was a

1131
01:02:27,240 --> 01:02:28,760
that was a Ripper.
How about you fellas?

1132
01:02:30,400 --> 01:02:32,960
Yeah, I've probably
misinterpreted this, this, this

1133
01:02:32,960 --> 01:02:35,960
segment, but.
I just give it to us.

1134
01:02:36,000 --> 01:02:39,480
I'm still.
Pumped up about so Janie did

1135
01:02:39,480 --> 01:02:42,720
this big historical like episode
on, on, on Fortescue.

1136
01:02:42,720 --> 01:02:45,240
And as a result of that, a
couple of people who were right

1137
01:02:45,240 --> 01:02:47,160
there at the beginning sort of
reached out.

1138
01:02:47,160 --> 01:02:50,720
We got coffee with him yesterday
and I'm just buzzing.

1139
01:02:50,720 --> 01:02:53,840
It was, it was, you know, two
hours with the people who've

1140
01:02:53,840 --> 01:02:57,200
lived through this absolutely
formidable thing, you know, like

1141
01:02:57,280 --> 01:03:00,560
create creating a true major
from from nothing.

1142
01:03:00,560 --> 01:03:02,400
And you like that.
Yeah, I was just, I was buzzing

1143
01:03:02,400 --> 01:03:05,680
all day yesterday and, and last
night from, from, from that

1144
01:03:05,680 --> 01:03:06,520
combo.
It was just wicked.

1145
01:03:07,600 --> 01:03:10,040
Yeah, nice.
I might just carry on in that

1146
01:03:10,040 --> 01:03:12,760
theme because it just reminded
me of a conversation I had last

1147
01:03:12,760 --> 01:03:15,760
night.
But yeah, and, and to be

1148
01:03:15,760 --> 01:03:19,160
positive about what this sector
can create, you know, and the

1149
01:03:19,160 --> 01:03:22,760
opportunity that it can have for
multiple people, you know, New

1150
01:03:22,760 --> 01:03:26,440
World resources taken over
recently by Cantera.

1151
01:03:27,160 --> 01:03:30,840
And, you know, just speaking to
a few guys there.

1152
01:03:32,160 --> 01:03:36,680
You know, there's a guy who who
is now he, he is effectively

1153
01:03:36,680 --> 01:03:39,880
going to buy a house for every
single one of his kids, right?

1154
01:03:39,920 --> 01:03:43,760
And he is just an everyday guy.
I I believe he was a landscaper

1155
01:03:43,760 --> 01:03:46,080
or something like that, right?
He runs a very honest business.

1156
01:03:46,080 --> 01:03:49,160
He lives a very honest life.
He's made an investment there

1157
01:03:50,240 --> 01:03:53,440
and it's paid off in spades.
He's now, and there's several

1158
01:03:53,440 --> 01:03:55,760
guys Fortescue reminds me
because there's several people

1159
01:03:55,760 --> 01:04:00,480
on that register that have, you
know, at the the most incredible

1160
01:04:00,480 --> 01:04:04,520
stories you've ever heard.
And that is so fantastic to

1161
01:04:04,520 --> 01:04:06,840
hear, you know, like guys having
a win like that.

1162
01:04:06,840 --> 01:04:13,120
But this is truly life changing.
And that is, yeah, if we can, we

1163
01:04:13,120 --> 01:04:17,040
all play a role in this, in this
sector, if we can keep promoting

1164
01:04:17,480 --> 01:04:21,880
and growing these assets and and
delivering value and what it

1165
01:04:21,880 --> 01:04:25,120
means to the people that are
involved can be just enormous,

1166
01:04:25,560 --> 01:04:28,000
you know?
And yeah, equally a new world

1167
01:04:28,000 --> 01:04:32,200
guys that that, you know, are on
drill wrecks, guys that that

1168
01:04:32,200 --> 01:04:35,560
pick up rocks for a living, you
know, they've all had a win

1169
01:04:35,560 --> 01:04:36,920
there.
And I just think that that those

1170
01:04:36,920 --> 01:04:38,680
stories are they're just so
good.

1171
01:04:38,680 --> 01:04:41,800
They're so good to reflect on.
It's, you know, it's there has

1172
01:04:41,800 --> 01:04:44,240
to be something more to what we
do.

1173
01:04:44,240 --> 01:04:48,160
And, and I love that aspect.
Perhaps more to the theme of

1174
01:04:48,160 --> 01:04:51,000
what you of the segment,
something that caught my eye

1175
01:04:51,000 --> 01:04:54,320
this week on the on the arts
front, which is, you know, not

1176
01:04:54,320 --> 01:04:58,440
necessarily something my
expertise is, is Quentin

1177
01:04:58,440 --> 01:05:02,640
Tarantino is is coming back, but
not with the 10th movie that I

1178
01:05:02,640 --> 01:05:04,120
think all the fans are waiting
for.

1179
01:05:04,120 --> 01:05:06,160
He's coming out with a stage
play next year.

1180
01:05:06,160 --> 01:05:10,440
So really you're interested in a
bit of blood, gore and, you

1181
01:05:10,440 --> 01:05:14,160
know, quirky dialogue that
appears to be where he's

1182
01:05:14,160 --> 01:05:16,560
directing his attention.
So yeah, that that that perked

1183
01:05:16,560 --> 01:05:18,560
up my interest this way.
That's awesome.

1184
01:05:18,560 --> 01:05:20,280
Have to catch that one before
you go mate.

1185
01:05:20,720 --> 01:05:22,800
OK, anything.
Anything in the portfolio that's

1186
01:05:22,800 --> 01:05:24,320
been changing lately you want to
talk about?

1187
01:05:24,840 --> 01:05:27,440
We are I think we had a good
chat on the phone the other day.

1188
01:05:27,520 --> 01:05:29,320
And I know, I know you're
thinking of a few things, but

1189
01:05:29,320 --> 01:05:31,320
are there anything you want to
kind of air out, you know, in

1190
01:05:31,320 --> 01:05:33,200
relation to the things you're
interested in?

1191
01:05:33,200 --> 01:05:33,680
Right.
Oh, I.

1192
01:05:33,680 --> 01:05:40,640
Love that get again really
passionate about the next suite

1193
01:05:40,640 --> 01:05:44,840
of assets and you know when when
markets are hard, you know,

1194
01:05:44,840 --> 01:05:47,880
hunting around in these things
can be a very friendless thing

1195
01:05:47,880 --> 01:05:49,640
to do.
But I think it's, some of them

1196
01:05:49,640 --> 01:05:53,200
now are just starting to, just
starting to come out and, and,

1197
01:05:53,200 --> 01:05:57,480
and be seen and, and, you know,
I think Black Canyon's right at

1198
01:05:57,480 --> 01:06:01,320
the top of that list.
So this is a, a, a manganese

1199
01:06:01,320 --> 01:06:06,400
discovery in, in WA.
It, it, it, it, the drill

1200
01:06:06,400 --> 01:06:09,320
programme there that they've
undertaken in incredibly

1201
01:06:09,320 --> 01:06:12,800
QuickTime.
It's been 12 months and, and

1202
01:06:12,800 --> 01:06:18,120
probably $3,000,000 worth of
investment, I think is unveiling

1203
01:06:18,120 --> 01:06:21,400
a, a true bulk commodity
project.

1204
01:06:21,800 --> 01:06:23,800
You know, it's going sort of 30%
manganese.

1205
01:06:23,800 --> 01:06:25,560
We haven't seen this since
Woody, Woody.

1206
01:06:25,800 --> 01:06:30,040
It's it's 80 kilometers from
Woody, Woody and equally as a,

1207
01:06:30,160 --> 01:06:31,840
as a bit of a kicker.
Also I think they've got some

1208
01:06:31,840 --> 01:06:34,200
exciting iron ore discoveries
there.

1209
01:06:34,200 --> 01:06:39,720
So you know that that's really
front of mind and under 50 mil

1210
01:06:39,720 --> 01:06:41,920
market cap.
There's nothing, nothing

1211
01:06:41,920 --> 01:06:43,680
ambitious about that at this
point in time.

1212
01:06:43,680 --> 01:06:49,080
So great to see that investment
into exploration is still

1213
01:06:50,000 --> 01:06:51,720
leading to discovery
discoveries.

1214
01:06:51,720 --> 01:06:53,480
Are back.
Yeah, it's great.

1215
01:06:53,800 --> 01:06:54,680
It's awesome.
Yeah.

1216
01:06:54,840 --> 01:06:59,600
And that's what it's all about.
And then, yeah, on the on the

1217
01:06:59,600 --> 01:07:02,200
rare earth fronts, I've probably
got to give a shout out to, to

1218
01:07:02,200 --> 01:07:05,360
Veritas in, in Brazil.
Yeah, Ding, Ding, Ding.

1219
01:07:07,440 --> 01:07:10,680
You know, that has has been a
tough journey, but they've done

1220
01:07:10,760 --> 01:07:13,720
good work.
That is a a equality asset on

1221
01:07:13,800 --> 01:07:17,040
the economic front.
So which I think is pretty

1222
01:07:17,040 --> 01:07:20,080
important and they've just gone
ahead now and got the

1223
01:07:20,080 --> 01:07:23,880
sponsorship really of the
Brazilian capital market.

1224
01:07:24,560 --> 01:07:31,080
And that is, yeah, that's truly
fundamentally changing that sort

1225
01:07:31,080 --> 01:07:33,480
of life changing for that
project and company.

1226
01:07:33,480 --> 01:07:38,880
I think, I think it will allow
it to mature and grow, grow up

1227
01:07:38,960 --> 01:07:41,240
in in many ways.
So latest change is.

1228
01:07:41,240 --> 01:07:43,880
Substantial there I think came
from a Brazilian fund.

1229
01:07:43,880 --> 01:07:47,520
So you can kind of tell the
local yeah, the, the, the local

1230
01:07:47,520 --> 01:07:51,000
capital allocators are this is
this is the the, the clays

1231
01:07:51,160 --> 01:07:53,200
project that they're, they're
backing into production.

1232
01:07:53,440 --> 01:07:54,960
Yeah, I think.
It's significant that that's

1233
01:07:54,960 --> 01:07:56,280
where you're seeing the
investment.

1234
01:07:56,280 --> 01:08:00,520
So that's a great sign to me.
I love seeing that level of

1235
01:08:00,520 --> 01:08:03,680
sponsorship on the ground from
sophisticated capital

1236
01:08:03,680 --> 01:08:05,520
allocators.
It brings a high level of

1237
01:08:05,520 --> 01:08:12,760
validation to to the project.
And you know, to get an asset

1238
01:08:12,760 --> 01:08:16,040
from discovery through to
production, it takes a lot of

1239
01:08:16,040 --> 01:08:19,720
people, takes plenty of capital
and it and it takes a lot of

1240
01:08:19,720 --> 01:08:20,920
things to go right.
Yeah.

1241
01:08:21,960 --> 01:08:24,800
Barbs St.
Barbs, do you have you?

1242
01:08:25,120 --> 01:08:25,920
Have you?
Do you own it yet?

1243
01:08:25,920 --> 01:08:28,920
Are you still waiting to?
Yeah, no, we own St.

1244
01:08:28,920 --> 01:08:30,000
Barbara, I only say.
Barbs.

1245
01:08:30,040 --> 01:08:33,760
Yeah, I think.
Like deep value proposition deep

1246
01:08:33,760 --> 01:08:34,760
value.
Deep value.

1247
01:08:34,960 --> 01:08:38,680
Yeah.
So in terms of the potential

1248
01:08:38,880 --> 01:08:44,040
like portfolio of gold growth
that is advanced and well

1249
01:08:44,040 --> 01:08:49,279
understood light and
infrastructure, it's, it's I'm

1250
01:08:49,279 --> 01:08:51,880
not sure there's any better
exposure out there lights up.

1251
01:08:51,880 --> 01:08:54,439
Green on this on the value
screen every every time I've

1252
01:08:54,479 --> 01:08:56,160
ever.
Looked at it, it has for.

1253
01:08:56,160 --> 01:08:58,720
A little while now.
That's why I always love hashing

1254
01:08:58,880 --> 01:09:02,160
out the the bio thesis for it.
And like, yeah, it's because

1255
01:09:02,160 --> 01:09:04,920
it's.
Yeah, that's it's got its warts

1256
01:09:04,920 --> 01:09:07,240
and, and everything has its
warts for sure.

1257
01:09:07,399 --> 01:09:10,800
Yeah, but there's something to
be said for, you know, in a

1258
01:09:10,800 --> 01:09:13,160
world where I think we've
discussed today that permitting

1259
01:09:13,160 --> 01:09:16,880
is not easy in any jurisdiction
if you have latent

1260
01:09:16,880 --> 01:09:20,479
infrastructure, if you have sunk
capital, if you can, if the

1261
01:09:20,479 --> 01:09:26,359
policy setting turns for you.
Well and and look in PNG,

1262
01:09:26,359 --> 01:09:28,479
they've just got their well, it
looks like they'll get that

1263
01:09:28,479 --> 01:09:31,720
mining license extension.
It's it's been recommended to

1264
01:09:31,720 --> 01:09:37,200
the mining minister that he he
approves such Yeah, the, the

1265
01:09:37,200 --> 01:09:39,439
platform there is pretty
significant.

1266
01:09:39,439 --> 01:09:42,000
So they've got a few things they
they still need to work through,

1267
01:09:42,000 --> 01:09:46,080
but ultimately with a with a
long term big picture sort of

1268
01:09:46,080 --> 01:09:50,720
view there it looks pretty deep
value fantastic.

1269
01:09:51,000 --> 01:09:54,600
Awesome go, it's great to great
to have you join us and bit of

1270
01:09:54,600 --> 01:09:56,960
room mate bit of room.
Thanks for having me boys.

1271
01:09:57,040 --> 01:09:58,280
Bit of room.
Cheers.

1272
01:09:58,280 --> 01:10:01,480
Big thanks to Dingo.
Big thanks to our partners who

1273
01:10:01,480 --> 01:10:04,600
make it all happen mate our.
Awesome partners focus the

1274
01:10:04,600 --> 01:10:07,680
platform brought forward by
Market Tech Sound at Ground

1275
01:10:07,680 --> 01:10:10,160
support Adu.
Get your tickets to the

1276
01:10:10,160 --> 01:10:14,120
conference September 3rd till
September 5th and Axis Mineral

1277
01:10:14,120 --> 01:10:18,960
Services O Doro O Doro.
Now remember, I'm an idiot.

1278
01:10:19,280 --> 01:10:21,680
JD is an idiot.
If you thought any of this was

1279
01:10:21,680 --> 01:10:24,200
anything other than
entertainment, you're an idiot

1280
01:10:24,560 --> 01:10:25,720
and you need to read out a
disclaimer.