Lithium Mayhem and Mozal Woes (Sam Berridge)

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Who's the Bogan Air?
That book, That somebody's

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autobiography.
Nathan Tinkler.

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I think, I don't know if I
mentioned last time he's owns

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one of the great one liners when
he's, you know, had somebody

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from Four Corners or someone up
in his face trying to get a

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reaction out of him.
How's it feel to be broke,

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Nathan?
A lot of people would like to be

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as broke as I am.
That's fantastic.

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Money miners.
We are going to try something

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new and this is Take Two because
we've got to record the first

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time.
We have got a, we've got a brand

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new style of show that we're
very excited to share.

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We're going to be talking about
the biggest news in the industry

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from this week.
We've got stories about the

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lithium world.
We've got stories about S 32

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talking about that HUD Bay deal
with Mitsubishi and a whole

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bunch more that we're going to
fire.

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Through Sammy Barrage is joining
us as our Guinea pig as we

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experiment with this new style.
I'm excited mate, because we've

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got segments.
I love segments Segments are

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fun.
You like you say the thing and

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then you're like, what do I
think about it?

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I thought this that's got.
A A rating section.

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So you're going to get punchy
responses and we're going to

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pick through a lot of the the
big drivers behind the the

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decisions being made in our
industry and like you said mate,

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with none other than Sammy B.
In the comments below, give us

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your great control of what you
think of this style of episode,

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JD.
We've also got some news we're

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looking at the calendar ahead
and between the 3rd and the 5th

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of September next, sorry, next
month, couple weeks time.

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We've got the Africa down under
conference here in Perth.

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You and I are going to be
attending that one.

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We hope to see some of the money
miners there.

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This is this has become like
quite an event, like payday to

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put this on for for many years
now.

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It's grown into like, you know,
this is the the premier occasion

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that you get literally Africa
in, in Australia, it's Africa

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down under.
But you know, it's the mining

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investment.
It's true.

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It comes together and you get
you get a really good diversity

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of people from different
backgrounds.

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Government comes together with
with investment capital and you

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get a great perspective into
what's going.

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On and mate, we saw the ratings
come out on on countries you

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want to invest in a lot of those
ones are in in Africa, you want

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to be there.
So we've got companies from

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explorers through to developers
through to producers, as well as

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delegates and a whole bunch of
people from these countries.

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So you can learn a lot from
going to a thing like this.

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And if you're in the market,
being an investor or service

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provider, you want to expand in
the industry, it's a perfect

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place to be.
It's well we're going to be

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there so obviously and we hope
to see there are two links here

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in the show notes if you want to
come along with us.

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All right mate, let's.
Let's tuck in.

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Sammy, thank you so much for
coming, coming and sitting down

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with us today.
We're doing something a bit

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different and you have kindly
accepted our invitation to join

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us for for the type of the type
of show, type of episodes that

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we haven't done before.
Absolute pleasure guys.

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And you guys could open an
envelope and I'd come and have a

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look at it.
So there's no problems at all.

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So no anthrax in this one.
We've got a bit on the on the

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shopping list today.
We're going to start with three

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of the biggest stories in the
the mining industry and first

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and foremost lithium.
This one we can sort of tackle

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in a in a few different ways,
but we get this news that

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Albemarle perhaps has a couple
issues.

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Rumours sort of spread through
the market that their La Negro

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operation in Chile is being
paused.

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Nobody kind of knows.
You see lithium futures in China

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limit up on a couple of days
earlier in the week and then

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they come out and it's a it's a
bit of a non event, but it was

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on the back of cattle pausing in
Jiangxi, their operation for for

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three months.
And you get quoted in in the AFR

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saying, yeah, you're actually
looking to to trim holdings,

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which was a bit counter to to
what the market and what other

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people that had sort of said.
How did you weigh up all this

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news this week?
When you get, I mean, there's

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new snippets for, you know,
various commodities pop up

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almost daily, you know, and it's
all about assessing the

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materiality of that
announcement, you know, to the

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the size of the market you're
talking about.

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And, and you know, whether it's
going to be a blip or whether it

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might be or hang on, you know,
this is a real inflection point

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here.
You know, when that dam

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collapsed in Brazil for iron
ore, like, you know, that was an

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inflection point.
Whereas a three month sort of

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hiatus from one of the lithium
producers or be it a, you know,

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a big, a big producer.
I don't think that by itself is

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enough to to put a bottom under
lithium prices and and get

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spodumene up to a level.
You know, that's being implied

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by some of the equities at the
moment.

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So, yeah, I mean, it's, you
know, when you're dealing with

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a, you know, quite a boutique
market like lithium, it's only

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one and a half million tons.
Like it can be pushed around

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very easily by financial flows
and, and even the existing

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market participants deciding to
restock a little bit.

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All of a sudden you can have
sort of apparent demand go well

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ahead of supply, whereas
absolute supply and demand, if

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you, you take out the, the
swings in inventory, you know,

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it still looks like it's pretty,
you know, pretty comfortably

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covered like in terms of, you
know, supplies pretty completely

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covering demand.
There's still more supply coming

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out out of Africa.
So yeah, I think it's an

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opportunity for, you know, maybe
for a quick turn and, and

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probably the hedge funds who
are, you know, you know, who are

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short the this industry would
have got nervous and you know,

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you know, if you have a short
that goes the wrong way, it can

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really, really hurt.
So it's understandable that some

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of them might have covered.
But ultimately, you know, are we

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about to have another big RIP
in, in lithium?

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I I don't think so.
I'd need to see a little bit

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more material come out of the
market or or see demand, you

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know, training a little bit
stronger.

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Yeah, it's, it's super
interesting because we, we had a

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very similar event late last
year with the the pausing of an

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operation where like UBS broke
the news and one of these cattle

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operations is going to be paused
for three months.

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Everyone is over their skies to
to buy the stock again.

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And it turns out in time to be a
non event and lithium falls from

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I think 800 of the time that
closer to to 500 and a few weeks

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later everyone's kind of
forgotten about it.

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And you're tying what we what
you said there about the price

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that you back out of a number of
these equities and it's 12113

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hundred when we're still in the
in the mid $900 range like IGO

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Lion town means it's a bit more
of a complex cow.

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Pilbra.
Pilbra as well, like they've

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they've run really, really hard
like Uber's near on doubled in

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in the past few months alone.
Yeah, I mean, and but they're

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all heavily shorted like these
stocks.

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And yeah, I mean, if you know,
if people have never shorted

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sort of company themselves, they
probably don't understand the

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sensitivity of when it goes the
wrong way.

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You know, it's not like when
you, you know, go long a stock

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and if it doesn't work out,
well, the position size gets

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naturally smaller and it's sort
of self solves.

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Whereas in a short position it's
the exact opposite.

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You know, if it's going wrong,
it turns into a bigger and

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bigger position in your
portfolio.

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So you have to do something
about it.

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So because of that sensitivity,
I think you do get some of these

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upside moves when you get sort
of bullish news for the lithium

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price.
And also, I mean the lithium

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price itself is as has ticked
up, you know, ticked up a bit.

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But are the speed and quantum of
those moves justified by the

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news itself, like the underlying
news, like how much materials

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come out of the market?
I I don't think so.

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But you know, everybody's
entitled to their own opinion

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and that what's make that what's
makes market.

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Yeah, the whole short, the
dynamic with the short interest

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is, is super interesting to
build into it because you've got

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the, the return of like retail
behaviour in markets in a very

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big way kind of globally,
globally again.

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And the the the retail portion
of of ASX market like a few

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years ago was super concentrated
on, on lithium names.

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Those guys have been asleep for,
you know, in hibernation for a

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couple of years waiting, waiting
for the right moment.

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And, and because globally, you
know, a lot of, a lot of retail

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stocks are performing, even
though those stocks might

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actually be, you know,
questionable businesses or, or

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whatnot.
I, I think some of that's just

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like following into the, into
the, into the ASX market.

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It's concentrating again in, in
lithium stocks.

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And you know in periods like
this valuations, you know, you

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do your NPV calculation, it
almost doesn't matter to what

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the stock does in the short term
in these in these weird periods

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of of market behaviour.
Yeah.

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And I think for some reason
like, and lithium certainly

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falls into this, but uranium had
a similar sort of situation was

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that couple of months ago when
they the the the spot trust

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raised, I think 202 hundred
million had a similar type

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event.
And you know, since then, Mark,

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the sort of sector sort of
drifted sideways to down rare

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earths is is another sector
where you get these sort of

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outsized moves in equity in
equities.

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And I think it's, you know,
maybe there's a bit of a theme

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there in commodities where, you
know, China is a material

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component of supply, like they
are in lithium and and rare

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earths as well.
Yeah, maybe that's, you know,

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you've got investors up there
that are willing to move around

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the Australian market, you know,
a little bit faster than what

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they are for, for other for
other commodities where they're

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not so relevant.
Yeah, Yeah.

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I mean, we can't talk about
lithium and and you know, rare

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rest there and the news we've
seen and not ask you about our

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our government buying stakes in
in projects.

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Lyontown's the the big one, I
mean.

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Ding, Ding, Ding, Ding, JD.
We're we're, we're all

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shareholders of Lyontown.
We're all shareholders of blind

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Town.
So for those that didn't catch

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it, 50 million bucks went from a
taxpayer money into the 300 plus

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rays of Lion Town.
And like this is just enormous

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news in in my mind.
We saw it with rare earths MP

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materials in the US and we're
starting to see it more and more

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in bits and pieces.
Like, I mean, how do you feel

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about it?
I don't, I don't think it's the

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right way to go about
stimulating the industry.

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The government has shown itself
to be actually utterly useless

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at picking winners in this.
I mean, I think what was the

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last big investment?
There was some quantum computing

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thing over in Queensland.
The government stuck like 600

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million or something, which is,
you know, questionable whether

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we'll ever see that money again.
But if you want, if the

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government wants to support the
industry, you do it in a sort of

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a broad brush way.
Like, I mean, you know, maybe

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you can again, I think this
would be a bad idea, but you

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know, you could set a floor
price for lithium at which you,

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you know, you guarantee that you
will buy at.

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And that allows, you know, an
even playing field for all, you

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know, companies in Australia to,
to participate in that rather

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than picking winners.
So, you know, when you pick

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winners, you know, one, I think
it's there's you're at risk of

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basically just getting the
investment wrong because, you

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know, same reason anyone who
gets an investment wrong.

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But I also think it's required,
it applies a level of

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discrimination, you know,
between other companies that

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don't enjoy that, that level of
government support.

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But yeah, I, I don't think it's
the right way of doing it.

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But you know, whatever it's,
it's just an observation.

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Yeah, Was it weird to say so?
It was, yeah, Lintown did that

223
00:11:05,280 --> 00:11:07,840
cap raise last week.
Then you had the like at the

224
00:11:07,840 --> 00:11:09,600
pellet over the weekend.
It was the news of the cattle

225
00:11:09,600 --> 00:11:13,280
mine closing kind of surfaced or
on Sunday all of those like

226
00:11:13,280 --> 00:11:15,920
lithium stocks opened up
massively.

227
00:11:15,920 --> 00:11:19,360
Lintown the most, it was like up
20% on on Monday.

228
00:11:20,040 --> 00:11:23,640
Pilbara was 15%, IGO 11%, min
res 10%.

229
00:11:23,640 --> 00:11:25,240
That was all like the opening
moves on Monday when we're

230
00:11:25,240 --> 00:11:27,720
looking at the the, the focus
charts, mate.

231
00:11:28,160 --> 00:11:31,040
By the way, behind you there
Sammy focused by market.

232
00:11:31,040 --> 00:11:32,800
Check out the charts.
Check them out.

233
00:11:33,920 --> 00:11:38,200
Very, very savvy, but and and
and since then, the the latter 3

234
00:11:38,200 --> 00:11:41,840
have have kind of like retained
their elevated price from the

235
00:11:41,920 --> 00:11:44,680
from the where they were the
week before line towns drifted

236
00:11:44,680 --> 00:11:46,040
back back below where it
started.

237
00:11:46,040 --> 00:11:48,840
Is that just a function of the
the the cap raise dynamics?

238
00:11:49,160 --> 00:11:51,400
It quickly rallied above cap
raise price and then you just

239
00:11:51,400 --> 00:11:54,240
have have the inevitable sell
off that comes after.

240
00:11:54,240 --> 00:11:57,080
Cabaret is like, oh.
It's, it's, it's very difficult

241
00:11:57,080 --> 00:12:00,280
to sort of tease out exactly
what the drivers were because

242
00:12:00,280 --> 00:12:03,040
there's, you know, there's a
mismatch of, of funds and

243
00:12:03,040 --> 00:12:05,080
entities that all have different
agendas and different

244
00:12:05,080 --> 00:12:07,240
sensitivities to, you know,
movements in price.

245
00:12:07,640 --> 00:12:11,520
I mean, I think Lion Town was
roughly 13% short, you know,

246
00:12:11,520 --> 00:12:14,320
short at the time.
So, you know, those guys would

247
00:12:14,320 --> 00:12:15,800
have been waiting for a capital
raise.

248
00:12:15,800 --> 00:12:19,800
It did come perhaps they didn't
get stock in, you know, in the

249
00:12:19,800 --> 00:12:21,560
raise.
And so then they have to cover

250
00:12:21,560 --> 00:12:23,880
on market if their thes if that
was their thesis and they want

251
00:12:23,880 --> 00:12:27,040
to get out, you know, so you've
got those guys probably buying

252
00:12:27,040 --> 00:12:29,360
back, whereas other people may
be looking for a quick turn on

253
00:12:29,360 --> 00:12:31,320
on the raise.
I mean, volumes were huge, you

254
00:12:31,320 --> 00:12:32,760
know, in the in the couple of
days.

255
00:12:32,760 --> 00:12:36,080
So, yeah, I mean, it's, it's
difficult to predict the way

256
00:12:36,080 --> 00:12:38,880
things these, you know, in the
one or two days after.

257
00:12:38,880 --> 00:12:43,160
But you know, ultimately, you
know, people look at the value

258
00:12:43,160 --> 00:12:46,600
of the that company at, at, you
know, whatever it is, 80 was it

259
00:12:46,880 --> 00:12:50,080
at now 8590 cents a share. 82
this morning. 82, yeah.

260
00:12:50,600 --> 00:12:53,040
And think, well, you know,
they've got they, you know, went

261
00:12:53,040 --> 00:12:55,240
on the call or the conference
call, they said they basically

262
00:12:55,240 --> 00:13:00,240
bought them enough time out to I
think it was mid 2027 assuming

263
00:13:00,960 --> 00:13:03,120
$700.00 US off the top of my
head.

264
00:13:03,160 --> 00:13:07,080
I think that's right, yeah.
Is it worth $0.82 a share for,

265
00:13:07,120 --> 00:13:09,120
you know, is that enough time
for the lithium sort of supply

266
00:13:09,120 --> 00:13:11,840
demand outlook to improve?
I mean, and that's a subjective

267
00:13:11,840 --> 00:13:14,360
view and I suppose that's will
be expressed through the share

268
00:13:14,360 --> 00:13:16,320
price as we get towards that
date.

269
00:13:16,560 --> 00:13:20,240
Yeah but the the final piece on
online Tan did you did you catch

270
00:13:20,240 --> 00:13:24,400
the dynamic with the call with
with Tony O on Gina's

271
00:13:24,400 --> 00:13:27,640
shareholding for Jane obviously
not not playing in in line and

272
00:13:27,640 --> 00:13:30,960
having to to issue an apology
for for speaking on her part

273
00:13:30,960 --> 00:13:36,320
that that cracked me up.
I think yeah, it's pretty

274
00:13:36,320 --> 00:13:40,720
telling that she hasn't since
the the three back sort of, you

275
00:13:40,720 --> 00:13:43,640
know, mucking about with the
takeover partaking in in any

276
00:13:43,640 --> 00:13:45,920
sort of raising but.
Staying corrected there.

277
00:13:46,120 --> 00:13:47,680
She did.
We just didn't know about it

278
00:13:47,680 --> 00:13:49,680
until the change of substantial
that went up yesterday.

279
00:13:50,040 --> 00:13:51,760
That's the first one that
they've lodged.

280
00:13:51,760 --> 00:13:54,960
But she did follow her money in
the dollar 81 that came, which

281
00:13:54,960 --> 00:13:56,680
you can see in yesterday's
change of substantial, but that

282
00:13:56,680 --> 00:13:57,760
was the only place that was.
Reported.

283
00:13:57,760 --> 00:13:58,760
Yeah, yeah.
Gotcha.

284
00:13:59,640 --> 00:14:00,800
Interesting stuff all around
there.

285
00:14:01,280 --> 00:14:04,880
Yeah.
I mean, I, you know, I, I don't

286
00:14:04,880 --> 00:14:06,920
think it's a good idea to be
criticising, you know, one of

287
00:14:06,920 --> 00:14:08,880
your major shareholders in the,
in the public domain.

288
00:14:08,880 --> 00:14:12,960
I mean, she's not under any
obligation to chip into any

289
00:14:12,960 --> 00:14:16,000
raising that she wants to be in.
But to frame it through some

290
00:14:16,520 --> 00:14:19,840
ideological lens of like she's
pro oil and gas or something in

291
00:14:19,840 --> 00:14:24,320
the USI mean, she's also got,
you know, a huge rare earth

292
00:14:24,320 --> 00:14:27,880
exposure across her investment
portfolio, which is, you know,

293
00:14:27,880 --> 00:14:32,960
very central to the critical
critical minerals thematics.

294
00:14:32,960 --> 00:14:34,320
So I mean, she can do whatever
she wants.

295
00:14:34,320 --> 00:14:36,400
I mean, she's not, you know,
she's not obligated to do

296
00:14:36,400 --> 00:14:38,040
anything or support anybody
else's.

297
00:14:38,040 --> 00:14:41,040
She'll probably invest.
I'm sure she, you know, assesses

298
00:14:41,040 --> 00:14:43,840
any investment on its merits and
she decided not to participate.

299
00:14:43,840 --> 00:14:47,240
I mean, that's the end of story.
Yeah, I think there might have

300
00:14:47,240 --> 00:14:50,600
been a bit of forgetting that
she is the owner of 20% of that

301
00:14:50,600 --> 00:14:53,720
business there.
Came to talk about S 32 next.

302
00:14:53,720 --> 00:14:56,520
I think this is a really big
story with what's happening at

303
00:14:56,560 --> 00:14:58,240
Moe's Hours.
So for those that haven't

304
00:14:58,240 --> 00:15:03,240
followed this one got the the
the whole aluminium supply chain

305
00:15:03,240 --> 00:15:06,800
that the end of it comes out at
Mozel in Mozambique and it

306
00:15:06,800 --> 00:15:12,400
relies on a heap of power from S
Com, the South African power

307
00:15:13,200 --> 00:15:16,840
company, as well as contracts
for for power within Mozambique.

308
00:15:16,840 --> 00:15:20,200
And interestingly, getting back
into the weeds on how this all

309
00:15:20,200 --> 00:15:23,400
sort of came about, Mozambique
had come out of a a long kind of

310
00:15:23,400 --> 00:15:27,920
civil war when the the smelter
is getting started and at that

311
00:15:27,920 --> 00:15:32,040
time S com is producing near on
the cheapest energy in the

312
00:15:32,040 --> 00:15:34,520
world.
And Moselle also gets super

313
00:15:34,520 --> 00:15:37,680
favorable settings in terms of
Rd. he's paying only 1% and

314
00:15:37,920 --> 00:15:43,000
favorable tax settings as well.
And that is about 25 odd years

315
00:15:43,000 --> 00:15:44,520
ago.
So we've we've really come kind

316
00:15:44,520 --> 00:15:48,000
of full circle and they can't
agree on on a power deal.

317
00:15:49,080 --> 00:15:54,080
Firstly like S 32 pills off 5 or
6% on on the back of this news

318
00:15:54,080 --> 00:15:56,600
they said.
They're going to write down 360

319
00:15:56,600 --> 00:16:00,280
odd $1,000,000.
Yeah, a bit over 360 usus.

320
00:16:00,280 --> 00:16:03,120
So it's a, it's a chance obvious
it's going to go on cash for our

321
00:16:03,120 --> 00:16:05,080
maintenance.
From March next year.

322
00:16:05,480 --> 00:16:07,120
Yeah, yeah.
I'll put it to you, Sammy.

323
00:16:07,120 --> 00:16:10,280
Is this, is this a hard bargain
they're driving or you think

324
00:16:10,280 --> 00:16:13,840
this is this is quite genuine?
I think they, well, I think it's

325
00:16:13,840 --> 00:16:15,160
both.
I mean, I think they are

326
00:16:15,160 --> 00:16:19,040
genuine.
I mean, if they can't secure a

327
00:16:19,040 --> 00:16:21,840
power off take agreement that
enables them to make a margin on

328
00:16:21,840 --> 00:16:23,680
that, then they 100% will shut
it down.

329
00:16:24,520 --> 00:16:29,720
And making, you know, the
various stakeholders in this

330
00:16:29,720 --> 00:16:32,920
agreement aware of that.
I think is, is, is more than

331
00:16:32,920 --> 00:16:36,200
fair enough.
But it's, you know, it's this

332
00:16:36,200 --> 00:16:39,520
issue of power, which again, you
know, again, we should be near

333
00:16:39,520 --> 00:16:41,280
and dear to our hearts in
Australia because our own

334
00:16:41,280 --> 00:16:44,320
smelters over here have been,
you know, having this sticking

335
00:16:44,320 --> 00:16:48,040
their hand out on account of how
higher power prices is, is not

336
00:16:48,040 --> 00:16:52,280
an issue confined to Mozambique.
But I also think there's a bit

337
00:16:52,280 --> 00:16:55,160
of a weather component to it,
like I think is, whilst Escom I

338
00:16:55,160 --> 00:16:57,560
think mostly gets its power from
coal, there is a decent sized

339
00:16:57,560 --> 00:17:01,680
hydro component over on the
eastern side of the of that grid

340
00:17:01,680 --> 00:17:03,320
there.
And, and rain's been a bit light

341
00:17:03,320 --> 00:17:04,960
on.
So I can just sort of highlight

342
00:17:04,960 --> 00:17:09,240
some of the sensitivity of, you
know, these big industrial users

343
00:17:09,240 --> 00:17:12,560
to, you know, to to weather
patterns and and hydro is not

344
00:17:12,560 --> 00:17:14,520
always reliable as, as you think
it might be.

345
00:17:14,520 --> 00:17:19,000
But yeah, I think it's they
really have to think long and

346
00:17:19,000 --> 00:17:23,520
hard about what they do there,
because once that smelter shuts

347
00:17:23,520 --> 00:17:26,240
down, I mean, it'd be very
unlikely that it would ever be

348
00:17:26,240 --> 00:17:29,560
restarted.
I think it was our core.

349
00:17:29,560 --> 00:17:33,320
I think it is has has a smell
drop in Spain which got shut

350
00:17:33,320 --> 00:17:35,600
down when they had the big
blackout in in April.

351
00:17:35,600 --> 00:17:37,680
That thing won't be back up and
running at nameplate until I

352
00:17:37,680 --> 00:17:40,800
think 2026.
Like it's a huge amount of time

353
00:17:40,800 --> 00:17:42,680
to restart.
Gotta keep these things hot

354
00:17:42,760 --> 00:17:46,760
like. 100% yeah, 100% so you
know, and there's and that

355
00:17:46,760 --> 00:17:50,080
involves a huge amount of cost.
So you know, I think if they if

356
00:17:50,080 --> 00:17:51,960
they do shut it down, it's gonna
stay that way.

357
00:17:51,960 --> 00:17:55,840
It's about .5% of global
aluminium supply.

358
00:17:55,840 --> 00:17:57,840
So it will cause a little bit of
a ripple there.

359
00:17:57,840 --> 00:18:00,640
But yeah, I do, you know, back
to your point, I think they are

360
00:18:00,640 --> 00:18:02,360
genuine.
And if they can't get, you know,

361
00:18:02,480 --> 00:18:05,560
aluminium itself is basically
congealed electricity and you

362
00:18:05,560 --> 00:18:06,880
don't need so much of it to make
it.

363
00:18:06,880 --> 00:18:09,480
And if they can't get
electricity at a reasonable

364
00:18:09,480 --> 00:18:12,560
price, well, that production is
going to be got shut down.

365
00:18:12,800 --> 00:18:15,040
Yeah, I I agree with you that
it's that they're serious.

366
00:18:15,040 --> 00:18:21,640
I mean, Even so S 32's playbook
though, when, when they couldn't

367
00:18:21,840 --> 00:18:24,240
quite get an environmental
agreement for, for Worsley last

368
00:18:24,240 --> 00:18:26,680
year, they they're kind of cut.
You know, it came to a point

369
00:18:26,680 --> 00:18:28,240
where they came out and said
we're going to have to do a

370
00:18:28,360 --> 00:18:30,600
pretty substantial impairment on
Worsley.

371
00:18:30,600 --> 00:18:33,480
Because the environmental
approval that we've we've had

372
00:18:33,520 --> 00:18:36,680
for the area of bauxite that we
want to mine at, at Boddington

373
00:18:36,680 --> 00:18:40,360
is, is, is so conditional and
prohibitive from of what we want

374
00:18:40,360 --> 00:18:43,000
to be able to do that that, you
know, there's, there's going to

375
00:18:43,000 --> 00:18:47,280
be a material write down that
that that disclosure LED like

376
00:18:47,280 --> 00:18:49,440
paved the pathway And you know,
seven months time for them to

377
00:18:49,440 --> 00:18:53,000
actually get an approval that
was, you know, probably met in

378
00:18:53,000 --> 00:18:55,200
the middle somewhere.
Yeah, but but you've got.

379
00:18:55,200 --> 00:18:57,440
To be public in order to get to
get that, that kind of a oh.

380
00:18:57,880 --> 00:18:59,440
That's right.
And I don't the miners don't

381
00:18:59,440 --> 00:19:01,960
want to go public.
They'd be very happy for them to

382
00:19:01,960 --> 00:19:03,960
put their application in, you
know, early enough.

383
00:19:03,960 --> 00:19:07,160
And my understanding is they
applied in like 2017 for those

384
00:19:07,160 --> 00:19:09,000
mining lease expenses.
So they gave the government

385
00:19:09,000 --> 00:19:10,040
heaps of time.
Yeah.

386
00:19:10,360 --> 00:19:12,240
And if the answer was no, then
say no.

387
00:19:12,240 --> 00:19:17,040
But this non answer for what is
that eight years or whatever is

388
00:19:17,040 --> 00:19:19,840
ridiculous.
So if you're allowed to mine

389
00:19:19,840 --> 00:19:22,520
there, then say so.
And if you say no because it's

390
00:19:22,520 --> 00:19:24,600
too close to the water catchment
or whatever, then that's the

391
00:19:24,600 --> 00:19:27,040
answer.
And then the company will take

392
00:19:27,040 --> 00:19:29,720
that on board and sort of move
around it as best they can.

393
00:19:30,080 --> 00:19:34,320
Also on the a theme here of, of
renegotiate, like what's what's

394
00:19:34,320 --> 00:19:37,480
happening is like, well, S 32
had a had a sweet power supply

395
00:19:37,480 --> 00:19:39,600
agreement at Mozel for a long
time and now that's rolling over

396
00:19:39,600 --> 00:19:42,880
and you, you're facing the
outlook of much higher energy

397
00:19:42,880 --> 00:19:45,000
prices.
Probably this is a global theme

398
00:19:45,320 --> 00:19:49,080
and even like even local to, to
home a bit more.

399
00:19:49,080 --> 00:19:52,440
Like I remember when our Co
acquired A whack and you could

400
00:19:52,440 --> 00:19:55,960
you could read in the scheme
booklet there when they

401
00:19:55,960 --> 00:19:59,960
consulted A whack that that the
the a whacks.

402
00:20:00,880 --> 00:20:05,040
Gas agreements that like they've
got 80% of their gas supply

403
00:20:05,040 --> 00:20:08,400
contracted at the moment that
progressively rolls off between

404
00:20:08,400 --> 00:20:13,800
2027 and 2032 and as they like,
you know, re enter the gas

405
00:20:13,800 --> 00:20:17,320
supply agreements, a $1.00
increase, $1.00 per gigajoule

406
00:20:17,760 --> 00:20:22,480
increase in the gas price in
Australian dollar terms, nukes

407
00:20:22,720 --> 00:20:28,160
NPV by $2.5 billion, right?
That's the independent technical

408
00:20:29,840 --> 00:20:31,840
valuation.
Like pointed out some pointed

409
00:20:31,840 --> 00:20:33,520
out that's some spicy
sensitivity.

410
00:20:33,600 --> 00:20:35,840
So spicy.
That's why you see them teaming

411
00:20:35,840 --> 00:20:39,960
up with Wesis and the other sort
of the people with the companies

412
00:20:39,960 --> 00:20:43,080
that need the energy here in
Washington to rally against the.

413
00:20:43,920 --> 00:20:47,040
The onshore, granted, you know,
WI gas prices have have tapered

414
00:20:47,040 --> 00:20:48,760
off a little, a little bit since
then.

415
00:20:48,760 --> 00:20:50,880
So maybe they'll be able to, you
know, secure something that's

416
00:20:50,880 --> 00:20:52,560
that's, that's appropriate over
the long term there.

417
00:20:52,560 --> 00:20:54,920
But this is, this is a pretty
sensitive, you know, topic.

418
00:20:54,920 --> 00:20:59,240
And I know you have a lot to say
about, you know, the gas prices

419
00:20:59,280 --> 00:21:01,040
and energy prices in general.
Yeah.

420
00:21:01,040 --> 00:21:04,960
I mean, it's, I mean, it, it, it
throws the development of or

421
00:21:04,960 --> 00:21:07,920
development approvals of, you
know, other gas projects, you

422
00:21:07,920 --> 00:21:11,440
know, off the Northwest Shelf
and elsewhere into, into sharp

423
00:21:11,440 --> 00:21:13,400
relief like in brows is the big
one.

424
00:21:13,400 --> 00:21:17,920
Like, if that doesn't go ahead,
then WA gas supply starts to

425
00:21:17,920 --> 00:21:21,640
look a bit tight, you know, you
know, 5-10 years out.

426
00:21:21,640 --> 00:21:23,960
So, and you know, that's not a
project that you can just snap

427
00:21:23,960 --> 00:21:27,320
your fingers and turn on.
So, you know, when you've got

428
00:21:28,000 --> 00:21:31,160
largely the federal government
can, you know, sort of pretty

429
00:21:31,160 --> 00:21:34,120
hostile to approving that
project, but it, you know, it'll

430
00:21:34,120 --> 00:21:36,400
be to the detriment of WI if it
doesn't go ahead.

431
00:21:37,960 --> 00:21:39,520
Yes.
I mean, there's, I know it's CO2

432
00:21:39,520 --> 00:21:41,480
rich, so there's, you know,
there's emission concerns,

433
00:21:41,480 --> 00:21:45,760
etcetera.
But it's not, it's not without

434
00:21:45,760 --> 00:21:48,840
substantial, you know, angst for
the WA economy.

435
00:21:48,840 --> 00:21:51,080
If if all of a sudden our power
prices start going up and we're

436
00:21:51,080 --> 00:21:53,400
seeing that around the world,
which, you know, Mozambique's a

437
00:21:53,400 --> 00:21:56,160
case in point.
But yeah, this power issue is,

438
00:21:56,400 --> 00:22:01,240
is everywhere and you can't get
away from the economic

439
00:22:01,320 --> 00:22:04,560
implications, quite dire
economic implications of higher

440
00:22:04,560 --> 00:22:07,840
power prices.
Yeah, Mozambique and and South

441
00:22:07,840 --> 00:22:14,320
Africa as well, just fantastic
examples of poor, poor, poor

442
00:22:14,320 --> 00:22:16,800
energy settings over the past
three decades.

443
00:22:16,800 --> 00:22:19,320
And the ramifications have have
been huge.

444
00:22:19,320 --> 00:22:22,360
So many other projects in so
many industries become

445
00:22:22,760 --> 00:22:25,000
uneconomic.
And this is like a huge deal for

446
00:22:25,000 --> 00:22:27,880
for Mozambique as well, because
aluminium is their third biggest

447
00:22:27,880 --> 00:22:31,120
export.
And for that to that all comes

448
00:22:31,120 --> 00:22:33,320
from Mozel.
There's no other smell to that's

449
00:22:33,320 --> 00:22:37,040
entirely Mozel.
And interestingly, electricity

450
00:22:37,040 --> 00:22:40,520
is their 4th largest export.
So oh really they they're

451
00:22:40,520 --> 00:22:44,680
talking because there's huge
demand from Zambia from the DRC

452
00:22:44,680 --> 00:22:47,640
who are short energy.
So yeah, they could repurpose

453
00:22:47,640 --> 00:22:48,920
some of the energy and sell it
on.

454
00:22:48,960 --> 00:22:53,160
But there is a, you know, I did
a value add as well in in the

455
00:22:53,160 --> 00:22:56,600
aluminium as well as a a cost in
transmitting that energy through

456
00:22:56,600 --> 00:22:58,600
the whole country up to other
parts of the continent.

457
00:22:59,080 --> 00:23:01,040
Big deal for Mozel, it's a big
deal for S 32.

458
00:23:01,040 --> 00:23:05,160
Like I saw that this was, this
was some, some analysts were

459
00:23:05,240 --> 00:23:07,640
were wiping $0.30 off of their
NPV.

460
00:23:07,640 --> 00:23:11,200
So that's 10% of their, their,
their NAV just from, you know,

461
00:23:11,240 --> 00:23:14,000
the, the, the indicative
curtailment of of this

462
00:23:14,000 --> 00:23:15,760
operation.
That's a yeah substantial to

463
00:23:15,760 --> 00:23:17,280
them.
And we and we'd heard people

464
00:23:17,280 --> 00:23:20,200
talk about, you know, when is
South 32 gonna spin off the

465
00:23:20,200 --> 00:23:23,200
alley business that the old
alley supply chain people made

466
00:23:23,200 --> 00:23:27,200
that argument 4-5 years ago.
But that becomes a bit more

467
00:23:27,200 --> 00:23:28,960
mutant in this sort of
environment.

468
00:23:29,080 --> 00:23:30,800
It's the rationale is still
there though, right.

469
00:23:30,800 --> 00:23:34,560
Like you look what the the
standalone aluminium businesses

470
00:23:34,560 --> 00:23:37,000
trade out on like a on a, on an
EBITDA multiple.

471
00:23:37,040 --> 00:23:41,600
It's like, you know, close to
close to 10 times and yet yeah,

472
00:23:42,240 --> 00:23:44,240
right.
S 32, we trade, trade it like

473
00:23:44,560 --> 00:23:48,920
like 4 or 4 1/2 times like yeah.
All right, we've got one more

474
00:23:48,920 --> 00:23:51,600
sick deal to to speak about,
which I'm pretty pumped to talk

475
00:23:51,600 --> 00:23:54,080
about Mitsubishi and HUD Bay.
This is a really interesting

476
00:23:54,080 --> 00:23:56,640
deal.
So US $600 million is what

477
00:23:56,640 --> 00:24:00,280
Mitsubishi is paying for a 30%
stake in Copper World.

478
00:24:00,280 --> 00:24:05,520
So we're talking Arizona copper.
This is a a prospective project

479
00:24:05,520 --> 00:24:10,360
not not yet built.
So stage 1 outlined 85,000 tons

480
00:24:10,360 --> 00:24:13,480
per annum of copper production
over a 20 year period.

481
00:24:13,480 --> 00:24:17,440
And stage 2 would encompass
federal lands being utilized and

482
00:24:17,440 --> 00:24:19,840
that can lift the the copper
output.

483
00:24:20,200 --> 00:24:22,880
But it's, it's cool for a number
of deals in, in my mind,

484
00:24:23,360 --> 00:24:27,000
firstly, it's done at a premium
to NAV for copper world that

485
00:24:27,080 --> 00:24:30,320
pretty much every broker had.
So that's a boon for for HUD

486
00:24:30,320 --> 00:24:34,240
Bay.
It then reduces and defers the

487
00:24:34,240 --> 00:24:37,360
CapEx that HUD Bay were going to
have to spend.

488
00:24:37,360 --> 00:24:39,880
So it pushes out what they were
going to have to spend and it

489
00:24:39,880 --> 00:24:43,240
reduces it to the tune of that
200 million bucks now at the

490
00:24:43,240 --> 00:24:47,000
earliest 2028.
And you've lined up a super well

491
00:24:47,000 --> 00:24:50,120
capitalized partner in in the
Japanese in in Mitsubishi.

492
00:24:50,120 --> 00:24:53,400
So I think it's a little
surprise the stock's up like 25%

493
00:24:53,800 --> 00:24:56,600
over over the past week.
I'm not sure if you had a chance

494
00:24:56,600 --> 00:24:58,440
to sort of sink your teeth into
this one, Sammy.

495
00:24:58,920 --> 00:25:01,040
I mean, it's an excellent deal
for for HUD Bay.

496
00:25:01,040 --> 00:25:03,720
And you know, the fact that
they've the Japanese have

497
00:25:03,720 --> 00:25:06,760
decided to invest in the in the
US, where I think there's

498
00:25:06,760 --> 00:25:09,400
probably a, you know, a clearer
path to permitting.

499
00:25:09,400 --> 00:25:13,240
Get that mine up and running now
is would be certainly part of

500
00:25:13,240 --> 00:25:17,840
their of their consideration.
And and also, you know, secure

501
00:25:17,840 --> 00:25:21,840
of of I think because it did
come with off take agreement for

502
00:25:21,840 --> 00:25:24,040
their pro rata share.
I I couldn't find that

503
00:25:24,040 --> 00:25:26,600
specifically in the wording, but
I would assume that Mitsubishi

504
00:25:26,600 --> 00:25:29,880
is going to take it all and do
it in country as well I would

505
00:25:29,880 --> 00:25:32,400
imagine too.
Yeah, I mean, copper concentrate

506
00:25:32,400 --> 00:25:35,880
is is, you know, is rare as
hence teeth at the moment, I

507
00:25:35,880 --> 00:25:39,960
think still like spot TCR C So
what the, the, you know, the

508
00:25:40,280 --> 00:25:43,760
miners used to pay the smelters
to treat their concentrate.

509
00:25:43,760 --> 00:25:45,480
It's actually negative.
You know, the only way that

510
00:25:45,480 --> 00:25:47,680
these copper smelters are making
any money is off the the

511
00:25:47,680 --> 00:25:49,760
sulfuric acid which they produce
as a byproduct.

512
00:25:49,760 --> 00:25:52,600
So, you know, the fact that
you've got a, you know, a big

513
00:25:53,360 --> 00:25:56,800
trading house like Mitsubishi
willing to pay overs to secure

514
00:25:57,120 --> 00:26:00,920
copper concentrate, I think is
indicative of the view they have

515
00:26:00,920 --> 00:26:03,000
of the, you know, supply demand
balance going forward.

516
00:26:03,320 --> 00:26:06,080
Yeah, yeah.
So Stage 2 if they they make

517
00:26:06,080 --> 00:26:10,120
that decision would involve the
the the building out of an SXCW

518
00:26:10,560 --> 00:26:14,080
facility to make cathode.
But for all of stage 1, there's

519
00:26:14,080 --> 00:26:16,080
more con in the market.
It gets to that point.

520
00:26:16,840 --> 00:26:19,960
HUD Bay was a HUD Bay is a $6
billion company.

521
00:26:20,280 --> 00:26:21,880
Last week it was a $5 billion
company.

522
00:26:22,160 --> 00:26:26,360
Like this deal added a billion
dollars in market cap, which is

523
00:26:26,440 --> 00:26:29,320
extraordinary that the, the,
like the, the funding

524
00:26:29,320 --> 00:26:31,480
requirement to develop is this
isn't a Tier 1 project.

525
00:26:31,480 --> 00:26:34,840
This is like tier Tier 2 best,
you know, and the, the, the

526
00:26:34,840 --> 00:26:38,320
funding requirement goes from
1.3 billion down to 200 million

527
00:26:38,320 --> 00:26:41,800
that HUD Bay has to, has to, you
know, come up with, with modest,

528
00:26:42,040 --> 00:26:45,120
modest project finance in there.
It's only like 350 million.

529
00:26:45,120 --> 00:26:48,960
They put a stream in there, but
they've retained 70% of the, of

530
00:26:48,960 --> 00:26:52,680
the project level economics.
It's, it's kind of it's, it's,

531
00:26:52,840 --> 00:26:55,560
it's remarkable.
And because of the, you know,

532
00:26:55,640 --> 00:26:59,080
the project IRR goes from from
19% now, yes, there's debt.

533
00:26:59,080 --> 00:27:01,480
So this is a leave it IRR goes
to 90%.

534
00:27:01,760 --> 00:27:04,440
That's that's like, this is one
of the rare deals that pop up

535
00:27:04,440 --> 00:27:06,320
and you're like, you know, the,
the financial engineering

536
00:27:06,320 --> 00:27:08,880
geniuses have actually created
shareholder value.

537
00:27:08,880 --> 00:27:11,280
Like 19 to 90.
It doesn't always happen, mate.

538
00:27:11,320 --> 00:27:14,080
It's like this is it's, it's,
it's a wicked deal.

539
00:27:14,400 --> 00:27:16,280
It's excellent.
And I mean, you know, more

540
00:27:16,280 --> 00:27:18,760
broadly, I mean the Japanese
have shown themselves to be

541
00:27:18,760 --> 00:27:22,400
fantastic partners in the
commodity industry for decades

542
00:27:22,400 --> 00:27:25,760
and decades and decades.
So I think, you know, that is a

543
00:27:25,760 --> 00:27:27,920
big tick.
But also it's, it follows on

544
00:27:27,920 --> 00:27:31,520
from a raft of copper M&A.
We saw was that last month or

545
00:27:31,520 --> 00:27:35,840
the month before where we saw
Xanadu, Mac copper and, and New

546
00:27:35,840 --> 00:27:37,920
World all get, you know, all get
bids.

547
00:27:37,920 --> 00:27:42,400
So, you know, the, the, the
corporates are moving here ahead

548
00:27:42,400 --> 00:27:44,960
of, you know, I think a big, you
know, big spike in copper price,

549
00:27:44,960 --> 00:27:46,560
which is, you know, sort of been
flattish.

550
00:27:46,560 --> 00:27:49,640
Recently, yeah, I think I think
you can call the the Japanese

551
00:27:49,640 --> 00:27:52,240
trading houses the the
kingmakers when it comes to

552
00:27:52,240 --> 00:27:56,480
these porphyry and not just
copper porphyry big scale copper

553
00:27:56,480 --> 00:27:59,840
projects, but they've done a
fair bit of work in in coal

554
00:27:59,840 --> 00:28:03,200
throughout Australia as well.
And like the the iron ore deal

555
00:28:03,200 --> 00:28:07,320
they did with on roads Ridge a
couple months back as as well.

556
00:28:07,320 --> 00:28:11,280
When they come in the de risking
and the the long term mindset

557
00:28:11,280 --> 00:28:15,200
that they have is is just a
phenomenal bone for for a lot of

558
00:28:15,200 --> 00:28:17,480
these projects.
They're such a good partner to

559
00:28:17,480 --> 00:28:21,120
get along and is not a big sort
of splash about it made, but

560
00:28:22,000 --> 00:28:24,520
it's been happening for the
better part of 50 years now.

561
00:28:24,560 --> 00:28:25,880
It's all cost of capital, isn't
it?

562
00:28:25,880 --> 00:28:29,120
It's like they can borrow it 0
percent or negative and.

563
00:28:29,120 --> 00:28:31,360
Thanks to Japan's and our own
challenges.

564
00:28:31,480 --> 00:28:33,360
And what a.
What a, what an, what an impact

565
00:28:33,360 --> 00:28:35,040
it has to, you know, someone
like HUD Bay had pretty

566
00:28:35,280 --> 00:28:37,840
substantial cost of capital.
But you apply you, you know, you

567
00:28:37,840 --> 00:28:40,960
apply like 30% of the, like, you
know, all this, all this project

568
00:28:40,960 --> 00:28:43,480
funding that's like, you know,
0% cost of capital and, and what

569
00:28:43,520 --> 00:28:45,120
does it do?
Like HUD Bay's the beneficiary

570
00:28:45,120 --> 00:28:46,880
of that when when they're
introduced as a partner at the

571
00:28:46,880 --> 00:28:49,240
project level, it's remarkable.
Oh, that's a core point.

572
00:28:49,240 --> 00:28:52,960
And people often forget or
overlook, look, the fact that

573
00:28:52,960 --> 00:28:56,280
without these, you know,
international finance or

574
00:28:56,280 --> 00:28:58,520
companies coming in and
investing in these projects, and

575
00:28:58,520 --> 00:29:00,560
a lot of them would have never
gone ahead because the cost of

576
00:29:00,560 --> 00:29:03,360
capital for these smaller
companies is just prohibitively

577
00:29:03,360 --> 00:29:06,320
expensive to to finance these
things into production.

578
00:29:06,320 --> 00:29:09,120
So, yeah, you know, 5-10 years
down the track, I'm sure

579
00:29:09,120 --> 00:29:11,080
Mitsubishi does very well out of
their investment there.

580
00:29:11,080 --> 00:29:14,120
But you can't overlook the fact
they were willing to stump up a

581
00:29:14,120 --> 00:29:17,760
huge amount of cash, you know,
when this project was, you know,

582
00:29:17,760 --> 00:29:21,160
basically an idea on paper.
Streaming is the the other point

583
00:29:21,160 --> 00:29:22,560
on that one.
Are you a fan?

584
00:29:23,280 --> 00:29:25,640
I, I, I prefer to avoid it if I
can.

585
00:29:25,640 --> 00:29:28,320
I mean, it's, you know, it's
sort of another form of royalty

586
00:29:28,320 --> 00:29:33,040
and it, it can and often is, you
know, an expensive form of

587
00:29:33,040 --> 00:29:35,560
financing.
But if that's all that, if

588
00:29:35,560 --> 00:29:38,200
that's the only offer that's on
the table and it's that or

589
00:29:38,200 --> 00:29:41,120
nothing, well, you know that's
you got to, you got to take it

590
00:29:41,120 --> 00:29:43,320
if it's there.
Yeah, it has its.

591
00:29:44,000 --> 00:29:46,200
I'm increasingly coming to the
view that has its place.

592
00:29:47,280 --> 00:29:51,240
Yeah, I do think like and the,
the, the, the example I do think

593
00:29:51,240 --> 00:29:54,560
of is like is, is Bellevue had
they done project finance with

594
00:29:54,560 --> 00:29:57,600
the stream instead of the, the,
the project finance package they

595
00:29:57,600 --> 00:29:59,280
came to market with?
With the Hedge book.

596
00:29:59,280 --> 00:30:02,800
Yeah, they, they actually have
alignment and like as, as their,

597
00:30:02,920 --> 00:30:05,520
you know, like expectations
being reset and I think, I think

598
00:30:05,520 --> 00:30:06,840
the equity would be a lot higher
today.

599
00:30:07,320 --> 00:30:09,360
Yeah.
I mean the, the 2020 hindsight

600
00:30:09,360 --> 00:30:13,360
on, on the hedge was imposed
with that that debt, which was

601
00:30:13,600 --> 00:30:15,640
standard practice at the at the
time.

602
00:30:15,640 --> 00:30:17,840
But I mean, they weren't the
only ones that got stuck with

603
00:30:17,840 --> 00:30:21,720
the nasty hedge hedge position
due to taking on debt at that

604
00:30:21,720 --> 00:30:24,680
particular point in time.
But yeah, unfortunately the

605
00:30:24,680 --> 00:30:26,040
production under, you know,
under shot.

606
00:30:26,040 --> 00:30:28,000
And so that hedge book was all
of a sudden a bigger problem

607
00:30:28,000 --> 00:30:30,480
than it than it would have been.
Just one last interesting detail

608
00:30:30,480 --> 00:30:32,880
on the stream there.
They tweaked it in there.

609
00:30:32,920 --> 00:30:34,760
They're looking to tweak it.
It hasn't completely gone

610
00:30:34,760 --> 00:30:39,720
through, but they don't want a
flat fee for the, the precious

611
00:30:39,720 --> 00:30:40,880
metals that they're going to
sell.

612
00:30:41,120 --> 00:30:43,840
They only get 15%.
So there's a, a small bet on

613
00:30:43,960 --> 00:30:46,040
precious metals continuing to to
rise.

614
00:30:46,040 --> 00:30:48,080
So they wanted us to to sub that
one out, which was an

615
00:30:48,080 --> 00:30:50,720
interesting quirk.
Mate.

616
00:30:50,720 --> 00:30:54,840
We've just unpacked some big
stories with regards to energy,

617
00:30:55,200 --> 00:30:58,840
some of the biggest companies in
the industry and deal making.

618
00:30:59,840 --> 00:31:02,440
All those things together make
me think of one company mate,

619
00:31:02,440 --> 00:31:04,320
and it is Access Mineral
Services.

620
00:31:04,440 --> 00:31:07,080
Access Mineral Services, that's
I don't know where you're going

621
00:31:07,080 --> 00:31:08,840
with this one, mate, because
when I think of Access Mineral

622
00:31:08,840 --> 00:31:10,600
Services, I think of turning
rocks off.

623
00:31:10,680 --> 00:31:12,720
It's big rocks into little
rocks.

624
00:31:12,720 --> 00:31:14,080
That is what they do.
These are the they're.

625
00:31:14,080 --> 00:31:15,880
The crushing experts.
That's what they're known for.

626
00:31:15,880 --> 00:31:18,720
They've mastered the skill of
crushing big rocks into little

627
00:31:18,720 --> 00:31:20,680
rocks.
You can pretty much go and ask

628
00:31:20,680 --> 00:31:24,120
anyone who operates a gold mine
in the gold fields, have axes

629
00:31:24,120 --> 00:31:26,360
done great work for us, and the
answer will be yes.

630
00:31:26,360 --> 00:31:28,560
And they are expanding their
horizons.

631
00:31:28,560 --> 00:31:32,040
Now they're going north,
southwest, SE, anywhere you've

632
00:31:32,040 --> 00:31:34,760
got a project, they can bring a
mobile crushing solution to you.

633
00:31:34,840 --> 00:31:36,640
Not just mobile crushing
solutions, that's what they're,

634
00:31:36,800 --> 00:31:38,840
that's what they've done in the
past, but now they can also do

635
00:31:38,840 --> 00:31:42,400
these like, you know, semi, semi
portable, big crushing units

636
00:31:42,400 --> 00:31:44,000
that you don't even need to fund
the CapEx for.

637
00:31:44,000 --> 00:31:46,800
Imagine the whole front end of
the plan Axis Mineral services

638
00:31:46,840 --> 00:31:50,360
fire a build and operate model
can actually make that happen

639
00:31:50,360 --> 00:31:52,360
for you to reduce the upfront
CapEx if you're, if you're

640
00:31:52,360 --> 00:31:53,600
building something, you know,
funky.

641
00:31:54,080 --> 00:31:56,560
Civil works you can lay a strip.
You know why?

642
00:31:56,560 --> 00:31:58,800
Because they're now backed by
Robex construction group.

643
00:31:58,800 --> 00:32:01,440
That is that's that's huge.
That's huge firepower.

644
00:32:01,440 --> 00:32:02,720
Big firepower, big balance
sheet.

645
00:32:02,880 --> 00:32:05,400
And they're also bolstered by
none other than Jason O'Rourke.

646
00:32:05,400 --> 00:32:08,680
Jason O'Rourke, he's the the CEO
industry veteran mate.

647
00:32:09,120 --> 00:32:11,640
Jason, Jason, Jason was happy to
see everyone at Diggers, he

648
00:32:11,640 --> 00:32:12,800
said.
I said hello to people at

649
00:32:12,800 --> 00:32:13,440
Diggers.
It was good.

650
00:32:14,480 --> 00:32:16,120
There we go.
If you need crashing solutions

651
00:32:16,120 --> 00:32:18,400
at your mind site, get in touch
with Axis Mineral Services.

652
00:32:18,600 --> 00:32:20,040
Turn the big rocks into little
rocks.

653
00:32:20,040 --> 00:32:22,560
Also sorting the little rocks
out if you if you need that too.

654
00:32:22,880 --> 00:32:25,400
And also now that there's
rollbacks they can do Shields

655
00:32:25,400 --> 00:32:27,360
and everything.
Engineering and also know how,

656
00:32:27,360 --> 00:32:28,240
man.
Nothing's too hot.

657
00:32:28,240 --> 00:32:30,040
It's turnkey, turnkey.
Turn your keys.

658
00:32:30,560 --> 00:32:32,720
Turning back to Sammy D, this
first new segment, it's called

659
00:32:32,720 --> 00:32:35,120
grade control.
Like maybe the name needs some

660
00:32:35,120 --> 00:32:36,680
improvement, but I kind of like
grade control.

661
00:32:36,960 --> 00:32:41,320
Basically, we've, we've all got
to give a letter A to F, we're

662
00:32:41,320 --> 00:32:43,680
grading things right to A to a
major corporate move or it's a

663
00:32:43,680 --> 00:32:45,760
government policy or it's a
commodity trend from the week

664
00:32:45,760 --> 00:32:48,120
just gone.
Explain your your reasoning.

665
00:32:48,120 --> 00:32:49,920
Hopefully we have a bit of
debate in the process.

666
00:32:49,920 --> 00:32:54,000
But to kick things off, what's
your grade of of, of Greatlands

667
00:32:54,600 --> 00:32:58,200
guidance that came out and reset
expectations a bit lower than

668
00:32:58,200 --> 00:32:59,600
where the prospectus was?
Yeah.

669
00:32:59,600 --> 00:33:02,200
I mean in isolation, it probably
wouldn't have been so bad if

670
00:33:02,200 --> 00:33:04,200
they hadn't given guidance a few
months before.

671
00:33:05,480 --> 00:33:09,160
I mean, that's, you know, things
don't move that quickly.

672
00:33:09,160 --> 00:33:13,640
I think so, you know, I'll give
them AD and it's, it's it's a

673
00:33:13,640 --> 00:33:16,480
struggle because you know, when
you're, you know, building your

674
00:33:16,480 --> 00:33:19,360
model and, and you don't have
access to the data room.

675
00:33:19,360 --> 00:33:23,680
I mean, you're basically relying
on management's guidance of, you

676
00:33:23,680 --> 00:33:25,520
know, what they're going to
produce, you know, next year and

677
00:33:25,520 --> 00:33:27,080
the year after.
But also you get a bit of a

678
00:33:27,080 --> 00:33:29,400
steer on, you know, what the
project should produce out in

679
00:33:29,400 --> 00:33:31,320
time.
And if it turns out those

680
00:33:31,320 --> 00:33:34,240
numbers are wobbly, will yeah.
I mean, you've got nothing to

681
00:33:34,240 --> 00:33:36,240
base your, you know, you
basically sort of at your

682
00:33:36,240 --> 00:33:38,840
forecasts on and it all becomes
very uncertain.

683
00:33:38,840 --> 00:33:41,800
And the more uncertain something
is the the lower multiple it

684
00:33:41,800 --> 00:33:43,000
trades on.
And that's what's happened.

685
00:33:43,800 --> 00:33:49,640
Trav, you're rating.
Mines in it, mines in E but I.

686
00:33:49,960 --> 00:33:52,440
I think this will be a theme to
I read to continue.

687
00:33:52,840 --> 00:33:54,800
I read to please explain like,
you know, the ASX.

688
00:33:54,800 --> 00:33:56,800
Yeah, yeah, yeah.
I was like some of that let

689
00:33:56,920 --> 00:33:58,920
just, you know, left, leave,
left a little bit to the

690
00:33:58,920 --> 00:34:01,080
imagination.
So it's it's it's it's a knee.

691
00:34:01,120 --> 00:34:03,040
Like they can still improve from
a knee.

692
00:34:03,040 --> 00:34:04,800
You can go from a knee to an A
if you just deliver.

693
00:34:04,920 --> 00:34:08,679
But I've got a day I think.
I find it hard to believe they

694
00:34:08,679 --> 00:34:11,920
would not have known a couple
months prior and they would

695
00:34:11,920 --> 00:34:13,800
depend that vigorously.
Mate, you can't.

696
00:34:16,239 --> 00:34:19,800
Yeah, all right.
Next one Jacob Stalzems farewell

697
00:34:19,800 --> 00:34:24,159
tour.
I mean, it's going better than

698
00:34:24,159 --> 00:34:27,080
Alan Joyce's farewell.
I'll give you credit for that.

699
00:34:27,440 --> 00:34:30,440
I mean, I don't know what is
these farewell tours for these

700
00:34:30,520 --> 00:34:32,920
high and you know, high flying
executives is often just the

701
00:34:33,280 --> 00:34:35,960
launchpad into whatever next
role they've got their eye on.

702
00:34:35,960 --> 00:34:40,920
But you know, one thing that did
I did come across a comment of

703
00:34:40,920 --> 00:34:43,719
his from his round table with
sell side.

704
00:34:44,400 --> 00:34:47,600
I think that was yesterday or
the day before, was that the

705
00:34:49,040 --> 00:34:52,520
difficulty in operating in
Australia, you know, due to

706
00:34:52,520 --> 00:34:55,960
rising costs, labour permitting
delays, etcetera, etcetera.

707
00:34:55,960 --> 00:34:59,720
I mean, you know, Rio obviously
might, you know, create a

708
00:34:59,720 --> 00:35:02,480
problem of his own making with
its with its permitting issues

709
00:35:02,480 --> 00:35:05,120
in the Pilbara after they went
and blew up that Duke and Gorge.

710
00:35:05,120 --> 00:35:09,120
But that's one thing that's come
out again, a global miner, you

711
00:35:09,120 --> 00:35:11,640
know, suggesting that things are
getting harder in Australia

712
00:35:11,640 --> 00:35:12,960
relative to the rest of the
world.

713
00:35:12,960 --> 00:35:16,600
And it's, you know, it was an
innocuous comment, but it's, it

714
00:35:16,600 --> 00:35:18,920
has far reaching implications, I
think when it's being, you know,

715
00:35:18,920 --> 00:35:21,400
I think repeated by other people
in the industry.

716
00:35:22,680 --> 00:35:26,720
Yeah, I'm going to give him AAC.
He's he's making some noise.

717
00:35:26,720 --> 00:35:31,960
I do think like the like Yacob
was probably the right person

718
00:35:32,000 --> 00:35:33,960
for Rio at that point in time,
that point in time when he when

719
00:35:33,960 --> 00:35:37,800
he came in, Rio's biggest issue
was you can gorge and he

720
00:35:37,800 --> 00:35:41,240
addressed that.
But now he's, he's, I do believe

721
00:35:41,240 --> 00:35:44,440
the critique that he's kind of
let that become the overwhelming

722
00:35:44,440 --> 00:35:49,000
kind of cultural identity of Rio
is a sense of, of, of, of guilt

723
00:35:49,000 --> 00:35:53,120
and self like self loathing
that's perpetuated since that

724
00:35:53,120 --> 00:35:55,040
event.
Rio's biggest issue right now is

725
00:35:55,040 --> 00:35:58,200
not you can gorge or or or or or
or anything like that.

726
00:35:58,200 --> 00:36:01,480
It's, it is, it is, it is what's
actually happened in the Pilbara

727
00:36:01,480 --> 00:36:05,280
like the the great decline, the
inability to, to, to get things

728
00:36:05,280 --> 00:36:08,360
developed on time that the costs
that are that are growing there.

729
00:36:08,360 --> 00:36:09,480
I don't think that's the biggest
problem.

730
00:36:10,560 --> 00:36:16,280
Yeah, I'd push back slightly.
I'd give AB because I think a

731
00:36:16,280 --> 00:36:19,240
lot of those things are right,
but they are in part a

732
00:36:19,240 --> 00:36:22,640
ramification of what happened
five years ago.

733
00:36:22,640 --> 00:36:25,280
So yeah, it's hard to say.
And this farewell tour has been

734
00:36:25,280 --> 00:36:27,960
going on a few weeks and there's
been loads of really interesting

735
00:36:27,960 --> 00:36:29,760
Nuggets that have that have come
out of it.

736
00:36:30,240 --> 00:36:33,280
One was on the importance of
good energy settings across the

737
00:36:33,280 --> 00:36:35,840
country.
And that was said in the context

738
00:36:35,840 --> 00:36:40,160
of Tamago in NSW, which is at
risk of being uneconomical,

739
00:36:40,160 --> 00:36:44,520
uneconomic as it sort of stands.
So there was a few really good

740
00:36:44,520 --> 00:36:45,800
bits of information that came
out.

741
00:36:46,360 --> 00:36:49,160
And I think the media framing
around the words that are said

742
00:36:49,160 --> 00:36:51,800
by an executive can always be a
bit sort of confused.

743
00:36:51,800 --> 00:36:54,280
So I sort of read some of the
titles and then read what was

744
00:36:54,280 --> 00:36:56,960
actually said, and it didn't
always kind of marry up.

745
00:36:58,000 --> 00:37:00,800
Yep, I was going to say that
point on energy is a is a good

746
00:37:00,800 --> 00:37:03,320
one and it's it's relevant.
And I've got a bit of sympathy

747
00:37:03,320 --> 00:37:07,520
for where how these major miners
sort of position themselves in

748
00:37:07,520 --> 00:37:10,000
their sort of government
relations versus, you know,

749
00:37:10,000 --> 00:37:13,520
their public relations and that,
you know, I understand that, you

750
00:37:13,520 --> 00:37:16,360
know, they need to have a
functional working relationship

751
00:37:16,360 --> 00:37:18,000
with whatever government is in
power.

752
00:37:18,000 --> 00:37:19,440
And so you can't be too
critical.

753
00:37:19,440 --> 00:37:22,800
But then, you know, when you had
Tom ago, I think come out and

754
00:37:22,800 --> 00:37:25,920
said, oh, you know, we've just
signed a a power purchase

755
00:37:25,920 --> 00:37:28,400
agreement.
That's, you know, taking a huge

756
00:37:28,400 --> 00:37:30,480
amount of wind and solar energy
and, and, you know, this is

757
00:37:30,480 --> 00:37:33,400
going to power us through, you
know, beyond 2028 or whatever.

758
00:37:33,800 --> 00:37:36,560
And they're no more than I think
it was a couple of months later,

759
00:37:36,560 --> 00:37:38,200
a month and a half later,
they've, they're back in the

760
00:37:38,200 --> 00:37:41,360
paper saying, well, they need
billions of dollars from the

761
00:37:41,360 --> 00:37:45,160
government to subsidize their
existence with this PPA in

762
00:37:45,160 --> 00:37:46,600
place.
And so they would have known

763
00:37:46,600 --> 00:37:50,400
when they signed it that it was
probably at a negative margin

764
00:37:50,400 --> 00:37:52,840
for, you know, based on their
their aluminium production.

765
00:37:52,840 --> 00:37:56,120
But you know, can you be a
little bit more upfront than

766
00:37:56,120 --> 00:37:59,800
this upfront with this and sort
of avoid some of this mixed

767
00:37:59,800 --> 00:38:02,800
messages that go out into the
media about what exactly is a

768
00:38:02,800 --> 00:38:06,080
reasonable power price and what
is a reasonable power solution

769
00:38:06,080 --> 00:38:10,800
for for this heavy industry
which you know is supports so

770
00:38:10,800 --> 00:38:13,240
many jobs around the place?
Absolutely.

771
00:38:13,240 --> 00:38:14,640
And it's an international
industry, right?

772
00:38:14,640 --> 00:38:16,040
It's going to be internationally
competitive.

773
00:38:16,040 --> 00:38:19,320
Yeah, exactly.
Next one is the Santa Piedmont

774
00:38:19,480 --> 00:38:22,560
deal.
So there was a the shareholder

775
00:38:22,560 --> 00:38:25,360
vote that that was held by
people and they couldn't, they

776
00:38:25,360 --> 00:38:30,000
couldn't, they couldn't get the
50% required PLL votes because

777
00:38:30,640 --> 00:38:31,800
it just weren't enough people
voting.

778
00:38:32,680 --> 00:38:34,760
Not that they didn't get the
required They couldn't get the

779
00:38:34,760 --> 00:38:37,440
people to vote.
Yeah, it's.

780
00:38:37,680 --> 00:38:39,880
Been extended I think.
Well, I mean, I'd have to have a

781
00:38:39,880 --> 00:38:42,320
quick look at their register and
I sort of had a glance and I

782
00:38:42,320 --> 00:38:44,800
could, you know, it's a bit
bizarre that they just couldn't,

783
00:38:45,000 --> 00:38:47,200
you know, get people
incentivized enough to put pen

784
00:38:47,200 --> 00:38:49,720
to paper.
But if it's a a largely retail

785
00:38:49,720 --> 00:38:52,560
investor base that, you know,
probably stuck this stock in

786
00:38:52,560 --> 00:38:54,720
their back in the bottom drawer
somewhere and hasn't haven't

787
00:38:54,720 --> 00:38:55,800
looked at it since.
I mean they.

788
00:38:55,800 --> 00:38:56,760
Don't want to look.
It's a pain.

789
00:38:56,800 --> 00:38:58,120
It's painful to look at it, you
know?

790
00:38:58,240 --> 00:39:01,160
But that's right, you know, it's
a tax loss that they, they, they

791
00:39:01,160 --> 00:39:02,880
haven't realized.
And I can, I can sort of

792
00:39:02,920 --> 00:39:06,920
understand how it might happen,
but you know, you just, you

793
00:39:06,920 --> 00:39:09,120
can't, I don't think you can
stick things in the bottom

794
00:39:09,120 --> 00:39:11,480
drawer anymore.
I mean, that, that adage is, has

795
00:39:11,480 --> 00:39:13,080
been proven incorrect time and
time again.

796
00:39:13,080 --> 00:39:16,560
So people are, you know, looking
at gift horse in the mouth and

797
00:39:17,000 --> 00:39:19,080
it's a frustration.
I but I don't know how they, how

798
00:39:19,080 --> 00:39:20,840
they change it.
I mean, unless they go, you

799
00:39:20,840 --> 00:39:23,760
know, cold calling people, you
know from their from the

800
00:39:23,760 --> 00:39:25,280
shareholder register
individually.

801
00:39:25,280 --> 00:39:27,960
I mean, what do they do?
I think, I think making the

802
00:39:27,960 --> 00:39:32,080
process of voting so much more
like user friendly is such low

803
00:39:32,080 --> 00:39:33,640
hanging fruit.
Like it's still a cumbersome

804
00:39:33,640 --> 00:39:36,840
thing to to vote your stock.
So yeah.

805
00:39:37,040 --> 00:39:40,360
And if you're trying to appeal
to retail people like simplify

806
00:39:40,360 --> 00:39:43,840
that, get some UI expert to just
like cut out all of the the crap

807
00:39:43,840 --> 00:39:46,000
involved in voting.
Just the Xanadu on your phone,

808
00:39:46,000 --> 00:39:48,320
The xanadu thing that issued a
cheque like.

809
00:39:48,800 --> 00:39:52,280
Yeah.
Is this 1955 like AI don't even

810
00:39:52,280 --> 00:39:54,640
know what to do with the cheque.
Blows my mind.

811
00:39:54,640 --> 00:39:57,160
This this one, I'd I'd give it a
sort of AD.

812
00:39:57,200 --> 00:39:59,320
And that's not to the company,
that's to the shareholders.

813
00:40:00,880 --> 00:40:02,440
You're the owners of a business
here.

814
00:40:02,440 --> 00:40:05,200
Like, yeah, it hasn't gone
great, and maybe you want to

815
00:40:05,200 --> 00:40:07,280
blame management for that, but
this?

816
00:40:07,840 --> 00:40:11,120
This has gone on for so long.
This takeover like this has been

817
00:40:11,120 --> 00:40:12,600
3/4 of a year at least this
time.

818
00:40:12,600 --> 00:40:16,600
That's where the your friendly
fund manager can come come in

819
00:40:16,600 --> 00:40:18,640
handy because we might look
after all that paperwork for

820
00:40:18,640 --> 00:40:19,560
you.
Yeah, exactly.

821
00:40:19,560 --> 00:40:23,440
There you go.
See from me next one Australia's

822
00:40:23,480 --> 00:40:32,320
rescue package of Nightstar.
I'll give this an EI mean it is

823
00:40:32,800 --> 00:40:36,080
ridiculous that, you know, we
adopt an energy policy that

824
00:40:36,080 --> 00:40:39,000
makes energy more expensive.
You need to subsidise the

825
00:40:39,000 --> 00:40:42,080
producers of this new energy so
that they're profitable.

826
00:40:42,080 --> 00:40:46,000
But in doing that, you therefore
also have to subsidise your

827
00:40:46,000 --> 00:40:48,120
incumbent energy producers
because they're, you know,

828
00:40:48,120 --> 00:40:51,200
margins get hit periodically,
but you can't have them leave

829
00:40:51,200 --> 00:40:52,600
the grid otherwise it'll all
fall over.

830
00:40:52,600 --> 00:40:55,080
And then you have to subsidise
the people that use that energy

831
00:40:55,080 --> 00:40:58,040
to keep them in business.
I mean, we've just had the RBA

832
00:40:58,040 --> 00:40:59,640
come out and talk about
productivity.

833
00:40:59,640 --> 00:41:03,120
I mean, this is a, you know,
productivity killing zone, this

834
00:41:03,120 --> 00:41:06,440
sort of negative feedback loop
of subsidy after subsidy after

835
00:41:06,440 --> 00:41:08,120
subsidy.
And it it can't go on.

836
00:41:08,120 --> 00:41:10,720
I mean, the country, this will
drag the country down if it's

837
00:41:11,000 --> 00:41:12,440
not nipped in the bud at some
point.

838
00:41:12,440 --> 00:41:15,800
But, you know, do you want once
this manufacturing does shut

839
00:41:15,800 --> 00:41:17,240
down, is it ever going to come
back?

840
00:41:17,720 --> 00:41:20,120
Probably not.
So you got to save it.

841
00:41:20,120 --> 00:41:23,240
But it's just so regrettable.
And and the fact that was so

842
00:41:23,240 --> 00:41:29,560
foreseeable is also regrettable.
Crap F massive own goal like

843
00:41:29,640 --> 00:41:33,080
what a yeah and the but the the
frustrating thing for my for me

844
00:41:33,080 --> 00:41:36,120
is like it sets the precedent
there's every smelter in the

845
00:41:36,120 --> 00:41:38,160
country is going to need a
handout by the way, it's not a

846
00:41:38,160 --> 00:41:39,480
once off handout.
This thing's going to be a

847
00:41:39,480 --> 00:41:42,400
perpetual motion machine of
handouts because there is no

848
00:41:42,400 --> 00:41:45,840
short term solution here like
this is a this is a long term

849
00:41:45,840 --> 00:41:47,640
problem.
And now we've we've, we've made

850
00:41:47,640 --> 00:41:52,760
a commitment to to subsidise an
uneconomic reality as a as a

851
00:41:52,760 --> 00:41:54,680
result of just a big own goal.
Yeah.

852
00:41:54,680 --> 00:41:56,480
And so I mean, how does the
government differentiate

853
00:41:56,480 --> 00:42:00,360
between, you know, the smelter
that is going under and, and,

854
00:42:00,440 --> 00:42:02,960
you know, the employees there
versus the, you know, the the

855
00:42:02,960 --> 00:42:05,720
guy that owns the bakery down
the shop who he goes under

856
00:42:05,720 --> 00:42:08,360
because of power prices, but you
know, he's not big enough to be,

857
00:42:08,720 --> 00:42:10,160
you know, to be saved.
Like there's.

858
00:42:11,080 --> 00:42:13,360
Yeah, it's just very, very
inconsistent in terms of who

859
00:42:13,360 --> 00:42:14,680
gets the handout and who
doesn't.

860
00:42:15,880 --> 00:42:16,960
Yeah.
And you're dead right.

861
00:42:16,960 --> 00:42:20,360
Like the the when these things
go negative margin, the revenue

862
00:42:20,360 --> 00:42:22,600
and the cost line are in the
hundreds of millions of dollars.

863
00:42:22,600 --> 00:42:26,200
So you know, if you once you go
negative, you end up in big

864
00:42:26,200 --> 00:42:28,880
bucks very, very quickly, which
is, you know, why these sort of

865
00:42:28,880 --> 00:42:31,600
one off sugar hits is bad idea.
They need to have a look at the

866
00:42:31,680 --> 00:42:33,240
the underlying reasons and
address them.

867
00:42:33,360 --> 00:42:36,960
Yeah, I I really agree.
Port Perry alone is losing in

868
00:42:36,960 --> 00:42:39,080
the range of 10s of millions of
dollars a month.

869
00:42:39,080 --> 00:42:43,720
So $135 million check is, I
think I saw going to keep them

870
00:42:43,720 --> 00:42:48,000
sorted until early 2026.
This is a Band-Aid fix on a

871
00:42:48,000 --> 00:42:51,680
serious, serious problem.
And the idea that you're going

872
00:42:51,680 --> 00:42:56,080
to let them run this study to
see if they can produce gallium

873
00:42:56,080 --> 00:43:00,480
and bismuth and antimony to to
traffic era like of all people

874
00:43:00,480 --> 00:43:03,360
that that's who owns this thing.
And there's no mention of

875
00:43:03,520 --> 00:43:06,040
repayment.
This is just a handout that goes

876
00:43:06,040 --> 00:43:07,560
like that.
Like I really do grapple with

877
00:43:07,680 --> 00:43:10,760
actually writing this one
because I also on the other hand

878
00:43:10,760 --> 00:43:12,920
don't want to end up in a
situation where China is the

879
00:43:12,920 --> 00:43:15,880
only one that can run the
downstream on every single metal

880
00:43:15,880 --> 00:43:18,840
in the world.
So it is a complex issue and

881
00:43:18,840 --> 00:43:22,600
this is not a well thought
through solution to that

882
00:43:22,600 --> 00:43:24,600
problem.
Now, I don't think they want to

883
00:43:24,600 --> 00:43:27,240
admit what the underlying
problems are.

884
00:43:27,360 --> 00:43:30,320
So it's band aids all around
until we get to the next

885
00:43:30,320 --> 00:43:32,480
election and then we kick the
can down the road a bit further

886
00:43:32,480 --> 00:43:33,520
again.
But you're gonna run out of

887
00:43:33,520 --> 00:43:34,720
money at some point.
Yeah.

888
00:43:34,720 --> 00:43:38,520
And the, and the paying for vote
type element to this, because

889
00:43:38,520 --> 00:43:42,080
there are a lot of jobs at stake
is an incredibly slippery slope.

890
00:43:42,080 --> 00:43:45,680
And, and it's been something
that's happened for for many

891
00:43:45,680 --> 00:43:47,560
years and decades in in other
regards.

892
00:43:47,560 --> 00:43:51,040
But because there are thousands
of jobs at stake here, the

893
00:43:51,040 --> 00:43:54,120
government feels that in that
sort of inkling to to write a

894
00:43:54,120 --> 00:43:57,640
check that that's a a sort of
very damaging part of it all.

895
00:43:58,760 --> 00:44:01,560
Next one, there's news, news in
the FT that you know, barracks,

896
00:44:01,800 --> 00:44:06,000
barracks pursuing $3.5 billion
in in debt for for Rico Dick.

897
00:44:06,360 --> 00:44:08,200
I'll be interested to see
whether they get the debt and

898
00:44:08,200 --> 00:44:11,800
what the cost of that debt is.
But you know, they're only like

899
00:44:11,800 --> 00:44:15,240
4050 KS.
I'm from the border of Taliban

900
00:44:15,240 --> 00:44:17,440
country up there.
They're quite close.

901
00:44:17,440 --> 00:44:18,440
Yeah, it's quite.
Close.

902
00:44:18,600 --> 00:44:21,160
So I mean, I must have been, I
haven't had a good look at the

903
00:44:21,160 --> 00:44:23,440
economics of that project, but
it would want to be an absolute

904
00:44:23,440 --> 00:44:28,280
cracker to sink cash into that
part of the world, I think.

905
00:44:28,280 --> 00:44:34,880
But yeah, I mean, it's, I think
it's CapEx is like roughly 1010

906
00:44:34,880 --> 00:44:36,640
to 12% of their market cap or
something like that.

907
00:44:36,640 --> 00:44:38,600
So it's a big swing for for
Barrick.

908
00:44:38,600 --> 00:44:40,480
They previously disclosed that
there was going to be this

909
00:44:41,000 --> 00:44:43,840
minority project sell down had
been earmarked with up, you

910
00:44:43,840 --> 00:44:47,960
know, up to 20% to go to Menara
Minerals, which is the the, the

911
00:44:47,960 --> 00:44:50,840
JV between modern and Saudi
Arabia's PIF.

912
00:44:51,080 --> 00:44:54,200
And it also in that article it
basically said Menara couldn't

913
00:44:54,480 --> 00:44:56,760
get over the line.
Now the question I have is

914
00:44:56,920 --> 00:44:59,600
Menara couldn't get over the lot
like the Saudis and this, you

915
00:44:59,800 --> 00:45:01,000
know, they couldn't get over the
line.

916
00:45:01,000 --> 00:45:04,040
Like it does give me a lot of
doubt about the ability to

917
00:45:04,040 --> 00:45:06,320
operate in that part of the
world And the huge amount of,

918
00:45:06,320 --> 00:45:09,040
you know, the company's capital
that has to be diverted to, to

919
00:45:09,040 --> 00:45:11,840
to build this project.
You know, debt is still capital.

920
00:45:11,840 --> 00:45:16,000
Like that's still your capital.
So that's, that's a that's AI

921
00:45:16,000 --> 00:45:17,680
think.
I think, I think for me, this is

922
00:45:18,240 --> 00:45:21,920
AAD because I also do think the
activist opportunity for Barrack

923
00:45:21,920 --> 00:45:23,720
is very much alive.
There's there's a real

924
00:45:24,680 --> 00:45:27,160
opportunity like break up
opportunity here, diversion of

925
00:45:27,280 --> 00:45:30,640
of capital, you know, even even
you know, the chance to to

926
00:45:30,640 --> 00:45:33,920
separate, you know, like your
your developing country copper

927
00:45:33,920 --> 00:45:38,120
growth assets in in one and then
you've got your US gold in

928
00:45:38,120 --> 00:45:39,640
another.
Like it's very like, you know,

929
00:45:40,000 --> 00:45:43,160
Nevada gold mine focused.
Those are those are those are

930
00:45:43,160 --> 00:45:46,960
alive and and barracks if they
if they continue on this path of

931
00:45:47,160 --> 00:45:49,800
of questionable capital
allocation like I think we'll

932
00:45:49,800 --> 00:45:52,920
find themselves at at the mercy
of the activists like Elliot.

933
00:45:53,080 --> 00:45:56,400
Well, I mean, if you're a sorry
a prospective debt lender, I

934
00:45:56,400 --> 00:45:59,240
mean, you'd, you want to ask
some questions about their sort

935
00:45:59,240 --> 00:46:02,720
of Foreign Relations policy with
regard to Mali.

936
00:46:02,720 --> 00:46:04,680
I mean, I don't think they just
took a billion dollar write down

937
00:46:04,680 --> 00:46:06,640
on goldmine that they just lost
there.

938
00:46:06,960 --> 00:46:09,600
I mean, it's that situation I
think could have been handled

939
00:46:09,600 --> 00:46:12,520
much better.
So you know things are going to

940
00:46:12,600 --> 00:46:15,040
be different in Pakistan.
To, to your point on being

941
00:46:15,040 --> 00:46:17,960
pretty close to Taliban country,
I remember we spoke about this a

942
00:46:17,960 --> 00:46:21,120
few months back and I think one
of us made the comment that it's

943
00:46:21,120 --> 00:46:22,600
about 100 KS from the from the
border.

944
00:46:22,600 --> 00:46:24,600
So and somebody sent through a
photo.

945
00:46:24,920 --> 00:46:26,120
It's a whole lot closer than
that.

946
00:46:26,120 --> 00:46:27,240
And it was just sort of turned
off.

947
00:46:27,520 --> 00:46:30,040
I think it was 40 odd kilometers
from the from the border there.

948
00:46:30,400 --> 00:46:32,840
So it's a, it's a spicy sort of
jurisdiction.

949
00:46:33,280 --> 00:46:37,840
Stage 1 CapEx is US 6.6 billion.
They haven't updated these

950
00:46:37,840 --> 00:46:42,640
numbers in in a little while,
but 6.6 US and given given the

951
00:46:42,640 --> 00:46:46,880
ownership they were talking
about Barrick doing about 1.5

952
00:46:46,880 --> 00:46:51,120
billion, Pakistan government
doing about 1.5 billion as well.

953
00:46:51,400 --> 00:46:57,640
And then looking for that 3.5
billion in debt funding with the

954
00:46:57,640 --> 00:47:00,480
specific sort of earmarking that
it would be Development Bank

955
00:47:00,520 --> 00:47:03,680
financing and also limited
recourse financing.

956
00:47:03,680 --> 00:47:06,600
Now it would say if that
actually sort of comes comes to

957
00:47:06,640 --> 00:47:08,760
fruition, if they can get
anything like that over the

958
00:47:08,760 --> 00:47:11,920
line.
But the one saving grace if you

959
00:47:11,920 --> 00:47:15,160
do get Development Bank
financing is that they can

960
00:47:15,160 --> 00:47:19,200
really impinge Pakistan, for
what it's worth on it's sort of

961
00:47:19,200 --> 00:47:23,040
economics as a, you know, as a
global lender for, for the

962
00:47:23,040 --> 00:47:26,160
government of, of that country.
So yeah, we'll, we'll sort of

963
00:47:26,160 --> 00:47:28,520
see if that at all kind of comes
to fruition.

964
00:47:28,520 --> 00:47:32,040
But I think, like you said,
Trev, that that break up play is

965
00:47:33,160 --> 00:47:36,680
I think there's a a bit of legs
to to that one and yeah, to to

966
00:47:36,680 --> 00:47:39,480
what you said, Sammy, there's a
bit more water to go under the

967
00:47:39,480 --> 00:47:41,320
bridge in in Bali as well there,
which is.

968
00:47:41,360 --> 00:47:42,640
I'd say so.
Yeah.

969
00:47:43,240 --> 00:47:46,520
Next one is, I don't know if you
call it this, but Sunday night

970
00:47:46,520 --> 00:47:51,160
in Australia, 60 minutes add
some some segment on Greenland

971
00:47:52,040 --> 00:47:55,640
rare earth investment and then
the stock on the ASX energy

972
00:47:55,640 --> 00:47:58,440
transition minerals, like one
point I looked at it was up like

973
00:47:58,440 --> 00:48:04,840
123% on Monday.
I think I read through the the

974
00:48:05,080 --> 00:48:07,720
the please explain afterwards.
Like they were quoting in situ

975
00:48:07,720 --> 00:48:12,080
value of resources as a means to
fluffing up the value of their

976
00:48:12,080 --> 00:48:13,520
project.
I think that's probably what it

977
00:48:13,520 --> 00:48:15,960
caught a few people's eye.
But I mean, So what?

978
00:48:15,960 --> 00:48:19,040
Like, you know, the in situ
value of gold in the ocean is

979
00:48:19,040 --> 00:48:21,440
probably billions and billions
of dollars, but you can't get it

980
00:48:21,440 --> 00:48:22,760
out economically.
So who cares?

981
00:48:22,840 --> 00:48:24,000
Oh, that's a good starting
point.

982
00:48:25,840 --> 00:48:28,920
Great control.
Is it an F?

983
00:48:30,240 --> 00:48:33,440
Yeah, an F for 60 minutes.
I think it's an F for 60

984
00:48:33,480 --> 00:48:34,560
minutes.
Yeah, I think so.

985
00:48:34,600 --> 00:48:37,320
I mean, there's, it's not hard
to sort of, you know, get some

986
00:48:37,320 --> 00:48:39,720
context from someone.
It only, only takes one or two

987
00:48:39,720 --> 00:48:41,480
phone calls and would have
thought the reporter or whoever

988
00:48:41,480 --> 00:48:44,280
put the story together might
have, you know, got a bit of

989
00:48:44,280 --> 00:48:47,400
colour around, oh, what's the
right way to be framing this

990
00:48:47,400 --> 00:48:49,000
project?
But then if you knock a few

991
00:48:49,000 --> 00:48:51,560
zeros off the number that they
were quoted, then perhaps it's

992
00:48:51,560 --> 00:48:54,240
not as not as interesting.
I think F is a pretty suitable

993
00:48:54,240 --> 00:48:56,480
rating for that.
I like it.

994
00:48:57,120 --> 00:48:58,440
All right, mate, we've got
another segment for you.

995
00:48:58,640 --> 00:49:01,720
This is so it's called sweet
deal or sour deal.

996
00:49:01,720 --> 00:49:04,760
It's going to rattle through,
rattle through three different

997
00:49:05,240 --> 00:49:08,880
sets of, of deals this week and
just just rapid fire if it was a

998
00:49:08,880 --> 00:49:13,360
sweet deal or sour deal.
And, and, and why the the first

999
00:49:13,360 --> 00:49:14,720
one?
I'm just going to group all of

1000
00:49:14,720 --> 00:49:16,520
the cap raises.
There's been so many cap raises.

1001
00:49:16,520 --> 00:49:19,280
There's been a cap raise week
like Santana 60 million bends,

1002
00:49:19,280 --> 00:49:22,320
30 million, Waratah 30 million,
Centaurus 23 million, Falcon 20

1003
00:49:22,320 --> 00:49:25,360
million, WA one, 100 million.
And that's just like the ASX

1004
00:49:25,360 --> 00:49:27,680
ones that were like above 20
million, right?

1005
00:49:28,440 --> 00:49:30,960
North America's had plenty over
the last week as well.

1006
00:49:31,720 --> 00:49:34,520
But just the group of of cap
raisers participating Cap

1007
00:49:34,520 --> 00:49:35,560
raisers this week.
Sweet deal.

1008
00:49:35,560 --> 00:49:38,880
What's our deal?
I mean, so there's some real

1009
00:49:38,880 --> 00:49:41,160
standouts in there like that.
Ben Steel is an absolute

1010
00:49:41,160 --> 00:49:43,040
cracker.
I mean that for that stock to

1011
00:49:43,040 --> 00:49:46,520
his run as hard as it did and
then raise at a new discount to

1012
00:49:46,520 --> 00:49:54,360
last well done.
But I think it's overall like

1013
00:49:54,360 --> 00:49:58,720
the, the commodities, the sector
has sort of been grinding higher

1014
00:49:58,720 --> 00:50:01,720
for the last couple of months
and and I think you know, with

1015
00:50:01,720 --> 00:50:05,680
interest rates generally coming
down, it's supportive of the

1016
00:50:05,680 --> 00:50:08,640
sector.
So hopefully on balance, no, no,

1017
00:50:08,680 --> 00:50:10,920
I didn't participate in all of
them, but I didn't some

1018
00:50:11,240 --> 00:50:12,960
hopefully it's you participate.
In.

1019
00:50:14,720 --> 00:50:16,520
I have to remind me through,
through, through this.

1020
00:50:16,600 --> 00:50:17,760
Santana.
No.

1021
00:50:17,760 --> 00:50:18,440
Miss, Miss.
Miss.

1022
00:50:18,440 --> 00:50:19,720
Santana.
Ben's.

1023
00:50:20,360 --> 00:50:21,960
Ben's were already there.
Fortunately.

1024
00:50:21,960 --> 00:50:24,880
Saratar No.
Santoris.

1025
00:50:25,480 --> 00:50:28,400
No, no nickel.
Yeah, Falcon, Falcon.

1026
00:50:28,400 --> 00:50:29,760
I think we, yeah, I think we
did.

1027
00:50:29,840 --> 00:50:33,160
Yeah, WA 1.
So WA one's interesting one like

1028
00:50:33,160 --> 00:50:36,920
we look closely at it, but we're
have a small position in

1029
00:50:36,920 --> 00:50:41,160
encounter which sits around WA
one which is, you know, I think

1030
00:50:41,640 --> 00:50:44,160
also interesting and and
probably more so after they've

1031
00:50:44,160 --> 00:50:45,640
raised the amount of capital
that they did.

1032
00:50:45,800 --> 00:50:49,680
Ding Ding Ding WA 1.
In the context of of what you

1033
00:50:49,680 --> 00:50:51,400
sort of said there, Sammy, I
think it's a sweet deal.

1034
00:50:51,400 --> 00:50:53,400
I don't think we can have that
sort of argument that the, the

1035
00:50:53,400 --> 00:50:56,280
capital isn't there for a bunch
of miners at the moment.

1036
00:50:56,280 --> 00:50:59,680
Like if you've got 1/2 decent
type project, you're you're

1037
00:50:59,680 --> 00:51:03,400
getting financed and they're not
like tiny raises like 30 million

1038
00:51:03,400 --> 00:51:04,800
bucks you can do a fair bit of
work with.

1039
00:51:04,800 --> 00:51:08,520
So I think from an industry type
perspective, it's not a bad

1040
00:51:08,520 --> 00:51:12,440
thing in the context of a lot of
frothiness in broader markets

1041
00:51:12,840 --> 00:51:14,720
right now.
So I wouldn't be sort of jumping

1042
00:51:14,720 --> 00:51:17,800
to participate in everyone, but
from the company perspective,

1043
00:51:17,800 --> 00:51:19,920
not a bad thing.
Sweet deal for all, I think

1044
00:51:19,920 --> 00:51:25,000
because this is the phase of the
cycle where being in deals is

1045
00:51:25,480 --> 00:51:28,200
like everyone, everyone wants to
be in deals as well, because the

1046
00:51:28,200 --> 00:51:31,640
deals are actually not
necessarily strictly drifting

1047
00:51:31,640 --> 00:51:34,160
back to the offer price.
There's, there's a, you know, a

1048
00:51:34,160 --> 00:51:37,160
day one bump in, in more than
50% of the cases.

1049
00:51:37,160 --> 00:51:39,960
So there's yeah, I feel like, I
think it's a sweet deal for all

1050
00:51:40,200 --> 00:51:42,400
the the share prices of these
companies with elevated prices,

1051
00:51:42,400 --> 00:51:44,920
They're doing them at local
highs instead of at 12 month

1052
00:51:44,920 --> 00:51:46,840
lows.
And and the participants are

1053
00:51:46,840 --> 00:51:49,160
getting rewarded in the short
term immediately afterwards as

1054
00:51:49,160 --> 00:51:51,480
well.
Yeah, No, I think that's, that's

1055
00:51:51,480 --> 00:51:53,720
right.
I think whilst, I mean, I mean,

1056
00:51:53,840 --> 00:51:57,000
most of those raises were in
gold and, and sort of the gold

1057
00:51:57,000 --> 00:51:59,400
sector is a bit a bit frothy,
but the, you know, these

1058
00:51:59,400 --> 00:52:03,160
companies are making money.
And I don't think broadly

1059
00:52:03,160 --> 00:52:06,400
speaking, where the industry's
wasting money.

1060
00:52:06,400 --> 00:52:10,080
Like it's not, it's not like it
was in 2012, 1112, things like

1061
00:52:10,080 --> 00:52:12,840
that where, you know, I think it
was just you've absolute

1062
00:52:12,840 --> 00:52:14,680
euphoria.
I think generally speaking, the

1063
00:52:14,680 --> 00:52:17,560
money that's been raised by
those companies is being put to

1064
00:52:17,560 --> 00:52:20,360
good use and they're, you know,
they're legitimate projects that

1065
00:52:20,360 --> 00:52:23,000
are being advanced.
So yeah, so hopefully works out

1066
00:52:23,000 --> 00:52:24,280
well.
Said local hires.

1067
00:52:24,280 --> 00:52:27,280
But the exception there is, is
Centaurus and I, I actually

1068
00:52:27,280 --> 00:52:28,960
thought this was, would have
been an interesting 1 to

1069
00:52:28,960 --> 00:52:32,120
participate in because it came
with, I mean, it was, you know,

1070
00:52:32,400 --> 00:52:34,680
on demanding price.
So and it came with this free

1071
00:52:34,680 --> 00:52:36,960
attaching option for every,
every two shares.

1072
00:52:36,960 --> 00:52:40,840
So it was the, the incentives
were there to participate if you

1073
00:52:40,840 --> 00:52:42,680
if you did, but it's at the
expense of the existing

1074
00:52:42,680 --> 00:52:45,040
shareholders who will experience
the, the punitive dilution.

1075
00:52:46,120 --> 00:52:47,800
But that's, that's nickel,
right?

1076
00:52:47,800 --> 00:52:50,720
Which leads into the other deal.
I wanted to talk about get your

1077
00:52:50,720 --> 00:52:52,120
opinion on if it's a sweet deal
or sour deal.

1078
00:52:53,120 --> 00:52:55,360
Life zone, don't know if you
follow this one, but they've got

1079
00:52:55,440 --> 00:52:59,040
the Kabanga project in Tanzania.
It's, you know, like along with,

1080
00:52:59,200 --> 00:53:02,640
along with Jaguar, one of these,
you know, still quite high grade

1081
00:53:02,640 --> 00:53:04,000
interesting nickel solar fire
projects.

1082
00:53:04,000 --> 00:53:06,320
PHP was, was at one point when
they were still in nickel,

1083
00:53:06,320 --> 00:53:08,880
pretty interested in this one,
right?

1084
00:53:08,880 --> 00:53:12,920
They announced a $60 million
secured bridge loan with Taurus

1085
00:53:13,720 --> 00:53:15,720
and, and effectively it's a
bridge line.

1086
00:53:15,720 --> 00:53:17,480
What are they bridging to?
Well, they're, they're, they're

1087
00:53:17,480 --> 00:53:20,920
running, they're progressing
towards FID order, you know,

1088
00:53:20,920 --> 00:53:22,480
ordering some like long lead
things, but they're running a

1089
00:53:22,480 --> 00:53:26,000
strategic process to, to bring
in a strategic partner at the

1090
00:53:26,000 --> 00:53:27,760
same time.
Sweet dealers.

1091
00:53:27,760 --> 00:53:30,680
How do?
I, I think I'm tentatively to

1092
00:53:30,680 --> 00:53:34,040
say sweet deal as long as it
works because, I mean, you know,

1093
00:53:34,040 --> 00:53:36,160
the tourist bridging debt
wouldn't have come cheap.

1094
00:53:36,160 --> 00:53:38,800
And if they don't have a,
something to grab onto at the

1095
00:53:38,800 --> 00:53:41,760
end of that loan, well, it's,
it's going to be very, very

1096
00:53:41,880 --> 00:53:46,200
expensive for them.
But yeah, I mean, it's, you'd

1097
00:53:46,200 --> 00:53:49,840
hope that they already had their
eye or a reasonable conviction

1098
00:53:49,840 --> 00:53:53,240
on one or two strategics to, you
know, get them out of trouble.

1099
00:53:53,240 --> 00:53:56,600
Yeah, at the other side of it.
And I, I would have thought that

1100
00:53:56,600 --> 00:53:58,840
was the case.
Otherwise you'd be be a bit

1101
00:53:58,840 --> 00:54:01,480
risky to do it.
And also in, you know, in

1102
00:54:01,480 --> 00:54:04,800
nickel, it's certainly an
unloved commodity at the moment.

1103
00:54:04,800 --> 00:54:07,480
I mean, you wouldn't want to be,
you wouldn't want to be starting

1104
00:54:07,480 --> 00:54:09,320
fresh.
So, you know, as a way, as a

1105
00:54:09,320 --> 00:54:12,160
means of avoiding dilution and,
and on the assumption that

1106
00:54:12,160 --> 00:54:14,880
they've already got their eye on
a potential strategic partner, I

1107
00:54:14,880 --> 00:54:17,200
think is, you know, might be the
right idea.

1108
00:54:18,000 --> 00:54:20,720
Yeah, the the bridge has got to
get you to the other side and

1109
00:54:21,240 --> 00:54:22,840
you can't just fall off the
other end.

1110
00:54:22,840 --> 00:54:24,840
So there's there's got to be
something firm there.

1111
00:54:24,840 --> 00:54:27,240
Otherwise they're going to have
a lot of egg on their face.

1112
00:54:27,240 --> 00:54:28,400
But yeah, I mean, really
interesting.

1113
00:54:28,440 --> 00:54:31,240
It was only a few months ago
that BHB finally said they're

1114
00:54:31,240 --> 00:54:33,200
going to walk away from this
one.

1115
00:54:33,640 --> 00:54:35,960
We're in a completely sort of
hated space.

1116
00:54:35,960 --> 00:54:39,320
So it's an interesting time to
kind of participate in in these

1117
00:54:40,000 --> 00:54:45,160
types of companies and and be
involved, albeit Nico is in a

1118
00:54:45,960 --> 00:54:47,600
particularly interesting part of
the cycle.

1119
00:54:47,960 --> 00:54:49,920
I hope it's a sweet deal.
I'm worried it's going to be

1120
00:54:49,920 --> 00:54:53,160
Saudi or it all depends on if
that's bridging to an outcome or

1121
00:54:53,160 --> 00:54:54,920
not.
But yeah, I'm sure everyone's

1122
00:54:54,920 --> 00:54:56,400
done their data here.
But you know me, I'm just

1123
00:54:56,400 --> 00:54:58,120
cynical.
You'd have, you'd have to have

1124
00:54:58,120 --> 00:55:02,680
faith in the board that they're
not rolling the dice on on a

1125
00:55:02,680 --> 00:55:04,480
strategic waiting at the other
end of that rainbow.

1126
00:55:04,520 --> 00:55:06,560
Because yeah.
If it's not there, it's going to

1127
00:55:06,560 --> 00:55:09,560
be painful.
All right, last deal swear sour

1128
00:55:09,560 --> 00:55:13,080
the Peabody Anglo Cole deal.
This one has also been in the

1129
00:55:13,080 --> 00:55:18,360
works for quite some time and it
feels as if you know D-Day is is

1130
00:55:18,360 --> 00:55:24,040
pretty imminent rating.
This one is, is is kind of hard,

1131
00:55:24,040 --> 00:55:26,920
but have you got thoughts on on
how you're thinking about this

1132
00:55:26,920 --> 00:55:32,000
deal many months later?
I've just got real sort of, I

1133
00:55:32,320 --> 00:55:35,760
suppose, sympathy for whoever
the the analysts are that have

1134
00:55:35,760 --> 00:55:39,760
to assess the the value of one
that caught fire.

1135
00:55:39,760 --> 00:55:41,880
And then that's complicated the
deal.

1136
00:55:41,960 --> 00:55:44,320
Yeah.
Like how do you because I mean,

1137
00:55:44,320 --> 00:55:47,160
I've got don't have any insights
into what the situation is, you

1138
00:55:47,160 --> 00:55:49,440
know, underground, whether or
not the the fires out and it's

1139
00:55:49,440 --> 00:55:53,400
all been sort of contained.
But you know, these these issues

1140
00:55:53,400 --> 00:55:55,920
when they pop up can take a very
long time to solve.

1141
00:55:55,920 --> 00:55:58,320
And if you're in the middle of a
sales process, then trying to

1142
00:55:59,040 --> 00:56:02,200
quantify the cost and therefore
the value and what you pay and

1143
00:56:02,200 --> 00:56:05,120
then, you know, the competing
sort of sides of that.

1144
00:56:07,280 --> 00:56:11,600
Yeah, it's difficult to do.
But I, well, I think if Peabody

1145
00:56:11,600 --> 00:56:14,800
ends up getting it, I think in
the fullness of time, it'll,

1146
00:56:15,240 --> 00:56:17,800
it'll probably turn in to be a
sweet deal because, I mean,

1147
00:56:17,800 --> 00:56:20,920
trying to get these mines
permitted is, is near on

1148
00:56:20,920 --> 00:56:23,520
impossible.
So, you know, it's the, the

1149
00:56:23,520 --> 00:56:26,880
incumbent producers is is where
you want to be because getting,

1150
00:56:26,880 --> 00:56:29,120
you know, additional supply up
and running is, is so tough.

1151
00:56:30,320 --> 00:56:33,680
I think it's, it's, I mean, the
deal, the deal's still in doubt

1152
00:56:33,680 --> 00:56:35,600
in some ways.
There's the Peabody saying it's

1153
00:56:35,600 --> 00:56:38,840
a material adverse event, Anglo
saying it's not.

1154
00:56:38,880 --> 00:56:43,720
Peabody's like share prices has
gone from as low as like 10:50

1155
00:56:43,720 --> 00:56:45,720
when everyone was worried about
how they're going to fund this

1156
00:56:45,720 --> 00:56:48,560
thing back to 18 bucks.
And, you know, now they're

1157
00:56:48,560 --> 00:56:50,680
actually in a position where
they they could fund it.

1158
00:56:50,680 --> 00:56:53,200
I think they've got to like,
yeah, I think their earnings is

1159
00:56:53,200 --> 00:56:55,320
on the on the 19th and they're
going to have to, they're going

1160
00:56:55,320 --> 00:56:57,520
to say, you know what, they're
what's going on here.

1161
00:56:58,400 --> 00:57:00,440
But I feel like there's an
opportunity to do a swing big

1162
00:57:00,440 --> 00:57:03,480
deal, reprice it Anglo.
Anglo probably will reprice it

1163
00:57:03,480 --> 00:57:05,120
lower because like what's the
alternative for them?

1164
00:57:05,120 --> 00:57:07,840
Like the, the quality of they're
not going to get the same price.

1165
00:57:07,840 --> 00:57:10,200
The quality of these assets has
absolutely diminished since the

1166
00:57:10,200 --> 00:57:12,240
start of the sale process as a
result of what's unfolded.

1167
00:57:12,520 --> 00:57:14,520
Like as well as the coal price
just peeling.

1168
00:57:14,600 --> 00:57:18,480
Yeah, all of this stuff now I
wouldn't like if I was Peabody,

1169
00:57:18,480 --> 00:57:20,920
I'd, I'd try to reprice it.
It's something that's actually

1170
00:57:20,920 --> 00:57:23,640
just like, you know, a
reasonable thing where it's not

1171
00:57:23,880 --> 00:57:26,560
so onerous to fund it and your
share price is where it is right

1172
00:57:26,560 --> 00:57:29,520
now.
And, and I'd even let like, I

1173
00:57:29,680 --> 00:57:32,800
wouldn't even care if, if, if if
Anglo wanted to shop it around,

1174
00:57:32,800 --> 00:57:35,200
like, you know, the rumoured
second highest bidder, that

1175
00:57:35,200 --> 00:57:39,760
process was M resources in in
consortium with, with their

1176
00:57:39,800 --> 00:57:43,280
various funding partners.
If, if M resources wanted to pay

1177
00:57:43,280 --> 00:57:46,360
higher, like, you know, So what,
like, you know, you're kind of

1178
00:57:46,360 --> 00:57:48,880
you're half in, you're half out.
You don't you're saying you

1179
00:57:48,880 --> 00:57:50,600
don't want it like let let
someone else over pay.

1180
00:57:50,680 --> 00:57:54,080
If you think that what fair
value is and and close who is

1181
00:57:54,080 --> 00:57:55,960
angry going to sell it to like
they do want they're going to

1182
00:57:55,960 --> 00:57:57,960
sell it.
And you can probably reprice it

1183
00:57:58,000 --> 00:58:01,720
and just settle all of the legal
shenanigans that would go on if

1184
00:58:01,720 --> 00:58:03,880
you're trying to argue for a
material adverse event and just

1185
00:58:04,000 --> 00:58:05,840
reprice the deal.
And I think I think it can be

1186
00:58:05,840 --> 00:58:06,400
win, win.
Yeah.

1187
00:58:06,560 --> 00:58:07,800
Yeah, I think that's well
captured.

1188
00:58:07,800 --> 00:58:11,160
And again, the Japanese, they're
saying they will buy big stakes

1189
00:58:11,160 --> 00:58:13,680
in the assets themselves again
to to support the deal to get it

1190
00:58:13,680 --> 00:58:16,640
through, which is part of the
reason I would say the Peabody

1191
00:58:16,640 --> 00:58:19,800
share price rebound because they
have that support, which was the

1192
00:58:19,800 --> 00:58:23,880
big worry that saw them I think
over more than half on the back

1193
00:58:23,880 --> 00:58:27,880
of doing this deal at what
turned out to be a bit of a high

1194
00:58:27,880 --> 00:58:32,360
point in, in coal prices.
Last one for you.

1195
00:58:32,400 --> 00:58:34,960
So I mean, this is our last,
last, last segment, big brain,

1196
00:58:34,960 --> 00:58:36,560
small brain, we're calling it
for now.

1197
00:58:36,600 --> 00:58:39,480
Might, might change that.
All the names are iterations

1198
00:58:39,480 --> 00:58:40,480
that can be worked upon.
Yeah.

1199
00:58:40,680 --> 00:58:45,080
So each of us just get the
opportunity to share the

1200
00:58:45,080 --> 00:58:48,600
smartest and the dumbest thing
that we've either done or seen

1201
00:58:48,600 --> 00:58:52,440
done this week.
And and yeah, like I can start

1202
00:58:52,440 --> 00:58:54,040
if you want me.
Oh, I was going to say, I mean,

1203
00:58:54,200 --> 00:58:56,280
as referenced before, the
smartest thing I've seen this

1204
00:58:56,280 --> 00:59:01,040
week is that that Ben's deal,
you know, getting that away I

1205
00:59:01,040 --> 00:59:03,760
think is all the other mining
executives to have a look at,

1206
00:59:03,920 --> 00:59:07,280
at, you know, what can be done.
I suppose if you scour the earth

1207
00:59:07,280 --> 00:59:10,800
for capital and find it, as you
know, at a reasonably cheap

1208
00:59:10,800 --> 00:59:13,560
rate.
Yeah, that was, that's something

1209
00:59:13,560 --> 00:59:15,160
special, that one.
The small brain.

1210
00:59:15,520 --> 00:59:18,680
My small brain thing is probably
not participating in the Lion

1211
00:59:18,680 --> 00:59:22,040
town raising for a quick for a
quick turn.

1212
00:59:22,840 --> 00:59:26,280
I thought about it, but you
know, we're, I mean, generally

1213
00:59:26,280 --> 00:59:30,240
speaking, we're not traders.
But yeah, it's there was an

1214
00:59:30,240 --> 00:59:32,600
opportunity there for a quick
for a quick turn around, but

1215
00:59:32,920 --> 00:59:35,520
didn't take it unfortunately.
So left a little bit of money on

1216
00:59:35,520 --> 00:59:37,760
the table.
Trav, big brain, small brain,

1217
00:59:37,880 --> 00:59:42,320
what do you got?
Big brain was it was it was

1218
00:59:42,640 --> 00:59:45,280
actually just like watching the
the diggers things like a live

1219
00:59:45,280 --> 00:59:47,840
stream of them as opposed to
going to diggers like my my

1220
00:59:47,840 --> 00:59:51,320
health was in far better Nick.
And yeah, I could, I could

1221
00:59:52,000 --> 00:59:54,280
follow things that were
happening across all the

1222
00:59:54,280 --> 00:59:56,160
companies pretty, pretty, pretty
succinctly.

1223
00:59:56,160 --> 00:59:59,280
And I could also just touch base
with people who who were who

1224
00:59:59,280 --> 01:00:00,520
were there.
So that was the big brain thing.

1225
01:00:00,520 --> 01:00:03,160
Small brain.
Just not using my calendar,

1226
01:00:03,160 --> 01:00:05,680
mate.
Like it was Wednesday.

1227
01:00:06,000 --> 01:00:07,320
I got a phone call from mum in
the evening.

1228
01:00:07,320 --> 01:00:09,600
She's like, are you coming with
me at a funeral at 2:00 PM

1229
01:00:09,600 --> 01:00:11,320
tomorrow?
And I was like, what funeral?

1230
01:00:12,040 --> 01:00:16,360
So anyway, just using my
calendar using my calendar when

1231
01:00:16,360 --> 01:00:18,520
I first hear about something.
Shocker.

1232
01:00:18,720 --> 01:00:23,920
Yep, I had one outstanding
howler over the past week that

1233
01:00:24,160 --> 01:00:27,600
outshines or work related ones
but got a pizza out of the

1234
01:00:27,600 --> 01:00:30,240
fridge on Saturday.
Had been there a couple days

1235
01:00:30,240 --> 01:00:34,240
longer than I might have thought
it had reheat it and feel shit

1236
01:00:34,240 --> 01:00:36,800
all Saturday afternoon so I
can't look beyond that.

1237
01:00:36,800 --> 01:00:40,600
One big brain side of things.
Premier League season is

1238
01:00:40,600 --> 01:00:42,880
starting tonight.
I've got Stan sport sorted.

1239
01:00:42,920 --> 01:00:45,800
I'm good to go.
So a big nine months ahead that

1240
01:00:45,800 --> 01:00:48,200
I'm very pumped for to see
Liverpool win the league again.

1241
01:00:49,360 --> 01:00:50,600
Beautiful.
But I'm saying this to a

1242
01:00:50,600 --> 01:00:53,520
completely non soccer audience.
It's falling on deaf ears here.

1243
01:00:54,640 --> 01:00:56,120
It was, it was a lot of fun,
Sammy.

1244
01:00:56,120 --> 01:00:58,080
It was, yeah.
What do you think of what do you

1245
01:00:58,080 --> 01:00:59,480
think of this format?
Did you enjoy it?

1246
01:00:59,800 --> 01:01:01,960
I always enjoy a chat with you
guys and yeah, I mean it's

1247
01:01:02,480 --> 01:01:05,840
there's quite a lot of breadth,
you know, I suppose I think we

1248
01:01:05,840 --> 01:01:08,320
got, we got through today
international and and domestic.

1249
01:01:08,320 --> 01:01:11,320
So you know, a few political
sort of angles in there too.

1250
01:01:11,320 --> 01:01:14,680
But that's always a enjoy chat
and you know, you guys are

1251
01:01:14,680 --> 01:01:17,680
always very well researched as
as usual.

1252
01:01:17,960 --> 01:01:19,080
Did that?
Did did you?

1253
01:01:19,080 --> 01:01:21,120
Was there anything you wanted to
talk about that we didn't talk

1254
01:01:21,120 --> 01:01:27,760
about today?
I mean, I, I think it's, you

1255
01:01:27,760 --> 01:01:30,680
know, this, this, this power
policy thing, which is sort of

1256
01:01:30,760 --> 01:01:33,880
a, an ongoing bug bearer of
mind, particularly in the light

1257
01:01:33,880 --> 01:01:39,080
of the federal government
battery subsidy, which if you

1258
01:01:39,080 --> 01:01:41,920
haven't had a look at this, you
should because it's free money.

1259
01:01:41,920 --> 01:01:45,080
Well, it's, it's free money from
other people who, you know, pay

1260
01:01:45,080 --> 01:01:47,120
their taxes.
But yeah, the federal

1261
01:01:47,120 --> 01:01:50,000
government's giving you, you
know, roughly 10 grand off the

1262
01:01:50,000 --> 01:01:53,080
cost of a, you know, 20 kWh
battery for your home.

1263
01:01:54,280 --> 01:01:57,160
And I was just looking at some
numbers which one of the sort of

1264
01:01:57,160 --> 01:02:03,400
regulators put out yesterday, I
think roughly a four to five

1265
01:02:03,400 --> 01:02:07,000
year payback if you also
participate in the, in the, you

1266
01:02:07,160 --> 01:02:09,120
know, the various governments,
government schemes.

1267
01:02:09,120 --> 01:02:13,920
But you still need circa 10
grand of your own money spare

1268
01:02:14,280 --> 01:02:17,320
to, to make up the balance, you
know, the, the bit that the

1269
01:02:17,320 --> 01:02:19,960
government doesn't subsidized.
And not everybody has that sort

1270
01:02:19,960 --> 01:02:21,840
of money lying around.
And that's assuming you've got

1271
01:02:21,840 --> 01:02:23,280
solar panels on your roof
already.

1272
01:02:24,160 --> 01:02:27,040
So a great win for, you know,
for those that can afford it.

1273
01:02:27,480 --> 01:02:31,080
But if you can't, unfortunately,
you know, you're going to be

1274
01:02:31,720 --> 01:02:35,400
more exposed to, you know,
rising and rising power tariffs

1275
01:02:35,400 --> 01:02:39,120
as the, the network charges,
which used to be paid by the

1276
01:02:39,120 --> 01:02:42,720
people who, who didn't have
solar power on their roofs or,

1277
01:02:42,720 --> 01:02:45,400
or did have solar.
But still, you know, tap, tap

1278
01:02:45,400 --> 01:02:48,320
into the grid for, you know,
when the sun goes down, you

1279
01:02:48,320 --> 01:02:50,960
know, as they're not using the
network, they're also not paying

1280
01:02:50,960 --> 01:02:52,440
for it, but the cost still
exists.

1281
01:02:52,440 --> 01:02:55,160
So they end up being borne more
and more by the people who don't

1282
01:02:55,160 --> 01:02:57,160
have solar and don't have
batteries.

1283
01:02:57,160 --> 01:03:01,880
So it's, it's not really fair.
But you know, that's, that's the

1284
01:03:01,880 --> 01:03:03,960
situation.
So if you do have the cash lying

1285
01:03:03,960 --> 01:03:06,000
around I I recommend having a
good look at it.

1286
01:03:06,640 --> 01:03:09,320
And on the on the theme of
buying votes that we touched on

1287
01:03:09,320 --> 01:03:11,840
earlier, this one was announced
one week before the WA election,

1288
01:03:11,840 --> 01:03:15,160
I think.
Yeah, yeah, it's, it's a winner.

1289
01:03:15,160 --> 01:03:17,080
I think there's AWA subsidy on
top of it as well.

1290
01:03:17,080 --> 01:03:20,040
But it's, you know, for the
reasons I just pointed out, like

1291
01:03:20,040 --> 01:03:23,920
it's become such a, a sensitive
topic for the people who have

1292
01:03:23,920 --> 01:03:26,640
sunk that capital into their own
homes that the government would

1293
01:03:26,640 --> 01:03:32,160
be very reluctant to touch it.
But it's, it's making the power

1294
01:03:32,160 --> 01:03:38,160
grid very regressive, I suppose.
And it's, you know, for

1295
01:03:38,160 --> 01:03:41,280
something that's a, a need, it's
a necessity of life, an absolute

1296
01:03:41,280 --> 01:03:44,200
human staple.
I think it's, you know, the,

1297
01:03:44,280 --> 01:03:47,440
the, the path that we're on here
is, is not great.

1298
01:03:47,560 --> 01:03:49,880
And yeah, it probably needs to
change.

1299
01:03:49,880 --> 01:03:53,200
But you know, nobody who's, you
know, already enjoying the

1300
01:03:53,200 --> 01:03:55,640
benefits of government largesse
is going to be going to give

1301
01:03:55,640 --> 01:03:57,640
them up willingly.
Absolutely, mate.

1302
01:03:57,640 --> 01:04:02,240
Well, I think that's a, a great
place to to round up on and let

1303
01:04:02,240 --> 01:04:05,680
let people reflect mate.
We've got some fantastic

1304
01:04:05,680 --> 01:04:07,040
partners.
We've got to got to thank you.

1305
01:04:07,040 --> 01:04:09,800
In addition to thanking Sammy
Barridge for joining us, Axi's

1306
01:04:09,800 --> 01:04:12,880
mineral services, mate, crushing
services for for all your

1307
01:04:12,880 --> 01:04:16,200
requirements, seeing the ground
support like the best of ground

1308
01:04:16,200 --> 01:04:18,640
support there ever has been.
Africa Down under, join JD and

1309
01:04:18,640 --> 01:04:21,240
I, we're going to be there from
the September 3rd to 5th.

1310
01:04:21,240 --> 01:04:23,880
You didn't know that was an ad,
did you?

1311
01:04:24,520 --> 01:04:25,920
And also focused by market
check.

1312
01:04:26,040 --> 01:04:27,880
That's a wonderful platform
right behind Sammy's head

1313
01:04:28,360 --> 01:04:30,560
checking out.
It's a wonderful mining user

1314
01:04:30,560 --> 01:04:32,240
market needs all in one
platform.

1315
01:04:32,480 --> 01:04:33,760
Have a 10 day free trial in the
show notes.

1316
01:04:33,880 --> 01:04:34,720
Hey Daru.
Hey Daru.

1317
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Thanks guys.
Now remember, I'm an idiot.

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01:04:38,520 --> 01:04:40,960
JD is an idiot.
If you thought any of this was

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anything other than
entertainment, you're an idiot.

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And you need to read out a
disclaimer.