Not having Conviction Hurts Returns (Dave Franklyn Interview)

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Righto buddy Borders, welcome to
another yarn bought to you by

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the best resource in bloody
drill hole survey

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instrumentation axis mine and
technology the trusted advisor

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and we've got one of the look.
I'm just gonna put him out there

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as one of the best bloody
resource fund managers gown

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around Dave Franklin, Argonaut
Co, head of Argonaut Funds

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management.
Mate, you you will not get an

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intro like that ever.
You have to you have to pay for

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that shit.
Usually you get titled like

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that.
How are you copper?

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I'm good, Maddie and Hailey and
and and JD, thanks for having me

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on today.
Oh.

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JD back.
You're obviously still making

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money if you're still coming on.
So, well, there's no one going.

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People don't come on if you're
losing money with them.

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Yeah.
What what I find is there's

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times in the market where you're
making money and there's times

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in the market where you just try
not to lose money and, and, and

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the last year's been a bit like
that, right?

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It's just hanging in there.
Ah, very, very good mate throw

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Sue she throws me iPad JC 'cause
I'll I will 100% go rogue as

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anything if I've got no God yes
JD churning in from over over E

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yeah E US.
I, I couldn't miss it.

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And I was actually, yeah, I was
excited.

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I'd listened back to the chat we
did almost a year ago now, Dave.

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And it was, yeah, interesting to
to reflect back on the, the way

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of the world back then and how
things are now.

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So yeah, maybe maybe keen to
start with just what you're sort

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of sentiment check was at at
Diggers.

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We bumped into each other a
couple of weeks ago there now

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and that's always a good place
to get a feel for the the market

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as it kind of relates to what we
follow in commodities.

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What what were you kind of
thinking?

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What?
A week I dive.

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It was a great week.
Yeah, as as it always is.

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But you know, I, I think Diggers
this year was, was what it used

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to be.
It's all about gold.

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And I think if you look at where
commodities gone over the last

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year, you know, everything's,
you know, a lot of the base

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metals have been tough.
Lithium I'm sure we'll talk

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about today has been
catastrophic.

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And but gold's up 20% and
particularly the gold producers

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have been up very strongly.
And perhaps if there's, if

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there's one disconnect is the
smaller golds really haven't

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moved.
But you know, diggers all about

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gold and a lot of the the
management there strutting

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around and reclaiming their
position at the top of the heap.

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Feeling pretty good about
themselves.

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Hey, yeah, did you find the I
think I repeated the repeating

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myself a bit here, but the
common theme I felt from

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Diggers, there wasn't many high
conviction longs.

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Like people were like, right,
what's the bet at the moment?

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What's the bet?
And like there wasn't like a

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real, you know, 'cause you
things like Spartan have already

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had the run and people like,
well, we're we're sort of, we're

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we're still long, but it's like
it's there wasn't that really?

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What's the next big thing?
Well, I, I think you're right

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and and that's in the gold
sector, but it's all, it's also

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really across the resource of
space.

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So what you tend to see is an
emerging opportunity.

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Everyone jumps on it and it and
it rewrites pretty quickly.

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But but I think you're right.
It's, you know, it's a difficult

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market to to find those, you
know, special stories.

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Any any other anything other
than goal that was sort of your

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fair what what gets a silver
medal for diggers?

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What was getting down about a
bit?

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Yeah, look, you know, you know,
I, I thought some of the, you

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know, I, I thought the, the
Pilbara presentation and, and

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Patriot were were good
presentations.

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And you know, I think what's
interesting about lithium is

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where the splodge mean prices in
particular suggests there's not

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a whole lot of downside.
I think in the equities perhaps

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there can be.
But as a market, you know, it's

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getting interesting because it's
way into the cost curve.

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And you know, I think as a
resource sector investor, what

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you're looking for is to buy the
really high quality assets at a

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good price.
And it's these kind of markets

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where those opportunities
emerge.

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So, you know, that's the
exciting thing.

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Yeah.
And was there much chat around

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the the fundies with you like
you just after diggers, we're

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obviously saying the Pilbara
Latin deal prior to that, what

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was the talk about getting
positions in lithium is everyone

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thinking?
Stay away.

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You can't.
I think we've learnt about

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lithium.
You can't predict when the

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pain's gonna stop because it
could keep going.

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Yeah, Well, good.
But are people starting?

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Was there a bit of a vibe?
They're starting to think, well,

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I how much lower can you go?
Yeah, I, I think so.

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And I think lithium but, but
also across other commodities.

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I mean, you look at something
like Middle's acquisition Corp,

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you know, they're obviously
pretty, pretty open about the

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wanting to, to add assets.
You look at, you know, beach

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Energy, which which we might
touch on, you know, they see and

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you know, Brett Woods coming in
there, it's all about growing

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the asset base and looking, you
know, adding, adding assets.

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So I think we're entering a
phase really across the resource

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landscape where acquisitions is
is often an easier way to grow

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your business rather than you
know developing new ore bodies,

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so.
I think Dave probably on on this

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statement sort of touching on a
quote that really stood out from

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our, our last channel arguably
probably resonates very strongly

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today is observe and react
rather than predict.

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I mean, it's been such a rocky
ride for resources in the last

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year.
How, how, what have been sort of

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your key observations you're
making at a macro level and, and

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how you sort of, you know,
deliver on that observe and

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react rather than predicting a
portfolio sense.

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Yeah.
So, so really what it comes down

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to is how do you, how do you
deal with with volatile and

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uncertain markets, right.
So, you know, if, if I'm to put

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it into context and really from
a macro view, if you look at

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what's happened over the last
year, you go, well, you know, in

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the Western world, interest
rates have been increasing.

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You know, economies have been
slowing question mark whether

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it's going to be a hard landing
or a soft landing.

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You've got China really
lacklustre economic performance.

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You've got, you know, conflicts
in, in numerous places around

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the world.
And, and most of that is, is at

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face value, not very good for
resources.

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So you know, you've got two
approaches.

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One is you just go, I'm going to
make a call, right?

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Things are going to improve.
The market's going to go up or

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things are going to deteriorate
and the market's going to go

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down.
I'm going to switch into cash

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and sit there.
And you know, if you think it's

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going to go down, you switch
into cash.

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If you if you think the market's
going up, then then then you get

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fully invested.
The risk with that is, you know,

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markets often don't move how you
expect that they will move,

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right.
So the, the way we take it is we

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say, well, let's not predict,
but let's just prepare for the

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eventualities.
So given those factors that I've

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just said, you know, the way we
adjust our portfolio is to say,

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well, we probably want to have
some flexibility.

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So we don't want to be in small
caps typically we want to be in

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big caps.
So in the end of July, for

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example, I think we had 70% of
the portfolio in companies with

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a market cap above a billion,
which you know, and, and 70% in

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producers rather than
developers.

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And I think you know, almost 90%
of the of the underlying

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projects in the portfolio we're
in either Australia or North

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America, right?
So, so you kind of firstly say,

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well, let's, let's minimise risk
as best we can, but we stay

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invested, right.
But the benefit of being in

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those bigger companies is if the
market does correct, either you

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get the benefit of being better
quality because they fall less

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and recover first.
But also if you then make the

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decision where you convert into
cash, you can.

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So, so a really good example
was, you know, that's where we

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were at the end of July, the
first week of August, you know,

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as you'd recall was, you know,
was, was pretty scary on the

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Friday night New York market
fell.

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And the positive was, you know,
going into Monday, I'm going, I

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know exactly what what we're
going to do.

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Our portfolio is in reasonable
shape.

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There's always stuff you never
get it percent right, but you

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know, our portfolio is in good
shape.

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You know, I think what I'll do
on Monday before the US market

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opens on Monday night is we'll
sell a bit more, increase our

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cash.
So it went above 25% because it

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looked like it could have been
one of those events where you

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get a big, a bigger sell off now
that didn't eventuate.

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So what it means is during that
week we could start to to to

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invest our cash.
We really didn't take any

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negative downside from that and
and we move forward.

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Yeah.
I mean you've also got the

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ability and the fund to an
extent to go short.

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Is that something you've tapped
into in the in the past year?

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We, we haven't.
And I know everyone, everyone

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you have on here.
Since they've done us.

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But, but what I would highlight,
JD, is how you structure your

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fund when you first set it up is
also really critical, right?

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So things like can you short is
important, but can you invest in

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big caps as well as small caps?
Can you invest internationally?

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What percentage of cash can you
hold?

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You know, can you short, you
know, can you buy mining

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services companies as well as
resource companies because what

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you're looking for is areas
where you can hide when the

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market's under pressure, but
also, you know, as broad a range

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of stock picking opportunities
as as possible.

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So that's, that's, that's
important.

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It's a tough one.
It'll be a tough one to surmise,

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but like how do you in terms of
quick pros and cons for of

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majority long preserving cash
when you need it and buying low

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versus long short like long,
long short like you know, stocks

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will go go up or down or stay
stay the same.

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What's the the trade off of
preserving the cash compared to

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activating a short position?
Yeah, look, I mean.

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Is it a risk?
It's.

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A well, it's a combination of
things.

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Is, is one, you know, I look at
the groups that do short and

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where you can get some
information on them really

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across the market.
And, and it's, it's difficult

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often to see that, you know,
over the course of a year, they

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actually create value through
that process, right.

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The resource market is also
pretty small and, and, and not a

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large, not a number of, not a
large number of companies that

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are, are really liquid.
So, you know, you need liquidity

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to, to do it effectively.
So the view we've taken to date

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is, is we, we haven't done it
and we probably won't do it, but

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we just like to have that
capacity to do it if if things

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change.
Is there is there much capacity,

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capacity for it?
But when you know you've got

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funds that have been you know
long short for a long time and

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they're probably in terms of the
prime broker relationships.

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And then now flock side, the
Argonaut Resource Fund says

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right, we're going to start
amping up our short position.

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So you sort of have to get in
line to get get into the pool.

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Well, I think you're going to
have those relationships and,

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and it comes down to, you know,
the, the size and the, you know,

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and the, and the frequency and
the quantity that you're doing.

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But as I said, you know, we've
stayed clear of that to this

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point.
Interest.

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Very interesting, yeah.
You, you really tap into the,

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the ability to go to cash and
that, that margin that you have

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there is, is notably bigger than
some other funds.

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Yeah, I mean you mentioned up to
25% the numbers I looked at the

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skimming through this morning, I
think was 17% where you're kind

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of currently at.
Yeah.

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The the time you last reported,
that's really the the, the safe

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haven as I see it for you.
Right knows everything about

224
00:11:16,360 --> 00:11:19,880
you, Dave.
Don't forget past the big fella.

225
00:11:19,960 --> 00:11:21,680
That's right.
That's a lot of top and your

226
00:11:21,680 --> 00:11:22,200
tax.
Hold on.

227
00:11:22,200 --> 00:11:25,880
Yeah.
So, so we can actually go to 30%

228
00:11:25,880 --> 00:11:32,880
cash and and we tried, you know,
the, the risk that you have when

229
00:11:32,880 --> 00:11:36,400
you have the ability to go to
30% cash is you go too cautious

230
00:11:36,400 --> 00:11:38,800
and you sit on high level of
cash for a long period of time,

231
00:11:38,800 --> 00:11:39,800
right?
So you got to keep telling

232
00:11:39,800 --> 00:11:42,840
yourself, I mean, this business
to invest, I got to invest which

233
00:11:42,840 --> 00:11:44,880
we try and do.
So we use of, you know, the

234
00:11:44,880 --> 00:11:48,520
higher levels say above, you
know, particularly above 20%,

235
00:11:48,520 --> 00:11:51,760
but even really above 15% is
when you got concerns about the

236
00:11:51,760 --> 00:11:55,040
market and we typically won't
hold large amounts of cash for a

237
00:11:55,040 --> 00:11:57,560
long period of time.
It's really just when you think

238
00:11:57,560 --> 00:12:04,560
there's an uncertain event or
the market's, you know, there's

239
00:12:04,560 --> 00:12:06,160
issues there and then then we'll
hold off.

240
00:12:06,160 --> 00:12:09,000
But you know, we think it's the
important part and it kind of

241
00:12:09,000 --> 00:12:11,160
goes to not, you know, to the
shorting.

242
00:12:11,160 --> 00:12:13,840
We'd prefer to hold cash rather
than short at this point.

243
00:12:14,880 --> 00:12:18,920
Dave, so the, the way you, you,
you think about your portfolio

244
00:12:18,920 --> 00:12:22,960
is sort of structuring into it
the two themes of one being

245
00:12:22,960 --> 00:12:25,920
energy transition and the other
geopolitical risk.

246
00:12:26,080 --> 00:12:29,400
You sort of talked to a bit of
sort of what's changed from from

247
00:12:29,400 --> 00:12:33,640
last year to this year.
I mean, arguably, I think

248
00:12:33,640 --> 00:12:35,800
probably the the interesting
ones to us there.

249
00:12:35,960 --> 00:12:38,600
You could probably add to
geopolitical risk is, is

250
00:12:38,600 --> 00:12:42,360
permitting risk in Australia,
just Australia, a lot of what's

251
00:12:42,360 --> 00:12:47,800
happened in very recent history
and yeah, addressing base load

252
00:12:48,080 --> 00:12:51,360
power and what the the future
energy makes could look like

253
00:12:51,360 --> 00:12:53,920
globally and and perhaps in
Australia's been quite a

254
00:12:53,920 --> 00:12:56,320
political and controversial
topic as well.

255
00:12:56,560 --> 00:13:00,480
Yeah.
How, how have you found that's

256
00:13:01,680 --> 00:13:05,600
impacted the portfolio broadly?
Like with those themes, is it

257
00:13:05,720 --> 00:13:09,200
sort of swung to 1 theme more
than another?

258
00:13:09,360 --> 00:13:11,920
Yeah, last year.
What, what I've found

259
00:13:11,920 --> 00:13:15,640
interesting, like we kicked off
the fund in January 2020 and at

260
00:13:15,640 --> 00:13:18,400
that time we kind of, sort of
outlined here the, the key

261
00:13:19,040 --> 00:13:21,960
resilient themes, you know,
energy transition, geopolitical

262
00:13:21,960 --> 00:13:25,480
risk and you know, and still
doing our, our monthly, you

263
00:13:25,480 --> 00:13:28,200
know, presentations, the, the,
the themes are the same.

264
00:13:28,200 --> 00:13:31,440
So you know, if you take energy
transition, I think the big

265
00:13:31,440 --> 00:13:36,880
change has been really up until
probably a year ago people

266
00:13:36,880 --> 00:13:40,040
talked about energy transition,
but they're really talking about

267
00:13:40,160 --> 00:13:44,640
electric vehicles and the EV
market and you know, and the and

268
00:13:44,640 --> 00:13:48,280
the roll out of that globally.
Yeah, that's right.

269
00:13:48,280 --> 00:13:50,720
It was just cars.
Yeah, solar panels and wind

270
00:13:50,720 --> 00:13:52,120
turbines wasn't.
It yeah, exactly.

271
00:13:52,160 --> 00:13:55,800
And and renewable power, whereas
I think now it's going you know,

272
00:13:56,160 --> 00:14:01,320
transport is, you know, is 15%
of global greenhouse gas to the

273
00:14:01,320 --> 00:14:05,040
emissions.
And whereas power and industry

274
00:14:05,040 --> 00:14:08,600
and it's really the, the, the
fossil fuels used used in, in

275
00:14:09,080 --> 00:14:12,760
empowering, you know, industry
is, you know, probably 55 to

276
00:14:12,760 --> 00:14:15,400
60%.
And I I suppose though they were

277
00:14:15,400 --> 00:14:19,080
thinking but originally that
this, the renewables were going

278
00:14:19,080 --> 00:14:21,280
to be the base like power.
Well, that's right.

279
00:14:21,280 --> 00:14:22,200
That's exactly.
What?

280
00:14:22,200 --> 00:14:24,360
The Australian, exactly?
So that's what, Yeah.

281
00:14:24,400 --> 00:14:26,520
He wasn't even getting a talk
about Yeah.

282
00:14:26,560 --> 00:14:29,320
So, you know, so I think where
we where we're at now is there's

283
00:14:29,320 --> 00:14:32,680
a much which I think is healthy
is there's a much greater

284
00:14:32,680 --> 00:14:35,400
understanding that we need to
address the base load issue,

285
00:14:35,400 --> 00:14:37,320
right.
And and renewables is part of

286
00:14:37,320 --> 00:14:39,160
that.
Really I think where that's

287
00:14:39,160 --> 00:14:42,200
fallen down from a base load
perspective is, is battery

288
00:14:42,200 --> 00:14:45,560
storage, which really hasn't
technology hasn't sort of driven

289
00:14:45,560 --> 00:14:47,520
that forward.
But then you're right, then it's

290
00:14:47,960 --> 00:14:53,040
then it's things like nuclear
power, but but also I think gas

291
00:14:53,040 --> 00:14:56,120
has come back as a transitionary
fuel and people understanding

292
00:14:56,360 --> 00:14:59,200
that's going to be necessary
either to replace coal, you

293
00:14:59,200 --> 00:15:01,960
know, thurible coal or to
support renewables.

294
00:15:02,920 --> 00:15:05,840
So I think it's, you know, I
think it's, it's, it's, it's,

295
00:15:06,040 --> 00:15:09,680
it's positive there.
What what have you sort of

296
00:15:09,680 --> 00:15:12,960
noticed just, you know, swerving
back to the, the geopolitical

297
00:15:12,960 --> 00:15:15,760
kind of front And you know, gold
is the key part and I find it

298
00:15:15,760 --> 00:15:18,440
fascinating.
You got oil and gas as well in

299
00:15:18,440 --> 00:15:21,040
there.
I mean, it's a bit sort of

300
00:15:21,040 --> 00:15:23,440
grandiose to talk about
everything going on in the

301
00:15:23,440 --> 00:15:26,920
Middle East, but how do you kind
of play that when you're talking

302
00:15:26,920 --> 00:15:29,560
about oil and gas and you're
picking names like Karoon and

303
00:15:29,560 --> 00:15:31,760
your top five?
Are you thinking about any of

304
00:15:31,760 --> 00:15:34,800
that stuff or you just purely
focused on the bottom up

305
00:15:34,800 --> 00:15:37,000
fundamentals of the names that
you're holding?

306
00:15:37,040 --> 00:15:39,360
Yeah, it's a combination.
You know, the way I often

307
00:15:39,360 --> 00:15:41,680
describe what we do, it's top
down meets bottom up.

308
00:15:41,680 --> 00:15:44,320
So you know, what's what's
happening at the commodity level

309
00:15:44,320 --> 00:15:46,640
and what's happening at the at
the micro company level.

310
00:15:46,960 --> 00:15:48,880
Something like Karoon's a good
example of that, where we're

311
00:15:48,880 --> 00:15:50,440
going.
If you look at what's happened

312
00:15:50,440 --> 00:15:53,160
in, you know, Russia, Ukraine,
you look at you look at what's

313
00:15:53,160 --> 00:15:57,720
happening in the Middle East.
You know, we we particularly

314
00:15:57,720 --> 00:16:00,920
like oil.
You know, we think prices will

315
00:16:01,160 --> 00:16:05,160
be supported there.
Corun has obviously had a few

316
00:16:05,160 --> 00:16:07,240
disappointments in the market.
We think it's coming through

317
00:16:07,240 --> 00:16:10,640
that on a free cash flow
generation perspective it looks

318
00:16:10,640 --> 00:16:15,240
really good.
So there's kind of commodity is,

319
00:16:15,280 --> 00:16:19,320
is where we want to be.
And you know, and from a value

320
00:16:19,320 --> 00:16:21,280
perspective it also sort of
stacks up.

321
00:16:21,600 --> 00:16:28,320
Do you think it's now more so
difficult to be high conviction

322
00:16:28,320 --> 00:16:29,720
in this market?
That's something sort of we

323
00:16:29,720 --> 00:16:32,080
spoke at at length in our last
chat.

324
00:16:32,080 --> 00:16:36,240
And I noticed in your monthly
report from about a year ago,

325
00:16:36,280 --> 00:16:39,760
yet your top five comprised
almost, you know, just over 50%,

326
00:16:39,800 --> 00:16:43,920
yeah, of your portfolio.
Now it's down to about a third,

327
00:16:43,960 --> 00:16:48,160
yeah, which is arguably a lot
more than most, yeah, fund

328
00:16:48,160 --> 00:16:52,040
managers still anyway.
But how do you manage that or

329
00:16:52,080 --> 00:16:54,320
you still take the view on, you
know, you otherwise you

330
00:16:54,320 --> 00:16:56,000
compromise on quality.
That was another.

331
00:16:56,200 --> 00:16:58,200
Yeah.
Well, I think that's right in

332
00:16:58,200 --> 00:17:00,640
that again, it comes back to the
resource sector is actually

333
00:17:00,640 --> 00:17:02,400
relatively small.
And so when you find a good

334
00:17:02,400 --> 00:17:03,760
idea, you want to be able to
back it.

335
00:17:05,440 --> 00:17:10,079
So that's right.
Our top five, I think a 3334% of

336
00:17:10,079 --> 00:17:14,240
the portfolio and our top ten
are about just under 60 percent,

337
00:17:14,240 --> 00:17:17,440
55 or 60%.
So what what we're seeing in the

338
00:17:17,440 --> 00:17:20,560
market now and I think Maddie,
we're talking about this earlier

339
00:17:20,560 --> 00:17:23,720
that it's just kind of hard to
find those really compelling

340
00:17:23,720 --> 00:17:26,480
opportunities.
So we tend to have a bigger

341
00:17:26,480 --> 00:17:28,640
number of more moderate
holdings.

342
00:17:29,040 --> 00:17:32,040
But as you're saying, relative
to what other funds might do

343
00:17:32,160 --> 00:17:35,000
our, our relative, you know,
modest holdings are still, you

344
00:17:35,000 --> 00:17:38,320
know, 4 to 6%, right, so.
Compelling.

345
00:17:38,840 --> 00:17:39,880
No.
Have you Do you?

346
00:17:39,920 --> 00:17:42,360
I'll, I'll use an example.
Genesis.

347
00:17:42,400 --> 00:17:44,360
Do you have Genesis?
We don't at the moment we've

348
00:17:44,440 --> 00:17:48,040
we've we've held it in the past.
So it's a mate the way that we

349
00:17:48,040 --> 00:17:52,680
sort of manage the portfolio is
we say we we have a universe of

350
00:17:52,680 --> 00:17:55,560
investable companies that we
like and we want to own right.

351
00:17:55,800 --> 00:17:59,640
And then it's really get really,
does the macro situation favour

352
00:17:59,640 --> 00:18:01,560
that and does it look good
enough value?

353
00:18:01,560 --> 00:18:03,360
So Genesis, we love what they're
doing.

354
00:18:03,360 --> 00:18:06,960
I mean, obviously Rally has done
a great job in pulling the

355
00:18:06,960 --> 00:18:09,800
Genesis business together and
now it's really in the execution

356
00:18:09,800 --> 00:18:12,360
mode.
But we think in the gold space,

357
00:18:12,360 --> 00:18:13,800
perhaps there's better value at
the moment.

358
00:18:13,920 --> 00:18:16,360
Yeah, and so I'll just the
reason I brought that up as an

359
00:18:16,440 --> 00:18:19,360
as an example and probably in
the year since we spoke to you

360
00:18:19,360 --> 00:18:21,800
last like one more.
I think I used to when I was

361
00:18:21,800 --> 00:18:24,480
talking about Ulysses, Yeah,
thinking like right.

362
00:18:24,680 --> 00:18:26,800
I think it was a 5 gramme
resource.

363
00:18:26,800 --> 00:18:29,640
I forget what they deserve rate
is, but I'm like, you know, like

364
00:18:29,640 --> 00:18:32,560
4 so mine and four gramme dirt
and it's flat.

365
00:18:32,560 --> 00:18:35,880
And once you get the recovery,
it's like hard work and all

366
00:18:35,880 --> 00:18:39,000
this, but the gold price is
going up so much.

367
00:18:39,000 --> 00:18:42,000
And like you look at what's
what's out there, it's like far

368
00:18:42,000 --> 00:18:44,600
out.
If you're pulling out three to

369
00:18:44,600 --> 00:18:47,400
four gramme dirt from a
underground, even if it's a bit

370
00:18:47,400 --> 00:18:50,200
difficult, it's like, well,
that's actually good these days.

371
00:18:50,320 --> 00:18:52,280
Yeah.
So like what what we considered

372
00:18:52,280 --> 00:18:54,760
was like compelling
opportunities and like just

373
00:18:54,760 --> 00:18:58,280
based on looking at yeah,
grades, like tonnes and grade.

374
00:18:58,280 --> 00:19:00,640
Yeah, it it's just changed so
much in a year.

375
00:19:01,120 --> 00:19:04,600
Well, like a blood Yeah right.
1.2 gramme open pit.

376
00:19:04,600 --> 00:19:06,960
That's like fucking Jake, give
it to us any day.

377
00:19:07,120 --> 00:19:09,560
Yeah, would have even pissed on
it 10 years ago.

378
00:19:09,680 --> 00:19:11,480
Yeah.
Well, I mean, it'd be

379
00:19:11,480 --> 00:19:14,640
interesting to look back 12
months ago and what the, you

380
00:19:14,640 --> 00:19:17,960
know, what the expectations were
about all in sustaining costs,

381
00:19:18,000 --> 00:19:19,640
which is the other side of what
you're talking about.

382
00:19:20,080 --> 00:19:23,760
You know, it was probably 15-16
hundred maybe, maybe a slightly

383
00:19:23,760 --> 00:19:26,560
higher, but probably not a lot.
Whereas now you know, 2000 is

384
00:19:26,560 --> 00:19:29,400
kind of, you know, not unusual
and and some are, some are more

385
00:19:29,400 --> 00:19:31,880
than that, so.
If you're if you're too 2000 and

386
00:19:31,880 --> 00:19:34,280
unhedged, yeah, like you think.
You're a genius.

387
00:19:34,280 --> 00:19:35,760
Yeah, exactly.
You think you should be still

388
00:19:35,760 --> 00:19:40,040
making maybe 800 to 1000 bucks
on top all in like you're

389
00:19:40,040 --> 00:19:41,920
frigging laughing.
Exactly, Yeah.

390
00:19:42,760 --> 00:19:44,080
Exactly, I'm a Ding Ding Ding
on.

391
00:19:44,480 --> 00:19:47,600
Genesis oh Ding Ding Dings just
ripped the Ding Ding Dings.

392
00:19:47,600 --> 00:19:48,880
Oh, you're a Ding?
Ding Ding on.

393
00:19:49,000 --> 00:19:51,560
I am a Ding Ding Ding on the
fund as well.

394
00:19:51,600 --> 00:19:53,120
Good.
That's some responsible

395
00:19:53,120 --> 00:19:57,000
investing JC, you're not not
punting there like well done

396
00:19:57,000 --> 00:19:57,760
mate.
Thanks.

397
00:19:58,560 --> 00:20:00,840
A Ding Ding Ding on on Karoon on
my part.

398
00:20:01,200 --> 00:20:04,120
Two, while while we're on gold,
I think we should just dive,

399
00:20:04,120 --> 00:20:07,800
dive a bit deeper and round out
how you, you kind of play it.

400
00:20:07,800 --> 00:20:10,440
So obviously we're talking about
a producer there.

401
00:20:10,920 --> 00:20:12,760
How do you talk about getting,
getting leverage?

402
00:20:12,760 --> 00:20:15,800
Obviously everyone's raging
about the, the gold price in

403
00:20:15,800 --> 00:20:19,000
Aussie dollar terms over 3700
and all that.

404
00:20:19,200 --> 00:20:21,600
And then people start to quickly
look, look down the curve, you

405
00:20:21,600 --> 00:20:23,960
know, what's what's in the
developer space, what's in the

406
00:20:23,960 --> 00:20:27,200
explorer space and see where
they can really find value

407
00:20:27,200 --> 00:20:28,400
still.
What are you seeing out there?

408
00:20:29,040 --> 00:20:31,120
Yeah.
Look, so to put it in context,

409
00:20:31,120 --> 00:20:35,080
in our fund, we typically have
between 10 and 15% exposure to

410
00:20:35,080 --> 00:20:38,320
gold and it's probably just
tipping up to, you know, it's,

411
00:20:38,320 --> 00:20:40,560
it's about 12 or 13% at the
moment.

412
00:20:40,880 --> 00:20:44,600
Is that 10 or 15% of what's
invested or the total?

413
00:20:44,600 --> 00:20:46,040
Of the total.
Including the cash.

414
00:20:46,040 --> 00:20:47,600
Yeah.
Total portfolio including the

415
00:20:47,600 --> 00:20:50,440
cash, Yeah, yeah, yeah, yeah.
Which is probably one of the

416
00:20:50,440 --> 00:20:53,160
bigger, bigger exposures we've
got to individual commodities

417
00:20:53,160 --> 00:20:55,000
as, as you'd expect given the
way it's gone.

418
00:20:55,840 --> 00:21:01,720
But our exposure is, you know,
West Gold, Northern Star and and

419
00:21:01,720 --> 00:21:04,840
the Grey we've owned until until
recently and, and we'll probably

420
00:21:04,840 --> 00:21:07,720
roll into, you know, another
producer.

421
00:21:08,520 --> 00:21:12,000
So we haven't really gone down.
I mean, we've looked at we, you

422
00:21:12,000 --> 00:21:14,120
know, we've been an investor in
Spartan during the year for a,

423
00:21:14,320 --> 00:21:17,000
for a period of time.
You know, I think some of the

424
00:21:17,000 --> 00:21:20,200
emerging projects like Catalyst
and Oribanda have have done

425
00:21:20,200 --> 00:21:22,520
really well.
But we've, you know, at the

426
00:21:22,520 --> 00:21:24,960
moment we're sitting in the in
the bigger producers.

427
00:21:26,320 --> 00:21:28,040
How do you how do you look at
Capricorn?

428
00:21:28,280 --> 00:21:31,960
Like the the yeah, it's one of
the like you look at how like

429
00:21:31,960 --> 00:21:35,000
it's performance recently, it's
always been traded at a high.

430
00:21:35,200 --> 00:21:38,520
Yeah, a high multiple yeah.
But it you know, it keeps on

431
00:21:38,800 --> 00:21:40,080
going up.
So it's like as a yeah.

432
00:21:40,520 --> 00:21:43,600
And, you know, and the, you
know, potential plans to expand.

433
00:21:43,720 --> 00:21:45,400
Yeah.
Carla Windell, everyone says,

434
00:21:45,440 --> 00:21:48,880
oh, look, it's gonna get deeper
and might get deeper and higher

435
00:21:48,880 --> 00:21:50,480
strip and get a bit more
difficult.

436
00:21:50,600 --> 00:21:54,240
Well, you can just expand the
plant and maybe lower the cost

437
00:21:54,240 --> 00:21:56,520
and offset that then with me and
Gibson coming on.

438
00:21:56,520 --> 00:21:59,080
But it's just one of the ones
that it really never gets talked

439
00:21:59,080 --> 00:22:01,400
about because everyone trades on
such a high multiple.

440
00:22:01,400 --> 00:22:05,920
But yeah, it's like possibly one
of the safer bets.

441
00:22:05,920 --> 00:22:06,680
Well, I.
Agree.

442
00:22:06,760 --> 00:22:09,640
Yeah, I agree.
Capricorn is, is the gold

443
00:22:09,640 --> 00:22:12,720
company I want to own, but I
don't own it right now.

444
00:22:12,720 --> 00:22:15,320
And the reason for that I don't
own it is I do have some

445
00:22:15,320 --> 00:22:18,880
concerns about the, the, the
permitting of of Mount Gibson

446
00:22:18,880 --> 00:22:21,760
and how quickly that'll come
through and potentially delay.

447
00:22:22,120 --> 00:22:24,600
But you know, if you look at it
and maybe comparing it a bit

448
00:22:24,600 --> 00:22:28,320
with with Genesis as you go,
well, you know, today it's

449
00:22:28,320 --> 00:22:31,360
producing 150,100 and 15,000
ounces.

450
00:22:32,040 --> 00:22:36,000
You crank up Carla Winder a bit
that maybe gets it close to 150

451
00:22:36,360 --> 00:22:40,000
and you bring on Mount Gibson,
you know, then you're 300,000 oz

452
00:22:40,000 --> 00:22:44,040
or or slightly more stay within
a three, three year time frame,

453
00:22:44,040 --> 00:22:46,880
something like that.
But the point of difference is

454
00:22:46,880 --> 00:22:49,240
going to be their costs are
going to be low and their free

455
00:22:49,240 --> 00:22:51,680
cash generation is going to be
really significant.

456
00:22:52,080 --> 00:22:55,880
And I think that, you know, that
combination is really

457
00:22:55,880 --> 00:22:58,120
compelling.
You know, I think when you look

458
00:22:58,120 --> 00:23:00,360
at it on multiples at the
moment, you know that the

459
00:23:00,360 --> 00:23:03,240
markets factoring in a value
from Mount Gibson that doesn't

460
00:23:03,240 --> 00:23:05,280
flow through in in earnings,
right.

461
00:23:05,280 --> 00:23:06,440
So you got to be careful on
that.

462
00:23:06,440 --> 00:23:09,440
But yeah, so I so I like it and
I'm just looking for an

463
00:23:09,440 --> 00:23:12,360
opportunity to buy it and
obviously management team is as

464
00:23:12,360 --> 00:23:13,720
good as going around.
Yeah.

465
00:23:14,080 --> 00:23:16,120
How do you think about paying up
for management?

466
00:23:16,120 --> 00:23:18,200
So they're they're obviously the
the name and you've also

467
00:23:18,200 --> 00:23:21,320
mentioned Raleigh develops one
of your biggest holdings as

468
00:23:21,320 --> 00:23:23,200
well.
Yeah, I mean the Capricorn is at

469
00:23:23,200 --> 00:23:26,240
6 bucks last time I looked.
So you, you are you are really

470
00:23:26,240 --> 00:23:28,480
paying up for it.
Can you talk a bit to that?

471
00:23:29,160 --> 00:23:33,800
Well, you know, I think, I think
the benefit of backing people

472
00:23:33,800 --> 00:23:37,560
that have a strong track record
of delivery is twofold.

473
00:23:37,560 --> 00:23:40,040
One is they track good people
into the business.

474
00:23:40,040 --> 00:23:42,040
I think we've seen that with
development, but also with

475
00:23:42,040 --> 00:23:47,120
Capricorn and and Genesis.
But you also know that if, if,

476
00:23:47,280 --> 00:23:50,920
if something unusual happens,
they're, they have an ability to

477
00:23:50,920 --> 00:23:54,280
raise capital, right?
So, so in the resource space,

478
00:23:54,560 --> 00:23:57,160
you know, your risk is you're
developing an asset, you're not

479
00:23:57,160 --> 00:24:00,440
generating an income stream and,
and something goes wrong and

480
00:24:00,440 --> 00:24:03,200
you, you're struggling, whereas
you know that the market is

481
00:24:03,200 --> 00:24:04,560
always going to support those
guys.

482
00:24:04,600 --> 00:24:06,440
So, you know, I think that's a
benefit.

483
00:24:06,440 --> 00:24:09,880
So I think, you know, Genesis is
a good example when, you know,

484
00:24:09,880 --> 00:24:14,800
when Rally stepped in and
implemented his plan, you know,

485
00:24:14,800 --> 00:24:17,200
the market immediately applied a
premium there.

486
00:24:17,200 --> 00:24:19,480
Capricorn's the same, develops
the same.

487
00:24:19,480 --> 00:24:22,080
So I think there is value there.
You gotta be careful because

488
00:24:22,280 --> 00:24:25,120
that premium can be eroded if if
things change.

489
00:24:26,080 --> 00:24:29,880
But but backing good people, I
think is is is a good strategy.

490
00:24:29,880 --> 00:24:33,880
We we have the same effect when
we have Alley on an episode lot.

491
00:24:34,640 --> 00:24:35,920
We get a.
Few premium.

492
00:24:35,920 --> 00:24:40,080
We've just gotta have a mug on
there and it just JC.

493
00:24:40,600 --> 00:24:42,680
Premium.
Yeah, sorry, sorry to interrupt

494
00:24:42,680 --> 00:24:44,960
you.
Probably the other guy that I've

495
00:24:44,960 --> 00:24:47,920
mentioned in that group is, is
Chris Ellison from Minrez,

496
00:24:47,920 --> 00:24:49,560
right.
And obviously Minrez is, is

497
00:24:49,560 --> 00:24:51,040
under pressure.
And you know, it's one of those

498
00:24:51,040 --> 00:24:53,680
companies which is in our
investable universe.

499
00:24:54,600 --> 00:24:57,920
There's been times where you
know where where we've owned it

500
00:24:57,920 --> 00:25:01,240
and but then it got a bit
expensive, but now you can kind

501
00:25:01,240 --> 00:25:02,840
of see this.
It's already boxed by.

502
00:25:02,840 --> 00:25:05,120
There's an emerging opportunity
whether it's quite now I'm not

503
00:25:05,120 --> 00:25:08,720
sure, but you know from a from a
medium term perspective, it's

504
00:25:08,720 --> 00:25:11,920
the stock that you want to own
because you know you'd back him

505
00:25:11,920 --> 00:25:14,800
on what he's done.
Old Ding Ding myself on means

506
00:25:14,800 --> 00:25:16,360
and develop.
Their Gee, you are and

507
00:25:16,400 --> 00:25:19,840
everything Jason, I just.
Spread myself too quickly that's

508
00:25:19,840 --> 00:25:21,600
the problem.
But I guess the thing

509
00:25:21,600 --> 00:25:25,120
interesting thing with with
Chris, yeah he is very much in

510
00:25:25,120 --> 00:25:28,480
that sort of universe as well
about you know ability to you

511
00:25:28,480 --> 00:25:33,520
know execute and get things done
raise capital that but how much

512
00:25:33,520 --> 00:25:35,440
lower can means go?
Well.

513
00:25:35,920 --> 00:25:38,120
Yeah, exactly where does it?
Where does it sort of.

514
00:25:38,640 --> 00:25:39,840
Yeah, stop.
Yeah.

515
00:25:39,840 --> 00:25:44,560
Well, you know you look at the
business mix, you've got lithium

516
00:25:44,840 --> 00:25:50,040
again he's got he's got some
good assets there, but it's

517
00:25:50,040 --> 00:25:54,320
bodge mean price at $800 a tonne
US means no ones really making

518
00:25:54,320 --> 00:25:56,920
any money right.
So, so the markets not applying

519
00:25:56,920 --> 00:26:00,240
a whole lot of value to that
asset notwithstanding, you know,

520
00:26:00,240 --> 00:26:03,160
I'm of the view that it can't
really be sustained at these

521
00:26:03,160 --> 00:26:05,720
levels and that prices will move
higher over the next year or

522
00:26:05,720 --> 00:26:08,400
two.
So, you know, so the market's

523
00:26:08,400 --> 00:26:10,440
discounted for that.
On the iron ore side, you've had

524
00:26:10,440 --> 00:26:13,800
iron ore prices come back from,
you know, 12130 back to just

525
00:26:13,800 --> 00:26:16,440
under 100.
So again, that's not helping him

526
00:26:16,440 --> 00:26:19,120
as he's bringing on, you know,
his new iron ore project.

527
00:26:19,920 --> 00:26:23,400
So you can see that at the, it's
really the commodity level that

528
00:26:23,400 --> 00:26:26,760
he's being impacted.
But you know, looking forward

529
00:26:26,760 --> 00:26:28,880
you'd go spot domain prices are
probably near their low.

530
00:26:29,240 --> 00:26:31,600
Iron oil prices I don't think
have a lot of downside beyond

531
00:26:31,600 --> 00:26:34,480
$90.00 a tonne.
So there's an emerging

532
00:26:34,480 --> 00:26:36,360
opportunity there.
Actually, while we sort of

533
00:26:36,360 --> 00:26:40,320
touched on developers, well, we
noticed that that's obvious sort

534
00:26:40,320 --> 00:26:42,440
of top five holdings.
That's the one that sort of

535
00:26:42,440 --> 00:26:45,120
remained pretty consistent
between, you know, last year and

536
00:26:45,120 --> 00:26:47,960
this year.
But Develop is has, you know,

537
00:26:48,000 --> 00:26:50,960
come off, you know, 25% in that
year too.

538
00:26:50,960 --> 00:26:55,360
So why do you feel that this is
important to, you know, stay

539
00:26:55,360 --> 00:26:57,160
high conviction in someone like
Develop?

540
00:26:57,200 --> 00:26:59,320
Yeah.
Well, so, so between then and

541
00:26:59,320 --> 00:27:01,440
now, we've kind of been in and
out a few times.

542
00:27:01,480 --> 00:27:04,760
Yeah, because you're right, it's
one of those stocks where

543
00:27:05,080 --> 00:27:09,520
probably more than other ones we
own, there was a backfilling of

544
00:27:09,520 --> 00:27:12,760
actual earnings and you know and
and operations.

545
00:27:12,760 --> 00:27:14,120
It was really for the early
stage.

546
00:27:14,440 --> 00:27:18,240
So when it ran up particularly
strongly, we took some profits

547
00:27:18,480 --> 00:27:21,840
and then we sort of re entered.
I think obviously what's good

548
00:27:21,840 --> 00:27:23,720
about it now.
I think if you look at what

549
00:27:23,720 --> 00:27:26,400
they've achieved over the last
year, I think they've made a lot

550
00:27:26,400 --> 00:27:28,360
of progress on their mining
service business.

551
00:27:28,720 --> 00:27:31,080
And really the outlook for
that's only improving with, for

552
00:27:31,080 --> 00:27:36,240
example, you know, Bellevue and
what's happening there and you

553
00:27:36,240 --> 00:27:44,280
know, and, and other operations.
And I think that you know, on,

554
00:27:44,760 --> 00:27:49,920
on Woodlawn that's, that's also
looking as a, as a pretty good

555
00:27:49,920 --> 00:27:51,800
operation.
Then obviously traffic, you're

556
00:27:51,800 --> 00:27:54,280
also signing up for some
offtakes.

557
00:27:54,320 --> 00:27:56,760
Yeah, it didn't get really much
activity after that.

558
00:27:56,760 --> 00:28:00,440
That was probably a pretty K
announcement with that that

559
00:28:00,840 --> 00:28:04,760
financing deal.
But what do you what do you

560
00:28:04,760 --> 00:28:06,920
think the investors are waiting
for?

561
00:28:06,920 --> 00:28:08,840
Like what do you think is going
to be the cut?

562
00:28:08,840 --> 00:28:11,520
It's a yeah.
Is it the FID is going to be

563
00:28:12,000 --> 00:28:14,360
sort of the?
Well, I mean, I think so, I

564
00:28:14,360 --> 00:28:17,240
think people are now saying it's
there, it's ready to go.

565
00:28:17,720 --> 00:28:21,000
There's no really hindrance.
It's just, you know, like to see

566
00:28:21,000 --> 00:28:24,440
copper prices a bit higher and
and then press the button so.

567
00:28:24,600 --> 00:28:28,400
It's set it like fucking set up
beautifully in terms of all

568
00:28:28,400 --> 00:28:32,080
developed ahead and at or and I
think I think I think they said

569
00:28:32,080 --> 00:28:35,680
they got about two years worth
of production already already

570
00:28:35,680 --> 00:28:39,320
developed.
So in terms of so they.

571
00:28:39,400 --> 00:28:44,040
Obviously.
Got a, you know, up do up the

572
00:28:44,040 --> 00:28:45,480
mill and everything to get it
down.

573
00:28:45,480 --> 00:28:49,280
But like in terms of a a mining
side, yeah like should we just

574
00:28:49,480 --> 00:28:52,200
freaking flown out once they
once they do pull the trigger?

575
00:28:52,320 --> 00:28:54,400
Well, that's just a risk that so
much.

576
00:28:54,440 --> 00:28:55,920
Yeah, Yeah.
I think you're right, you know,

577
00:28:55,960 --> 00:28:58,400
and and getting back to the
question, why isn't the market

578
00:28:58,400 --> 00:29:00,640
reacting?
I think the market is very, it's

579
00:29:00,640 --> 00:29:03,720
very earnings focused and it's
very fundamental focused and

580
00:29:03,720 --> 00:29:07,640
develops kind of stillwell,
we've got a base business here,

581
00:29:07,640 --> 00:29:09,120
but it's what we're going to do
in the future.

582
00:29:09,160 --> 00:29:12,040
So notwithstanding the funding
is is locked away now.

583
00:29:12,160 --> 00:29:17,160
So I think it will come as as
market sentiment improves.

584
00:29:17,560 --> 00:29:20,080
Yeah, yeah, I think it's it's
it's shaping up similar.

585
00:29:20,600 --> 00:29:22,680
Oh, not really, because I
suppose that in the Northern

586
00:29:22,680 --> 00:29:25,280
Star journey, like Paulson's
tipped along for ages and then

587
00:29:25,280 --> 00:29:28,920
it was like, you know, Barrack
assets, Newmont assets, bloody

588
00:29:28,920 --> 00:29:30,920
bang, bang, bang.
And that then it was flying.

589
00:29:30,920 --> 00:29:33,880
So it's sort of, you know,
Woodlawn sitting there.

590
00:29:33,880 --> 00:29:37,280
Oh no, it's not getting mined
yet, but it's like when there

591
00:29:37,280 --> 00:29:42,880
may be a a flurry of activity
inorganically that might come

592
00:29:43,040 --> 00:29:45,920
yeah, for them and then it'll
just start rolling.

593
00:29:45,920 --> 00:29:49,360
I think he's proved probably
except for Pioneer dime like

594
00:29:49,360 --> 00:29:53,080
proved like a lot of discipline
in the the Northern Star days

595
00:29:53,080 --> 00:29:56,400
and when when he yeah, picked up
a lot of things fucking pretty

596
00:29:56,400 --> 00:29:58,280
cheap.
And look at they're still mining

597
00:29:58,280 --> 00:30:00,080
those assets today.
Yeah, exactly.

598
00:30:00,160 --> 00:30:03,720
Yeah, Pioneer Dime I think was a
a good, good idea at the time,

599
00:30:03,720 --> 00:30:06,280
but.
It might be a good idea in the

600
00:30:06,280 --> 00:30:08,440
future too, it's just not a good
idea at the.

601
00:30:08,880 --> 00:30:10,960
At the moment.
At the moment, but like, it's

602
00:30:10,960 --> 00:30:14,080
only going to take a frigging
yeah, we're not even, as I said

603
00:30:14,080 --> 00:30:17,160
at the start of the year when
lithium like absolutely started

604
00:30:17,160 --> 00:30:18,800
to shit itself.
Everyone's like, look, this

605
00:30:18,800 --> 00:30:21,640
could be a six to 18 months sort
of downturn.

606
00:30:23,200 --> 00:30:25,320
We're what, not 8, not 8 months
in.

607
00:30:26,000 --> 00:30:27,600
So what?
We're still early in what could

608
00:30:27,600 --> 00:30:29,600
potentially be a soft period for
it.

609
00:30:29,600 --> 00:30:32,520
So that one buddy knows where
anything's.

610
00:30:32,560 --> 00:30:34,280
Now we're all guessing,
absolutely.

611
00:30:34,280 --> 00:30:35,680
Some people guess better than
others.

612
00:30:36,280 --> 00:30:39,920
Where do you think copper has to
kind of hold above for them to

613
00:30:39,920 --> 00:30:44,120
make the call on Woodlawn?
I think it's probably, you know,

614
00:30:44,160 --> 00:30:48,640
somewhere between $4.00 and
4:50, you know, a pound,

615
00:30:48,960 --> 00:30:52,160
probably 425, yeah, that kind of
level.

616
00:30:52,160 --> 00:30:54,560
Because and and that'll be
pretty that's pretty heavily

617
00:30:54,800 --> 00:30:57,560
contingent, I'd say because he
wants to guarantee the price is

618
00:30:57,560 --> 00:31:01,680
bloody high because I'm as soon
as they start F.

619
00:31:01,760 --> 00:31:05,160
Is it FRD or producing?
I think the next payment to the.

620
00:31:05,280 --> 00:31:06,000
Yeah, that's right.
Yeah.

621
00:31:06,920 --> 00:31:09,880
Not, not the the administrators,
yeah.

622
00:31:09,920 --> 00:31:12,280
Gets activated, Yeah.
So I think they obviously want

623
00:31:12,280 --> 00:31:15,520
the price to be bloody high so
they don't get really hamstrung

624
00:31:15,520 --> 00:31:17,320
by that.
Yeah, it's 30 million or

625
00:31:17,320 --> 00:31:18,680
something.
Yeah, well, that's right.

626
00:31:18,680 --> 00:31:22,640
I mean, I think that's top man.
I think what you want to see is

627
00:31:22,640 --> 00:31:25,680
some certainty about the
sustainability of, of copper

628
00:31:25,680 --> 00:31:27,560
prices.
So rather than just to tick up

629
00:31:27,880 --> 00:31:31,280
and and that probably relates to
what's happening in China and

630
00:31:31,280 --> 00:31:32,920
what's happening with the global
economy.

631
00:31:32,920 --> 00:31:35,640
But, you know, with interest
rates near their near their peak

632
00:31:35,640 --> 00:31:38,680
and likely to come down,
particularly in the US, you

633
00:31:38,680 --> 00:31:41,800
know, you can see better times,
you know, moving into next year.

634
00:31:42,560 --> 00:31:44,920
On, on the copper front, I mean,
there's been heaps and news

635
00:31:44,920 --> 00:31:48,440
since we spoke, you know, big,
big end of town BHB, they

636
00:31:48,640 --> 00:31:52,040
obviously went after Anglo then
they actually signed up a deal

637
00:31:52,040 --> 00:31:53,800
with, with Philo as well.
Yeah.

638
00:31:54,120 --> 00:31:56,440
And I think we spoke about Mac
at the time, Sandfire, these

639
00:31:56,440 --> 00:32:00,000
sorts of names, Firefly, where
else you kinda looking around

640
00:32:00,000 --> 00:32:03,800
and you spoke about your ability
to, to look overseas before as

641
00:32:03,800 --> 00:32:05,320
well.
Is that something you're you're

642
00:32:05,320 --> 00:32:09,840
tapping into for copper?
Look, we, we've looked and this,

643
00:32:09,880 --> 00:32:12,480
you know, we owned tech for a
little while, which was partly,

644
00:32:14,600 --> 00:32:19,120
you know, on the, on the shift
to being a more pure copper

645
00:32:19,120 --> 00:32:22,400
group.
So we, you know, we've owned

646
00:32:22,600 --> 00:32:29,040
capstone, but you know, often
there's no easy way to play

647
00:32:29,040 --> 00:32:32,240
copper globally because you've
either got a big, typically

648
00:32:32,240 --> 00:32:35,240
you've got a big exposure to
South America or you've got an

649
00:32:35,240 --> 00:32:37,880
exposure to somewhere like, you
know, the DRC.

650
00:32:38,960 --> 00:32:43,240
So, you know, we kept coming
back to, you know, Mac and sand

651
00:32:43,240 --> 00:32:48,640
fire and you know, you know, we
can't own BHP and, and typically

652
00:32:48,640 --> 00:32:50,800
we don't buy BHP for copper
exposure.

653
00:32:50,800 --> 00:32:55,200
It's really for, for, I know as
you'd expect 70% of earnings,

654
00:32:55,200 --> 00:32:59,240
but does give you give you give
the ability to get some

655
00:32:59,280 --> 00:33:01,600
explosion.
Do you find it strange that like

656
00:33:01,600 --> 00:33:05,840
a developer like Fireflies
actually outperforming producers

657
00:33:06,000 --> 00:33:08,840
or is it does that more of a
comment on the the the asset

658
00:33:08,840 --> 00:33:11,040
quality?
Or it's more an exploration.

659
00:33:11,320 --> 00:33:13,920
Yeah, it's a, it's an
exploration project really.

660
00:33:14,160 --> 00:33:15,920
Yeah.
And that, that's quite unusual

661
00:33:15,920 --> 00:33:18,440
because we've seen sort of quite
the opposite in gold, right?

662
00:33:18,440 --> 00:33:22,400
Yeah.
I mean, you're right, the only

663
00:33:22,400 --> 00:33:25,120
benefit is, you know, if, if
you're in a commodity where

664
00:33:25,120 --> 00:33:28,880
you've got a positive long term
view, but the short term view

665
00:33:28,880 --> 00:33:32,720
is, is, is struggling, you know
what that means?

666
00:33:32,720 --> 00:33:35,440
If you're a producer, you might
not be making money And so, so

667
00:33:35,440 --> 00:33:37,240
people don't want to be there.
But if you've got a quality

668
00:33:37,240 --> 00:33:40,920
asset that's going to be ideally
producing it in a couple of

669
00:33:40,920 --> 00:33:43,920
years in the in the future, then
that can be a better way of play

670
00:33:43,920 --> 00:33:45,760
it because there's, you know,
there's not everyone's not

671
00:33:45,760 --> 00:33:48,600
looking at the earnings and how
that's falling in the short

672
00:33:48,600 --> 00:33:50,520
term.
Maddie, I think it's, I think

673
00:33:50,520 --> 00:33:52,800
it's time to talk uranium.
It's you time.

674
00:33:54,360 --> 00:33:57,000
What a bloody Friday.
Friday's a big day.

675
00:33:58,320 --> 00:34:00,440
Everyone's a lot.
That's just the fucking magic.

676
00:34:00,440 --> 00:34:03,800
The calendars are on people's
fridge that have just got 'cause

677
00:34:03,800 --> 00:34:06,000
Adam prom announcement.
Cause Adam prom announcement.

678
00:34:07,360 --> 00:34:10,400
So it's gonna be an interesting
one that yeah, you've done it.

679
00:34:10,440 --> 00:34:13,040
How much were you in uranium?
Much, Dave.

680
00:34:13,120 --> 00:34:16,199
Yeah.
So we we've probably got around

681
00:34:16,199 --> 00:34:18,880
10% of the portfolio in uranium
we have.

682
00:34:18,960 --> 00:34:21,880
Last time we talked, how much
were you much in at?

683
00:34:21,880 --> 00:34:26,239
That we, well, we don't we'd own
next Gen really for for years.

684
00:34:26,320 --> 00:34:29,480
So I think it last year that was
probably the only one we owned.

685
00:34:30,159 --> 00:34:34,719
We've kind of rolled through
that now and we own Denison and

686
00:34:34,719 --> 00:34:40,239
Fission and actually we've just
bought yellow cake, which is

687
00:34:40,239 --> 00:34:43,440
which is more of the physical
because the the discount to NTA

688
00:34:43,440 --> 00:34:44,840
has actually opened up quite a
lot.

689
00:34:45,159 --> 00:34:47,239
Yeah, what's that one?
Oh, I know because spots going

690
00:34:47,239 --> 00:34:50,800
from like, you know, frigging 9
to 15% around that range.

691
00:34:50,800 --> 00:34:53,560
And like that's what yellow cake
was always 15%.

692
00:34:53,840 --> 00:34:55,880
More.
Yeah, it's about 2025, so yeah.

693
00:34:56,239 --> 00:35:01,280
So, yeah, exactly.
So one, so, so we're there and

694
00:35:01,480 --> 00:35:05,040
you know, I think medium term,
you know, we're, we're positive

695
00:35:05,040 --> 00:35:06,880
on it.
We think prices will go up and,

696
00:35:07,360 --> 00:35:10,040
and, and there'll be some
opportunity and, and there's a

697
00:35:10,040 --> 00:35:15,040
relatively small number of of
decent sized uranium stocks.

698
00:35:15,120 --> 00:35:20,520
So, so, so we think we need
exposure there.

699
00:35:22,000 --> 00:35:24,600
What can we kind of read into
you, you know with next Gen your

700
00:35:24,600 --> 00:35:28,840
biggest holding this time last
year to now no longer, What is

701
00:35:28,840 --> 00:35:31,800
that evaluation?
Was that a management, was that

702
00:35:31,840 --> 00:35:33,880
a permitting timelines type of
thing?

703
00:35:34,120 --> 00:35:36,440
Why won't you sell out?
It's a good bet because it's

704
00:35:36,440 --> 00:35:38,640
going down shit lights.
Yeah, well, no.

705
00:35:38,760 --> 00:35:41,640
And, and, and we probably, you
know, we didn't sell at the top,

706
00:35:41,760 --> 00:35:45,440
but it's really a relative
valuation, right?

707
00:35:45,440 --> 00:35:50,080
So, so Denison's also in the
Athabasca Basin vision we own,

708
00:35:50,080 --> 00:35:52,160
which isn't as you, as you know
is next door.

709
00:35:53,080 --> 00:35:56,120
So we just thought there's
better value in, in, in those,

710
00:35:56,520 --> 00:36:00,320
in those names.
Obviously next gen's done a

711
00:36:00,320 --> 00:36:03,120
capital raise.
Ultimately, when it gets to

712
00:36:03,120 --> 00:36:05,840
approval, there'll be another
big capital raise you'd expect.

713
00:36:07,360 --> 00:36:09,600
I think you guys have commented
on, on some of the, you know,

714
00:36:09,640 --> 00:36:12,440
management decisions, which I
think the market has also made

715
00:36:12,440 --> 00:36:15,760
it, you know, has, has, has
impacted on the market.

716
00:36:16,040 --> 00:36:18,840
But you know, our view is, you
know, we're looking at our

717
00:36:18,840 --> 00:36:22,280
relative value and and hence
switching to Denison and and

718
00:36:22,280 --> 00:36:25,360
vision.
What and do you, we talked about

719
00:36:25,360 --> 00:36:29,240
yesterday that Atha deal, Atha's
been picking up bloody ground

720
00:36:29,240 --> 00:36:30,840
ever.
It's just this big, the bitter

721
00:36:30,840 --> 00:36:34,600
exploration mania in the
Adabaska Basin starting to

722
00:36:34,600 --> 00:36:36,480
happen.
Like when, when that sort of

723
00:36:37,400 --> 00:36:41,040
commences, whether it's like
over there and, or in Australia

724
00:36:41,040 --> 00:36:43,640
or all over the world, similar
to what was happening with

725
00:36:43,640 --> 00:36:44,560
lithium.
Yeah.

726
00:36:44,560 --> 00:36:47,680
How do you approach that side of
things?

727
00:36:47,680 --> 00:36:52,360
Is it like too, too, too risky,
too volatile or like do you

728
00:36:52,360 --> 00:36:54,080
start doubling in that sort of
stuff?

729
00:36:55,120 --> 00:36:59,880
Look, I think in in uranium you
need to be in the bigger players

730
00:37:00,560 --> 00:37:04,800
because you know, what you've
seen is to, to get a project, to

731
00:37:04,800 --> 00:37:07,680
get a project through approvals
is difficult.

732
00:37:08,560 --> 00:37:12,360
And then you know, the, the, the
whole build out takes a long

733
00:37:12,360 --> 00:37:16,280
period of time.
So, and, and I guess more

734
00:37:16,280 --> 00:37:20,320
generally what you've got is, is
globally there's actually a, a

735
00:37:20,320 --> 00:37:24,080
lot of uranium out there.
It's just the, the, the

736
00:37:24,080 --> 00:37:27,120
permitting and approvals and and
build process that takes so

737
00:37:27,120 --> 00:37:29,160
long.
So, you know, my view is that

738
00:37:29,160 --> 00:37:31,880
the best time to be in uranium
is really probably in the next

739
00:37:31,880 --> 00:37:37,880
couple of years, maybe next
three to five years where supply

740
00:37:37,880 --> 00:37:40,640
is still constrained and demand
is starting to take off as as

741
00:37:40,640 --> 00:37:42,960
nuclear builds its position as
space flow powers.

742
00:37:43,200 --> 00:37:46,680
Yeah, speaking to that sort of
permitting and approvals thing,

743
00:37:46,720 --> 00:37:50,240
I mean, and not to get too
political about it, but how do

744
00:37:50,240 --> 00:37:57,240
you see uranium, nuclear more
broadly playing out in the

745
00:37:57,440 --> 00:38:02,200
Australian landscape and perhaps
becoming a some sort of part of

746
00:38:02,200 --> 00:38:06,680
our energy mix or you know, even
just having the ability to mine

747
00:38:06,680 --> 00:38:10,640
it and export it in in WA.
How?

748
00:38:10,760 --> 00:38:13,120
How do you say that?
Yeah.

749
00:38:13,320 --> 00:38:15,960
I mean, you know, I think
Australia has one of the biggest

750
00:38:15,960 --> 00:38:18,040
uranium resources globally,
right?

751
00:38:18,840 --> 00:38:21,560
And.
Lot of and a lot of, obviously

752
00:38:21,560 --> 00:38:25,560
with Jabaluka and big dams and
big contributor to that, yeah.

753
00:38:25,960 --> 00:38:30,280
So I think in, in this day and
age where we're moving away from

754
00:38:30,280 --> 00:38:34,360
fossil fuels, it, it seems
logical to be able to, to, to

755
00:38:34,400 --> 00:38:36,800
access that and, and sell it
internationally and also

756
00:38:36,800 --> 00:38:39,400
developing in, you know, an
industry in Australia.

757
00:38:40,680 --> 00:38:43,680
So, you know, I'm, I'm
supportive of that, but I think

758
00:38:43,680 --> 00:38:45,440
also think it's part of the mix,
right?

759
00:38:45,440 --> 00:38:48,200
I think, you know, you should
account for part of the

760
00:38:48,200 --> 00:38:51,480
solution.
I think there's obviously scope

761
00:38:51,480 --> 00:38:53,440
for renewables and there's scope
for gas.

762
00:38:53,440 --> 00:38:56,280
Is is all supporting?
Sources.

763
00:38:56,520 --> 00:38:59,480
What do you, what do you think?
Cuz Adam problem's gonna say on

764
00:38:59,480 --> 00:39:02,200
Friday.
What do you think's gonna And

765
00:39:02,400 --> 00:39:06,160
cuz if you and when you mate,
when you're the stewards of

766
00:39:06,160 --> 00:39:09,480
other people's capital and
you're betting on uranium, like

767
00:39:09,680 --> 00:39:13,600
that's like going into Friday
and you've got the weekend like

768
00:39:13,600 --> 00:39:16,600
whether people are long or
short, like yeah, what comes out

769
00:39:16,600 --> 00:39:20,640
Monday in the market like it's a
it's a yeah, pretty volatile

770
00:39:20,640 --> 00:39:22,680
play based on one company
speaker.

771
00:39:22,680 --> 00:39:24,840
What do you what do you think is
going to happen?

772
00:39:24,840 --> 00:39:28,880
Yeah.
Look, look, my view is if you

773
00:39:28,880 --> 00:39:31,400
look at what the analysts are
saying, they're saying

774
00:39:31,400 --> 00:39:34,960
production is going to be at one
level, but their target and what

775
00:39:34,960 --> 00:39:36,800
they put out will be at slightly
higher level.

776
00:39:37,080 --> 00:39:39,360
Yeah.
And then they won't achieve that

777
00:39:39,560 --> 00:39:41,680
target, right.
So that's.

778
00:39:41,720 --> 00:39:45,560
Irrelevant at the moment.
You know, so, so you know, I, I

779
00:39:45,560 --> 00:39:48,560
think there'll be a downgrade
just because of what was out

780
00:39:48,560 --> 00:39:50,880
there previously was, was at the
high end.

781
00:39:51,360 --> 00:39:54,000
It probably won't be as big a
downgrade as the market's

782
00:39:54,000 --> 00:39:56,160
expecting.
But I think as we get through

783
00:39:56,160 --> 00:40:00,600
the next 12 months and you know
into 25, I think ultimately the

784
00:40:00,600 --> 00:40:04,400
outcome of production will be
below the target and and

785
00:40:04,400 --> 00:40:06,640
probably more in line with
where, where the market's AT.

786
00:40:07,200 --> 00:40:11,200
So you'd suggest also from from
because that a Prom's

787
00:40:11,200 --> 00:40:15,080
perspective that having the
market react by forcing up

788
00:40:15,080 --> 00:40:17,920
prices is probably a good thing.
Yeah, Yeah.

789
00:40:17,960 --> 00:40:19,760
So.
And I think, and I think to

790
00:40:19,760 --> 00:40:25,120
understand because that a prom
as a stock is something that

791
00:40:25,120 --> 00:40:29,240
people have to do in terms of if
they piss off the stock market.

792
00:40:29,360 --> 00:40:36,480
Yeah, they don't not saying they
don't care, but 75% of the mines

793
00:40:36,480 --> 00:40:38,880
are owned by the Kazakhstan
state.

794
00:40:38,880 --> 00:40:42,800
Yeah, what you say on the stock
market is the 25% free float

795
00:40:43,000 --> 00:40:44,760
Yeah.
So who are they going to look

796
00:40:44,760 --> 00:40:46,480
after the most?
They're going to look after the

797
00:40:46,480 --> 00:40:48,000
state.
They're going to do whatever is

798
00:40:48,000 --> 00:40:50,080
in the best interest, Yeah, of
the state.

799
00:40:50,120 --> 00:40:54,920
And if they have to answer to
the share market, because for

800
00:40:54,920 --> 00:40:57,040
the other 25%, they'll be like,
it's all good.

801
00:40:57,120 --> 00:40:59,720
We we've got we're looking after
the big Daddy.

802
00:40:59,920 --> 00:41:02,360
Yeah.
And and that's like it's trying,

803
00:41:02,360 --> 00:41:05,040
I'm being sort of trying to wrap
my head around like what's the

804
00:41:05,040 --> 00:41:08,960
best for that side.
And the the mineral tax is

805
00:41:08,960 --> 00:41:14,280
probably the example of the
lifted rates for the MAT over

806
00:41:14,280 --> 00:41:18,440
there is the best you would
think the best for Kazakhstan to

807
00:41:18,440 --> 00:41:21,600
make more money.
Yeah, maybe at the expense of

808
00:41:21,760 --> 00:41:23,600
Cos Adam Prom.
Yeah, the stock.

809
00:41:23,680 --> 00:41:26,280
Yeah, So, yeah.
And there's also the sulfuric

810
00:41:26,280 --> 00:41:28,760
acid issue, which, you know,
which is another constraint.

811
00:41:28,760 --> 00:41:31,960
So I think it's fascinating, I
think and it would be

812
00:41:31,960 --> 00:41:33,880
interesting to see how that how
that all plays out.

813
00:41:33,880 --> 00:41:36,920
And we, you know, we saw with,
you know, Kamiko's result

814
00:41:37,360 --> 00:41:41,440
recently, you know, the market,
you know, took took that

815
00:41:41,440 --> 00:41:42,920
negatively.
So it's it's one of those

816
00:41:42,920 --> 00:41:45,000
markets where you got a small
number of companies that

817
00:41:45,000 --> 00:41:48,080
dominate production and what
they do has a big impact.

818
00:41:48,080 --> 00:41:49,440
Yeah.
And the fact that like if they

819
00:41:49,440 --> 00:41:52,720
do say a lift, say they're they
even if they do promise a lift

820
00:41:52,720 --> 00:41:57,400
in pounds for 2025, it's all
going to Russia anyway because

821
00:41:57,400 --> 00:42:01,000
it's got all that burden off
score six and seven.

822
00:42:01,040 --> 00:42:03,400
Yeah, I think for the first two
or three years, that's all goes

823
00:42:03,400 --> 00:42:05,040
to Russia anyway.
So it's completely

824
00:42:05,040 --> 00:42:10,520
debottlenecked from the western
world and even China to to

825
00:42:10,520 --> 00:42:13,840
integrate and China just
announced another bloody 6

826
00:42:13,840 --> 00:42:17,400
reactors yeah plan to be built.
So it's, yeah, it's a

827
00:42:17,400 --> 00:42:18,440
fascinating.
Well, exactly.

828
00:42:18,720 --> 00:42:21,560
And I think that's, that's
really the, the point isn't it

829
00:42:21,560 --> 00:42:26,000
is, is look at the demand
outlook in the next few years in

830
00:42:26,000 --> 00:42:28,440
particular.
It's very strong and supply is

831
00:42:28,440 --> 00:42:32,440
going to struggle to keep up.
So I think that's really the

832
00:42:32,440 --> 00:42:34,280
opportunity.
Yeah, very good mate.

833
00:42:34,280 --> 00:42:36,440
I've got a couple of bloody.
These are a bit random.

834
00:42:36,440 --> 00:42:39,960
I don't know if you're into
mining services, but like, and

835
00:42:40,000 --> 00:42:42,160
you know, not, not telling you
how to run the fun, but there

836
00:42:42,160 --> 00:42:45,320
might be some IPO opportunities
coming up next year.

837
00:42:45,680 --> 00:42:49,800
And I'm thinking maybe MMS and
Silverstone, if they actually,

838
00:42:50,760 --> 00:42:53,280
if they actually float.
And Dave, look, we've got a

839
00:42:53,280 --> 00:42:58,360
Direct Line if you do wanna get
a bit of seed, cause in terms of

840
00:42:58,720 --> 00:43:02,240
two sensational businesses that,
you know, I'm predicting might

841
00:43:02,240 --> 00:43:05,120
go on the market next year.
Do you say like you'd you'd take

842
00:43:05,160 --> 00:43:07,520
a bit of skin?
Oh, bit of skin.

843
00:43:07,560 --> 00:43:10,200
I mean just like I I wanna be
the lead manager on.

844
00:43:11,480 --> 00:43:14,480
That maybe that could be the
first Test job that could be,

845
00:43:14,480 --> 00:43:15,680
mate.
Well, yeah, you're talking about

846
00:43:15,680 --> 00:43:17,600
the global energy transition,
Dave.

847
00:43:17,600 --> 00:43:21,440
No, like Silverstein are at the
bloody forefront of it mate in

848
00:43:21,440 --> 00:43:24,920
terms of mining the critical
minerals to get it it MMS are

849
00:43:24,920 --> 00:43:28,000
getting it out of the ground
everywhere for the bloody.

850
00:43:28,000 --> 00:43:30,240
Have you seen what do you think
of the old MMS?

851
00:43:31,000 --> 00:43:32,960
This is actually a market
related question.

852
00:43:33,240 --> 00:43:37,200
These small mining companies
that are actually doing these JV

853
00:43:37,200 --> 00:43:40,600
arrangements with mining
services contractors to get up

854
00:43:40,600 --> 00:43:45,520
and going in bit of a hybrid
debt arrangement in turn instead

855
00:43:45,520 --> 00:43:48,840
of going to a bank.
Well, I, I think it's, I think

856
00:43:48,840 --> 00:43:53,920
it's good.
Obviously if you can't get your,

857
00:43:54,440 --> 00:43:57,440
your, your debt or your equity
in, in another way, you know,

858
00:43:57,480 --> 00:43:59,360
those kind of partnerships can
work well.

859
00:43:59,520 --> 00:44:03,280
So more generally on mining
services, we can invest in

860
00:44:03,280 --> 00:44:06,600
mining services companies.
And I think one of the benefits

861
00:44:06,600 --> 00:44:11,400
of mining service companies is
you kind of you step away from

862
00:44:11,400 --> 00:44:15,040
the commodity price, right.
So it's really volume driven so,

863
00:44:15,520 --> 00:44:20,800
so when they come on.
Bloody Silverstein at MMS, we've

864
00:44:20,800 --> 00:44:24,480
already got your first investor
for the IPR sorted.

865
00:44:24,560 --> 00:44:25,800
Premier RPO.
Pleasure.

866
00:44:25,880 --> 00:44:28,440
Do pleasure doing business for
the desk.

867
00:44:28,760 --> 00:44:30,320
Yeah.
Beauty, right, JD?

868
00:44:30,320 --> 00:44:32,760
You can bring it back to a more
serious level if you'd like.

869
00:44:34,440 --> 00:44:36,680
You know, I love it, Maddie, you
you won't be too busy on the

870
00:44:36,680 --> 00:44:38,320
desk because those ones will
sell themselves.

871
00:44:40,880 --> 00:44:43,200
There are a couple other
commodities we've we've got to

872
00:44:43,200 --> 00:44:45,400
talk about.
So one in your top five holdings

873
00:44:45,400 --> 00:44:48,360
is Coronado.
And yeah, I just want to start

874
00:44:48,360 --> 00:44:51,320
this going from a broader level.
Metco, what do you think?

875
00:44:51,320 --> 00:44:54,680
In demand, supply and then hone
in on the half year which we

876
00:44:54,680 --> 00:44:56,800
were chatting about before we
started recording.

877
00:44:56,920 --> 00:45:00,800
Yeah.
So, you know, I think a big

878
00:45:00,800 --> 00:45:03,680
change even over the last 12
months is, is a better

879
00:45:03,840 --> 00:45:06,080
understanding in the market of
the difference between thermal

880
00:45:06,080 --> 00:45:09,520
coal and metcoal and metcoal's
role in, you know, steel

881
00:45:09,520 --> 00:45:11,480
production and the fact that,
you know, it's kind of a

882
00:45:11,480 --> 00:45:15,440
necessary commodity.
So, so I think what you're

883
00:45:15,440 --> 00:45:18,760
saying is from an investment
perspective, that is becoming

884
00:45:20,400 --> 00:45:22,480
more acceptable, which, which,
which is good.

885
00:45:24,440 --> 00:45:26,520
What you're not seeing though,
is a whole lot of money going

886
00:45:26,520 --> 00:45:29,640
into, into new projects.
So it's that whole, you know,

887
00:45:29,640 --> 00:45:33,280
demand is actually stayed, you
know, very strong.

888
00:45:33,880 --> 00:45:36,320
And I think we'll increase on
the back of what's happening in

889
00:45:36,320 --> 00:45:39,680
India, which is an increasing
bar of, of Australian Medco,

890
00:45:40,720 --> 00:45:43,160
whereas supply is going to be
constrained because it's very

891
00:45:43,160 --> 00:45:47,760
hard to get new mines permitted
and approved and, and, and old

892
00:45:47,760 --> 00:45:49,400
mines are starting to, to run
off.

893
00:45:49,400 --> 00:45:53,960
So, and Australia has, you know,
among the highest quality met

894
00:45:53,960 --> 00:45:57,520
coal mines in the world, right?
So, so the from the commodity

895
00:45:57,520 --> 00:46:01,960
level looks good.
Coronado as a, as a player in

896
00:46:01,960 --> 00:46:05,400
that, you know, we also really
like, it's probably had a bit of

897
00:46:05,400 --> 00:46:10,440
an up and down kind of history.
But I think under the existing

898
00:46:10,440 --> 00:46:14,720
management team, particularly
the, the second quarter result

899
00:46:14,720 --> 00:46:17,960
was really good at Cara in, in
Queensland where I think you saw

900
00:46:17,960 --> 00:46:23,520
mining costs go from $125.00 a
tonne down to about $95 a tonne.

901
00:46:23,560 --> 00:46:26,240
And they're pushing that down to
so in the 80s.

902
00:46:26,240 --> 00:46:31,040
And that's partly because they
had a lot of material movement

903
00:46:31,040 --> 00:46:33,480
they had to do and sort of
optimise the way the mine is

904
00:46:33,480 --> 00:46:36,280
being operated.
But it's all very well to say

905
00:46:36,280 --> 00:46:38,400
you're going to do that, but
then actually deliver it and

906
00:46:38,400 --> 00:46:41,520
show the results.
I think it's an EBIT to

907
00:46:41,560 --> 00:46:44,400
enterprise value multiple of,
you know, three times, something

908
00:46:44,400 --> 00:46:46,680
like that.
So they get this right.

909
00:46:46,680 --> 00:46:49,840
From a value perspective it
looks good, but also the

910
00:46:49,840 --> 00:46:52,240
commodity level looks good.
Well, it was everyone starting

911
00:46:52,240 --> 00:46:54,240
to lose their patience a bit
with Coronado.

912
00:46:54,240 --> 00:46:58,120
Like everyone was like it's like
a bit of a noted as that

913
00:46:58,120 --> 00:47:00,160
underperformer for the Met, the
Met car.

914
00:47:00,160 --> 00:47:02,000
Well, yeah, it sounds like it's.
Yeah, I think.

915
00:47:02,000 --> 00:47:03,440
Possibly turning around.
Yeah.

916
00:47:03,440 --> 00:47:06,040
Well, exactly.
And and I think the market is

917
00:47:06,040 --> 00:47:08,320
still saying, well, that's a
good first step, but let's see

918
00:47:08,320 --> 00:47:10,440
you, let's see you follow
through here.

919
00:47:10,800 --> 00:47:13,080
The the other factor with
Coronado is always under

920
00:47:13,080 --> 00:47:17,040
takeover for, you know, sort of
a rolling takeover for a period

921
00:47:17,040 --> 00:47:18,680
of time and that's now sort of
dropped off.

922
00:47:18,680 --> 00:47:23,120
But what it highlights and I
think we're seeing that more

923
00:47:23,120 --> 00:47:27,080
generally is that there is
demand for good quality met coal

924
00:47:27,080 --> 00:47:30,960
assets and you've got a major
shareholder in Coronado that is

925
00:47:30,960 --> 00:47:33,520
probably a seller.
So you know, you've got the

926
00:47:33,520 --> 00:47:36,000
added kicker of something that
looks cheap, but with corporate,

927
00:47:36,720 --> 00:47:39,360
corporate opportunity.
And then another one I'm keen to

928
00:47:39,360 --> 00:47:43,920
chat about rare earths.
So meteoric I saw was a holding

929
00:47:43,920 --> 00:47:48,000
last time, last time you
reported your, your holdings and

930
00:47:48,000 --> 00:47:51,560
that they've, you know, had a
pretty, pretty tough few months

931
00:47:51,560 --> 00:47:53,240
of it.
Not just them, but you look

932
00:47:53,240 --> 00:47:55,720
across the the rare earths and I
think, you know, Linus is the

933
00:47:56,120 --> 00:47:59,440
the good one to tune into to get
a feel for where this market is

934
00:47:59,440 --> 00:48:01,720
kind of at.
But what, what are you sort of

935
00:48:01,720 --> 00:48:03,800
feeling on that side of things?
Obviously you're at the whims of

936
00:48:03,800 --> 00:48:06,280
China to a large extent.
How do you sort of see that

937
00:48:06,280 --> 00:48:09,240
playing out?
Yeah, it's, it's a good

938
00:48:09,240 --> 00:48:10,920
question.
And it probably comes back to

939
00:48:10,920 --> 00:48:13,760
what we were talking about at
the outset around, you know,

940
00:48:14,520 --> 00:48:16,760
observe, react rather than
predict.

941
00:48:16,760 --> 00:48:20,720
And I think the view we got to,
you know, for most of this year

942
00:48:20,720 --> 00:48:26,040
was, you know, rarest MDPR
prices were really low and do we

943
00:48:26,040 --> 00:48:28,920
need to be here?
And are we better off not trying

944
00:48:28,920 --> 00:48:32,320
to sort of predict that a turn
around might come, but wait

945
00:48:32,320 --> 00:48:34,600
until that turn around happens
and then re re enter?

946
00:48:34,600 --> 00:48:37,560
So we haven't been in liners for
some time.

947
00:48:39,280 --> 00:48:41,680
You know, we're looking at, at
meteoric and we actually bought

948
00:48:41,680 --> 00:48:44,440
a small holding just about the
time of the, the capital raise.

949
00:48:47,640 --> 00:48:51,040
And I think the Brazilian rare
earth industry is, is

950
00:48:51,040 --> 00:48:53,960
fascinating because the
potential to reduce the

951
00:48:53,960 --> 00:48:56,720
operating costs in the industry
is significant.

952
00:48:56,720 --> 00:49:01,440
So it's, you know, I, I think
it's, it's one of those sectors

953
00:49:01,440 --> 00:49:05,480
where the, the commodity prices
depressed, the negative is you

954
00:49:05,480 --> 00:49:08,480
got processing and you've got
the raw material dominated by

955
00:49:08,480 --> 00:49:12,880
China, which is never, never a
place you want to go to if you

956
00:49:12,880 --> 00:49:17,480
can avoid it.
But but rare earths are just so

957
00:49:17,480 --> 00:49:21,760
critical and there's potential
opportunity by the really good

958
00:49:21,760 --> 00:49:23,400
quality assets at at a cheap
price.

959
00:49:23,400 --> 00:49:26,360
So, you know, Lioness will keep
watching media.

960
00:49:26,360 --> 00:49:29,440
We've got a small holding and
and really interested to see

961
00:49:29,440 --> 00:49:32,840
what comes out of Brazil there.
Yeah, with the with Brazil, like

962
00:49:33,240 --> 00:49:36,120
everyone's talking about lot
lowering the operating costs,

963
00:49:37,360 --> 00:49:40,600
but I assume that is labour a
lot cheaper over there.

964
00:49:40,680 --> 00:49:43,680
Yeah, it it would because like
they talk about like obviously

965
00:49:43,680 --> 00:49:45,960
the hydro powers.
Yeah, a lot cheaper.

966
00:49:46,040 --> 00:49:49,720
Yeah, but you think of I
wouldn't imagine, and correct me

967
00:49:49,720 --> 00:49:54,120
if I'm wrong, if a like a rare
earth project and even even the

968
00:49:54,120 --> 00:49:57,440
lithium projects over there a
lot the the spot like lithium

969
00:49:57,440 --> 00:50:01,080
projects, what they DMS only
they crush to six mil yeah, so

970
00:50:01,080 --> 00:50:03,720
you can't say they're going to
use shit loads of power for

971
00:50:03,800 --> 00:50:07,880
crushing and then rarest
probably wouldn't use shit loads

972
00:50:07,880 --> 00:50:11,960
of power compared to the gold
processing plant grinding down

973
00:50:11,960 --> 00:50:15,440
to 75 Micron.
But I assume the labour is.

974
00:50:16,080 --> 00:50:17,880
A well.
Bloody saving as well.

975
00:50:17,960 --> 00:50:21,680
Well, I, I think you're right.
And you know, I mean, and we'll

976
00:50:21,680 --> 00:50:24,800
probably talk on, on Pilbara
and, and Latin, which is, which

977
00:50:24,800 --> 00:50:27,360
is in Brazil as well.
But you know, what's attractive

978
00:50:27,360 --> 00:50:31,320
about that location is, is
you've got, you know, cheap

979
00:50:31,320 --> 00:50:34,680
labour costs, you've got cheap
hydro costs, you've got, you

980
00:50:34,680 --> 00:50:40,040
know, relatively rapid approvals
process so.

981
00:50:40,520 --> 00:50:43,000
Which should lead to cheaper
construction costs.

982
00:50:43,000 --> 00:50:45,840
Exactly, construction costs are
lower as well, right?

983
00:50:46,680 --> 00:50:51,760
But but just the nature of the
of the ionic clays is the the

984
00:50:51,760 --> 00:50:55,000
actual extraction process is
much is much easier as well.

985
00:50:55,320 --> 00:50:59,920
Because I think equities, rare
earth equities of sort of kept

986
00:50:59,920 --> 00:51:03,520
sliding even though the NDPR
prices stayed pretty flat.

987
00:51:03,520 --> 00:51:07,600
I think NDPR has gone up a bit,
43 to 47 last.

988
00:51:07,600 --> 00:51:12,160
Time well yeah but but even at
50 at 50 bucks no one's really

989
00:51:12,160 --> 00:51:16,240
making money right so that's
that's the issue it's it's

990
00:51:16,280 --> 00:51:18,040
difficult so it.
Doesn't matter if it goes up or

991
00:51:18,040 --> 00:51:19,360
down, you're just losing money
either way.

992
00:51:19,680 --> 00:51:23,720
Yeah, and or not mining.
And just on that as well day of

993
00:51:23,720 --> 00:51:28,040
sort of mentioning Brazil more
broadly and you know, Pilbara's

994
00:51:28,320 --> 00:51:32,800
foray into South America, you
know, there was a big a big

995
00:51:32,800 --> 00:51:38,480
article in in the West about
Dale singing his praises for for

996
00:51:38,480 --> 00:51:41,040
Brazil.
I mean, you know, a big move

997
00:51:41,040 --> 00:51:43,680
like a major like that.
What do you think that and in

998
00:51:43,880 --> 00:51:47,120
particularly a lot of what's
been happening in in Australia

999
00:51:47,120 --> 00:51:51,480
this week as far as the whole
permitting and approval sort of

1000
00:51:51,840 --> 00:51:55,600
landscape, you know, what do you
think that that and the

1001
00:51:55,640 --> 00:51:58,240
Pilbara's move sort of says
about it all?

1002
00:51:58,840 --> 00:52:01,160
Yeah.
Look, so I'm, I think it's a

1003
00:52:01,160 --> 00:52:03,040
good, I think it's a good deal
for Pilbara.

1004
00:52:05,120 --> 00:52:08,200
You know, what they're doing is
with very little dilution to

1005
00:52:08,200 --> 00:52:11,440
their equity, they're adding a
project that could potentially

1006
00:52:11,440 --> 00:52:14,840
be, you know, four hundred
450,000 tonnes of spodumene a

1007
00:52:14,840 --> 00:52:17,520
year.
But more importantly, if you

1008
00:52:17,520 --> 00:52:20,920
take a view that spot mean
prices might stay lower than

1009
00:52:20,920 --> 00:52:24,560
where we think they where they
think they should be, It's a

1010
00:52:24,560 --> 00:52:27,360
project that's going to be at
the lower end of the cost curve.

1011
00:52:27,360 --> 00:52:30,520
And it's for those reasons.
It's low labour, it's low power

1012
00:52:30,520 --> 00:52:33,680
cost, it's planning approvals,
low capital costs.

1013
00:52:34,480 --> 00:52:39,600
So you know, for a relatively
small outlay, I think it's a,

1014
00:52:39,600 --> 00:52:41,240
it's a good part of the
portfolio.

1015
00:52:41,240 --> 00:52:43,600
And you know, there's been a lot
of talk about them looking at

1016
00:52:43,600 --> 00:52:46,840
something like Patriot in in
Canada, but you know, and

1017
00:52:46,840 --> 00:52:50,680
that's, that's, you know, a
fabulous project, but you're

1018
00:52:50,680 --> 00:52:55,320
talking a whole lot of CapEx and
you know, and maybe you know, 5

1019
00:52:55,320 --> 00:52:56,720
to 10 years away.
So.

1020
00:52:58,320 --> 00:53:00,720
So it's just an easy bolt.
On for him, I think what about

1021
00:53:00,720 --> 00:53:03,760
Sigma, do you think that's going
to be in the mix?

1022
00:53:03,760 --> 00:53:09,600
It makes sense obviously, but is
do you think a Pilbara of bet on

1023
00:53:09,600 --> 00:53:11,600
Brazil versus Quebec
effectively?

1024
00:53:11,600 --> 00:53:13,880
I don't think so.
I, I think it's opportunistic

1025
00:53:13,880 --> 00:53:17,400
that you know, I think they want
to obviously they want to have

1026
00:53:17,400 --> 00:53:19,760
an exposure there.
Whether they want to double up

1027
00:53:19,760 --> 00:53:23,440
and buy Sigma, I'm not sure.
So I wouldn't, I wouldn't bank

1028
00:53:23,440 --> 00:53:27,120
on that, but but one will tell.
There and that's the thing they

1029
00:53:27,280 --> 00:53:30,920
for the amount of the what is it
6.8% shares they issued lot they

1030
00:53:30,960 --> 00:53:33,000
could yeah, could just sit there
for a while, yeah, but they've

1031
00:53:33,000 --> 00:53:33,680
got it.
Yeah.

1032
00:53:33,920 --> 00:53:36,160
Yeah, exactly.
And they got the optionality.

1033
00:53:36,160 --> 00:53:36,840
Yeah.
Yeah, exactly.

1034
00:53:37,320 --> 00:53:39,080
Ding Ding on a bit Pilbara as
well.

1035
00:53:39,360 --> 00:53:41,680
Sorry.
Yeah, You like the bloody ATF?

1036
00:53:41,680 --> 00:53:43,280
Yeah.
The GCE.

1037
00:53:45,280 --> 00:53:47,600
TAA, bit closer to home.
Dave, what are you thinking in

1038
00:53:47,600 --> 00:53:49,680
Lyntown?
I noticed I think yesterday

1039
00:53:49,680 --> 00:53:53,720
morning a bit of an interesting
line went through of stock.

1040
00:53:53,960 --> 00:53:56,800
I think in the morning there's a
decent amount of stock change in

1041
00:53:56,800 --> 00:53:58,120
hands.
How are you kind of thinking

1042
00:53:58,120 --> 00:53:59,920
Trading 80?
Cents.

1043
00:54:00,960 --> 00:54:03,600
There was, I think 50 million
shares, which is, you know,

1044
00:54:03,600 --> 00:54:07,360
they're a bit under a buck, so
not a crazy amount, but above

1045
00:54:07,360 --> 00:54:09,560
average.
Yeah.

1046
00:54:09,560 --> 00:54:12,240
Look, look, I think you've got
to give the management team

1047
00:54:12,240 --> 00:54:14,640
there a lot of credit for what
they've delivered over the last

1048
00:54:14,640 --> 00:54:16,400
year, right?
In a difficult market.

1049
00:54:17,040 --> 00:54:19,520
You know, they've basically got
to the point they are now on

1050
00:54:19,520 --> 00:54:23,080
cost and on on budget and
they've, and they've put some

1051
00:54:23,080 --> 00:54:25,320
funding away, right.
So I think that's really good.

1052
00:54:25,840 --> 00:54:30,160
But I think what we all know is
that commissioning a lithium

1053
00:54:30,160 --> 00:54:34,560
project is bloody difficult and,
and it's going to, and it's

1054
00:54:34,560 --> 00:54:37,760
going to take longer and it's
probably going to cost more than

1055
00:54:37,760 --> 00:54:40,600
than you'd want.
And then on top of that, you've

1056
00:54:40,600 --> 00:54:43,480
got to spot to me in price at
$800 a tonne, right?

1057
00:54:43,480 --> 00:54:46,200
So, so my view is, you know, I
give them credit for what

1058
00:54:46,200 --> 00:54:48,920
they've achieved so far, but do
I need to own it right now?

1059
00:54:48,920 --> 00:54:51,160
I, I don't.
So I'll, I'll watch it through

1060
00:54:51,160 --> 00:54:54,720
that process.
I think if you say where's this

1061
00:54:54,720 --> 00:54:57,640
business going to be in five
years time, I think it'll be

1062
00:54:57,640 --> 00:55:00,480
there, it'll be producing, it'll
be a fantastic asset.

1063
00:55:01,160 --> 00:55:04,600
But I think probably now it's a
bit bit too early to jump in.

1064
00:55:05,160 --> 00:55:09,640
Yeah, I think oh what what is
old Miss Reinhardt up to?

1065
00:55:10,360 --> 00:55:15,160
That's yeah, that's and I think
we talked about like the the

1066
00:55:15,160 --> 00:55:17,880
control she's got on that now no
one else is going to have a

1067
00:55:17,880 --> 00:55:19,800
crack at it.
Bloody look what happened to oh

1068
00:55:19,800 --> 00:55:22,960
it probably saved out album.
Imagine if Albemarle.

1069
00:55:23,200 --> 00:55:26,160
Yeah, it got it through.
And I'm sure like if you, if you

1070
00:55:26,160 --> 00:55:30,880
go back in history, imagine if
like Longtown entertained the

1071
00:55:30,880 --> 00:55:34,840
original Albemarle deals that
were like $1.80, imagine if that

1072
00:55:34,840 --> 00:55:39,400
actually got over the line.
I reckon they'd at the time they

1073
00:55:39,400 --> 00:55:41,080
were thinking not worth more
than that.

1074
00:55:41,080 --> 00:55:44,440
But they would never have
envisaged this was going to

1075
00:55:44,840 --> 00:55:47,200
happen to them just cause of
the, the mania.

1076
00:55:47,200 --> 00:55:52,200
But it's just turned so quick
and they've just gone through

1077
00:55:52,200 --> 00:55:56,680
the whole greenfields process
straight into a shit pricing

1078
00:55:56,680 --> 00:55:59,160
market.
So yeah, yeah, so bloody do feel

1079
00:55:59,160 --> 00:55:59,840
for him.
That's for.

1080
00:55:59,840 --> 00:56:00,480
Sure.
Yeah.

1081
00:56:00,480 --> 00:56:04,320
No, it's you're exactly right.
Hindsight's a wonderful thing.

1082
00:56:04,600 --> 00:56:08,600
It sure is Dave.
I reckon I'd like to close off

1083
00:56:08,600 --> 00:56:11,240
with a a couple of lessons from
the last year and I reckon we

1084
00:56:11,240 --> 00:56:14,520
should do an another overrated,
underrated segment as well.

1085
00:56:14,520 --> 00:56:18,520
So what do you feel in the last
year, some lessons you've

1086
00:56:18,520 --> 00:56:21,600
learnt, you know, commodity or
equity related?

1087
00:56:23,840 --> 00:56:25,560
Well, things can change really
quickly, right?

1088
00:56:25,560 --> 00:56:30,680
So you look at lithium, what it
shows is predicting what's going

1089
00:56:30,680 --> 00:56:33,000
to happen is, is, is, is
difficult.

1090
00:56:33,000 --> 00:56:36,920
So, you know, I look at lithium
and when it was $400.00 a tonne,

1091
00:56:37,000 --> 00:56:40,800
you know, 2020, no one thought
it was going to 8000 splodge

1092
00:56:40,800 --> 00:56:43,560
rent and and then no one thought
it was going to 8000 back to,

1093
00:56:44,080 --> 00:56:47,840
you know, 800.
So, so I think that's number

1094
00:56:47,840 --> 00:56:49,120
one.
I think probably the second

1095
00:56:49,120 --> 00:56:55,360
point is, is resource sector
investing is all about quality

1096
00:56:55,360 --> 00:56:59,600
or bodies, right.
So it's mitigating risk and,

1097
00:56:59,640 --> 00:57:02,640
and, and buying good quality
stuff that will, that will, that

1098
00:57:02,640 --> 00:57:06,360
will survive and as an investor
see you through good and bad

1099
00:57:06,360 --> 00:57:08,720
markets.
Unless you're Capricorn and you

1100
00:57:08,720 --> 00:57:11,400
can make a point. 8.9 grand.
Yeah, well.

1101
00:57:11,520 --> 00:57:13,040
The.
Exceptions.

1102
00:57:13,280 --> 00:57:14,640
Yeah, buddy, the as they've been
doubted.

1103
00:57:14,640 --> 00:57:18,320
The Unicorn, yeah.
And another one on the, the sort

1104
00:57:18,320 --> 00:57:20,920
of rapid fire random question
round.

1105
00:57:21,120 --> 00:57:24,040
I'm keen to know, Dave, what's
the, what's the commodity that

1106
00:57:24,040 --> 00:57:26,920
kind of intrigues you most of
the market that you know, you

1107
00:57:26,920 --> 00:57:29,520
think there's the most to kind
of learn about and get excited

1108
00:57:29,520 --> 00:57:32,760
about?
Yeah, it's a good question.

1109
00:57:32,760 --> 00:57:37,640
But you know, I, I tend to focus
on the bigger commodity.

1110
00:57:37,640 --> 00:57:41,440
So, you know, I think copper,
copper is really interesting

1111
00:57:41,440 --> 00:57:45,240
just because of the, you know,
the impact it has on the global

1112
00:57:45,240 --> 00:57:47,160
economy and it's importance to
the global economy.

1113
00:57:47,160 --> 00:57:50,480
And it's hard to see how demand
might keep increasing and supply

1114
00:57:50,480 --> 00:57:53,600
will be constrained.
I think met coals kind of kind

1115
00:57:53,600 --> 00:57:57,360
of interesting as well.
Gold is is probably 1, which is

1116
00:57:57,360 --> 00:58:02,800
harder to clarify, you know,
where, where demand come from

1117
00:58:02,800 --> 00:58:06,560
from and where the buying comes
from and and how the market kind

1118
00:58:06,560 --> 00:58:10,600
of prices it.
So, so they're probably, they're

1119
00:58:10,600 --> 00:58:13,440
probably a few.
'Cause how do you like, how do

1120
00:58:13,440 --> 00:58:15,760
you analyse gold?
Yeah, like 'cause it's not a

1121
00:58:15,760 --> 00:58:19,040
supply demand thing.
To me, yeah, To me, there's

1122
00:58:19,040 --> 00:58:23,360
three buckets, right?
We strive gold first is sort of

1123
00:58:23,360 --> 00:58:28,440
the the retail demand from
primarily coming out of China

1124
00:58:28,440 --> 00:58:32,160
and India, which is for
jewellery and, and, and as a

1125
00:58:32,160 --> 00:58:35,320
store of wealth really.
But, but it's really jewellery

1126
00:58:35,520 --> 00:58:38,560
and that market has been very
steady for a long period of

1127
00:58:38,560 --> 00:58:40,960
time.
Good buying out of places like

1128
00:58:40,960 --> 00:58:44,280
China where, where the, where
the the public is saying I

1129
00:58:44,280 --> 00:58:46,760
wouldn't mind having some of my
wealth in, in gold jewellery

1130
00:58:46,760 --> 00:58:51,680
just because it helps, you know,
helps me keep, keep control of

1131
00:58:51,680 --> 00:58:54,000
it.
And that's been stable.

1132
00:58:54,000 --> 00:58:57,280
What you're seeing more recently
is as, as gold price goes up,

1133
00:58:57,280 --> 00:58:59,800
demand is actually coming down
because it costs more to buy,

1134
00:58:59,920 --> 00:59:01,680
right?
But but in general, that's a

1135
00:59:01,680 --> 00:59:05,520
stable market.
The next bucket is, is central

1136
00:59:05,520 --> 00:59:07,720
bank buying.
And if you look at what's

1137
00:59:07,720 --> 00:59:10,440
happened over the last two
years, what has driven the gold

1138
00:59:10,440 --> 00:59:13,280
price has been a surge in
central bank buying,

1139
00:59:13,560 --> 00:59:17,160
particularly from China, but
also from those global economies

1140
00:59:17,160 --> 00:59:19,520
that don't necessarily want to
hold U.S. dollars or U.S. dollar

1141
00:59:19,520 --> 00:59:22,200
assets.
So it's places like Turkey and

1142
00:59:22,200 --> 00:59:25,800
Uzbekistan and Russia and stuff.
And so that that's really driven

1143
00:59:25,800 --> 00:59:28,600
the price up to date what we're
seeing now.

1144
00:59:28,600 --> 00:59:32,080
And then the third bucket is the
investor ETF market.

1145
00:59:32,600 --> 00:59:38,360
And really for the last three
years, there's been net outflows

1146
00:59:38,360 --> 00:59:41,400
on a month by month basis.
It's taken a spike when COVID

1147
00:59:41,400 --> 00:59:46,600
happened, took a spike when we
had a banking crisis, inverted

1148
00:59:46,600 --> 00:59:49,360
commerce in the US which lasted
you know, a month or something.

1149
00:59:50,040 --> 00:59:53,200
But in but apart from that,
outflows had been pretty steady

1150
00:59:53,200 --> 00:59:55,360
going forward.
What you saw in the last six

1151
00:59:55,360 --> 01:00:00,280
months is you started to see
some inflows from most a lot of

1152
01:00:00,280 --> 01:00:03,520
you know, European markets, but
but not from the US and really

1153
01:00:03,520 --> 01:00:07,240
only in the last month is you've
seen the US investor come into

1154
01:00:07,240 --> 01:00:08,600
the ETF market.
So.

1155
01:00:08,760 --> 01:00:13,040
So what that says to me is.
Is there's increasing investor

1156
01:00:13,040 --> 01:00:17,120
demand, more broad based for
gold and that's corresponded

1157
01:00:17,120 --> 01:00:19,400
with the price ticking up?
What, what's the, what's the

1158
01:00:19,400 --> 01:00:23,080
relative sizes of those buckets?
Would you say I think that

1159
01:00:23,120 --> 01:00:26,880
you're waiting?
Yeah, so, so the the big one

1160
01:00:26,880 --> 01:00:29,600
would be, well, I think they're
all pretty big.

1161
01:00:30,280 --> 01:00:35,360
The ETF side is probably the,
you know, the smallest but but

1162
01:00:35,360 --> 01:00:40,160
also the most the most variable
on a month by month basis.

1163
01:00:40,400 --> 01:00:42,880
But I'm going to put that down
as the most interesting thing

1164
01:00:42,880 --> 01:00:46,920
I've heard all year in terms of
learning so about how the how

1165
01:00:46,960 --> 01:00:49,240
the best explain the gold
market.

1166
01:00:49,240 --> 01:00:52,720
Oh, that'll be get you short.
You can get a free T shirt.

1167
01:00:54,680 --> 01:00:57,120
Appreciate that.
And I reckon that opens up the

1168
01:00:57,120 --> 01:01:01,160
the perfect first overrated or
underrated question actually.

1169
01:01:01,160 --> 01:01:03,240
So I mean, it's not your first
rodeo, Dozo.

1170
01:01:03,240 --> 01:01:05,040
Overrated, underrated or
neutral?

1171
01:01:05,040 --> 01:01:09,320
So Aussie dollar gold over 4000
bucks an ounce in a year.

1172
01:01:11,800 --> 01:01:15,320
Fuck, I'm not far away.
No, it's not less than 10%.

1173
01:01:16,280 --> 01:01:18,440
So underrated.
Underrated.

1174
01:01:18,720 --> 01:01:21,680
Yeah.
How about iron ore?

1175
01:01:21,880 --> 01:01:26,200
Does it, you know, sort of does
it hold under US100 in one

1176
01:01:26,200 --> 01:01:29,000
year's time?
No.

1177
01:01:29,000 --> 01:01:32,160
So I don't know how I translate
to underrated or overrated, but

1178
01:01:33,400 --> 01:01:37,240
I I think it'll be around $100
in into a month's time, yeah.

1179
01:01:38,000 --> 01:01:39,760
We'll go neutral then.
Yeah, neutral, neutral.

1180
01:01:41,280 --> 01:01:43,640
Yeah.
Do you reckon the the ASX

1181
01:01:43,880 --> 01:01:47,800
resource index is higher or
lower than where it currently is

1182
01:01:47,800 --> 01:01:50,640
in one year's time?
It'll be higher.

1183
01:01:54,440 --> 01:01:59,120
Small Cap Gold, Australia.
I think, I think you've got to

1184
01:01:59,120 --> 01:02:03,320
be, I think it's underrated.
So I think it's hard to see that

1185
01:02:03,320 --> 01:02:06,480
disconnect in value between the
big and the smalls can continue.

1186
01:02:06,480 --> 01:02:10,320
So if the gold price maintains
anywhere near it is where it is

1187
01:02:10,320 --> 01:02:12,040
now, I think you'll see money
flowing.

1188
01:02:12,840 --> 01:02:17,000
Part 2 of that small cap gold M
and I either between themselves

1189
01:02:17,000 --> 01:02:19,680
or from bigger.
Absolutely in caps, absolutely

1190
01:02:19,680 --> 01:02:21,760
so underrated.
It's and I think there's a

1191
01:02:21,760 --> 01:02:26,360
recognition that needs to happen
and and it's obviously easier

1192
01:02:26,360 --> 01:02:28,960
than than developing something
from scratch.

1193
01:02:28,960 --> 01:02:32,760
So I I think it's underrated.
Broadstar might just merge with

1194
01:02:32,760 --> 01:02:35,280
that every company instead of
the next five years.

1195
01:02:35,960 --> 01:02:41,880
Yeah, it's.
A good deal flow Brazil or Minis

1196
01:02:41,880 --> 01:02:47,720
juris is a jurisdiction.
Look, I think it's I think it's

1197
01:02:47,720 --> 01:02:53,520
fairly rated.
You know, I like, you know, I

1198
01:02:53,520 --> 01:02:56,960
like Brazil for the reasons
we've talked about, but I don't

1199
01:02:56,960 --> 01:03:00,480
think you can classify as a tier
one location, right.

1200
01:03:00,480 --> 01:03:04,040
It's still not without risk.
How about Argentina?

1201
01:03:04,040 --> 01:03:05,240
We've seen a bit of action
there.

1202
01:03:05,240 --> 01:03:08,000
Do you think that's you know
that the risk is overrated or

1203
01:03:08,000 --> 01:03:11,200
underrated?
I think it's probably

1204
01:03:11,200 --> 01:03:16,440
underrated, but again, there is
still a risk there and I think

1205
01:03:16,680 --> 01:03:19,640
the risk is has come back.
I think the new, the new

1206
01:03:19,640 --> 01:03:23,240
government there is outlining a
plan that's more supportive of

1207
01:03:23,240 --> 01:03:25,880
mining.
But but things can change,

1208
01:03:25,880 --> 01:03:27,920
right?
So there's no lifetime

1209
01:03:27,920 --> 01:03:31,720
guarantees in places like that.
Permitting and approvals risk.

1210
01:03:33,120 --> 01:03:41,040
I think it's, it's underrated
and and I think it's going to,

1211
01:03:41,320 --> 01:03:42,920
it's going to be discussed more
in the next year.

1212
01:03:42,920 --> 01:03:46,200
If you if you looked at 1 theme
that's going to play out of the

1213
01:03:46,200 --> 01:03:48,840
next 12 months in Australia in
particular, I think it's going

1214
01:03:48,840 --> 01:03:50,680
to be that.
Why do we actually haven't

1215
01:03:50,680 --> 01:03:55,520
covered it all yet, Nicole?
Yeah, it's, it's, it's, it's

1216
01:03:55,520 --> 01:03:57,840
tough.
It's, it's tough.

1217
01:03:57,840 --> 01:04:01,480
So I think we all are aware of
the story, you know, increasing

1218
01:04:01,480 --> 01:04:04,240
production out of out of
Indonesia.

1219
01:04:05,160 --> 01:04:07,440
You know, I think the project to
keep an eye on there is the

1220
01:04:07,440 --> 01:04:09,800
Centaurus project again in
Brazil.

1221
01:04:11,280 --> 01:04:12,600
I think they've done a great job
there.

1222
01:04:12,600 --> 01:04:15,240
If there's one nickel sulphide
project that should get off the

1223
01:04:15,240 --> 01:04:18,840
ground, it's that still should
make reasonable money at current

1224
01:04:18,840 --> 01:04:24,000
levels and I think there will be
demand for it.

1225
01:04:24,000 --> 01:04:27,760
So I think it'd be fascinating
to see how that rolls out over

1226
01:04:27,760 --> 01:04:31,560
the next year and whether they
can get party to come here at

1227
01:04:31,560 --> 01:04:33,560
the asset level and and really
get that happening.

1228
01:04:33,640 --> 01:04:36,080
Is there is there anything on
the if you looked at like the

1229
01:04:36,240 --> 01:04:41,320
the spacing between nickel booms
in history, like is there you

1230
01:04:41,320 --> 01:04:44,480
know, we've just it's it's live,
but it can obviously stay live

1231
01:04:44,480 --> 01:04:47,760
for a while and then it's it's
very obviously yeah bust Yeah,

1232
01:04:48,080 --> 01:04:49,000
but.
Yeah.

1233
01:04:49,000 --> 01:04:54,080
I mean, you know, the, the
expansion in production out out

1234
01:04:54,080 --> 01:05:00,680
of Indonesia is, you know, from
a historical perspective, you

1235
01:05:00,680 --> 01:05:02,760
know, the, the volume growth is
substantial.

1236
01:05:03,000 --> 01:05:06,280
Now I think demand is also
increasing, you know, raise me

1237
01:05:06,280 --> 01:05:10,480
rapidly as well, but there's a
lot of uncertainty there, so.

1238
01:05:11,520 --> 01:05:19,560
GCETF is a Ding on Centaurus.
Do you think Meadows X the the

1239
01:05:19,560 --> 01:05:21,600
company is underrated or
overrated?

1240
01:05:22,560 --> 01:05:24,440
I got to do the Ding Ding
because we actually own it in

1241
01:05:24,440 --> 01:05:29,640
the front.
So I think it's underrated, you

1242
01:05:29,640 --> 01:05:34,520
know, capped at 380 mil, 180
million cash Tim prices current

1243
01:05:34,520 --> 01:05:37,880
level it's making probably free
cash 25 a quarter, 100 million a

1244
01:05:37,880 --> 01:05:40,120
year.
Still got a $36 million

1245
01:05:40,120 --> 01:05:47,200
convertible note with Cyprium.
So summer parts, it looks looks

1246
01:05:47,200 --> 01:05:49,040
good.
Cyprium that that the what they

1247
01:05:50,280 --> 01:05:52,680
do off take.
The wankall Bruce.

1248
01:05:52,680 --> 01:05:53,920
Yeah, well, I think there's
something today.

1249
01:05:53,920 --> 01:05:55,680
I didn't see the detail I.
Haven't seen the 1:00 today.

1250
01:05:56,800 --> 01:06:00,640
Yeah.
I think we're all out.

1251
01:06:00,960 --> 01:06:03,000
All right, bloody sensational,
mate.

1252
01:06:03,280 --> 01:06:05,120
Anything.
Anything you want to talk about

1253
01:06:05,120 --> 01:06:07,600
specifically?
Anything you want to bring to

1254
01:06:07,600 --> 01:06:10,200
the table.
I think I'm all talked out, but,

1255
01:06:10,920 --> 01:06:12,760
but, but, you know, keep doing
what you're doing.

1256
01:06:12,760 --> 01:06:16,440
It's, it's good to have a, you
know, a voice in the industry

1257
01:06:16,440 --> 01:06:18,800
that's that's out there every
day, keeping people informed of

1258
01:06:18,800 --> 01:06:20,280
what's going on.
So, so well done.

1259
01:06:20,280 --> 01:06:22,440
We're having fun.
Yeah, bloody good fun.

1260
01:06:23,680 --> 01:06:26,080
It's like, it's like talking
driving back from Cal, from

1261
01:06:26,080 --> 01:06:28,840
Diggers.
Find a car with JD and JC

1262
01:06:28,840 --> 01:06:30,040
talking stocks.
Yeah.

1263
01:06:30,080 --> 01:06:31,360
Alright.
What a what a day.

1264
01:06:31,560 --> 01:06:32,760
Yeah.
What a 7 hours of it.

1265
01:06:32,760 --> 01:06:36,320
Didn't even need Guns and Roses
on the music to keep me awake or

1266
01:06:36,320 --> 01:06:38,080
anything.
Yeah, right.

1267
01:06:38,080 --> 01:06:39,680
Oh, good on your day.
I appreciate your time as

1268
01:06:39,680 --> 01:06:40,320
always.
Babe.

1269
01:06:40,360 --> 01:06:43,640
We're gonna we're gonna have you
back in end of the month doing a

1270
01:06:43,640 --> 01:06:50,240
bit of a special with looking.
Forward to it.

1271
01:06:50,720 --> 01:06:53,480
Oh God.
Bloody much for you there Jimmy.

1272
01:06:53,480 --> 01:06:56,920
Send me some royalties when you
again, right.

1273
01:06:56,920 --> 01:07:00,200
Thanks for all the bloody
Speaking of royalties, bloody

1274
01:07:00,200 --> 01:07:03,600
Axis modern technology flicking
us some royalties every now and

1275
01:07:03,600 --> 01:07:08,280
then and and the the IP, the
potential IP as we talked about

1276
01:07:08,280 --> 01:07:11,800
MMS and Silverstone.
Apologies if you get inbound

1277
01:07:11,800 --> 01:07:14,080
calls about those.
The seed.

1278
01:07:15,000 --> 01:07:19,320
MMS at Silverstone, we've got
Verify spec, power and

1279
01:07:19,320 --> 01:07:23,600
technology, DSI, underground CR
Insurance, Greenland equipment,

1280
01:07:23,600 --> 01:07:25,920
K drill.
Get a spark chart up here as

1281
01:07:25,920 --> 01:07:28,320
well.
Hooteru money miners.

1282
01:07:28,720 --> 01:07:29,760
Hooteru.
Thanks, Dave.

1283
01:07:30,160 --> 01:07:32,800
Information contained in this
episode of Money of Mine is of

1284
01:07:32,800 --> 01:07:34,880
general nature only and does not
take into account the

1285
01:07:34,880 --> 01:07:38,480
objectives, financial situation
or needs of any particular

1286
01:07:38,480 --> 01:07:40,520
person.
Before making any investment

1287
01:07:40,520 --> 01:07:43,600
decision, you should consult
with your financial advisor and

1288
01:07:43,600 --> 01:07:46,720
consider how appropriate the
advice is to your objectives,

1289
01:07:46,920 --> 01:07:48,920
financial situation and needs.