An Unfiltered Chat with Wyloo (Luca Giacovazzi + Joel Turco)

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
I think nickel's a tough space. Not in business to wash our
face. While they're sitting on like
$500 billion of unrealised profit right now in Bradman's
Stuff You. Said billion.
Higher a lot than. That is that a bit more than.
That bit more than that. We've done a bidding goal, yeah.
You've got to remember we we tried the RAID on.
I think we just, I think about this.
All the time. I think about it a lot as well.

(00:21):
We look at that share price as well you.
Guys are ready to go in perspective.
Yeah, it's a very philosophical,but we're just going to put back
right then. While we're meant to be a minor
or a strategic investor environment, while the IPO
inevitable the most underrated place to be allocated capital
right now. I actually really resent being
associated with the term. Premiums today we've got 2

(00:52):
returning guests joining us. Look at you, Kibati and Joel
Turko. WAILU Metals, just in case you
live under a rock or maybe outside of Australia and you
don't know who WAILU is. This is the private mining
investment arm for Andrew and Nicola Forest.
So you don't know who these people are.
You're probably listening to thewrong podcast.

(01:12):
Now last time Luca and Joel joined us, it was mid 2023.
It was shortly after they wrapped up the deal to buy 100%
of mincore. Since then, the nickel market
has changed a lot. The project was put on care and
maintenance, and we address the decision to buy it and
everything about that process ina really, really candid way

(01:34):
while we stayed busy. Since very recently, they've had
an enormous win with their strategic stake in Great Land
Gold Plus they carved out a tidyoutcome from the wreckage of
rare earth developer Hastings. And we unpacked the lessons from
each the good, the hard, the serendipitous.
We talk market cycles, deal structuring and how, while the

(01:55):
positions himself as both an operator and an investor in this
volatile sector. Yeah, there was, there was heaps
of candor in this conversation. They reflect on some timing
stakes. They, they also reflect on
doubling down on, on, you know, names in which they have high
conviction and also what, what it sort of means to, to juggle
both the, the nature of being a miner mining company as well as

(02:17):
investing in these mining businesses.
This is this is one of my favorite conversations that
we've we've had all year, JD. Let's get into it.
Luka Gikavazzi, Joel Turko, welcome back to Money Mine
Podcast. Thanks for having us guys.
Good to be back. Yeah, good to see you guys.
It's been an highly eventful past couple years since we spoke
with you guys mid 2023, so we'vegot a lot to unpack.

(02:40):
Two years, yeah. Two years, yeah.
It doesn't feel like it was thatlong ago.
How do you reflect on those lasttwo years?
How do we look? Yeah, 2 years old.
I'm biting the the hair that's fallen out.
Yeah. That's that's why you've come in
with these iron Williams like hats, which is the most
expensive merch we've ever been brought by a mile.

(03:01):
But but yeah, it's wicked. But it's been it's been an event
for two years for for you guys. It's, it's kind of, it's kind
of, it's funny looking back like2 years ago, like when we, when
we had that first conversation and the world looked a lot
different as well. It was, you know, nickel, the
signs were there, but they weren't quite there.

(03:21):
That of what was like, what was really playing out over the,
the, the, the full course of theIndonesian supplier that's come.
Have you guys just reflected on the change in the nickel market,
not just the last two years, butmaybe the last, you know, 3 or
4? Yeah.
I think nickel's a tough space. And the reason it's tough is

(03:44):
it's a very flat cost curve. So and the sometimes the problem
with nickel is that it kind of sits on that cost curve for a
really long period of time. And that's kind of what we've
seen I think over the last last couple of months.
And I think you're right, when we did the acquisition of Minkle
at the time we had seen the nickel price come off a fair bit
and we thought, OK, are we starting to hit that kind of

(04:05):
flat part of the cost curve and it's going to sit there and it
just kept going. So from that perspective,
obviously wasn't great, wasn't great for us, felt like we were
catching a falling off at the time.
And I think Fast forward now, I mean he's still seeing a lot of,
you know, I just, there's just no supply discipline in the
space. You've got, you know, capital to

(04:26):
happy to happy to keep building out capacity even though the
price is really weak. Starting to see signs of that
disappearing now, which is good.But then you've got a backdrop
of, you know, EV sales on the decline.
Yeah. So I think couple of headwinds
there, but starting to see some shoots that things are starting

(04:48):
to turn around a little bit. And I think unfortunately,
sectors, you know, some miners need to feel pain before they
start to become rational. And I think you're starting to
see that a little bit coming through in Indonesia.
Yeah, no, certainly a challenge.It's been a challenging, you
know, two years with regards to nickel.
There's there's no way around it.
I think that, you know, the challenge that we had is we took

(05:08):
ownership of the business. We thought that we'd we'd
bought. Well, the price kept dropping.
You know, post acquisition, we were adopting a very lean
approach to our operations. We were ripping costs out of the
business and, and just to play, just to play catch up, you know,
the process falling as we're taking costs out of the
business. At the same time, we then got to

(05:30):
a point where we're actually at a very low cost base for our
operations to the point where wewere washing our face even at a
depressed nickel price. But we're not in business to
wash our face. So sort of wisely made the
decision to, it's a very difficult decision obviously to
put the minds on care and maintenance.
You know, looking back on it, what would I do differently?

(05:53):
I actually think we executed thedeal really well.
I think it was like a well execute a deal strategy would
have waited six months then and then, you know, I think we'd be
looking at it very differently now.
Always looks easier in hindsight.
Always looks easier in hindsightof course, of course you know I
we still think that Campbell hasgot a really bright future as

(06:14):
far as nickel's concerned. The nickel market is is a
challenging one. We are starting to see in
Indonesia some of the, what I think will will go on to become
kind of cost pressures that'll that'll sort of eventually start
to creep in. We're seeing some of the
subsidies and government supportfalling away.

(06:35):
We're seeing royalties increase.You know, naturally when you're
mining in an area, you start at the best spots for the best
access to infrastructure and energy and highest grades and
mining nickel ladder arts, you're mining outward.
So you're, I think over time we'll start to see those, those
costs tick up, which will have aresultant impact on the, on the
nickel price. But we're still, we're still

(06:57):
very optimistic about the futureof Cam Belder.
It's not easy, but you know, we're, we're, we're, we're in
with both feet. We're committed and, and, and
actually having some exciting, doing some exciting work at the
moment in the last 12 months or so.
When when you bought pink or no one was in care and maintenance.
Yeah, and now now everything in care and maintenance.

(07:20):
Like maybe some people saw the the nickel supply thing coming,
but the extent that it kind of just gutted out an entire yeah.
It's not as many people who saidthat they saw it coming, yeah.
But yeah, always the way, yeah. I think, I think if there's any
kind of learning from that experience for me is it's just
really hard to predict how a market will react.
A market can be oversupplied by millions of tons and not react

(07:44):
as strongly as with the nickel market reactor.
It can be oversupplied by a handful of tons and react
really, you know, respond in a really sharp way.
So I think it's difficult. And you know, I think in mining
you're always trying to time thecycle and sometimes you get it
really right, sometimes you don't.
I mean, investments in gold haveobviously gone really well.
I don't think we can pat ourselves on the back and say,

(08:06):
you know, we saw Donald Trump winning the election and wars in
the Middle East and etcetera, etcetera.
You can have a view on these things, but I don't think you
can never quite get them 100% right.
And I think you're just trying to get as close to the top and
the bottom as you can when you're making these decisions.
But I think for me, that's the the biggest learning.
It's you know, you, you, I thinkyou've got to you've got to wait

(08:28):
to see how kind of prices respond a bit more.
I think we were just a little bit too premature.
Like we knew there was some price pressure coming in nickel
and we thought, OK, well, this is our moment to to acquire this
whole asset and maybe we should have waited a bit longer just to
see the full extent of, you know, that impact.
Has your thinking on how China dominates commodity markets

(08:50):
changed at all? I think if, if we would ask that
question two years ago, like theinfluence of China couldn't have
been any greater. But if we look across, you know,
we'll speak about rare earths later.
Nickel, lithium, has that changed at all?
Look, I think it's again like innickel, the other problem you
have is it's, it's so opaque what's going on in Indonesia.
You just, you don't really know.And you can, you know, you can

(09:12):
read the best research, you can go over there yourself and, and
try and have a look. But you know, I think we
underestimated how much supply was coming online.
And I think that's the risk you run with kind of Chinese
involvement in commodity markets.
You don't really have transparency to be able to make
a judgement call. I mean, I always look back on it
and I go when we did mink or youknow, our model, we had, you

(09:33):
know, we can nickel numbers thanwhat every broker was putting
out and we were all wrong and way lower than what everyone
thought. So I think that's my take away
from, you know, Chinese involvement in in any kind of
commodity market. You know, I think, you know, you
guys saw the quote from Gary Nagle saying, you know, Glenn
Call will stay away from commodities where there's too

(09:54):
much Chinese control. I think that's also a bit of a
fallacy because ultimately Chinahas, you know, involvement in
almost every commodity in some shape or form.
So I think it's hard. It makes decision making hard.
But I think for us, you know, we're really focused on actually
owning these metal units. I think we sometimes lose sight
of that. Like you actually have the

(10:16):
physical asset and over time commodities are going to go
through ups and downs and at certain points in the cycle,
you're going to do really well. Certain points in the cycle,
you're just going to have to wear a bit of paint.
One observation I have with you guys over Yeah, the the the
duration with on you is even when the sock was not going your
way, you're always trying to find angles or ways to create

(10:38):
like, you know, realize option value that might be latent amid
a bad, bad decision or a bad hand.
Have you been doing that lately?Yeah.
Yeah, Yeah. I mean, you mentioned earlier
like obviously the whole, the whole sector's challenged and,
and you know that, that that is not great for the nickel sector,

(10:59):
but it also does provide opportunity.
So we're always looking at ways to, to, to, to grow, to grow our
resource base, be that organically or inorganically.
So, you know, it doesn't have tobe ownership all the time.
It can be partnerships. Like we've shown an ability to
be pretty agile across differentdeal structures.
Not everything has to be acquisition, although I know you

(11:21):
love a hostile deal, Trav, but Ithink we've provided enough
photo for this podcast in that regard.
You know, we're also, you know, we can do friendly agreements.
We can be a shareholder, we can be an owner, we can be a joint
venture partner. So looking and, and at all times
testing different different options, you know, obviously
access to processing infrastructure for nickel is a

(11:44):
challenging 1. So we are, have been for the
last couple of years ways we canbest, you know, either build
something new or, or use what already exists in the area or
can you retrofit something. So yeah, we're kind of we've,
we've got financial model with about 25 different permutations
of different production bases, different processing pathways,

(12:08):
different paths to market. And then, you know, we never sit
still for long and, and the, youknow, we're, we're trying to
keep the rigs turning as much aswe can and growing our resource
base organically as well. So I, I think that what we, what
we know is that, yeah, there's definitely a operating cost
challenge in Australian nickel. The bigger you are, the easier

(12:32):
that is to overcome. The higher the quality of the
of, of, of your body in size andgrade, the easier that is to
overcome. So I think that that will be the
pathway out of this. I don't think there's any like,
secret sauce you know of. Space rules the day.
When I think about nickel over the past few years, there's
actually two factors. There's the Indonesia

(12:54):
implications and there's also the the battery side of it and
the the world moving much more towards LFP than and I certainly
had suspected as that sort of playing into into the models.
And you know, has that impacted your, your thinking?
Yeah, I think it comes back to even the comment around China
where you're you're trying to operate in these really

(13:16):
illogical markets, irrational markets because even within the
EV space now you're starting to see these articles coming out
about a glad of EVs in China. You know they've they've built a
lot of capacity, they're trying to get it exported overseas.
I think you're seeing a little bit of that play out with LFP
versus NMC right now. There is so much over capacity

(13:37):
in LFPS that they are dirt, dirtcheap and it makes sense to use
them. I think there is a there is
still a very strong use case forNMCS and I think that's why you
still kind of see the market in A50506040 split.
So I think we do try and keep a close eye on kind of how
technology is trending and changing.
It's hard, you know, we're not battery experts by any means,

(14:00):
but I think from what we, you know, from what our perspective,
you know, we definitely see thatthere's kind of A use case for
both. You know, there's the LFPS which
are really suited to kind of lower cost, lower range type
vehicles, large vehicles. And then you've kind of got NMCS
that are higher performing, longer range, maybe heavier
vehicles. You have to use them.

(14:20):
So yeah, and I think that market, JT you stepping on this,
but that market has kind of matured over the yeah, the last
like 5 years. It feels like we're kind of
settling into a bit of a groove of like what's the preferred
technology or changing as rapidly as before.
So. Yeah.
And like, like like I said, I'm not a don't pretend to be a
battery expert. We just consume as much research

(14:42):
that other people produce as we can.
Does feel like every time I readsomething it's telling a
slightly different story. I think that zooming out at sort
of 40,000 feet, I think we can get a bit tied up in this
argument of like is it LFP or NMC?
And I think the answer will be it's both and and more and very
others battery chemistries. I think that in the same way we
have, I think I might have said this before, 4 cylinder, 6

(15:04):
cylinder vehicles will have different battery technologies
for different sorts of cars, different sorts of vehicles.
But certainly the popularity of LFP batteries is also driven by
the popularity of EVs in certainparts of the world.
They're more popular in China. The adoption rate in China is
much higher than than elsewhere in parts of Europe.
And in those countries that vehicles tend to be, tend to be

(15:27):
large cities. So tend to have lower range,
lighter, smaller vehicles. I think if you want to have, you
know, large parts of the United States driving electric
vehicles, I think I can't see them getting away from their
large vehicles anytime soon. So that'll push towards a
different battery chemistry. LFP battery tech is certainly
coming on in leaps and bounds asfar as energy density is

(15:48):
concerned. I think that one of the other
challenges is, is also like whatis it a high nickel NMC or mid
nickel NMC battery? Probably 12 months or so ago, it
felt like we were going towards either no nickel or lots of
nickels like high, high nickel NMC batteries or LFPS or no

(16:09):
nickel whatsoever. Then the popularity of hybrids
kicks in. Then you're starting to see a
lot of popularity now in mid nickel NMC batteries.
So it does feel like whenever weread something, it's a slightly
different story. I think that trying to predict
where that's going to be in two,5-10 years time is really
challenging. I don't think that nickel is

(16:32):
going anywhere. As far as the demand case, I
think the demand story is reallygood under all scenarios.
You're still seeing predicted cumulative annual growth rates
of like 7%. That's goodbye anyone's measure
when you've got a big stainless steel demand still driving,
still driving the story. And then the kicker from from
batteries. So I don't think it's going
anywhere, but I also think that we don't need to be, we don't

(16:55):
need all electric vehicles in the world to use nickel
batteries. In order for there to be a great
use case for nickel in batteries.
I think that they will continue to exist.
Can be a bit frightening to think of what happens if there's
a completely new battery technology that comes as
solid-state batteries emerges like the dominant Navy battery
technology random and that that that's always a bit nerve

(17:18):
racking. But I also think that the
incubation period for a new battery technology takes a long
time because all the infrastructure that's built
around it, that doesn't just change overnight.
You know, Tesla's spending billions of dollars building out
battery infrastructure in the United States is built around a
nickel battery. So I kind of suddenly go switch
that off. We're now doing a sodium battery
or something like that. Do you know why?

(17:39):
Joe Turco said. We're still very optimistic
about the future of Cambelder. It's because right before he
walked into the studio, he just got off the phone with Derek
Hurd at Sandvik Ground Support, who told him all about the
ground support innovations. They could implement A Cassini
nickel mine when they restart now.
Derek probably said something like this.
The the. Logistics and warehouse people.

(18:01):
He then got the technical people, obviously making sure
the product is the right specification.
We have our after sales people come on to come on to the site
and they'll do pull tests. So they go on underground and
connect a hydraulic device to try and pull the product out of
the ground to make sure it's installed correctly.
So a bit of a QA perspective. So it's so critical to match the

(18:21):
whole size to the bolt diameter and for us to come along and
we'll do a pool test to make sure that that has been done
correctly. I'm positive about the future
too when I talked with Derek Kerr to background support, so
you should get in touch with Derek Kerr to tell him money of
mine sent you back to Arloo. Should we talk about great land?
This has been a huge like we while he's worth sitting on like

(18:43):
$500 billion of unrealized profit right now in Greatlands.
Stock, you said a billion or a million billion, billion.
I would love 5. $100 billion, anyway, you've got 500 billion,
yeah, $500 million over like, yeah.
Is it? Is it higher or lower than that?
So that a bit more than that. A bit more than that, yeah.

(19:04):
It's it's a remarkable, remarkable outcome.
And the, you know, the large swath of that has come from
underwriting the acquisition of,of, of Telther and the other 70%
of Haveron recently. But, but that wasn't where you
kind of got into the story. You probably don't even get the
inside edge or the opportunity to do that unless that's why
they was there two years before that with a strategic

(19:26):
investment, which at the time was $60 million in a, in a
potential for 60 million more fire options.
So how does that come about originally?
What's what's the initial interest like 2 years ago?
Yeah, I guess we sort of known, both of us known Sean from his
previous roles at Northern Star and sort of followed his move

(19:47):
into into Grayland and sort of organically started up a
conversation with him around notlong after he started there
looking at different investment opportunities.
And obviously they'd like to have a strong supportive
shareholder around that time. I think, you know, we like the
story. You know, I think that this was
always part of the plan, but a lot of the.

(20:09):
Holes in the wheels of cheese needed to line up for it to to
to work out it. Was still new Crest that's right
it was the jabby fun and new Crest didn't grab them they were
still playing games they. Were playing games, yeah.
There was a lot of cat and mousegoing on, which is sort of
around the time that it happened.
It's a funny story because I remember when we first looked at
it, we compared it to the Tropicana Stake and we were
like, how does this compared to Tropicana that that was the way

(20:30):
we were thinking about it more than, you know, I think at the
time we, you know, with Sean, wewere always saying, you know, we
should go talk to a new Crest that makes sense for these
things to come together. It's an unloved asset in that
new Crest portfolio. But our, our call like our first
bit of analysis was like this isTrop, this is what Trop's valued
at. You know, how does heavier on a

(20:51):
30% stake of heavier on stack upagainst that?
Yeah. And and so I think when we
initially looked at it, we couldn't get the valuation to
stack up where I was trading at the time kind of re engaged
again in mid 2022 share price. I think that was sort of post
some of the fun and games with with new Crest and we thought
the valuation now does stack up,albeit as I said, a lot of those

(21:13):
pieces need to fall into place in order for it to be the
roaring success that it is today.
So that was probably reflective in the nature of the investment.
I have modest investment in equity and then you know the
some, some warrants that attached to that.
The warrants were just just likethe leverage you have being a
strategic investor and I'm listed like gold buying stock
because there's such little capital.

(21:33):
You can get some juicy warrants along the way I think.
It's I mean, those, those warrants came about just from
being early investors. You know, we got them when we
did the first place went into into Greatland.
And I think the bits that you know, you don't kind of see from
the outside is it's been a three-year journey, you know,
working with those guys talking and, you know, you, you again,

(21:55):
you don't see this, but a lot ofconversations with New Crest.
Then they'd all just fall away. And you've invested all this
time and effort into trying to get something done and then just
fall away overnight. And then, you know, you have to
pick up from the beginning, start a new conversation with
Newmont, try and get the deal done.
The. Moment that that Newmont
announced that they were acquiring new Crest, effectively

(22:17):
it was also that disclosure thatthey're going to say realize
three $2 billion of asset rationalization or the exact
same time. So you kind of know immediately
this is probably on the table atthat point in time, yeah.
And then then they named Javier and Telfa like among a list of
the assets we're going to divest.
So like that was always like, you know, that was the Greyland

(22:37):
plan, but there was no guaranteethat that was ever going to
happen. So I think once, even before
that happened, when there was starting to be rumours of Newman
new crests were like probably shakes out, which it did.
And then then it sort of really became like, all right, this is
this is looking like what we hoped it would look like in

(22:58):
2022. So then we, you know, well,
we've been supportive all along.I think Sean and his team bring
a lot of energy to to to the company and I think they shown
the ability to articulate and execute on a strategy really
well. So we, you know, we're
supportive all along. We did the did the placement in

(23:18):
2022, in 2023, we provided them with a like a credit facility as
US $50 million credit facility just to give them some financing
flexibility around the time, youknow, that they that they needed
some. And then, yeah, as as you said
it, the the rumours around on Newcrest happened.
They they they mentioned Javier on Intelfa specifically.

(23:39):
It's not like, it's not like Greatlands, you know, the share
price really reflected the potential optimism that could
come because there's still a lotof uncertainty about getting
that deal done right? Like were they going to pay
yada, yada. And the of course, The thing is
well publicized now is the amount of leverage they got from
the the right to get wrap their wrap their hands around the
whole lot for what was appears now in hindsight, a pretty

(24:02):
undemanding price paid. But they're still they still
have to double the share count in that capital raise And as an
AIM listed like gold miner, likea raise, which I imagine
wouldn't have been very easy to do if while you didn't
cornerstone it or underwrite. Portion of it.
So I think like one thing we we,we must say, you know, Sean and

(24:23):
and Rowan on that deal, you know, I've never met two guys
more determined to get this dealacross the line.
They worked incredibly hard. It's not easy, you know, when
you're a small, a small minor trying to go to the world's
whatever second biggest gold miner and try and try and buy
one of their assets. It's not an easy thing to do.

(24:43):
And those two really did an awesome job getting it across
the line. But yeah, I think to your point,
you know, maybe Turkey, you can,you can touch on a little bit
more. But you know, I think the the
thing that we could bring and that we could help was that we
could say to Newmont we'd bring that financial back in to make
sure this deal closed. Yeah.
I mean, it was like a rare example of a win, win, win that,

(25:07):
you know, Newmont wanted to divest of the asset.
They knew that greatly with a logical owner.
The right gave them a lot of leverage, but it was still a
really challenging transaction because they had to raise more
than their market cap. You know, they, to their credit,
accepted a bunch of script as consideration and they also
needed, you know, some financial, there's such a raise

(25:27):
a lot of money in spite of that.We could lean in and and and
provide that, you know, obviously the big name, but also
the the financing support. I think we look back on it now
and think, oh, of course it's a screaming deal.
Screaming deal. But it was still all before
squeaky bum time. Like there was a few nervous
moments leading into that. That it was.
Yeah. You know, you're asking for a

(25:49):
lot of money from from investorswho and on this obscure exchange
that no one really knows much ofdown under so.
One day we will have to do like a live podcast the night before
a deal. And.
You know, there's phone calls and, you know, 12 AM in the
morning and you're trying to getthings done and, you know,
trying to fill a book that was quite challenging at the time.

(26:10):
You know, it was a, you look back on it now and that that
equity raise was done at a pretty steep discount. 30%
discount. Yeah, and that.
Was 4.84 point. Eight, yeah, that was to get it
across the line, get across the line it.
Was now, so you can't get your hands on the stock if you if you
tried. And the part that yeah,
obviously easy to overlook originally, but is a huge source

(26:31):
of the the profit while the the the the option to buy, you know,
half of half of new month's stock at A at a fixed price
there of 7.2 pence that's. Yeah.
So 50% premium to the right price at the time?
It's kind of it's, it's kind of an interesting dynamic, right?
Because you you've got leverage in getting the deal over the

(26:53):
line by by providing by getting some upside from the future sale
of the shares to to Newmont likethe link is triangular.
It's a clever, neat kind of outcome that managed to stitch
it all together. I.
Think, yeah, I think just important to go back to kind of
what we were saying before. You know, this deal took a long
time to incubate. And I think the the one and only

(27:15):
role we played was providing that certainty that we could
provide that financial backing. The rest of the credit goes to
the Greatland team. And you know, I think it, you
know, now it looks at the time, I think Newmont, we're happy to
say you can, you can take this off of me for a 50% premium.
It now looks like we've done a smart deal, but at the time, so

(27:37):
Joel's point was a 111 for everyone.
Yeah. And and at the same time,
Newmont took a bunch of consideration as script and that
script's now with three times like they've sold it in the IPO,
like that's they've sold that for three times what it was
issued at. So they've also done
astonishingly well. Credit to them for for leaning
into a pretty creative deal structure that otherwise would

(27:59):
have made that deal really hard to get across the line.
So yeah, just yeah, good gold price sells, sells everything.
Now I understand all that, but Idon't understand how the OPS you
first got when you when you tipped in money in 2022 those
they were called warrants. Somehow when I when I read them
in the announcement back then when I read them about them in
the prospectus, the expiry date have been extended by three

(28:21):
years now. I don't I don't understand how
that happens. So I've never seen that one
before. That's.
Just neat. It's just neat if everything
expires at the same time. I think look mate, I think the
the option was a is a an agreement between US and and
Newmont and then providing the actual underwrite to Greatland.
You know again at the time most people would ask for an

(28:41):
underwrite fee. We asked for an extension on the
warrant term. So you know, at the time I think
everyone goes, yeah, that's an easy thing to give away versus
cash. But now, now it's value.
Yeah. I also think it reflects the
fact that when we, when we were initially granted those warrants
in 2022 and we did the capital right of the placement like 8.2
P and then the warrant exercise price was 10 P So it's like a

(29:02):
relatively modest premium. And at the time, those warrants,
if converted, accounted for about 6% of the register,
whereas, you know, now those 10Pwarrants are more than 100%
premium to the capital raise at 4.8 P And, you know, assuming
that the deal gets away, they'renow with 2 1/2% of the register.
So it's sort of a little bit of a balance there.

(29:23):
There's a little bit of, yeah. I want some of those warrants.
So just you can just you can just extend it.
Yeah, I think. You've got to remember though,
like we walked away from a lot of fees at the time in exchange
for those warrants. And yeah, they've it's worked
out now, but you know, it could have gone the other way where,
you know, we walked away from a fee and and had something that's
not worth anything. That's that.

(29:44):
Yeah. Well, there's a lesson there in
alignment too. Like this.
Yeah. Equities long term, yeah, a fee
is transactional. Yeah, that's right.
When you were reflecting on the the price and the the price tag
that Gretlin was going to have to pay becomes apparent to to
you, what's your sort of gut feeling if you can cast your
mind back? Yeah.

(30:07):
I think you go through all this work around trying to
triangulate around a, a price. I think, you know, they got very
lucky with timing as well. Greatland, I think this is, it's
been a great deal, but it's alsobeen a great deal around this.
The timing of it's been really, really good.
You got to remember in those days they're just taking it over

(30:30):
and I just announced a, a tailings dam pothole that was
causing a massive headaches. They had to suspend production.
So worked out well for Greatlandbecause it was an asset that I
think was just causing you want a lot of headaches that were
keen to offload it. It needed some work fixing the
tailings dam. And I think, you know, overall

(30:50):
was a good outcome for them, youknow, resulted in a big
stockpile coming along with the deal, which was which was great
and just to get started. But at the time, like we, you
know, when they were looking at the price they were going to pay
for it, you know, there were also all these issues with it.
So, yeah, what, what, what I'm really curious about is the, the
commitment that you already had.You'd already put money and I

(31:12):
would feel that, you know, investing my own money.
But this is a, a much bigger scale that you guys are doing
it. You'd, you'd written big checks
and you know, given the the facility as well, did you feel
that same sort of commitment that you have to follow it?
Through well, you went hard. You you actually, you went hard
in the underwrite and it was thefirst time I'd noticed you guys
go hard since Mink or. Yeah, yeah, I don't, yeah.

(31:33):
I don't think it was a you know,I know what you're saying is
like, you know, you're kind of 1foot in, do you just go both
foot? Yeah, I don't think that was the
case. I mean, we really do look at
things, you know, on an individual basis every.
Decision on its merits. On its merits.
Incrementally on its merits. I think the only thing I would
say with that was that we do have a very strong view that
heavier on is a fantastic asset.And I think we had a strong view

(31:53):
that TULFA wasn't getting a lot of love and you know we knew
there were things like we're storm deep.
So there was all this potential there that kind of people had
spoken about, but never really gone and spent the time really
investigating. So I think from like a quality
of the all body perspective, we were, we had a pretty strong
conviction. But I mean, at the time and you
jump in here JT, like at the time we were like, this is still

(32:14):
a big acquisition for a small company and you know you're
nervous when you're when you're doing it.
Yeah. When we, I mean, the benefit of
having invested 2 years prior isthat you're already across a lot
of the details of the project. You've got your own models and
an analysis around it. I think when we're looking at
something as big and transformational as this, as

(32:35):
this deal was, I like to look atit for the lens of like, what do
you have to believe for this to be the downside to be here?
So as long as you're protected sufficiently on the downside and
then what you have to believe for this to be a stonker, You
know, I'd be lying if I said that I had my model spitting out
these sorts of evaluations so quickly because we weren't
running as an aggressive gold price through the model.

(32:57):
But I think what we did look at,we believed in the in the
potential for Telfer extension. We believed in the we still do
believe in the quality of the ofthe heavier and all body.
But then we also would run some sort of doomsday scenarios like
what happens if there is this gap between Telfer Delfer
production heavier on coming online.
So if all of these things happenand maybe the gold price softens

(33:19):
is the downside. What's the downside scenario?
What's the upside scenario? And I think where we got to on
Greatland is that it was like real asymmetric risk profile, a
lot more risk to the upside thanto the downside.
And that gave us the confidence to to follow our investment.
And you're right, that was our first big swing since main core.
And yeah, I think it's, yeah, a combination of, you know,

(33:42):
confidence in our commercial position, confidence in our
technical analysis, and then confidence in the like the, the
known quantity of the, of the, of the company, of the
management of the board, the technical team.
You know, we spent a lot of time, they are our technical
people speaking with their technical people, led by Simon,
who do a fantastic job. And then I think when I look

(34:04):
like it's something a great deal, and I was chatting about
it today, like what's what's made this such a great deal?
And I think it's a few factors that relate to, to one another.
Like one they've, they've boughtreally well.
Like there's no getting away from the fact that they've
bought really well. It's a tried and tested
strategy. You, you buy an asset that
shakes out of a major that's notgetting the capital allocation
and management time and attention in that big portfolio.

(34:27):
The gold price has been strong. The asset has outperformed
through a combination of having that capital allocation and
management time and attention and a strong gold price, giving
the ability to look at other production opportunities, other
other, other mining opportunities.
And then like a bit of that goodluck and, and, and timing like

(34:49):
the the TSF issue creating this great big stockpile right before
completion that you can pump through the meal.
So I think a lot of those thingsare interrelated, obviously, but
ultimately we we look at what doyou have to believe for this to
be a bad investment? What you have to believe this to
be a good investment where thosevaluations come out.

(35:10):
And then when something is as asymmetric to the upside as this
was, I think we'll give us the confidence to to go at it.
You're. Going to do any more in gold?
We've done a bid in gold. Yeah, you've got to remember we
we tried the RAID on. I think we just I think about
this all the. Time.
I think about it a lot as well. We look at that share price as
well. How do you reflect on it?
Oh my. God, I think, let's look, let's

(35:31):
get to the back story because people probably won't be
familiar with this was like. Oh, let's.
Not 30th of June 2020 was the 30th of June to market and you
guys, you guys launch. You've already got 4.9% kind of
undisclosed at this point and you'd launch a feel like kill
for another 15%. Baron Joey's like phoning,
phoning people up for you and and they get to 12.

(35:54):
So it's Phil or kill and in thiscase you didn't get filled, so
it's killed. Do you wish you took the 12
though? It wasn't even, I won't tell you
what exactly. It wasn't 12.
It was decimal places of a percent that we were all filled.
Oh, really? Why Phil or kill?
Look, I think the one thing thatis important to us is if we say
something, we stick with it. And you know we told the market

(36:18):
it's full of kill. So this is your opportunity to
sell your stock at the end of the financial year.
And what what we don't want to go and do is we say that and
then I will just take whatever we get next time we try and do
the same thing. You know, we've we don't have
that track record. I think if we say something, we
stick with it. I mean, we look back on it now
and of course, again, hindsight's 5050, you know, we

(36:40):
would have made as good a returnon, on Regis as, as what we've
just done on Greatland. But yeah, and look, I think
Regis is a great story. We we don't have any shares in
it anymore, but similar kind of view on it that, you know, that
Duked and Bolt hasn't had a lot of exploration.
And I think there's more to comefrom that part of the world.
Regis was so out of favor back then too.

(37:01):
Like I remember every bank was pitching defense.
They, you know, the market was hiding them for overpaying drop
and, and wearing all that with the hedge book at the same time
and gold price fell off, which really complicated all all of
those factors. But you can't you, you it did
take a bit of kindness to be like, you know, that no, this is
cheap. It's not like it's not
warranted. This is cheap, yeah.
Yeah, I mean, we looked across the whole ASX gold landscape at

(37:24):
that around that time towards the end of that financial year.
And you know the like the whole ASX gold landscape was trading
at like reasonable discounted. And like, I don't know if you've
been around mining gold and, and, and punching out gold
decks, which I know you did a few of your time and travel and
I suddenly did a few of my time doesn't tend to try to at large

(37:45):
discount and have very long. And so that was sort of the like
the Super macro view. It was like, it was like these
Aussie gold socks trading a discount we took instead of
sprinkling. We, we, we started out, we
thought we'll sprinkle a bit of capital around and then and
then, you know, chatting with the, the rest of the team
thought let's have a swing here.And and and Regis was the one
and go gosh, yeah. Hey, it freed us up to be able

(38:08):
to do. I mean, that's the that's the
thing. It's a sliding doors moment,
right? You always remember the ones
that you're like, oh, if only. But then at the same time, you
know, Grayland, we, we, you know, we got it right and we got
the timing right and we got lucky with it and a combination
of great execution, good luck and timing.
So you say a macro view, but you're not actually thinking the
dollarization, you know, U.S. debt and these sorts of things.

(38:33):
That was only a few months afterRussia had invaded Ukraine and
assets had been seized. It was very much these are
trading to a discounted NAV. Yeah.
I mean, I think we look at what brokers was saying on on gold
price, I think our view on the kind of more macro side of it
was probably a little more driven around.
I think the thing we watch a little bit more with gold and

(38:53):
and there's not a direct sciencein this or correlation to it.
But you know, we're looking at inflation rates, we're looking
at government debts and we're kind of going like everywhere in
the world seems over levered. We look like we're going into
this inflationary environment. Interest rates are going to go
up. You know, gold looks like a
sensible place to park some money.
Did we think it was going to go as well as it has?

(39:14):
No. And are we some like gold
savants? Definitely not.
But it was a bit of that just very, very high level.
Like where do we think kind of global economies are going?
And that's how we made the decision.
Yeah. And then we just then then we
like just nerds and got into nerves and yeah, gold comps and.
Yeah. What?
You just were being addicted to those rolling P NAV charts.

(39:35):
Yeah, that's right. Exactly right.
So the the what would you have done if you if you got the 19.9%
stake, like what would your nextmove have been?
Hostile. Take her No.
No, look, I think again like I think, look, we don't know the
business well enough to kind of tell you what I think the
strategy would have been. But I think at the time we hated

(39:57):
that hedge and we thought, you know, could we help these guys
get out of the hedge And look, Ithink.
We think Dukedon's got more to go than than, you know, what I
think people realize. I think it's got good
exploration upside there. And I think the other thing that
we thought at the time was it wasn't really well disclosed how
much CapEx they had, I remember.There was a high CapEx period of

(40:20):
Tropicana. Yeah, where?
The view that they were coming out of that.
And even at Dukedon, they were moving underground and they were
spending a lot of money getting the undergrounds up and running.
And we thought to ourselves, this is kind of a one off and
and only because it hasn't been kind of wall guarded to the
market, the market's overreacting how much capital is
required. So it was struggling to produce
free cash flow. It was going to be capital.
And spend period Mcfilm is that too?

(40:41):
And they had celebrating the. Power and Phil is getting next
as. Well, so look, I think them like
again, like there were a few things that I think we would
have, would have tried to help them with, but Jim said does a
good job. They're they're they're
consistent performers. And yeah, I think they'll
they'll do well out of those undergrounds at Duketon.
And I think there's more to go in that bolt.
Yeah. I think we're just looking at
going, this is a mature cash flow generative gold project

(41:03):
trading at a significant discount.
These opportunities don't come around very often and they don't
last very long. That was that was the the high
level driver and then we got into the into the leads. 11 more
for reflecting on it has been AIdon't know right what the right

(41:24):
word to use is, but I imagine a bit of a roller coaster with
your investment Hastings, which is which is no longer an
investment in Hastings. It's now we talked about your
own the shares in their performance materials and the
60% interest in the younger banner joint venture.
When when you kind of like go back to the the deal you guys
did you, you you provided the the con note to facilitate

(41:49):
Hastings to buy strategic stake in Neo.
Maybe there was a view to kind of bring it all together and
your instrument kind of, you know, allowed that to happen and
you reflect now. OK, you've you've got the shares
which you probably kind of caredabout and the and the and
interest in the project as well.But all of that said, would you
still done the same deal you didback then to lend Hastings?

(42:11):
Yeah, they're convertible. It's a, it's an interesting one
more in the context of we're a pretty small team at Wyloo and I
think at the time we're just coming off of the neuron
acquisition. We rolled into Greatland and
Hastings and then shortly after that did Minkle.
Yeah, we did Greatland and Hastings in a month of each
other. And I and I don't think we kind
of realized how much we would betaking on like you, if you look

(42:33):
at Wilder today, you know it's two projects we own outright 1/3
project that we've got 60% in and then a pretty sizeable
investment portfolio. And we're running it out of our
Perth office of 20 people. And I think it's a very
different kettle of fish when you're trying to operate assets
versus just being a just being an investor that running,

(42:53):
running mines is a very different set up to just running
a portfolio. And we run both.
And I think that makes us quite unique because we're comfortable
taking on assets and integratingthem.
And I think, you know, over the last three months, I would say
on Hastings, you know, when we first took over the rent, we
had, you know, we didn't have the infrastructure in place to

(43:15):
actually take on that business. And I think we've gone on a long
journey as a, as a group, you know, picking up the Angie
banner now was just it's really easy.
You know, we've got the systems in place, we've got everything
we need to operate it. We've got the right people and
you know, could we go and do that again?
Absolutely got the platform to now be able to go and do those
things to be real operators. But then on the flip side, we've

(43:35):
also got great investment peoplelike Joel and his team and doing
deals like like great land. So we're very, very unique set
up I think in the mining space. But but As for like would we do
it again? Yeah, I would.
I think we like that condo structure.
I think for the, you know, the the reasons that that have

(43:57):
played out now, I think when we when we originally did the deal,
this isn't this wasn't the plan,this wasn't plan A, but it's a
good fall back Plan B and. You think it, do you think it in
you think like it made Hastings getting project financing a kind
of well, I know, I know, I know there's a project financing kind
of, but do you think it made them getting financing for that

(44:20):
project like much, much more challenging?
Yeah, it's a good, good questionbecause coming out of it now,
you know, I think unfortunately Yang Japan has been a little bit
tainted by the Hastings experience.
And I think we've kind of we've lost sight of the fact that this
is a project that's had $200 million plus put into it.
It's fully permitted. Last tennis court.

(44:41):
Yeah, beautiful camp, beautiful airstrip, big ball field, the
one try. To site ready to go clear.
What was that about the camp Luca?
Beautiful camp. A beautiful camp.
Now that reminds me, JD, you seethis Belkauer Times article?
Mining camp door slammer vows tointensify his efforts at
spacious new FIFO resort. Now, mate, Big Dave sounds like

(45:02):
a knob. But FIFO workers, they just want
a room that allows a good night's sleep.
Hear it from Paul Natoli himself.
His grounded group knows this. That's why they build with
acoustics in mind. Yeah, so seven years ago, I'd
like to stay up and we set out to do a survey to really
understand what it is that FIFO guys and girls like, love and

(45:23):
and hate about their camps. So we collated that data, right,
which is very similar data to what we're getting today, funny
enough. So it still hasn't changed or
changed much. Comms noise in rooms, you know,
acoustics is, is, is one of the biggest things, the bed.
So we designed, we called it thedesigner donga.

(45:44):
What should be the new standard of living out in mining camps
and and remote communities? Grounded gets it, so get with
it. The bit that really gets me is
you, you go to these warehouses here in Perth and they're full
of is 2 complete plants sitting in warehouses big order clave.
It's you know, it's incredible and you know, you kind of
resided the fact that you know, this thing could be producing

(46:06):
concentrate in 18 months. It's unlike any other rare, rare
project around the world. Every other projects got, you
know, years and years ahead of it of permitting or billion.
Dollars plus of capital. Billion dollars plus of capital
or in a challenging jurisdiction.
So I think we really like the Angie Banner story from that
perspective that, you know, if things keep going in the right,
right way in the rear space, this is a project that's kind of

(46:28):
turnkey and you can really get off the ground quickly.
So I. Mean one thing that we were
Hastings and while we came to structure around in the initial
investment was that we did not encumber the asset.
So that left the ability for them to put project finance
against the asset. This had a security guarantee
against the the NEO shares. Yeah, I think it look, with the

(46:51):
benefit of hindsight, again, I think it did that the package to
create some challenges. I also think that, you know, the
initial idea was to see if therewas something that could happen
between Hastings and Neo. And you know, I listened to your
recent rare earth spectacular and you know, the comment around
the whole mine to magnet strategy being like a bit of a

(47:12):
crazy 1. And I think that it's true in a
sense that you're a rare earth mine developer.
I think, OK, magnets, you've gotrocks in your head.
I think that's true. That's a very, very challenging
pathway. It'd take you decades to get
there, but can you stitch together a supply chain that
takes it from mine to make it so?
I think you can. And I think that was the
opportunity that we liked, you know, for us now having the

(47:40):
obviously the guarantee over thethe neo shares and we don't have
ownership of those neo shares. Like Neo is a business unlike
any other. Like I don't it's such I've
heard brokers described as like an enigma.
They don't know how to classify.They're not sure who's
investment mandate it fits into broke like broker coverage is is
a bit disjointed because it doesn't quite fit anywhere.
But it is cool company. It's a really cool, really

(48:02):
interesting company. It's the only company of its
type in the world, you know, andwe focus so much on the magnets.
There's sort of three verticals in there.
The magnets the one that you've spoken about nice they are it's
it's 1/3 of the company and it but it is the only producer at
scale of permanent magnets outside of China like that on
its own, it's just such a compelling story still blows our
mind that it is sub billion dollar company probably isn't

(48:25):
had a fairly good elements. Still sub a billion.
I think the other thing with with Neo is you know like going
through the kind of down cycle on rear.
It's there was a point in time where it was the only cash flow
positive rear with company on all the global exchanges.
And I and you kind of look at itand you go this thing's doing
three times the EBITDA of Lanas,but it's got you know a tenth of

(48:46):
the market cap and that's what we liked about it.
And I think we picked up the shares at 860.
Yep, Currently sitting at about 40.
So it's done really well. If you're asking us if we'd redo
the deal, those numbers speak for themselves, yeah.
Doesn't, doesn't, it's doesn't, didn't EO kind of the stake that
you guys ultimately help Hastings buy you now own they

(49:07):
bought that off of Oak Tree and Oak Tree's interest rates back
to the kind of Molly Culp. Yeah.
Yeah, yeah. It's like, gosh, the history of
the company is quite fascinating.
Like had a few resurrections andyeah.
And here it is today. Is this, you know?
Yeah, it's producer of pairing magnets and magnet materials and

(49:28):
a bunch of really unusual like rare metals, the rare metals
division and catalysts and chemicals and oxides.
So it's, yeah, really fascinating business.
So we're still learning about. Has your has your enthusiasm for
like rare Earth changed in the last two years?
I think I famously called it Pixie dust.
Pixie dust, you guys. It hasn't for me.

(49:50):
I mean, I think, I think every electronic device in this room
has a little rare earth something in it doesn't have to
be NDPR. It can be one of the other 17
rare earths. And I think that that makes it
quite special. I think, you know, more and more
we're going to need these, theseminerals.
So I think the demand side for me with Ray Earth's is different

(50:12):
to the demand side on batteries.We spoke about different battery
chemistry changes. Ray Earth's says none of that.
It's like it is what it is and you need it across all these use
cases. So I think from a demand
perspective, I mean, still very bullish on it.
Is it an incredibly hard sector to operate in?
Absolutely. It's it's just very challenging
where 1 country dominates 90% ofthe supply chain and really sees

(50:35):
it as a, sees it as a strategic asset for the country.
And that makes it incredibly difficult.
But I think the demand will, I think the demand is so strong
that that dynamic will change over time because the demand is
coming out, is coming through from all over the world.
It's not just coming through from, from China.
You're seeing it come through inEurope, you're seeing it come
through in America. And those supply chains have to

(50:57):
get off the ground. So, yeah, again, I mean, I think
from in terms of that investment, you know, we got the
new shares back that's really covered kind of our initial
investment and we've picked up Yangibana.
And I think a good reminder that, you know, Yangibana was a
$600 million company and we think it could go back there in
the right riff environment. Do you wait for the the playing

(51:20):
field to change or do you just press ahead with development?
Like a fair bit has been spent, but a fair bit more still has to
be spent. Yeah, I think it's a private
company. The last thing is we can, you
know, we can take a longer term view on things.
So that's what we'll do with theAngie banner.
We're we've got our eyes on the bigger prize at the end of it.
So, you know, once we we get thekeys, we're still waiting for

(51:42):
the deal to fully complete. You know, we'll have a look at
everything and we'll do you knowthe necessary work to make sure
that longer term we aren't we unlocking full value on that
that project. I think first I was really
reintroducing the project to theworld because there has been a
little bit forgotten about. I think that, you know, on the,
there was a notable absence of any mention of the Angie banner

(52:03):
on their risk. We were talking about other,
other projects and I'm like, they're great.
And and like all of those projects need to get out, right?
Like all like. Maybe indirectly, like maybe
maybe anybody can feed any ABBA,maybe talk about any ABBA.
Yeah, yeah. I mean, yeah.
I mean, we talk about has our enthusiasm for rare earth wind,
like I don't think it's ever been, there's ever been more
momentum and interest in it froma like it sits at the

(52:25):
intersection of, you know, technology and geopolitics at
the moment. Like there's never been more
interest. There's never been more
politicians using the words railroads in, in history.
You know, a lot of it's still missing, not well understood, I
would say, but you know, fascinating discussion on the
previous podcast and I, I learned a lot from it as well.

(52:48):
But I, I, I agree. I think that people are
realizing certain governments are realizing that it is a, you
know, they are commodities of, of, of national interest and of
that require security. I think it's one of the, you
guys have talked about this on the pod before, but you know,

(53:09):
the, the bifurcation became likea punchline and Rusty talked
about, it's like, you know, everyone's teasing about it, but
like we actually see it. We have seen it in rare.
It's like the end of last year there was a restriction on
Chinese explosive gallium ex China gallium Ross like was 70%
up from Chinese scaling supply like that is a security of

(53:30):
supply premium and and I think that if.
You want to play that idea, you have to own Neo.
Yeah. So it's, so I think it's a.
Ding, Ding, Ding. That's right.
Big, big, big Ding, Ding, Ding. So yeah, like, I think that it
is, Yeah. It's a really fascinating space

(53:52):
to be in. It's incredibly complex, but the
world needs more of this production of these critical
meals and it needs the processing pathways and
infrastructure. I guess the one thing that I
probably did disagree slightly with in that discussion was like
the tendency to discuss it from like what's like best for the

(54:14):
world and like, oh, this efficient supply chain.
But like the, the challenge comes when, you know, at first
contact, when companies don't just do things because it's
because they're altruistic and it's good for the world.
Like there needs to be a commercial benefit to the
company. I think that's the that's a huge
challenge here. It's like what's good for the
country, what's good for the world.
Companies need to make money trying to find that that overlap

(54:36):
in the in the Venn diagram. I'd be thrilled if I look it
decided to make commercial decisions.
No comment, no comment, no comment.
I mean, like that's AI mean that's a that's a project that,
you know, once built will be a piece of infrastructure of
national significance. You know, is there a pathway to

(55:01):
to to make like Australia, whichhas great rare earth deposits
to, to make us a serious player?You know, I think that that is,
you know, and, and, and government's putting on its
critical thinking hat and tryingto find interesting solutions to
to government's credit. I think like rare earths like
any other, it's like a kin to the government having to keep a

(55:21):
refinery open because we we're not able to refine fuel that,
you know, some kind kind of government support.
I think in the future that's what rare earths will become.
But you will need this infrastructure.
It'll be it'll be critical. So I think yeah, I mean we're
supportive of of any other see where it goes, but.
If it's used as a local buyer offuel.

(55:42):
Yeah. That's true.
But you know, the one other thing just to remind everyone
is, you know, you saw factories in Germany shutting down for,
you know, a couple of weeks because they couldn't get
magnets. And same thing happened in a
Suzuki factory in Japan. So you know, our manufacturing
industry here in Australia, as much as it's very small, is not
insulated from that. At some point you know you're

(56:05):
going to have a magnet in an Australian made product and
you've got to be sure that you know you're able to actually get
access to it. We should totally talk policy
because I do you're, you're you're not afraid to speak your
views on on policy. And it's and it's wicked like I
expected a lot. I suspect we have some
disagreements on views of like, yeah, desirable levels of policy

(56:27):
intervention or desirable levelsof government support in terms
of need and all that and all that kind of stuff.
But I mean, you guys have come at it from an angle of being
like miners of critical minerals, critical mineral space
needing to grow a nice industry,etcetera.
Yeah. Why do you why do you believe
that the things you do about government like and policy
support? Around yeah, for like from my
perspective, it's not so much about government subsidizing

(56:50):
industry in any way or like losing focus of free market
principles, but the reality is in our space, we do not operate
in a free markets world. You know, there's very different
standards around mining and I think that's really starting to
hit home a little bit. I think in in the all Western
governments, I think there's been a massive wake up call in

(57:10):
Canada, massive wake up call in Europe that you can't just go
around blocking every mining project and expect to have a
secure critical mineral supply chain.
You also can't. I also think on an overall
basis, it's not good for the environment either when we're
we're not producing it locally. Are we expecting to hire a

(57:31):
standard locally? And then but we're fine with
buying products that are, you know, using use Indonesia as an
example. I've got to tell the story.
But like, I saw this guy drivingthis EV saying, you know, had a
big green slogan on it, which iswonderful, but he was driving a
Chinese made EV. And I was like, mate, that EV

(57:51):
has probably got the dirtiest battery on the planet in it.
You think you're doing the rightthing because you bought an EV,
but little do you know how that EV is actually made.
And I think that's the thing that I find needs to be resolved
with regulation at some point, you know, you, you can't have
consumers buying a car thinking they're doing the right thing by
the environment where actually that car's not being produced in

(58:12):
the best way. And we need to kind of close
this gap between we need to level the playing field if we
expect our industry to to be competitive between US and other
jurisdictions. And that's either we lower our
standards, that's not a good thing.
So what we should be doing is lifting the standards around
what can be sold in Australia. Maybe it should be the case that
an EV that doesn't meet a certain environmental standard

(58:34):
shouldn't be allowed to be sold here.
And I sometimes I think I've used this when I've done talks
is tariffs were for me a really missed opportunity.
You know, you've seen 100% tariffs on Chinese made EVs and
that's just protectionism. It's just protecting America's
auto industry is protecting Europe's auto industry.
I actually think there was a better way of doing it from a

(58:54):
political perspective. You could have gone, hey, our
order guys have to meet the standard.
We're not allowing them to do XYand Z or damage the environment.
XY and Z. Until you meet that stand same
standard, you're not allowed to sell your product in this
country. And then that would have just
lifted the global standard. We're right now all we've done
is it's a race to the bottom. We've just gone to car
manufacturers. You have to compete with the

(59:16):
Chinese made EV, which is reallylow cost.
So you need to go find the cheapest form of lithium, the
cheapest form of nickel and makemake your product in the country
with the cheapest and the lowestLabor Standards.
And that's basically what we're telling industry.
So it's just a race to the bottom and that needs a massive
fix because you can't fix these industries or protect them
through protectionist mechanisms.

(59:37):
It's not going to, that is not astrategy that can last over
time. You need to lift the global
standard. Yeah.
I mean, I think Australia's beenso successful at mining that
we're quite allergic to the ideaof any sort of government
support for for mining. I think that's it's something
that's in our nature. We don't like that just as a
country they're not very popularpolicy and it's been fine when

(01:00:02):
we're dealing in iron ore and gold and things.
We've had a really huge competitive advantage at
certainly cost structures have changed over the last decade or
more. We're at a point now where
having that sort of utopian view, like that real purest view
of free markets is like, fine, as long as we acknowledge and
consciously know that we're the only ones playing by those

(01:00:24):
rules. Like they're, you know, the,
the, the countries and the jurisdictions we're competing
with are not, you know, we have this problem in nickel.
People like, oh, you know, the, the, the government support for
nickel like it's, it's unsustainable.
It's like companies building projects in Indonesia are
getting 15 year tax holiday. Like if while we got a 15 year
tax holiday, people would be in the street with the Torchem

(01:00:45):
pitchfork. So I think the role of
government and, and this is where I think I do agree with
you, Travo. It's like it's the nature of
that support or those governmentincentives or that government
support. The nature of it is very
important, I think, not just a blank check forever like that
doesn't work. But I think the role of
government is to support the development of industries that

(01:01:08):
the free market on its own will not for whatever reason.
And now trying to unscramble that egg is really complex, but
I actually do see that as being the role of government.
It's to obviously facilitate an environment where Australian
companies can, you know, be as competitive as possible, but
then also where that free marketisn't working for whatever

(01:01:28):
reason. Try and implement a policy that
does allow where there is a industry of national
significance it to exist. Now there are some that we are
willing to relinquish automobilemanufacturing, relinquish that.
Are we willing to relinquish certain other industries like I
don't think we are as a country,I don't think we're willing to
do that. And so I do have some sympathy

(01:01:54):
for government. It's hard.
It's really hard. It's not a simple, particularly
in industries like rivers that are super complex, it's not a,
an easy fix. But I guess I do commend their
willingness to really lean in and to put on creative thinking
caps. And even if some of those
policies are not fully thought out yet, you know, they are at

(01:02:15):
least a step in the right direction.
And but I, but I agree with you,it has to be, you know, it's
not, it's not just any support, it's good support.
It has to be the right form. What about the approach of
infrastructure? There's key bits of
infrastructure that the whole industry could benefit from
aside from, you know, going the much more targeted approach
which they've done in the case of any other.

(01:02:37):
Is that something you think about like cheap clean energy
or, you know, bits of port infrastructure, road
infrastructure being developed? Is that a spot where the
government sort of left a bit lacking?
I. Don't know if it's, yeah, I
don't know if it's lacking, but I mean, it's certainly an area
that, you know, industry would welcome support.

(01:02:59):
You know, there's a lot of talk about these industrial parks and
that makes sense to me. You know, at a high level, if,
if you can go to an area that the government's designated and
said, hey, you don't have to do,you know, three years of
environmental approvals because we've, we've done it all for you
and you're allowed to do XY and Z in this park.
That helps, helps. And I think we, when I was

(01:03:20):
looking at the, I think the GDP per capita growth numbers today
in Australia, we, we have a massive productivity problem in
this country. We need to be doing more.
We need to be growing business if we want to maintain our kind
of living standards. And I think government needs to
think about policy and think about how they do things from
the lens of how can we be enablers of that growth?

(01:03:42):
It's I think the like I find government policies and it's an
interesting thing. You kind of you put a, you put
something in place because you're trying to do the right
thing. So you have a policy that's in
place, you realize it's causing a whole lot of productivity
issues and then you try and subsidized the problem to try
and resolve it where maybe the fix was actually to go back to
the drawing board on that piece of policy that you put in place.

(01:04:04):
So I think there's a bit of thatand that's the that is exactly
at a lot of the time, you know, there's been over regulation in,
you know, like the prime exampleis what we have in Canada where
it was just so over regulated mining that you basically put up
a big sign to mine as to say, donot come to Canada and do not
build a new mine in Canada because you'll wait 15 years to
get a permit and get shovels in the ground.

(01:04:26):
Now, you know, from our project perspective, we've done a lot of
work working with the governmentto say, hey, here is the
pressure points guys, this is what you're staring down.
And they had the biggest wake upcall of their lives when Donald
Trump said, Hey, we're slapping you with, with massive tariffs
and we're going to make you the 51st state comments, right?
There's a huge wake up call for them that they have to actually

(01:04:48):
grow their their economy, they have to grow their country.
And they're doing a lot of work.And there's a lot of good things
happening in Canada to actually be more pro development.
And actually being pro development doesn't mean
lowering standards. It just means going back to the
drawing board a little bit and making sure that what you've
actually got in place makes sense and it's efficient because
right now we have a system that isn't efficient.

(01:05:09):
There's just too much duplication.
Yeah, there's also. Duplication of processes was the
main like I think we are, I think you'll find very many
mining groups that are as pro sustainability as as Wailu and I
in Australia. We are yeah, Australian mining
companies are generally like fantastic in that regard.
But I think so you know, we go in there the best of intentions

(01:05:29):
to do to try try and develop a truly world class project that
will look like that will look like a modern mining project in
every sense of the word. But then so the problem isn't
that the regulations exist because they should exist for a
good reason, right? There's a fairly good reason.
It's just like the overlapping duplication of policies at
provincial level, just state level, federal level, doing

(01:05:51):
everything sequentially rather than in parallel.
I think, you know, it just meantthat the timelines for
development are so out of whack with the timelines for demand.
You think, gosh, are we actuallygoing to be able to bring this
online in a meaningful time frame?
And as you said, it was a huge wake up call earlier this year.

(01:06:12):
You don't have to stretch out time months by March to
completely erode like an IRR or yeah.
I mean, you can kind of see it happening even on, you know,
the, the move away from kind of public sector, like not public
sector public money, so ASX money to more private capital
because you've really, really only private capital has the
patience to be able to go through that really long

(01:06:34):
journey. And I look, I think it's
something that in particular impacts our sector because they
are so capital intensive and they are so susceptible and so
sensitive to timelines. But yeah, and I look, and I
think the one thing that I always reflect on is like, I
think as a nation, we've kind oflost sight of the fact that we
are actually world leaders in developing projects and we're

(01:06:55):
world leaders in from a standards perspective.
And I think we, we, you know, I certainly get a lot of
frustration is when you get a, an EPA decision that's taken a
really long time and a lot of work's gone into it and then it
gets challenged. And it's kind of like every lost
faith in our institutions that everything gets challenged
again. And I think that cycle is really
negative because, you know, you,you've, yeah, I think

(01:07:20):
bureaucrats are even scared to make decisions because they know
it's going to end up getting challenged.
So it just everything just gets delayed because and like in
Canada for example, when you apply for something, they have a
fixed time. It's fantastic.
It's like this, this, the decision will be made in two
years. So you submit your document,
it's 10,000 pages long. They've made you go through a
million hoops. You submit it on day one year

(01:07:41):
364, you get a reply from the government with he has 300
questions that you need to answer.
And it's like you could have told me these 300 questions two
years ago. I would have had the answers for
you and we could have all been moving along, but I think you've
got this real kind of fear factor now in bureaucrats that
they're really scared to be the ones to approve a project
because it might get challenged.So for me, there's something in

(01:08:03):
that that needs to also be fixed.
And and not to get too like philosophical, but we do talk
about this sometimes that the public markets in the Western
world, in particular in Australia have been great for
mining, like mining on Essex hasbeen wonderful.
But sometimes we we look at it now with in the usually
inflationary environment where capital costs are through the
roof, it's actually a challenging market through which

(01:08:29):
to fund development projects which are very, very expensive
and the appetite for deferred returns or long data returns
actually quite, quite low. So I think it's a really
interesting place to be private capital, which is, you know, how
I think of Wylo being private, private for a mining company and
then the big investment or very active investment arm that can

(01:08:49):
act kind of like private capital, You know, because at at
the moment, imagine you're an ASX gold investor and you know,
one of the companies you're involved that you're invested in
has like a big development project.
But I mean that Regis is a perfect example.
Like Mcfillimy's getting canned might have been good for its
share price. I mean, maybe not the only thing

(01:09:10):
that happened around that time that made the share price go
through the roof, but it's like,oh, great.
Well there there's a big CapEx spill off the table.
This thing's absolutely printingmoney.
And maybe there's easier nearer term, lower, lower cost organic
expansion potential here. But in, in like critical
minerals, we want to bring new supply online.

(01:09:33):
So it's very challenging. It's, it's, it's like, I'm not
sure what the answer is. I'm not really sure I'm going
with this, this comment, but butlike philosophically, it's quite
it's, it's a it's, it's a challenging environment to be
building these critical mineralsprojects.
I do think about that quite a bit actually.
And the the lens. I knew you were J Day.
The the lens in which I think about it is you guys have a

(01:09:54):
relatively unique position giventhe how well capitalized you are
and the private nature. And I think about the Superfund
system in Australia and they just have a fire hydrant of cash
coming in month over month. They have trouble deploying it.
Do you think we're going to see them starting to take asset
stakes taking, you know they they already take substantial

(01:10:17):
stakes in, in mining companies, but even longer term kind of
thinking and other potential I guess competitors to to you guys
in the space? You see it a bit in the Canadian
market actually. They'd be more advanced, right?
Like the Ontario teachers? And things like that.
They kind of had the same issue and then so they started taking
direct ownership in usually large infrastructure projects.

(01:10:38):
I think I think that's super dynamic.
There's, there's an opportunity in that as well.
You know, there's a you very rarely do you see super style
funds coming into projects earlyon, you know, and helping
develop projects. So yeah, they, they, they've got
this massive, you know, funnel that they, they're trying to
drink from. I think that that industry will

(01:11:01):
evolve and you know, I think they'll they'll be pressured to
deploy capital and maybe you do see them getting involved in
things at an earlier stage. I think with critical minerals
though, in like in particular, you know, nickels, different
coppers, different rear, it's very difficult because no one's
got a clear line of sight of where prices are heading.
So it's very hard to have a longer term view.

(01:11:23):
And I think even you know, I mean, you said in that the
commercial banks as well, unlessyou can hedge something on a
there's a large ability to hedgeit, generally you're not seeing
the commercial banks get involved in funding projects.
And this is again where I come to my point around you've then
seen government try to step in as a funder, right?
And government, this is not a natural home for government.

(01:11:44):
It doesn't want knife and EFA and critical minerals funds.
These are not like this is not this shouldn't be the role of
government to fund projects, butthey've had to step in because
the commercial banks are not willing to do it.
And in within that, and this is Joel's other favorite playground
is even within that there's an issue because government wants

(01:12:04):
you to. They'll only lend you money if
they can come in alongside a commercial bank because they
maybe they're relying on the commercial bank to do a level of
due diligence alongside them. They're trying to crowd in
funding and I think that's so difficult when you're going,
hey, I want to build a rare earth project or my nickel mine.
Need you to have a longer term view on price.
The commercial banks will go, nothank you.

(01:12:26):
Unless you can hedge, hedge all the cash flows and I'm not at
risk, I'm not interested. Then government goes, hey, if
you find somebody to a commercial bank to invest
alongside you, then we can come in.
You're kind of stuck in the snowman band.
And I think that's the reason wehaven't seen a lot of government
funds actually going into projects.
This those funds are all still sitting on billions and billions
of dollars of taxpayer money that hasn't really been

(01:12:48):
deployed. And I don't think it's been as
effective as what the governmentwas hoping.
The the evolution of the market is so fascinating.
Like, Andrew Forrest was one of the first people building
Anaconda to not go and take commercial bank debt back in 96,
I think. And it was pretty unheard of
going to the states, getting bond financing.
And in 30 years, we've got to a place where sort of seeing banks

(01:13:11):
come in is like almost done. Not unheard of, but we're
heading that direction. It's fascinating.
Yeah, it is the moment. Yes, it's funny, right?
Like the government funding can unlock a project to become
finance, but that in itself is clearly like there's an adverse
selection problem. Like a project needs the
government funding piece to be financed and it probably was

(01:13:33):
evidently A marginal project. Like if the the credit case is
requires the congestion finance.There's a bit of that, but
there's also a bit of like thesemarkets are just also quite new.
You know, I think, I think we'veseen over the last 10 years,
people get a lot more comfortable with lithium.
But in the early days of, you know, you saw Ulbra using Nordic
bonds to build their project that I think is changing in the

(01:13:54):
lithium market. People have definitely got a
level of comfort around it. I would say Ruth's are almost
unbankable. I don't think you'll ever get a
commercial bank involved, you know, too challenging for them.
So I think there is an opportunity for government to
play a role in that space. But they need to fix the they
need to fix those funds. They need to think about how
they deploy their capital. Yeah, not to be the pro

(01:14:15):
government guy as well, but I think the, the, this would be
the first time I've been accusedof that anyway in my life.
But I, I think, I think taking nickel as, as an example, I
think the challenge that that the commercial banks will have
is, you know, they'll have fixedpolicies around reserve tails on
my life and things like that. And if you, if you're taking, if

(01:14:37):
you take Cambaldo, nickel is a very specific example.
You know, these underground highgrade ore bodies, they, they
extend a depth So very few smalland midcap nickel mining
companies are going to have drilled out 20 years of my life
surface because it's prohibitively expensive.
What they can point to is like ahistory of replenishment at

(01:14:58):
depth mine. You drill from underground, you
keep punching down South to government's credit where where
some of those funds do work is they'll say, look, we'll, we'll
come in alongside a commercial bank.
The commercial bank have a shorter tenner.
We can have a longer tenner, we can have a more optimistic
assumptions around resource conversion and extension.
So I think that that is the that's where they're trying to

(01:15:19):
play the. The trick is always trying to
thread the needle by giving a commercial bank sufficient
certainty that it can get through its risk committee and
then obviously showing enough meat on the bone for the the
government fund to be like, yeah, we, we can stay for, for
longer. Take these optimistic

(01:15:41):
assumptions. So, yeah, it's, it's an evolving
space, you know, one that we, you know, we, we do a bit of
work in certainly wouldn't say experts in it, but I.
Think yeah, another another thing that maybe distinguishes
us from other groups is like, you know, Andrew Nicola of are

(01:16:02):
very passionate about the state and this country.
And when we get involved in these discussions with
government, it's more than just our projects.
It's genuinely trying to see Australia being able to
participate in these industries.So yeah.
And I think the government, they've, you know, to Joel's
point, they've done a good job. They've, you know, they've been
creative with the way they've thought about things.

(01:16:22):
But yeah, there's, you know, it's not a, this is not an, an
easy nut to crack. It's quite a complex complex
space. You guys ready to go
introspective? Yep.
Even more. Yeah, it's got very
philosophical. I thought we were just going to
talk about Greatland. It's a lot of dream in here.
Hey, that's Trav. Why are we meant to be a minor

(01:16:47):
or a strategic investor in minors?
I think we're a bit of both, yeah.
You know, I think as I said before, you know, we're we're
set up to do both now and I think that puts us in a unique
position. I think when I look at the
portfolio now, I always say thisto Joel, we've almost got the
opposite problem of every other mine.
We've we've got too much growth.You know, we've got an awesome

(01:17:11):
project in Ring of Fire, We've got Cam holder that we'll bring
back online at some point. And then we've got obviously a
rear project that we're trying to build as well.
I think, yeah, I think we're, we're both, I think we're always
going to have an element of investing and we we're going to
have Andrew's passion and, and where he really made his fortune
was being a good operator and having that, you know, that,

(01:17:33):
that culture that he created at Fortescue is really what we try
to bring to assets. So I think we'll always have an
element of of both. Yeah, absolutely.
I I think that obviously our, you know two of our three
projects in nickel mines at the moment.
So it's sort of hard to say like, oh, we're operators.
So obviously it's a challenging time for nickel, but that I
think is in the DNA of the wholeorganization and and we'll never

(01:17:54):
change like we are not investment only fund.
Having said that, and I'm obviously going to say this
because I manage the investmentsteam, like I think that what are
we really good at? The Greylin example is a is a
perfect, perfect illustration ofwhat we're good at is when there
is, you know, some sort of eventdriven transaction, we can come
in and really put our shoulder to the wheel.

(01:18:15):
As you know, a well financed group with commercial and
technical capability and, and, and you know, underwrite or or
through very many flexible funding structures, you know,
bring a new project into production, whether it's
ourselves or whether it's financial support for another
group like we've done with Griteland, whether it's in
partnership like a joint venturewith Hastings on your Gibana.

(01:18:37):
Like I do think that that is ouryeah, I think that you know,
really leaning into projects that we like with the full kind
of weight of the group behind us.
I think it's what is sort of while at its best, you know,
strategically, is it helpful, you know, if we were buying

(01:18:57):
something on market, do these guys want to own it or is this
just a investment play? Like that actually is quite a
strategic advantage for us. But I would say that like that
is not really a consideration 99.9% of the time.
Normally we've got a pretty clear idea internally of, you
know, what we're what we're doing.
So yeah, it's both, both of those I think.

(01:19:19):
What is the the future of green premiums?
I actually really resent being associated with the term big
premium. We've become, you know, I think
Rusty is still the poster boy. Yeah, he is.
He's. Mr. Price, Bifurcation.
He's Mr. Price. Bifurcation, look, I know I
think I'm probably more in a little bit more in his camp as

(01:19:39):
well. And it comes back to our earlier
comments. I think there is such a big
standards difference between howwe're mining in Australia versus
how Nichols getting mined in Indonesia and at some point that
needs to be fixed. So I don't think it's a green
premium that's voluntary that someone's going to put their
hand up and say, hey, I'm going to pay more than my competitor
for the same thing. I think it will become something

(01:20:01):
that's regulatory driven. And I think we see it in C bam
rules we saw at the G7, they're talking about a standards driven
regulation around critical minerals.
So I think it's, it's not so much a yeah, like a voluntary
premium, it's more a regulatory driven.
Yeah, bifurcation. Or, or it becomes like a point
of differentiation like I have some, you know, I think I can

(01:20:25):
empathize with electric vehicle manufacturers that are, you
know, say you're a Western EV manufacturer, you're like pay
more for these metals because they're green.
It's like, hang on a second. I can barely turn a margin as it
is. And I'm competing against, you
know, Chinese electric vehicles that are produced at a much
lower cost. So no, I will not be paying more
for the inputs. I think over time, as you know,

(01:20:46):
costs get closer to parity, thenit starts becoming a point of
differentiation. The challenge then becomes how
can you differentiate? Can you point to some
international auditable standardthat says X percent of the
materials in this battery meet this standard?
And I think that's where groups like LME are getting to, trying

(01:21:09):
to working with industry to say,you know, here is a agreed set
of criteria that meet this threshold, these materials that
meet this threshold right here. There's no requirement to buy on
that exchange. There's no requirement to buy on
that index. But I do think that over time,
the two big changes would be 1, differentiation and two,
regulation, green premium, security premium, sustainability

(01:21:33):
premium, whatever you want to call it.
I think that, you know, everyonewill mock it until it happens,
but it has happened, like I usedthe Gallium example earlier,
like it has happened when you have to pay extra to get it from
somewhere because you can't get it from the other place.
That's how premiums emerge. So yeah, I mean, I think that I

(01:21:55):
don't think it happens next week.
What do you guys think? Yeah.
The bigger question and we just we just commentate like.
I think you, I think you said itreally well.
I think it's very hard when it'salready higher cost to do stuff
in the West to to have that. And I think whatever shape it
takes, it's got to be some sort of mandated policy.

(01:22:16):
That's the only way it's going to happen.
The the the cases where it's consumer LED a too few and far
between and even when cost of living kind of crisis, right.
And that's not changing anytime soon.
Even when it is like government mandated, like I do think
there's complications to the extent that commodities, you
know, yeah. And like look at the tracking

(01:22:39):
that does happen to it's like tantalum in in Rwanda, DRC or
whatever. And, and they like there's,
there's, there's, there's, there's actually quite stringent
processes to track where things have come from and traders have
to be compliant through that allalong the way, etcetera,
etcetera. But what happens is the the
coltan and yeah, so it just getsblended with the coltan in, in
Rwanda and you get the thresholdand there's some trader that has

(01:23:01):
like less stringent standards and it goes by then because I
just think like the extent commodities are fungible and
there are ways to blend and navigate via kind of those.
Yeah, those kind of channels. It will always happen.
And that makes the premium very tricky.
Very tricky. And I think that's why you do
see mining companies wanting to move further downstream, like
moving mining companies moving further downstream has been like

(01:23:23):
a recipe for disaster for decades.
But I think one of the ideas is that, well, if I can own, if I
can own this beyond it being a commoditized product, if I can
produce like a wallow widget andthen I can market that, then
I've got a premium for that. But like you said, if I'm
producing A commodity that's going to get blended with that
commodity and some trader makes their money by that opaque, you
know, by buying from here, buy from here, mixing insight into

(01:23:45):
that guy. And you know, that's that's
always gonna be really hard. So I think that's why you do see
groups trying to, you know, havemore direct relationship with
their customers. I think we've been too lenient
on supply chains just in general, like right, yeah, I
mean, traders have thrived on that ambiguity videos yeah.
And I think, yeah, look, I don'tknow where we're we're heading,

(01:24:06):
but it's quite a sad reality because, you know, if we're
serious about climate change andwe're serious about all these
things, we can't have that race to the bottom.
We can't just meet the minimum standard.
And, and that's acceptable. Like we really have to as a, and
this is the sad thing. It's like we need like globally
as a people, we need to put our differences aside and agree that
looking after the planets important and we should be

(01:24:27):
meeting a standard. And right now we're not.
Yeah. We're just, I mean, I guess that
point I made earlier is that like we should be doing that,
but then ultimately, like peopleare incentivized by like.
Yeah, there's always one way we're going to cheat the.
System, Yeah. Prisoner's dilemma, right?
It's like. You're not winning any friends
in Switzerland right now with those.
Sorts of comments, that's right.One other thing I've been
thinking about a bunch, and you guys spoke about this years ago

(01:24:47):
in the context of the Ring of Fire is a mine of the future.
And this could be a whole, a whole podcast.
But designing a mine from the very beginning to be, you know,
in, in the, the way in which theworld is moving, autonomous and
all these sorts of things. Like, do you think about that
much? I know you still need to go
through a lot of the, the permitting and these sorts of

(01:25:08):
things and the the process in Canada, but I think there's like
the, the future is quite crazy to think about in that.
Yeah. Yeah, I think like one thing I
will say as much as we've had anexciting year with Great London
and Neo and Hastings, like Canada's actually been our kind
of unsung hero really going wellthere for us from a permitting
perspective. We're just about to finish a

(01:25:29):
feasibility study on Eagle's nest in terms of that kind of
mind to future dynamic. I actually think it kind of, you
know, when we took it, took it over, we set ourselves and this
is this is this comes from our chairman, really the stretch
target of making this the greenest mine that we possibly
could. And I think having the benefit

(01:25:51):
of going into it with that mentality from the beginning, we
really push the limits of like what we're trying to do with
equals nest. Now I can tell you now with that
mine, it's going to have a footprint of one square
kilometer. I remind everyone that's like a
little strip mall in Perth. It's not this is a tiny little
mine. We've been able to keep that
footprint really small. Mining technologies come a long

(01:26:13):
way. We've we're able to electrify
everything. This is a mine that goes really
deep. It goes to 1.4km deep on our
inferred resource. We want to keep our ventilation
as minimal as possible. So going electric really made
sense for us. So I think, you know, we had
that ambition from the beginning.
It really challenged us. And I think it's one of those

(01:26:34):
times where that kind of stretchtarget or that challenge
actually resulted in a very, very good outcome for us because
the way the mine is going to getset up, this thing will be super
low cost for its whole 17 year mine life.
So the deeper we go, everything's on conveyors and
shafts, it's really low cost even though we're getting quite
deep where if we had taken maybea typical W Australian approach

(01:26:56):
which was coming, smash and grabtruck and shovel, just get it
out the ground as quickly as possible.
Your Ness is really high grade at the surface.
It's like beautiful getting there.
Get it? Out.
Get it, get it out. Cash flow.
Quickly as you can for the model.
You'll pay, you'll pay the pricein the future because it just
starts to get expensive as you're getting deeper, so.
The problem then is like you, you stop being resilient to to
local like that'd be great in a so nickel ribs beautiful.

(01:27:18):
Let's get in there. Let's start mining it.
And then ten years down down thetrack, you hit another through
in the nickel price. All of a sudden that's not
resilient and then you have to switch it off.
And which has been the problem with Western nickel ones around
the world, whereas in designer in such a way that that that is
resilient to those price swings.Once that study's done, been an
exciting one to to share becauseit's it'll be a very unique set

(01:27:42):
up the way we got that mine set up and it will be ultra low
cost. I think you know it'll be first
quartile, but not a long way. And some of the interesting like
technical things like underground tiling, storage, you
know, these are all relatively small things and, and in some
cases existing technologies thatare being adapted or refined
slightly. But you know, the, the trend is

(01:28:03):
only going one way with mining, which is, you know, it's, it's
getting more difficult to do things.
You know, there are more and more environmental concerns,
usually for very good reason. So, you know, to the extent that
we can improve upon Pioneer be the showcase for as I said, you
know, the, the attitude towards having a surface tailing storage

(01:28:25):
facility in a really remote location that's very sensitive
ecosystem is pretty low. So having, you know, underground
tailing storage is, you know, not a brand new concept, but
proving it up and deploying it at scale.
I think it'd be really, really interesting and it could be like
a piece of infrastructure of regional significance as well.
So that's something that we're really excited about that our

(01:28:46):
Canadian team's done a great jobof.
And yeah, look forward to sort of sharing a bit more about that
in the future as as that study wraps up.
Is is in? Is a wildly IPO inevitable?
A long enough timeframe. Look, I think if you look at our
portfolio, we've got a few billion dollars of CapEx coming
down the line. Yeah.
So look, I wouldn't put it out of the realm of the possible.

(01:29:10):
I think the one thing that we'redoing which is good is we're
kind of wearing that really risky period for shareholders
and that obviously creates a lotof value for us as well.
And you know that's what we're certainly doing in Canada.
It's the way we're thinking about Cam Boulder as well.
You know, we're we're weatheringthis down cycle.
We're working on how we're goingto process our material at some

(01:29:31):
point. It could be interesting.
And you know, I think for me Eagle's nest is it's it's a
world class mine, but ring of fight that, you know, we're
sitting on what is it 7-7 all bodies out there, all very
developable. That's a word developable.
Yeah. And I think for us, like, you
know, Eagle's Nest is kind of the first cab off off the rank

(01:29:54):
and yeah, just this amazing mineral basin.
And then you kind of got Cambalda.
We're actually quite uniquely placed in the nickel sector.
We've got a Nova style asset which survives kind of peaks and
troughs that'll be Eagle's Nest to mine that you'll probably
never switch off and you'll justwear the cycles.
Then we've got an asset in Cambalda which is really cheap

(01:30:15):
to switch off and easy to switchback on that you bring on when
the cycle's really good. So we're kind of playing the
nickel game in two different ways.
And I think that's quite unique exposure.
And you know, right now it's a tough soul in nickel, but
there'll come a time where nickel will be going well again
and people will be looking for that.
And where do you find it in the market?
You can't really get nickel exposure.

(01:30:36):
Yeah, I mean, I'm looking at theLausanne curve on, on JD shirt
and I think that like the, you know, there's a period in with a
big project like Eagles sort of complex and and takes a lot of
permitting and studies. There's a period where it's
great to be private. It's a period that we're in
right now. It's deeply, deeply unsexy.
Not a lot. Of study with a CapEx number?

(01:30:56):
Right. It's like, you know, there's,
you know, we, we can't, we've got exciting news to put out
every quarter around Eagles Nest, right.
And I used to joke that like if you could privatize every mining
asset at this point and it's cycle, you would because you can
just diligently go about the work without worrying about the
next quarterly having some greatannouncement, having to raise a
bit of money to keep going. So it, you know, we're talking

(01:31:17):
earlier about all the benefits of being private and there are a
lot of them, you know. But having said that, yeah,
possibly that's something that we sort of have spoken about.
I think that it's a we're assembling a really interesting
portfolio of assets. We've got the ability to to, you
know, move kind of cyclically tomove pro cyclically.
And yeah, we are establishing a interesting portfolio, whether

(01:31:40):
you do it for the whole group, whether you do it for some parts
of the group. Yeah, we, we talk about, but
certainly at the moment with a big project like Eagles, it's a
great time to be private. This means that you can.
How often do we see, I mean, youguys talk about it on your show
all the time. How often do you see corporate
actions, corporate decisions that are made that are long term

(01:32:01):
value destructive, But, but justto make some near term
objective, like it's so common that you show me the incentive,
I'll show the outcome. And, and, you know, I think one
of the good things about being private is that we can keep our
head down. We can do things diligently.
We can do them in ways that are going to unlock the greatest
long term value. And we have seen that at a

(01:32:21):
really granular level when we have, you know, come into
companies and, and, and change the way things are done.
Like, why was this being done like this?
He realizes because it accelerates things, it brings
forward cash flow or, or we didn't have the money to do that
or we couldn't justify the budget to do that.
So yeah, there's a, there's a great benefit to being private
at certain times. It's a great benefit to being

(01:32:43):
public at certain times. So I think it's just about
assessing that on its merits as we move forward.
Awesome guys, would you buy an? Answer.
You want some of those warrants.I'll buy someone at private now
and then. Yeah, yeah, yeah, yeah.
And I just realized that. Yeah.
Paper gain of some sort. Yeah, yeah.
Should we finish up with an underrated overrated?

(01:33:04):
Oh. You guys ready?
We haven't done this in quite some time, so.
I'm nervous. We have to get creative.
One sentence or whatever sort ofcomes to mind can can be your
response and we'll go back and forth a bit.
Underrated overrated WA Hard Rock lithium.
Projects. No.

(01:33:26):
I'm. Not sure.
I have. I'm not sure.
Oh my gosh, maybe a billion dollar question.
You should have warmed warmed usup.
Come on, I. Think underrated, I think.
Look, I think our perspective onit is underrated.
I think until you see like the LE really finding its traps,
it's. I'm going to go with a soft
underrated call. I feel like Lithium is, there's
a few things in lithium that are, this is not only one

(01:33:47):
sentence answer that could be quite binary that I definitely
don't understand well enough, but I I would say underrated on
the basis I think it's all been hit too hard.
Vanadium. I have a soft spot for vanadium.
I'm going to say underrated. I'm going to say underrated.

(01:34:08):
Vanadium flow batteries are not a novel or new technology.
They're used around the world. I think that they have a
compelling use case. Australia.
Yeah, underrated. I think we haven't seen that
tech really found its, yeah, found its feet yet.
PGM operations I'll. Let the South African answer

(01:34:30):
this one. I think, I think huge kind of
headwinds there and I think still a huge use case for PGS
and everyone's kind of written it off too early.
Yeah. I, I think that the byproduct
nature of PGM production is sortof a complicating factor, but
we're certainly seeing disruption in that market that

(01:34:50):
make it. Under Eagles Eagles Nest is 5g
per ton PGS. So just a, just a, just a that's
under. Added.
Royalties. Owning them or paying them?
Owning them, underrated. Buying them overrated.
That's an easy one look, I think.

(01:35:12):
We're on the. I'm put you on the wrong side of
them. Yeah.
So yeah. Overrated.
Yeah, yeah. Fair enough.
I mean, you can, maybe you can buy some like, Yeah.
Yeah. I mean, look, I think that like
all sources of capital that havea have a use, but they can be
absolute killers and have been an absolute.
What you hate to see is a project that should get up that
doesn't because it's royalty on it.
Say overrated cuz everyone has this idea that they're not

(01:35:34):
dilutionary, but they are the most dilutionary thing you could
possibly do to your mind, yeah. Another commodity 1 graphite.
Overrated. Overrated.
Yeah. It's funny because it's I don't
think it's rated too highly and it's.
No, Yeah, yeah, probably rated. Probably rated, Yeah, rated.
Just tough, tough. And that's not, that's not a
knock on anyone. I find out a very, very complex

(01:35:56):
commodity, the natural syntheticinterplay.
I think it's really challenging.I I think that there are some
interesting pockets, though having said that, there's some
really interesting pockets. I think again you can, if you
can differentiate so that you'lljust do selling commoditized
product. I think it's interesting.
Private equity like to mining. Like to mining.

(01:36:18):
I know your answer I. Think it's for me, it's
overrated. Yeah.
Just these are, yeah, mining is long dated and it's even these
funds with longer lives really struggle to do what they have to
do in the time frame they have. Yeah.
I mean, it's the mismatch of of fun timelines with mine
development timelines, which I think can be really challenging.

(01:36:38):
You can see funds, they might really like a project having to
sell their position because their funds closing even though
they still like the exposure. The the growth of battery energy
storage systems. Stationary batteries.
I think underrated, I think, I think we're moving into a really

(01:37:00):
difficult energy period where we're consuming so much energy
for AI technology reasons. And I don't think we have a
solution for where we're going to find this energy.
And we have too much conflict ata political level.
Yeah. Right.
Right. Corporate rights.
Underrated, right? Fun.

(01:37:23):
By the flag. Overrated because they're much
harder to deal with than you think.
Yeah, yeah. I mean, it depends what you're
doing them for. You just try and make money.
I mean, we were that close to absolute stonker so.
Why are they harder than you think?

(01:37:44):
Because I mean, like, you never see them.
Yeah, that's actually the 80s. Yeah, I mean, I think that
there's also not a great willingness to do it because it
makes you deeply unpopular. I.
Think picking up the pieces is what's challenging afterwards.
So it's, yeah, just it's challenging better ways of doing

(01:38:07):
things. Yeah, I think so.
I mean the Regis example is a good one.
I think it assumes naturally that you like don't write the
company or management or something like that.
And in that case it's like this is value.
That's funny how like people's brain go because my, yeah, my,
like my, my, my thoughts is justlike, you want to execute like
very quickly at a set price and you think there's a discrete

(01:38:28):
window to do that. Yeah, that was it.
How about the hype around hybridvehicles?
Rated overrated. He's got a strong view, but I go
he's got a very strong view, as you can tell.
I say I say overrated as well. I think overrated, massively
overrated. I think I, I totally understand
why they are attractive right now, but I think that who's the

(01:38:48):
example of it being a sailing boat with a steam engine or
steam engine with a with sails on it.
I think that like ultimately youdon't want to hedge your bets.
You don't want the worst of bothworlds, best of something.
But I I understand that in certain countries where
infrastructure is currently where it is, it's a useful
product for right now, but I don't want.

(01:39:10):
One, I think battery tech gets so good that you don't need that
really long stepping mileage. And I think if you talk to
mechanics that hate working on them because it's just like the
worst of both worlds. Yeah, you got everything jammed
in. You got both technologies jammed
into a small space. I'm also like, I don't drive
long distance. It's one guy, very, very rarely.

(01:39:31):
So I think that's for my life. I, I don't see it, but I, I
appreciate that there is a use case.
Some folks, generally I think itwill be transitional.
This is fun. We should do.
This is a great committee like this.
Thumbs up. Thumbs down.
Yeah, I don't know. The propensity of the majors to

(01:39:55):
lean into diversification towards fertilizers.
Very specific. Question.
It's really young too, like Anglo and PHP.
But the the I say overrated thisthe story around fertilizers and
growing populations. Petrics.
Any chance to put the gloves up to PHP?

(01:40:16):
Like, yeah, yeah. No, I mean, I, you know, in the
early days we were looking at soft projects and things like
that, but we just haven't quite seen it actually.
Yeah. We haven't quite seen it kind of
find its find its traps or actually, you know, that kind of
big growth story really happened.
Yeah. I mean, I also do like the

(01:40:39):
ambition to lean into a different industry that requires
scale and a lot of investment. So like in the altruistic hat
on, is it good for the world? Probably, yeah.
They'll make money out of it. Yeah, I think at some point in
the cycle. I think so.
I think like BHP has realized like oh large scale bulk

(01:41:00):
operation, that's what we're good at.
Let's do that. Let's really squeeze, really
squeeze the lemon so. Love Travis's face.
That's what you. What do you?
What do you think? I'd like to stop myself from
talking sometime. BHP is in way too deep anyway.
Yeah, it's, I mean, they're doing it.
Yeah, yeah, yeah. Thinking kind of

(01:41:21):
jurisdictionally, what do you think of the emergence of Saudi
Arabia as a mining hub? An investment hub or an actual
location? Well, they want people, you
know, sharing tenements, looking.
Is the right way underrated in that?
I think for a long time we you'dsee little junior mining
companies being like, are we getting investment from Saudi?

(01:41:43):
I think it's very real. I think that the money getting
deployed by Saudi is real. And I think the effort to go and
explore that country is very real.
I mean, you know, we've seen it,we've seen friends join Saudi
companies, you know, you see them at conferences.
Like I think it's, it's genuine,so.
Yeah, I mean, I think that if you ever make a case for

(01:42:05):
governments taking a long term view, I mean, that's that's the
case in point right there. That's belief in the energy
transition. We need to diversify away from
fossil fuels. Even if you think it's still got
another 20-30 years to run and they are doing it, you know,
they don't do things small, small bots that are a big swing.
So yeah, it feels real. Probably appropriately righted

(01:42:27):
at the. Moment so right around this the
like do we focus on cost curves enough?
I don't know is this how do I describe this in over and
underrated? I think we focus on it too much
because I think the market doesn't behave.
It takes what the cost curve doesn't take into account is how

(01:42:50):
long somebody's willing to wear losses.
Yeah. And because we're not static.
Yeah. And because we're in a mining
world where you might be subsidized by your government to
keep going because it's important to them.
The cost curve means nothing because you're you're being
funded to your losses are getting funded.
Tell you what's underrated, appropriately adjusted cost
curve. It's like cost curves ain't cost

(01:43:13):
curves. So it's.
An equivalent basis, yeah. That's underrated.
Wait, what's left out? I may adjust it.
Properly rare. It's horrible.
What product are you using? How hard is it to get to that
actual product? Yeah, everyone's making
something different. Nickel.
Same thing. There's ten different forms of
nickel. Which one are you using?

(01:43:34):
Yeah, something just comparing apples with apples.
Challenging. I've got one last one tin.
Haven't spent enough time on it,but we've looked in the past.
A couple of years ago, we had a crack at a few things and
incredibly difficult to find assets.
So I'd say underrated just on not knowing the market very
well, but knowing how how scarcethose assets are.

(01:43:58):
Awesome, what he said. The entrepreneurial mining
spirit in Australia. I think best in the world.
Yeah, I think it's. I think it's.
Great. I think we, yeah, Yeah, no,
hugely underrated, hugely underrated, yeah.
You know, I think, you know, when you look at those, those
kind of mining jurisdiction ratings and like we should be #1

(01:44:20):
by a long margin, I think we're,we've got the best mining people
in the world by by far. And I think we've got very, very
entrepreneurial people as well. It's not just down to there's a
lot of good miners globally, butjust the the ability for us to
get into challenging terrains, roll up our sleeves, just get on
with it, be clever, be smart, dothings inexpensively, being

(01:44:45):
efficient. The culture like we call like
we've said this before, like difference between Canada and
Australia. It's like a jumbo operate in
Australia is like a it's. Like a mercenary, right?
So you, you, I, I am the best atthis.
I do this many metres a day and I'll go down the road and do it
right because that's how good I am.
It's hard to find that anywhere else in the world.
Yeah, I think, I think it's massively underrated.

(01:45:07):
I think that it it, it's not just the entrepreneurial
leaders, the Andrew Forrest wellthat we obviously think of them
naturally, but it permeates downto the attitude at the
operations and I think it is thebest in the world.
I you know, yeah, these are the industry builders, these are the
people that actually bring new things to to market.

(01:45:28):
And it's great to see like a newgeneration coming through as
well. You know, great to see the
emergence of new companies. And, and I spare a thought for
the lithium guys who've actuallyexecuted really well and just
been on the receiving end of a crappy price cycle.
I think of Lyontown that executed a project on time and
on budget. It's a.

(01:45:48):
Good example, lithium, it's challenging to permit projects
in Australia, yet we went from zero to #1 in the world pretty
quickly. Yeah, where like we look at
Canada, we have some really goodore bodies and in that whole
time period failed to build a single lithium.
I think like you get a standard tool.
Kind of like best sort of viewership of this show might be
Canada. So I just feel like I can hear

(01:46:10):
you French. No, look, I think it's, look, I
think they're different. Canada's on a, on a journey at
the moment. Yeah.
But I think, you know, it's jurisdiction's one thing, but
the people are something else aswell.
I got to say one last one the most, the most underrated place
to be allocating capital right now, be it location, but you've

(01:46:31):
got to say location and commodity with a long term
patient view. Yeah, Yeah.
I think it's, this is a pretty boring answer, but I think it's
probably South America and copper.

(01:46:52):
Yeah. I just think that the projects
there are going to be enormous and it's been interesting to
see, you know, Co-op petition, Iguess for one of a bit of a
word, you know, thinking about how we can bring.
Those also making up words on this.
Yeah, yeah. You know how you can bring a

(01:47:16):
bunch of projects online together that are probably going
to need a share infrastructure. I think that, but that requires
a huge investment of capital over a long period of time.
I've spent this whole podcast talking badly about Canada, but
I'm actually going to say Canada.
I think the change that's happening in Canada.
It's hated. It's people are people are
bearish about it. If timeline's condensed and

(01:47:37):
that's a bits. I reckon the shift that's
happening in Canada is very realand I think it's reputationally
not where people want to go. And I think that's for me why I
think it's underrated, where I think something like South
America is pretty. It's pretty well saturated.
Yeah. What commodity?
I'm interviewing now. Just I don't know lithium,

(01:48:00):
nickel, I think they they wrap full for production there,
especially maybe more lithium than nickel.
Really, Nickel, it's us, but that lithium triangle up in
yeah, Quebec and. Yeah, the giants that lithium
projects. Like.
Again, it's, it's like it's similar to the South American
copper. It's like there's a bunch of

(01:48:21):
kind of disjointed ownership of lithium projects.
They need an infrastructure infrastructure solution.
That's probably an Ave. where you can bring a couple of groups
together and unlock the whole region.
Guys this has been awesome. Thank you so much for making the
time and coming on money. Mind spending two hours chatting

(01:48:42):
with? Us Oh, thanks for having a nice
time. It's been good.
Thanks James, this has been awesome.
Went a little deep, but. Yeah, real deep.
Yeah, it. Was great.
It was wicked. I appreciate the, the
transparency and the candid nature with your responses and
yeah, the ability to kind of unpack how you both think and
commend you on the journey you've been on and you're
excited to see what while they kind of continue to go to.

(01:49:05):
Thanks, hope we can come back. Keeping you on that chairman's
list for when we RPI. That's right.
Awesome guys. Thanks, goodbye.
I've got nothing more to say, mate.
That was a special, special conversation and I'm, yeah, just
very grateful to the guys for coming in and and speaking the
way they did. Absolutely mate, what a wicked
conversation. We hope you all enjoyed that one

(01:49:25):
as much as we did. And a massive thank you to
Mineral Mining Services, grounded sand, big ground
support and cross boundary energy.
Odoro, Odoro. Now remember, I'm an idiot.
JD is an idiot. If you thought any of this was
anything other than entertainment, you're an idiot.
And you need to read out a disclaimer.

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