1 00:00:00,040 --> 00:00:01,400 Righto buddy. Miners. 2 00:00:01,400 --> 00:00:04,080 You wanna know about royalties? This whole episode's about 3 00:00:04,080 --> 00:00:06,360 royalties. Everything and everything you 4 00:00:06,360 --> 00:00:09,040 wanna know. I wouldn't the the dark art of 5 00:00:09,040 --> 00:00:12,400 royalties and you can make a whole episode about it. 6 00:00:12,400 --> 00:00:14,640 Really you can. We've got it here, buddy. 7 00:00:14,640 --> 00:00:18,640 We have got bloody speaking about royalties. 8 00:00:18,640 --> 00:00:22,200 Talk about insurance, broking royalties, CRE insurance. 9 00:00:22,840 --> 00:00:26,880 Well, we're on the topic on the on the back of telling everyone 10 00:00:26,880 --> 00:00:30,600 our bloody good CRE are mate, they're expanding everywhere, JC 11 00:00:30,600 --> 00:00:32,600 they are. They're they're more people to 12 00:00:32,600 --> 00:00:36,200 keep up with the demand that's coming out of finally everyone 13 00:00:36,200 --> 00:00:37,960 now and how bloody good they are mate. 14 00:00:37,960 --> 00:00:39,960 You want it doesn't matter whether you own the rocks, own 15 00:00:39,960 --> 00:00:43,440 the equipment to mine the rocks or you construct things around 16 00:00:43,440 --> 00:00:47,320 the rocks. They can broke a policy for you 17 00:00:47,320 --> 00:00:51,600 or review your existing one, mate, Hard Rock Carl friggin 18 00:00:51,720 --> 00:00:55,760 construction anything, renewables, anything, CRO 19 00:00:55,760 --> 00:00:59,960 insurance and there anything and everywhere Brisbane, Sydney, 20 00:01:00,240 --> 00:01:02,240 Perth. They just doubled the Perth 21 00:01:02,240 --> 00:01:04,200 chain. Oh mate, it's so happening. 22 00:01:04,360 --> 00:01:07,560 Oh, getting right back on to royalties, right this episode 23 00:01:07,560 --> 00:01:14,320 we've got Spencer Carl from UBSBHBS 32 fame started the 24 00:01:14,320 --> 00:01:18,520 royalty marketplace CIO at Vox Royalties. 25 00:01:18,520 --> 00:01:21,200 And since I've said royalty so many times, you can tell this 26 00:01:21,200 --> 00:01:26,160 guy's a guru about royalties. Yes, royalties streaming buddy. 27 00:01:26,280 --> 00:01:28,400 The the art of it, all the funky stuff. 28 00:01:28,400 --> 00:01:31,120 Let's get into it, JC. Thanks to the boys for recording 29 00:01:31,120 --> 00:01:33,480 this one. Spencer Cole, thank you so much 30 00:01:33,480 --> 00:01:36,240 for for joining us. We're really keen to understand 31 00:01:36,240 --> 00:01:39,640 the landscape of, of royalties, how that industry has changed. 32 00:01:39,720 --> 00:01:43,080 It's changed a lot. The whole yeah, investment 33 00:01:43,080 --> 00:01:44,840 universe for investors has evolved. 34 00:01:44,840 --> 00:01:48,200 The valuations have changed. The way that, you know, mining 35 00:01:48,200 --> 00:01:49,760 companies get finance has changed. 36 00:01:50,480 --> 00:01:52,440 Yeah, I'm, I'm really interested to have this conversation with 37 00:01:52,440 --> 00:01:55,520 you because you've spent obviously the best part is 15 38 00:01:55,520 --> 00:02:00,200 years just trying to find obscure royalties in in the most 39 00:02:00,200 --> 00:02:02,280 strange of places and, and get your hands on them. 40 00:02:02,280 --> 00:02:03,920 Would that be a fair, fair characterisation? 41 00:02:05,280 --> 00:02:08,120 Yeah, it's a fair assessment, Trev, and thanks for having me 42 00:02:08,120 --> 00:02:10,600 here. Yeah, I'm a sort of self 43 00:02:10,600 --> 00:02:14,120 confessed royalty nerd, so I could talk the leg off the chair 44 00:02:14,120 --> 00:02:17,120 about royalties. So happy to talk both of your 45 00:02:17,120 --> 00:02:20,200 the legs off your collective chairs and hopefully it's 46 00:02:20,200 --> 00:02:23,280 interesting for listeners. We, we, we, we want to own some 47 00:02:23,280 --> 00:02:25,280 royalties, Spencer. So if you can find some for us, 48 00:02:25,280 --> 00:02:28,000 that'd be wonderful. But I don't think I don't think 49 00:02:28,000 --> 00:02:30,200 we're alone in wanting to own royalties. 50 00:02:30,200 --> 00:02:32,600 The the challenge is we're just not massive fans of seeing 51 00:02:32,600 --> 00:02:35,320 royalties pop up when they are created in deals because they 52 00:02:35,760 --> 00:02:37,120 they're pretty the hemorrhage projects. 53 00:02:38,120 --> 00:02:40,120 Yeah. Well, not to be flippant, Trev, 54 00:02:40,120 --> 00:02:44,360 but if you're in the market for extremely cheap royalties, the 55 00:02:45,040 --> 00:02:48,440 the the inside money would be if you're willing to go to northern 56 00:02:48,440 --> 00:02:54,960 Burkina where there's, you know, it's more sandy than secure, I 57 00:02:54,960 --> 00:02:57,160 think you you'd be able to buy them for probably less than one 58 00:02:57,160 --> 00:03:00,360 times revenue. But that's not necessarily an 59 00:03:00,360 --> 00:03:03,480 investment strategy that we at Vox Royalty would necessarily 60 00:03:03,480 --> 00:03:04,880 support. So what about? 61 00:03:04,880 --> 00:03:09,040 What about actually upholding the the terms of that royalty? 62 00:03:09,040 --> 00:03:11,680 Would I, how would I go about doing that? 63 00:03:11,680 --> 00:03:14,440 Yeah, need a few. Well you might bit of security. 64 00:03:14,440 --> 00:03:17,840 Challenges You might be getting paid in rubles rather than U.S. 65 00:03:17,840 --> 00:03:23,520 dollars, but when your when your friends at the Wagner Group are 66 00:03:23,840 --> 00:03:26,480 sending you royalty checks. But no, in All, in all 67 00:03:26,480 --> 00:03:30,200 seriousness, there are some some extremely cheap royalties out 68 00:03:30,200 --> 00:03:32,160 there, but they're probably not the type of royalties you want 69 00:03:32,160 --> 00:03:34,240 to be acquiring. Yeah, makes sense. 70 00:03:34,240 --> 00:03:38,000 Totally. It's like for, for us observing 71 00:03:38,600 --> 00:03:41,480 the, the mining industry and, you know, albeit our careers are 72 00:03:41,520 --> 00:03:44,920 shorter than the, the history of the royalty industry, but it, it 73 00:03:44,920 --> 00:03:48,800 really seems like, you know, the oil and gas industry led the way 74 00:03:48,880 --> 00:03:51,240 with, you know, with royalty businesses. 75 00:03:51,240 --> 00:03:54,800 They're they're much larger in that, in that world and, and the 76 00:03:54,800 --> 00:03:57,120 likes. But Franco kind of kind of 77 00:03:57,120 --> 00:04:01,160 captured the essence of, of, of that, that industry and, and, 78 00:04:01,280 --> 00:04:04,800 and birth what is now becoming a quite a substantial and growing 79 00:04:05,160 --> 00:04:06,640 part of the mining industry over time. 80 00:04:06,880 --> 00:04:10,680 They started like, was it 1986 was the first royalty, but they 81 00:04:10,720 --> 00:04:14,600 they didn't actually become at least they spun out of Newmont 82 00:04:14,600 --> 00:04:15,960 in 2007. Is that right? 83 00:04:17,240 --> 00:04:20,200 Yeah. So they they were incubated 84 00:04:20,200 --> 00:04:25,520 within Newmont and then spun out and then ultimately they were 85 00:04:25,520 --> 00:04:29,920 IPO D in 2007. But yeah, that the the classic 86 00:04:29,920 --> 00:04:33,480 story was, you know, they threw one of their connections. 87 00:04:33,480 --> 00:04:37,080 They they heard heard about a small ad in a local Nevada 88 00:04:37,080 --> 00:04:41,040 newspaper selling a a little gold royalty for 2,000,000 bucks 89 00:04:41,200 --> 00:04:43,280 and they rattled the tin with friends and family. 90 00:04:43,720 --> 00:04:48,520 This is PLS on and Seymour short can Fast forward to today and I 91 00:04:48,520 --> 00:04:51,840 think over 40 million oz have been delineated at that little 92 00:04:51,840 --> 00:04:55,520 gold gold claim. So you know, turned that into 93 00:04:55,520 --> 00:04:58,640 that $2,000,000 into a billion Ave. and probably another 94 00:04:58,640 --> 00:05:02,480 billion in MPV at gold strikes. So you know when you do it 95 00:05:02,480 --> 00:05:05,080 right, the industry can be extremely lucrative. 96 00:05:05,720 --> 00:05:07,680 It really is like the ultimate treasure hunt. 97 00:05:07,920 --> 00:05:11,760 If you like sifting through dusty old maps and storerooms 98 00:05:12,080 --> 00:05:16,240 looking for a reference to a forgotten royalty, this is the 99 00:05:16,240 --> 00:05:19,440 industry for you. And you know, it's a great 100 00:05:19,440 --> 00:05:22,600 industry where if you choose the right royalty and, you know, you 101 00:05:22,600 --> 00:05:25,160 just sit back and collect quarterly checks. 102 00:05:25,200 --> 00:05:28,120 So it's that's not a bad business to be in if you can, if 103 00:05:28,120 --> 00:05:29,280 you can choose the right royalties. 104 00:05:29,920 --> 00:05:32,760 They're such awesome business and yet pretty envious. 105 00:05:32,760 --> 00:05:35,280 It's, they're not just limited to natural resources either, 106 00:05:35,280 --> 00:05:38,600 like some of the ones that come to mind, Michael Jordan on, on 107 00:05:38,600 --> 00:05:42,600 his shoes and Coco Chanel, I'm pretty sure had one on Chanel #5 108 00:05:43,400 --> 00:05:46,400 and you know, one of them had like just living expenses 109 00:05:46,400 --> 00:05:47,720 chucked in for the rest of their life. 110 00:05:47,720 --> 00:05:50,400 They're such awesome businesses. I'm sure that's part of the 111 00:05:50,400 --> 00:05:52,360 reason you're sort of attracted to them. 112 00:05:52,520 --> 00:05:54,440 It's. Perpetuity you've got like, it's 113 00:05:55,000 --> 00:05:57,520 these things, it's perpetuity. How many assets do you buy that 114 00:05:57,520 --> 00:05:59,040 have? Yeah, an entitlement for 115 00:05:59,040 --> 00:06:02,400 perpetuity like. The people in the you guys 116 00:06:02,440 --> 00:06:04,120 fence. I think one of the the most 117 00:06:04,120 --> 00:06:06,880 lucrative royalties is actually like AI think it was a royalty 118 00:06:06,880 --> 00:06:09,360 on Listerine or some sort of mouthwash. 119 00:06:10,640 --> 00:06:13,000 And that's, that's yielded, you know, hundreds of 1,000,000. 120 00:06:13,520 --> 00:06:17,920 So, yeah, I mean, these these types of yield instruments, you 121 00:06:17,920 --> 00:06:20,480 know, whether you're in the Pharmaceutical industry, the 122 00:06:20,480 --> 00:06:24,680 music industry or mining, you know, you name it, oil and gas, 123 00:06:25,600 --> 00:06:28,840 you know, they, they're extremely attractive because as 124 00:06:28,840 --> 00:06:31,040 you said, they're perpetual typically. 125 00:06:31,320 --> 00:06:35,320 And you know, if there's a fundamental change or shift in 126 00:06:35,320 --> 00:06:38,520 the industry, you know, you can see, you know, exponential 127 00:06:38,520 --> 00:06:41,360 factor in, in the yield you're getting, which is why I think 128 00:06:41,680 --> 00:06:45,360 generalist investors are also attracted to this model, you 129 00:06:45,360 --> 00:06:48,840 know, relative to just single asset mining, mining companies. 130 00:06:48,880 --> 00:06:51,720 That's a big distinction right in, in mining royalties versus 131 00:06:51,720 --> 00:06:55,880 the the more generic royalties is that, yeah, I'd use the word 132 00:06:55,880 --> 00:06:58,520 perpetuity, but the reality is mines have a finite mine life. 133 00:06:58,520 --> 00:07:01,840 However, you can have a royal, a royalty over an asset and then 134 00:07:01,840 --> 00:07:04,480 there's some new discovery or some like crazy my life 135 00:07:04,480 --> 00:07:07,480 extension, which can, you know, and and they can just keep going 136 00:07:07,480 --> 00:07:09,960 in there. You talked about Frank Franco's 137 00:07:10,320 --> 00:07:12,640 origination. One like that's that's where 138 00:07:12,640 --> 00:07:16,840 things get exciting because you can pay a small amount and and 139 00:07:16,840 --> 00:07:20,000 have a a really large long term lucrative pay off. 140 00:07:21,400 --> 00:07:24,040 Yeah. I think what's what's not as 141 00:07:24,040 --> 00:07:27,600 well understood is, you know, you know, when you value any 142 00:07:27,600 --> 00:07:31,960 sort of option, you know, how do you actually increase the value 143 00:07:31,960 --> 00:07:34,360 of that option? And, and there's a lot of people 144 00:07:34,360 --> 00:07:37,960 running around sort of buying moose pasture royalties or spin 145 00:07:37,960 --> 00:07:41,320 effects royalties that don't have any work going on them. 146 00:07:42,200 --> 00:07:46,040 You know, our focus is really buy royalties at attractive 147 00:07:46,040 --> 00:07:48,800 prices. But most importantly, they have 148 00:07:48,800 --> 00:07:51,400 millions, 10s, hundreds of millions of dollars of work 149 00:07:52,080 --> 00:07:56,000 being done on the ground because, you know, buying 150 00:07:56,000 --> 00:07:58,160 completely out out of the money options. 151 00:07:58,480 --> 00:08:01,040 You know, you're not sort of getting enough shots on goal 152 00:08:02,000 --> 00:08:05,680 relative to if you're buying. You know, if you, if you want 153 00:08:05,680 --> 00:08:09,920 one hypothesis we love is you pick a big hungry mill that's 154 00:08:09,920 --> 00:08:13,440 running out of feed and you try and buy all the royalties on all 155 00:08:13,440 --> 00:08:15,080 the satellite deposits around it. 156 00:08:16,080 --> 00:08:18,160 You know, we've, we've had some success with the likes of 157 00:08:18,160 --> 00:08:20,640 Genesis and whatnot consolidating some of our 158 00:08:20,640 --> 00:08:23,440 royalties and you know, we've made some, some really 159 00:08:23,440 --> 00:08:25,400 attractive returns on that, that hypothesis. 160 00:08:25,400 --> 00:08:27,960 But fundamentally if your royalty isn't getting any 161 00:08:27,960 --> 00:08:31,560 activity and it's moves past you, obviously you know it's 162 00:08:31,720 --> 00:08:33,080 you're not going to get a lot of return on it. 163 00:08:33,480 --> 00:08:36,440 Kaydrill or Exploration royalty that checks out. 164 00:08:36,520 --> 00:08:39,520 They they do all this royalty talk just reminds me of Rhino 165 00:08:39,520 --> 00:08:46,560 Sol Ryan O'Sullivan, the royalty of operation manager exploration 166 00:08:46,560 --> 00:08:48,640 drilling, king of the RC and diamond rig. 167 00:08:48,640 --> 00:08:50,800 Yeah, mate, there mate. There ain't going to be enough 168 00:08:50,800 --> 00:08:54,760 bloody exploration rigs to keep up with this gold mania we are 169 00:08:54,760 --> 00:08:57,320 seeing at the moment. So I would suggest calling K 170 00:08:57,320 --> 00:09:00,760 drill right now if you want their expertise drilling your RC 171 00:09:00,760 --> 00:09:02,840 and diamond holes, because they're probably by the end of 172 00:09:02,840 --> 00:09:05,880 this episode they've been snapped up by someone else. 173 00:09:06,200 --> 00:09:09,000 Get up the team go K drill. Oh, mate, call them now. 174 00:09:09,000 --> 00:09:12,840 Number is in the show notes. Finds yourself some gold. 175 00:09:14,320 --> 00:09:17,200 Spencer, you made the really interesting comment just before 176 00:09:17,200 --> 00:09:20,760 about generalists being attracted to royalties. 177 00:09:20,760 --> 00:09:23,800 And I think that's a an awesome segue into sort of setting the 178 00:09:23,800 --> 00:09:27,400 landscape of what the royalty business looks like in the Hard 179 00:09:27,400 --> 00:09:29,640 Rock natural resources industry right now. 180 00:09:29,640 --> 00:09:33,520 Because it's evolved massively over the past couple decades. 181 00:09:33,520 --> 00:09:36,160 Over the past ten years in particular, the the number of 182 00:09:36,160 --> 00:09:40,640 companies, while not massive, it sort of ticked up steadily and 183 00:09:40,640 --> 00:09:46,040 the combined market cap has also grown quite massively over that 184 00:09:46,040 --> 00:09:49,840 period. So given your sort of 15 year 185 00:09:49,840 --> 00:09:53,800 experience, talk us through how it's kind of evolved and I'm 186 00:09:53,800 --> 00:09:57,760 keen to hear the sort of impacts that the growth in the royalty 187 00:09:57,800 --> 00:10:01,560 sector has had on more classical miners, whether that might be 188 00:10:01,560 --> 00:10:04,640 sort of pulling away market cap, pulling away generalist dollars 189 00:10:04,640 --> 00:10:07,880 and these sorts of things. Yeah. 190 00:10:07,880 --> 00:10:13,760 So, yeah, it's an interesting sort of history, JD, if you go 191 00:10:13,760 --> 00:10:18,560 back sort of 20 years ago, you know, there are about 10 royalty 192 00:10:18,560 --> 00:10:23,440 companies and but collectively I think the combined market cap 193 00:10:23,440 --> 00:10:26,160 was about 1,000,000 bucks, a billion bucks. 194 00:10:26,160 --> 00:10:29,840 Sorry. So, you know, the industry as a 195 00:10:29,840 --> 00:10:33,800 whole has really picked up steam, I guess you could say 196 00:10:33,800 --> 00:10:37,520 largely since the success of Franklin Nevada post 2007. 197 00:10:39,160 --> 00:10:43,120 And you know, there has been somewhat of a proliferation of 198 00:10:43,120 --> 00:10:45,760 royalty companies. So the industry's gone from 199 00:10:45,760 --> 00:10:50,280 circuit 10 companies to 30 companies in the last 20 years 200 00:10:50,640 --> 00:10:53,880 and it's gone from a billion dollar combined market cap to 201 00:10:53,880 --> 00:10:57,560 about 70 billion. Then you know, when you 202 00:10:57,560 --> 00:11:01,080 segmented through a few different lenses, you know it 203 00:11:01,480 --> 00:11:04,880 it, it fragments a bit further. So the majority of that 70 204 00:11:04,880 --> 00:11:07,960 billion is, is precious metals and more specifically gold and 205 00:11:07,960 --> 00:11:10,600 silver. So that probably speaks for, you 206 00:11:10,600 --> 00:11:13,200 know, about 65 of that 70 billion. 207 00:11:13,440 --> 00:11:16,840 And then there's about 5 billion across sort of diversified or 208 00:11:16,840 --> 00:11:21,160 non precious royalty companies. There's three majors, There's 209 00:11:21,160 --> 00:11:23,200 like 3, three major royalty companies kind of dominate. 210 00:11:23,200 --> 00:11:26,480 Is that right? Yeah, that's absolutely right. 211 00:11:26,480 --> 00:11:31,360 So you know, the top three speak for I think 2nd 90 odd percent 212 00:11:31,360 --> 00:11:33,920 of the industry in for in terms of market cap. 213 00:11:35,840 --> 00:11:39,600 But you know, in terms of deal flow and activity, obviously the 214 00:11:39,720 --> 00:11:43,240 the other sort of 27 odd companies, you know, nipping at 215 00:11:43,240 --> 00:11:45,840 their heels and you know, aggressively trying to sort of 216 00:11:46,120 --> 00:11:48,680 step into that sort of next that next category. 217 00:11:50,120 --> 00:11:54,000 I think in terms of how capital has shifted between miners and 218 00:11:54,000 --> 00:11:57,200 royalty companies, you know, it's interesting. 219 00:11:57,200 --> 00:12:00,640 We I'd say the incremental buyer of our stock, particularly since 220 00:12:00,640 --> 00:12:04,800 we do listed on NASDAQ has been US generalist investors. 221 00:12:05,720 --> 00:12:09,680 And so we get a lot of really granular feedback from US family 222 00:12:09,680 --> 00:12:12,880 office investors and generalists and small cap investors. 223 00:12:13,240 --> 00:12:16,840 And for a lot of them, what they'll tell us is I was burnt 224 00:12:16,840 --> 00:12:19,640 on this, this junior mining stock or this whatever mining 225 00:12:19,640 --> 00:12:21,600 stock, you know, a couple of years ago. 226 00:12:21,600 --> 00:12:25,400 And so I haven't been able to trust the mining industry since 227 00:12:25,400 --> 00:12:28,720 then. And so, you know, the attract 228 00:12:28,800 --> 00:12:30,600 the attraction to a royalty model where you've got a 229 00:12:30,600 --> 00:12:33,360 portfolio approach, it's capital light, head count light. 230 00:12:33,960 --> 00:12:38,360 It resonates really strongly. So, you know, I wouldn't say 231 00:12:38,360 --> 00:12:41,800 that that's always been the same level of attraction from 232 00:12:41,800 --> 00:12:44,120 generalists in the last five to 10 years. 233 00:12:45,440 --> 00:12:48,440 But you know, certainly, you know, in these markets where 234 00:12:48,600 --> 00:12:51,280 particularly American generalists are looking for an 235 00:12:51,280 --> 00:12:54,400 inflation hedge, looking for metals exposure, but don't 236 00:12:54,400 --> 00:12:56,400 really know how to dissect the mine. 237 00:12:57,240 --> 00:13:00,200 You know, I think this model is resonating really strongly in 238 00:13:00,200 --> 00:13:02,160 these markets, particularly in the US. 239 00:13:02,320 --> 00:13:06,840 Combine that with the, the historic tendency of of miners 240 00:13:06,840 --> 00:13:09,560 to disappoint expectations as well, right? 241 00:13:09,560 --> 00:13:15,440 Like I was talking to JD this morning about that, that chart 242 00:13:15,440 --> 00:13:18,600 that is always used the showing the historical P NAV, a price to 243 00:13:18,600 --> 00:13:22,080 NAV ratio that the gold miners would would, would trade at for 244 00:13:22,280 --> 00:13:24,000 over like a, you know, 40 year period. 245 00:13:24,000 --> 00:13:27,120 And for the best part of of history, they roughly traded 246 00:13:27,120 --> 00:13:30,800 about two times NAV And then it kind of, you know, rapidly falls 247 00:13:30,800 --> 00:13:35,000 off around 2010 ish 2009 two thousand and 10:00-ish where 248 00:13:35,280 --> 00:13:38,160 they kind of now hover around one times NAV And the the bulls 249 00:13:38,160 --> 00:13:42,600 will tell you a return to the long term average of of of 1.5 250 00:13:42,600 --> 00:13:47,040 Times Now. But I just I think previously 251 00:13:48,760 --> 00:13:52,800 the like investors in those gold companies were were willing to 252 00:13:52,800 --> 00:13:56,280 pay greater than NAV because if because that would attribute, 253 00:13:56,480 --> 00:13:58,760 you know, the option value, the upside or option value of those 254 00:13:58,760 --> 00:14:01,160 like the projects that they had to the to the mining company, 255 00:14:01,160 --> 00:14:03,800 They get the upside of them. But in reality, costs escalate 256 00:14:03,800 --> 00:14:07,600 massively and they're not able to capture the upside of my life 257 00:14:07,600 --> 00:14:09,480 extension on on new discoveries very well at all. 258 00:14:09,480 --> 00:14:12,080 In fact, the royalty companies capture that very well. 259 00:14:12,360 --> 00:14:14,840 Hence, Franco Nevada rightfully trades at two times NAV. 260 00:14:15,560 --> 00:14:18,280 Do you think that's like a fairway to interpret trading 261 00:14:18,280 --> 00:14:24,720 valuation evolution as well? I think there's sort of infinite 262 00:14:24,720 --> 00:14:29,440 ways you could dissect it. Look, I think one metric that is 263 00:14:29,440 --> 00:14:34,320 really telling or maybe 2 metrics, 1 is if you look at the 264 00:14:34,320 --> 00:14:40,800 total quantum of managed mining funds relative to passive mining 265 00:14:41,040 --> 00:14:43,640 ETFs. So as of the end of last year, 266 00:14:44,320 --> 00:14:49,680 the stats I saw was it was about US 28 billion collectively in in 267 00:14:49,680 --> 00:14:54,000 discretionary like mining hedge funds and you know, managed 268 00:14:54,000 --> 00:14:57,880 mining funds. So contrast that 28 billion with 269 00:14:57,880 --> 00:15:03,080 the passive mining ETF money and that that was 330 billion. 270 00:15:03,640 --> 00:15:05,920 So you know, what do you take out of that? 271 00:15:05,920 --> 00:15:09,680 It's that for a lot of the, you know, historically a lot of the 272 00:15:09,680 --> 00:15:13,120 industry and the volatility has been driven by that 273 00:15:13,240 --> 00:15:16,640 discretionary capital. Whereas now this sort of light 274 00:15:16,640 --> 00:15:19,720 towards, you know, passive ETF mining capital. 275 00:15:20,440 --> 00:15:25,400 It's, it's just it grown so much that, you know, if, if investors 276 00:15:25,400 --> 00:15:28,840 want exposure to gold, they're going to buy an ETF that's sort 277 00:15:28,840 --> 00:15:32,480 of gold linked or mining linked more, more and more. 278 00:15:32,480 --> 00:15:36,840 So, So yeah, I think there is an element that a lot of the large 279 00:15:36,840 --> 00:15:38,800 cap golds have have disappointed. 280 00:15:39,040 --> 00:15:41,880 You know, I think our investors tell us that all the time and 281 00:15:41,880 --> 00:15:44,360 that's why they sort of move recycling capital into 282 00:15:44,360 --> 00:15:46,400 royalties. Like you look at Newmont, I 283 00:15:46,400 --> 00:15:49,400 think over the last five years they've doubled their share 284 00:15:49,400 --> 00:15:51,520 count. They've grown production from 5 285 00:15:51,520 --> 00:15:55,200 million oz per annum to 8 million oz and then they've sold 286 00:15:55,200 --> 00:15:58,640 3,000,000 ounces of production. So, you know, they're still at 5 287 00:15:58,640 --> 00:16:00,880 million ounces of production, but they've doubled their share 288 00:16:00,880 --> 00:16:03,320 count. And the share prices, you know, 289 00:16:03,960 --> 00:16:08,560 they're broadly flat. So I think for some of these 290 00:16:08,560 --> 00:16:11,920 large golds companies that just haven't focused on value per 291 00:16:11,920 --> 00:16:16,440 share or compounding returns per share, investors are 292 00:16:16,440 --> 00:16:19,680 understandably pissed off. And you know, that's why a, a 293 00:16:19,680 --> 00:16:22,720 number of people are sort of moving away from the large caps 294 00:16:22,720 --> 00:16:25,760 and just, you know, there's, there's a trend towards passive 295 00:16:25,760 --> 00:16:30,880 sort of index hugging. To to go into the, the multiples 296 00:16:30,880 --> 00:16:36,040 of how these royalty businesses trade sort of in general, it 297 00:16:36,120 --> 00:16:41,360 seems to be around that 20 times, you know, EBITDA multiple 298 00:16:41,360 --> 00:16:44,000 that they kind of trade on. And whilst the market has grown 299 00:16:44,000 --> 00:16:45,880 massively. Am I sort of right in thinking 300 00:16:46,040 --> 00:16:51,360 that has, you know swayed as the the commodity cycle of ebb and 301 00:16:51,360 --> 00:16:54,680 flowed, but it's broadly for a long time despite the growth 302 00:16:54,680 --> 00:16:56,720 stayed similar to that level, right? 303 00:16:58,400 --> 00:17:01,320 Yeah, I think, I think you're right, JD, particularly at the 304 00:17:01,320 --> 00:17:06,359 sort of mid to large cap space at the small cap end of town, 305 00:17:06,520 --> 00:17:09,400 you know, we see sort of multiples that are quasi tech 306 00:17:09,400 --> 00:17:14,160 multiples like 50 to 60 times revenue where, you know, 307 00:17:14,160 --> 00:17:18,280 investors I guess are buying into longer dated, you know, 308 00:17:18,319 --> 00:17:19,280 DCF. Or. 309 00:17:19,960 --> 00:17:24,680 Yeah, development royalties, so and there's probably a lot more 310 00:17:24,680 --> 00:17:28,319 arm waving around, you know, those development pipelines that 311 00:17:28,319 --> 00:17:31,600 at the large end of town. So but yeah, like broadly 312 00:17:31,600 --> 00:17:35,000 speaking, the industry has sort of traded around that sort of 313 00:17:35,000 --> 00:17:40,600 2020 times level. And look, I think what also 314 00:17:40,600 --> 00:17:44,720 shifted in the industry was about sort of 15 years ago with 315 00:17:44,720 --> 00:17:48,680 the advent of streaming and streaming and it's, you know, 316 00:17:48,680 --> 00:17:51,600 when it was created, it was just pure financial arbitrage. 317 00:17:51,920 --> 00:17:55,560 We'll pay 10 times revenue for this metal, this, this silver 318 00:17:55,560 --> 00:17:59,360 byproduct stream and it'll trade, you know, magically it'll 319 00:17:59,360 --> 00:18:03,520 trade at 20 times. And there's a number of people 320 00:18:03,520 --> 00:18:06,640 in the industry that's still trying to chase that, you know, 321 00:18:06,960 --> 00:18:10,880 financial arbitrage dragon, so to speak, some successfully, 322 00:18:10,880 --> 00:18:16,360 some extremely unsuccessfully. But, you know, we're, we're not 323 00:18:16,360 --> 00:18:18,280 in the game of sort of financial arbitrage. 324 00:18:18,280 --> 00:18:21,840 We're trying to focus on, you know, identifying which mines 325 00:18:21,840 --> 00:18:24,920 and deposits are just about to be built and then finding 326 00:18:24,920 --> 00:18:28,880 forgotten royalties from 20 to 40 years ago on those rural on 327 00:18:28,880 --> 00:18:32,120 those projects and acquiring them at attractive prices. 328 00:18:32,120 --> 00:18:35,920 But yeah, this this arbitrage game and and hoping that 329 00:18:35,920 --> 00:18:40,000 everything trades 20 times historically that that's been 330 00:18:40,000 --> 00:18:41,880 quite prevalent, particularly on the streaming side of the 331 00:18:41,880 --> 00:18:43,840 business. That that's an interesting 332 00:18:43,840 --> 00:18:46,800 point, right? And I mean, you do get the the 333 00:18:46,800 --> 00:18:50,880 big difference in in trading valuations between the the 334 00:18:50,880 --> 00:18:53,160 royalty goes that have largely development portfolios. 335 00:18:53,160 --> 00:18:57,000 You don't get too much value for a development royalty given so 336 00:18:57,000 --> 00:18:59,920 much uncertainty with them. But I can like those companies 337 00:18:59,920 --> 00:19:03,520 can try to like slows like .3 Times Now all the way up to to 338 00:19:03,520 --> 00:19:07,080 Franco, which is often north of two Times Now whenever I've 339 00:19:07,080 --> 00:19:09,840 checked. But on the on the on the actual 340 00:19:09,840 --> 00:19:13,120 like the the arbitrage, financial arbitrage side of 341 00:19:13,120 --> 00:19:18,080 things, it's like how do you if you're playing that game, how do 342 00:19:18,080 --> 00:19:21,520 you compete with the, the Francos of the world where the 343 00:19:21,520 --> 00:19:24,640 cost of capital is so, so low? You know what I mean? 344 00:19:24,640 --> 00:19:28,760 Like that, Like, yeah, I always, I always thought of that 345 00:19:28,760 --> 00:19:32,280 conundrum for De Terra in a lot of ways because they they didn't 346 00:19:32,280 --> 00:19:35,400 have the same cost of capital as as as Franco, but you know, 347 00:19:35,440 --> 00:19:38,320 probably found themselves trying to compete with them on various 348 00:19:38,320 --> 00:19:40,360 opportunities. Yeah. 349 00:19:40,360 --> 00:19:43,400 Look, I think if you go head to head with, you know, the 350 00:19:43,400 --> 00:19:46,000 strongest balance sheet in the industry, generally speaking, 351 00:19:46,640 --> 00:19:49,080 you're going to come come off pretty bad and then bruised. 352 00:19:50,080 --> 00:19:53,120 You know, I think the behind closed doors, a lot of the large 353 00:19:53,120 --> 00:19:55,760 capital royalty companies will tell you their cost of capital 354 00:19:55,760 --> 00:19:59,960 is effectively 0 and 1%. You know, maybe that's crept up 355 00:19:59,960 --> 00:20:02,600 with rates a little bit, but you know, you're probably talking 356 00:20:02,600 --> 00:20:05,800 zero to 3% for a lot of the, you know, the large caps. 357 00:20:06,080 --> 00:20:09,680 And so for them, you know, a lot of things, almost everything 358 00:20:09,680 --> 00:20:14,720 looks accretive. So, yeah, the key to in any 359 00:20:14,720 --> 00:20:18,120 rational business model is not not coming head to head with 360 00:20:18,120 --> 00:20:19,960 that extremely low cost of capital. 361 00:20:21,360 --> 00:20:25,040 You know, it's, it's I guess comparable to say, you know, a 362 00:20:25,040 --> 00:20:29,640 sand fire or capstone, you know, trying to compete with a Chinese 363 00:20:29,640 --> 00:20:33,120 SOA cost of capital, you know, that places strategic value on 364 00:20:33,120 --> 00:20:36,680 copper off take like, you know, it just doesn't make any sense. 365 00:20:36,680 --> 00:20:39,680 Don't don't bid against someone who's got, you know, a 366 00:20:39,680 --> 00:20:41,520 structural advantage relative to you. 367 00:20:41,520 --> 00:20:47,360 So look, I think, you know, most sort of mid to small cap royalty 368 00:20:47,360 --> 00:20:52,680 companies acknowledge that and you know, some are still in the 369 00:20:52,680 --> 00:20:54,040 business of trying to win auctions. 370 00:20:54,280 --> 00:20:57,920 Others, you know, we're trying to find bilateral proprietary 371 00:20:57,920 --> 00:21:00,120 deal flow. But you know, it doesn't grow on 372 00:21:00,120 --> 00:21:05,320 trees and you can sort of go seek 25% returns in Excel, you 373 00:21:05,320 --> 00:21:08,480 know, all day every day. But as we all know, you know, 374 00:21:08,560 --> 00:21:10,720 you often that's often not going to be reality. 375 00:21:10,720 --> 00:21:15,440 So just copying and pasting the PEA or the pre phase into Excel, 376 00:21:15,920 --> 00:21:20,360 you know, that's delusional. So, yeah, all that is to say, I 377 00:21:20,360 --> 00:21:23,400 think people have tried to compete with with the large cap 378 00:21:23,400 --> 00:21:26,720 cost of capital, but you know, there's there's a trail of 379 00:21:26,720 --> 00:21:28,680 impairments behind that sort of folly in. 380 00:21:29,360 --> 00:21:31,680 My banking Dave Spencer, I did it. 381 00:21:31,880 --> 00:21:34,720 There was like one, yeah, unsuccessful advisory to a 382 00:21:34,720 --> 00:21:38,200 royalty Co bidding for a, a, a royalty portfolio. 383 00:21:38,760 --> 00:21:42,280 And I can tell you the the assumptions to to try and 384 00:21:42,280 --> 00:21:44,960 compete in that process were assumed better than the better 385 00:21:44,960 --> 00:21:47,280 than the Peas and PEFSS have some really questionable, 386 00:21:47,280 --> 00:21:49,760 dubious projects and they still didn't win. 387 00:21:49,760 --> 00:21:52,520 Yeah. Yeah. 388 00:21:52,520 --> 00:21:56,200 I mean, some people there, some people sort of reach for the 389 00:21:56,200 --> 00:21:58,560 wrong assets. I'm sure we've all seen it. 390 00:21:58,640 --> 00:22:03,760 But yeah. And, and I think others will try 391 00:22:03,760 --> 00:22:07,000 and sort of create, construct this narrative that, you know, 392 00:22:07,360 --> 00:22:11,280 the market's missing a certain technical assumption or, but you 393 00:22:11,280 --> 00:22:14,520 know, if you're getting close to paying 10 to 15 times revenue, 394 00:22:14,840 --> 00:22:18,240 even if there is exploration success in year 25, what does 395 00:22:18,240 --> 00:22:20,960 that really mean for your DCF? And, you know, you're probably 396 00:22:20,960 --> 00:22:23,240 not going to be able to massage your returns from, you know, 397 00:22:23,240 --> 00:22:26,560 maybe from 5 to 6% if you're bidding against the herd like 398 00:22:26,560 --> 00:22:29,160 that. That's a really interesting sort 399 00:22:29,160 --> 00:22:33,840 of concept you, you bring up there because the beauty in a in 400 00:22:33,840 --> 00:22:38,160 a sense is the, the optionality and the thing the, the, you 401 00:22:38,160 --> 00:22:41,640 know, you think about the iron ore royalties and some of them 402 00:22:41,640 --> 00:22:44,480 gone on for 50 years and that wouldn't have looked great in 403 00:22:44,920 --> 00:22:50,680 ADCF, but it's awesome to still get that check 50 years down the 404 00:22:50,680 --> 00:22:54,080 track down the track. But it just doesn't show up as a 405 00:22:54,120 --> 00:22:57,920 massive kicker if you're looking at it from a DCF perspective. 406 00:22:57,920 --> 00:23:04,080 But how do you think about the optionality of multiple cycles 407 00:23:04,080 --> 00:23:07,720 in a commodity and the fact that if you're, you know, in, in a 408 00:23:07,720 --> 00:23:11,800 precious or often in a, in a bulk like an iron ore or a a 409 00:23:11,800 --> 00:23:15,400 long life cop of mine, that it could be around way, way, way 410 00:23:15,400 --> 00:23:17,160 down the track. How do you sort of put that in 411 00:23:17,160 --> 00:23:19,720 perspective when you're crunching the numbers? 412 00:23:21,400 --> 00:23:23,800 Yeah, there's there's probably two different answers to that. 413 00:23:23,800 --> 00:23:28,320 JDI think 1 is, you know, P Ellison often says as the the 414 00:23:28,320 --> 00:23:31,880 godfather of the royalty industry often talks about, you 415 00:23:31,880 --> 00:23:34,960 know, you need a, you know, a 20 year mine life. 416 00:23:35,640 --> 00:23:38,880 So that then you're going to have four or five peaks. 417 00:23:39,520 --> 00:23:42,480 And, you know, if you have commissioning and ramp up 418 00:23:42,480 --> 00:23:46,000 challenges for up to three or four years and then, you know, 419 00:23:46,000 --> 00:23:50,840 enclosure or sort of as the the mine starts to run off, you 420 00:23:50,840 --> 00:23:52,800 know, becomes less predictable and less stable. 421 00:23:53,960 --> 00:23:58,400 So, yeah, I mean, obviously if you can, if you can sort of 422 00:23:58,400 --> 00:24:02,400 underwrite and acquire a royalty on that sort of longevity happy 423 00:24:02,400 --> 00:24:06,640 days. But I think, you know, and, and, 424 00:24:06,680 --> 00:24:10,280 and getting exposure to the full commodity cycle and multiple 425 00:24:10,280 --> 00:24:14,040 cycles, you know, I think gives you some extra embedded 426 00:24:14,040 --> 00:24:17,720 optionality and option value. But I think something is more 427 00:24:17,720 --> 00:24:21,960 important perhaps is if you look at the absolutely spectacular, 428 00:24:22,360 --> 00:24:24,800 like the best deals in the royalty industry, the absolute 429 00:24:24,800 --> 00:24:29,120 barn burners, a lot of them haven't been from, you know, 430 00:24:29,480 --> 00:24:32,360 mine life extending from 10 to 15 years. 431 00:24:32,640 --> 00:24:36,040 A lot of them have been, you know, if you take gold strike, 432 00:24:36,320 --> 00:24:40,520 it was, you know, a smaller scale gold, gold asset in 1986 433 00:24:40,520 --> 00:24:44,160 something, it had 400,000 ounces of reserves in the ground. 434 00:24:45,240 --> 00:24:47,960 There was an ownership change, you know, some brownfields 435 00:24:47,960 --> 00:24:51,600 drilling that that really proved up, you know, extremely well. 436 00:24:51,880 --> 00:24:54,880 And then lo and behold, they've produced another 20 million oz. 437 00:24:54,880 --> 00:24:59,000 So often it's change of ownership, change of project 438 00:24:59,000 --> 00:25:02,760 scale, you know, doubling, tripling, quadrupling the size 439 00:25:02,760 --> 00:25:05,800 of the mill. As ridiculous as that sounds in 440 00:25:05,800 --> 00:25:08,800 this sort of capital intensity environment, you know, it's, 441 00:25:09,320 --> 00:25:13,040 it's often that ownership change and rescoping the fundamental 442 00:25:13,040 --> 00:25:19,840 size and shape of the project that where you see the 100X plus 443 00:25:20,000 --> 00:25:24,880 returns in the royalty industry. And so even if you look at, you 444 00:25:24,880 --> 00:25:27,280 know, another, another incredible deal that Franco did 445 00:25:27,320 --> 00:25:31,400 historically was they put, I think it was a 2 or $3,000,000 446 00:25:31,400 --> 00:25:36,280 into D2 or like when that asset was effectively being acquired. 447 00:25:37,000 --> 00:25:41,240 So, you know, if you can back acquisition finance for an asset 448 00:25:41,240 --> 00:25:44,680 that's been either forgotten or overlooked and then the new 449 00:25:44,680 --> 00:25:49,280 management team comes in, dusts it off and absolutely, you know, 450 00:25:49,280 --> 00:25:51,560 it might inject a billion or a couple of billion dollars of 451 00:25:51,560 --> 00:25:54,160 capital into it. That's where you get the real 452 00:25:54,160 --> 00:25:56,160 talk. It's not, it's not necessarily 453 00:25:56,160 --> 00:25:59,800 the mind life extension. It's it's that rescoping the the 454 00:25:59,800 --> 00:26:02,920 actual throughput and often through change of ownership. 455 00:26:03,160 --> 00:26:09,240 That's yeah, that's fascinating how the different ways that 456 00:26:09,240 --> 00:26:12,960 royalties actually like come come into existence is is an 457 00:26:12,960 --> 00:26:15,920 area of interest. And and like what you talked 458 00:26:15,920 --> 00:26:19,520 about there is acquisition finance is one method. 459 00:26:20,240 --> 00:26:23,200 Project finance, I imagine is a, is an, is another method of a 460 00:26:23,200 --> 00:26:25,880 single asset developer might not be able to access equity in debt 461 00:26:25,880 --> 00:26:28,160 markets quite enough. Chuck a royalty in there. 462 00:26:29,360 --> 00:26:32,000 Yeah. And so so M and a project 463 00:26:32,000 --> 00:26:37,120 finance distressed balance sheets, I think, I think that's 464 00:26:37,120 --> 00:26:39,480 why Sabani I did their streaming deal last year because they 465 00:26:39,480 --> 00:26:41,680 needed the cash. Franco sure, we'll do that. 466 00:26:42,400 --> 00:26:45,360 What like what are the other way weird ways that that you see 467 00:26:45,360 --> 00:26:47,960 royalties kind of come into existence? 468 00:26:49,520 --> 00:26:54,160 Yeah, so, so before moving to other categories, I think 469 00:26:54,160 --> 00:26:56,920 balance sheet repair is an interesting one and particularly 470 00:26:56,920 --> 00:26:59,960 on the streaming side of of the business, less so on the royalty 471 00:26:59,960 --> 00:27:02,400 side. So if you look at some of the 472 00:27:02,480 --> 00:27:08,480 the highest IRR streams in the industry, most of them came from 473 00:27:08,480 --> 00:27:10,280 balance sheet repair transactions. 474 00:27:10,480 --> 00:27:13,080 So, you know, you may recall Circuit 10 years ago when 475 00:27:13,080 --> 00:27:17,520 Glencore had a mountain of debt. And then, you know, the, the, 476 00:27:17,760 --> 00:27:21,320 the, the, the extremely novelty sized checkbooks from the 477 00:27:21,320 --> 00:27:24,240 streaming industry came out and started writing half half 478 00:27:24,240 --> 00:27:27,760 billion dollar checks, you know, into sort of large silver 479 00:27:27,760 --> 00:27:30,920 streams on assets like antimener and you know, some of these 480 00:27:30,920 --> 00:27:35,560 absolute generational base metal ore bodies to repair the likes 481 00:27:35,560 --> 00:27:39,960 of Glencore's balance sheet. Those streams really have been 482 00:27:39,960 --> 00:27:43,680 the most, the highest IRR streams in the industry and 483 00:27:43,680 --> 00:27:46,200 likewise the balance sheet repair royalties as well. 484 00:27:47,520 --> 00:27:50,400 The other, I guess probably the most common way royalties are 485 00:27:50,400 --> 00:27:55,120 created is, you know, when mineral rights claims, tenements 486 00:27:55,240 --> 00:28:00,400 are farmed out or sold. So, you know, particularly in 487 00:28:00,400 --> 00:28:04,440 Australian or US context or in some other countries where the 488 00:28:04,440 --> 00:28:08,280 individual owns the mineral rights, you know, and let's say 489 00:28:08,280 --> 00:28:13,320 a rancher, you know, in Brazil or Nova or even Nevada sells the 490 00:28:13,360 --> 00:28:15,720 the gold rights to their to their land. 491 00:28:16,920 --> 00:28:19,840 You know, selling the mineral rights and then retaining a 492 00:28:19,840 --> 00:28:21,840 royalty is sort of deferred consideration. 493 00:28:21,960 --> 00:28:25,520 That's the most common way that royalties are typically created. 494 00:28:26,000 --> 00:28:29,840 But the challenge then becomes, how the hell do you find that 495 00:28:29,840 --> 00:28:33,120 landowner or, you know, that salty prospector who lives in a 496 00:28:33,120 --> 00:28:35,080 van doesn't have an e-mail address? 497 00:28:35,680 --> 00:28:40,440 It's a real example. But yeah, so it becomes, you 498 00:28:40,440 --> 00:28:43,600 know, bizarrely, the challenge for the industry for these 499 00:28:43,600 --> 00:28:47,120 forgotten royalties is how do you actually track down who owns 500 00:28:47,120 --> 00:28:49,760 the royalty? So, you know, we, we use private 501 00:28:49,760 --> 00:28:54,080 investigators. We send a lot of snail mail, as 502 00:28:54,080 --> 00:28:56,960 as crazy as that sounds, because there's a number of prospectors 503 00:28:56,960 --> 00:29:01,320 and royalty holders that are basically off grid and the only 504 00:29:01,320 --> 00:29:04,760 way you can reach them is, you know, with a written letter or, 505 00:29:05,120 --> 00:29:07,000 you know, through a a private investigator. 506 00:29:07,000 --> 00:29:11,600 So yeah, that that type of royalty created from mineral 507 00:29:11,600 --> 00:29:14,360 rights being sold, that's probably the the most common 508 00:29:14,360 --> 00:29:17,440 sort of creation mechanism for royalties in the industry. 509 00:29:17,680 --> 00:29:19,360 I think you sort of nailed the other ones. 510 00:29:19,360 --> 00:29:23,280 Project finance is probably the second most common creation sort 511 00:29:23,280 --> 00:29:24,840 of genesis. Yeah. 512 00:29:25,000 --> 00:29:28,040 And when you're in a big company and you sell, sell an asset, you 513 00:29:28,040 --> 00:29:29,720 maybe can't get much for it. You've got to put a royalty on 514 00:29:29,720 --> 00:29:31,960 it to have some insurance. You don't look silly down the 515 00:29:31,960 --> 00:29:33,880 track if the new if the new are going to find something. 516 00:29:34,680 --> 00:29:35,800 You call small. That's everyone. 517 00:29:37,960 --> 00:29:41,520 Yeah, it's a great way to get some schmuck insurance as long 518 00:29:41,520 --> 00:29:43,120 as you don't sell the royalty too early. 519 00:29:43,120 --> 00:29:46,080 And unfortunately I've, I've, you know, having worked at the 520 00:29:46,080 --> 00:29:49,040 big end of town, I've, I've seen, you know, that schmuck 521 00:29:49,040 --> 00:29:52,080 insurance created sometimes and then, you know, sold too 522 00:29:52,080 --> 00:29:55,840 cheaply, unfortunately. On the, the earlier point that's 523 00:29:55,840 --> 00:29:58,800 really counter cyclical investing the the Glencore 524 00:29:58,800 --> 00:30:02,760 example you gave when they're in a real pinch point, you know, 525 00:30:02,760 --> 00:30:06,080 indebted up to the hilt and they need to get cash on board. 526 00:30:06,080 --> 00:30:09,280 How do you how do you think about counter cyclical investing 527 00:30:09,280 --> 00:30:11,760 given that you know, you spend a lot of time looking at the 528 00:30:11,760 --> 00:30:14,800 precious metal space Gold has done phenomenally well over the 529 00:30:14,800 --> 00:30:19,800 past couple years. Those more counter cyclical type 530 00:30:19,800 --> 00:30:22,480 deals would be a bit harder to come by, right? 531 00:30:25,400 --> 00:30:31,400 You'd be surprised, I think, you know, royalty holders are still, 532 00:30:31,760 --> 00:30:34,560 you know, subject to the same whims and emotions as everyone 533 00:30:34,560 --> 00:30:37,560 else. And you know, depending on what 534 00:30:37,560 --> 00:30:40,000 types of royalties you're, you're creating, like which of 535 00:30:40,000 --> 00:30:43,000 those you know, whether it's project finance or historical 536 00:30:43,000 --> 00:30:47,560 prospect or royalty, you know, there are, there are, you know, 537 00:30:48,080 --> 00:30:52,720 plentiful opportunities to acquire royalties in troughs in 538 00:30:52,720 --> 00:30:58,360 certain commodities. So you know for example, you 539 00:30:58,360 --> 00:31:01,000 know, when we speak to people about lithium royalties or 540 00:31:01,000 --> 00:31:06,200 Palladium royalties today, you know, relative to two years ago, 541 00:31:07,160 --> 00:31:12,080 you know it's night and day. So yeah, I think the fact that 542 00:31:12,520 --> 00:31:16,920 there is effectively no holding cost on a royalty means that 543 00:31:17,080 --> 00:31:20,480 there are close to perfect counter cyclical investment 544 00:31:20,480 --> 00:31:24,760 instrument because you can buy a royalty when the price is in the 545 00:31:24,760 --> 00:31:27,360 doldrums and put in the bottom drawer. 546 00:31:27,800 --> 00:31:32,240 And then you know, hopefully you know that commodity price, that 547 00:31:32,240 --> 00:31:35,360 metal price main reverts and happy days. 548 00:31:36,160 --> 00:31:38,760 But obviously, you need to make sure that you're buying a 549 00:31:38,760 --> 00:31:41,440 royalty on on an asset that's at the right point in the cost 550 00:31:41,440 --> 00:31:43,760 curve. Yeah, I'd never thought of the 551 00:31:43,760 --> 00:31:47,760 fact they have no holding costs. That's actually like a food. 552 00:31:47,760 --> 00:31:49,720 Food for. Thought the only, the only one 553 00:31:49,720 --> 00:31:54,840 caveat I should say on that is like the only way typically or 554 00:31:54,840 --> 00:31:56,960 sorry, I guess there's two ways that a royalty can be zeroed 555 00:31:56,960 --> 00:32:00,080 out. One is if the mining company 556 00:32:00,120 --> 00:32:05,280 relinquishes the tenements. The other one is if the mining 557 00:32:05,280 --> 00:32:07,880 company ultimately disputes the royalty legally. 558 00:32:08,480 --> 00:32:11,280 But you know, put that to one side, assuming you've done your 559 00:32:11,280 --> 00:32:15,360 proper legal due diligence, like I guess there's no holding cost 560 00:32:15,360 --> 00:32:19,600 on a royalty insofar as the mining company doesn't give the 561 00:32:19,600 --> 00:32:22,760 tenements back to the actual state, which would only 562 00:32:22,760 --> 00:32:25,720 typically happen if there's there's no buyer for those those 563 00:32:25,720 --> 00:32:28,080 tenements. So it's a pretty sort of rare, 564 00:32:28,120 --> 00:32:29,400 rare event. So you don't want to buy 565 00:32:29,400 --> 00:32:31,120 royalties on absolute junk, can you? 566 00:32:32,040 --> 00:32:34,560 Because. It will be really good. 567 00:32:34,600 --> 00:32:36,600 Gotcha. Yeah, or, or or, you know, you 568 00:32:36,600 --> 00:32:39,840 need to be careful also like if the company, if the operator 569 00:32:39,840 --> 00:32:43,280 goes into administration, this gets into the weeds. 570 00:32:43,280 --> 00:32:46,560 But you need to be sure that the royalty runs with the land and 571 00:32:46,560 --> 00:32:49,360 can be secured in the event of administration. 572 00:32:49,360 --> 00:32:53,600 But yeah, so, but generally speaking, it's if you don't buy 573 00:32:53,680 --> 00:32:57,080 a lot of moose pasture royalties with dodgy operators, you're 574 00:32:57,280 --> 00:33:01,160 probably in in good shape. Spencer, there were some pretty 575 00:33:01,160 --> 00:33:05,720 big themes coming out of 2024 in In Your World of royalties. 576 00:33:05,720 --> 00:33:07,840 And I'm came to chat through a couple of them. 577 00:33:08,000 --> 00:33:11,760 You sort of mentioned with a bit of experience the offloading of 578 00:33:11,760 --> 00:33:16,560 these, you know, non core royalties out of, you know, you 579 00:33:16,560 --> 00:33:18,480 know, some of the big companies you worked with. 580 00:33:18,480 --> 00:33:21,480 But it it was a trend across a number of companies last year 581 00:33:21,480 --> 00:33:25,320 with near on a billion dollars in transactions happening. 582 00:33:25,320 --> 00:33:28,120 Is is that something you see continuing? 583 00:33:28,120 --> 00:33:31,080 And can you sort of dig into just briefly the, the rationale 584 00:33:31,080 --> 00:33:34,720 behind the, you know, the liquidation of these royalties? 585 00:33:36,280 --> 00:33:41,560 Yeah, absolutely, JD. So you know there's a lot of 586 00:33:41,560 --> 00:33:46,360 major mining companies or large mid caps that end up with sort 587 00:33:46,360 --> 00:33:49,800 of stranded portfolios of royalties as you're sort of 588 00:33:49,800 --> 00:33:53,640 alluding to. Yeah, last year we did see sort 589 00:33:53,640 --> 00:33:56,920 of close to a billion dollars of secondary royalties traded. 590 00:33:58,000 --> 00:34:01,920 There still are, you know, a number of quite a large quantum 591 00:34:01,920 --> 00:34:05,480 of royalties held within mining companies. 592 00:34:06,720 --> 00:34:10,920 You know, I think as the broader mining industry has sort of, you 593 00:34:10,920 --> 00:34:13,840 know, understood more about the sort of option value of 594 00:34:13,840 --> 00:34:19,280 royalties, you've seen more large cap miners include 595 00:34:19,280 --> 00:34:22,719 royalties as part of sort of divestment or sale proceeds when 596 00:34:22,719 --> 00:34:25,400 they're selling assets. So I think you will see that the 597 00:34:25,400 --> 00:34:28,560 trend of majors creating royalties continue. 598 00:34:29,679 --> 00:34:33,560 You know, if you look at BHP effectively gave away a 2 599 00:34:33,560 --> 00:34:37,719 million oz project in Brazil, the central gold asset just for 600 00:34:37,880 --> 00:34:40,840 a 1% NSR. So, you know, I think the major 601 00:34:40,840 --> 00:34:44,600 miners do realize the value in these royalties G mining. 602 00:34:44,679 --> 00:34:46,760 Picked that up. Yeah, that was the one that came 603 00:34:46,760 --> 00:34:49,880 out of Oscar was Oscar was. Oscar Minerals, Yeah, I think I 604 00:34:49,880 --> 00:34:52,679 tried to sell it, yeah, in the past, but couldn't get much, 605 00:34:52,719 --> 00:34:57,160 yeah. So, yeah, so look, it typically 606 00:34:57,160 --> 00:34:59,840 these are the completely orphaned assets internally. 607 00:34:59,840 --> 00:35:03,680 And you know, when I was with BHP in South 32, it was less so 608 00:35:03,680 --> 00:35:08,760 S 32 more so BHP that, you know, we LED this project essentially 609 00:35:08,760 --> 00:35:11,440 trying to find all these bottom, bottom drawer royalty contracts. 610 00:35:11,440 --> 00:35:14,880 And you know, they they either come from divestments or you 611 00:35:14,880 --> 00:35:18,920 acquire a company like BHP bought WMC and WMC were 612 00:35:18,920 --> 00:35:22,080 brilliant in the 90s when they were divesting all their gold 613 00:35:22,080 --> 00:35:25,560 assets. They always kept a royalty and 614 00:35:25,560 --> 00:35:29,240 so, so you know you've got some of these companies, you know, 615 00:35:29,760 --> 00:35:34,440 I've got a lot of respect for WMC that in their DNA, you know 616 00:35:34,480 --> 00:35:37,280 they understood the value of royalties, so they created a lot 617 00:35:37,280 --> 00:35:40,840 of them. So you know, I think when will 618 00:35:40,840 --> 00:35:43,840 these major miners, when will large the various miners are 619 00:35:43,840 --> 00:35:46,240 still on royalty portfolios sell them. 620 00:35:46,560 --> 00:35:50,880 A lot of it comes down to our esteemed beam counters and you 621 00:35:50,880 --> 00:35:54,560 know, when the CFO has a 50 to $200 million holder plug on 622 00:35:54,560 --> 00:35:57,720 there, you know, for their annual cash flow or their 623 00:35:57,920 --> 00:36:00,800 balance sheet, they'll say, oh, don't we own those royalties? 624 00:36:01,000 --> 00:36:04,840 Can we flip those to, to some sucker for, you know, 50 to 200 625 00:36:04,840 --> 00:36:07,160 million. So a lot of it's sort of 626 00:36:07,160 --> 00:36:09,640 influenced by filling cash holes. 627 00:36:09,800 --> 00:36:12,000 That matches the balance sheet, that matches the divestment of 628 00:36:12,000 --> 00:36:15,640 South 32's royalty portfolios and also Anglo's divestment. 629 00:36:18,640 --> 00:36:21,920 In their in their defence, though, shareholders just don't 630 00:36:21,920 --> 00:36:27,040 really care an awful lot about a couple royalties within a 20 to 631 00:36:27,040 --> 00:36:30,960 $200 billion company, do they? But then they're not really 632 00:36:30,960 --> 00:36:33,400 getting much value. From royalty to pay through the 633 00:36:33,400 --> 00:36:34,480 roof for it. Yeah. 634 00:36:34,480 --> 00:36:37,080 And royalties will see the value, like you said, if they're 635 00:36:37,080 --> 00:36:40,320 going to get marked 20X on the, on the cash flow of some of 636 00:36:40,320 --> 00:36:44,400 these, then it's, you know, it's the kind of financial type of 637 00:36:44,400 --> 00:36:47,280 engineering or whatever you call it that the people on the 638 00:36:47,280 --> 00:36:49,840 finance side love. But it really goes back to what 639 00:36:49,840 --> 00:36:53,960 you were saying before, that you need a balance of geological 640 00:36:53,960 --> 00:36:56,960 knowledge as well as financial knowledge to understand the the 641 00:36:56,960 --> 00:36:59,720 true value of a lot of these royalties. 642 00:37:00,280 --> 00:37:01,920 I'd love to ask. Yeah, two of them. 643 00:37:02,400 --> 00:37:06,240 Two of the WMC 1 Spencer, one of one of them. 644 00:37:06,880 --> 00:37:09,280 One of them you're about to ask about Trev, but go on. 645 00:37:09,480 --> 00:37:11,640 So the the I'm not going to, I'm going to ask about the other 646 00:37:11,640 --> 00:37:14,120 one. So the one I want to ask about 647 00:37:14,120 --> 00:37:16,200 is when I actually only learned about it recently. 648 00:37:16,200 --> 00:37:21,440 But so there was like the, the royalty, the infamous Morgan 649 00:37:21,440 --> 00:37:25,840 Stanley royalties that that haunted WA kind of gold, gold 650 00:37:25,840 --> 00:37:29,880 companies that this was like these were royalties put in 651 00:37:29,880 --> 00:37:33,680 place in 1991 by WMC. But smart folks at Morgan 652 00:37:33,680 --> 00:37:38,320 Stanley commodities, a portfolio of the they will have the same 653 00:37:38,400 --> 00:37:42,280 royalty I think in 2002. And the way it was, was 654 00:37:42,280 --> 00:37:48,880 structured was an unindexed royalty, 4% net smell to return 655 00:37:48,880 --> 00:37:54,240 with an additional price participation at 10% of, of, of 656 00:37:54,360 --> 00:37:58,800 any gold price above $600.00 Australian per oz. 657 00:37:59,960 --> 00:38:03,120 That's an amazing royalty to own because gold grass has just like 658 00:38:03,120 --> 00:38:05,040 trended N over time. And all of a sudden, you know, 659 00:38:05,200 --> 00:38:08,760 like you just get 10% of that price capture into perpetuity. 660 00:38:09,960 --> 00:38:12,720 How like, like surely that's like just an unknown pitfall. 661 00:38:12,720 --> 00:38:14,320 You don't structure royalties like that anymore. 662 00:38:14,320 --> 00:38:18,880 But what's your understanding of like that royalty and the the 663 00:38:18,880 --> 00:38:23,640 kind of impact it had? Yeah, this sort of brings up, 664 00:38:24,000 --> 00:38:26,840 you know, I guess a few questions around, you know, 665 00:38:26,840 --> 00:38:30,800 what's sustainable from a royalty percentage or burden 666 00:38:31,160 --> 00:38:36,400 generally. So, you know, WMC, they 667 00:38:36,400 --> 00:38:39,320 structured a number of gold royalties with price linked 668 00:38:39,320 --> 00:38:42,600 escalators historically. That's that's on the public 669 00:38:42,600 --> 00:38:47,080 record. I think, you know, when gold's 670 00:38:47,080 --> 00:38:51,360 at 23400 bucks, who could possibly imagine that it's going 671 00:38:51,360 --> 00:38:55,920 to double. So it's not not only is it sort 672 00:38:55,920 --> 00:38:59,000 of schmuck insurance, it's schmuck insurance with, you 673 00:38:59,000 --> 00:39:01,360 know, an escalating clause type thing. 674 00:39:01,360 --> 00:39:07,920 But yeah, I think in that that world is specifically and more 675 00:39:07,920 --> 00:39:12,280 generally, I think once you start to see a royalty 676 00:39:12,400 --> 00:39:16,200 overburdening the asset and, you know, directly impacting 677 00:39:16,400 --> 00:39:19,960 operators willingness to drill, you know, develop or expand an 678 00:39:19,960 --> 00:39:25,240 asset, it's this bad business. And so unfortunately, this whole 679 00:39:25,240 --> 00:39:29,880 large swathes of that Morgan Stanley royalty ground that were 680 00:39:29,880 --> 00:39:35,320 effectively sterilized for, you know, over a decade at least 681 00:39:36,240 --> 00:39:38,560 because of how hefty that royalty was. 682 00:39:38,840 --> 00:39:43,040 So hats off to the Morgan Stanley team for for picking 683 00:39:43,040 --> 00:39:45,600 that royalty up. What did what did they pay for 684 00:39:45,600 --> 00:39:46,440 it? And what have it like? 685 00:39:46,520 --> 00:39:48,840 Have you ever done the numbers on what that what their returns 686 00:39:48,840 --> 00:39:52,400 must have been on that? I No, I haven't. 687 00:39:52,400 --> 00:39:54,240 I haven't. I'd be talking out of school, to 688 00:39:54,240 --> 00:39:56,880 be honest. Trav yeah, I can speculate. 689 00:39:56,880 --> 00:40:00,360 But yeah, the most recent iteration, I guess of that 690 00:40:00,440 --> 00:40:05,360 specific royalty was just with. In and around Higginsville and 691 00:40:05,480 --> 00:40:09,760 and Beta Hunt where it was obviously restructured but but 692 00:40:09,760 --> 00:40:12,800 no like I'm sure was a great deal for Morgan Stanley. 693 00:40:12,800 --> 00:40:16,400 But when you think about the cumulative oz and and 694 00:40:16,400 --> 00:40:20,400 exploration that you know that that royalty sterilized in WA, 695 00:40:20,400 --> 00:40:23,480 it was it's probably quite substantial, although you know 696 00:40:23,640 --> 00:40:26,960 somewhat amusingly that WA government's probably in Morgan 697 00:40:26,960 --> 00:40:30,120 Stanley's debt because it means that gold's being mined at you 698 00:40:30,120 --> 00:40:33,560 know, 4400 bucks an ounce instead of 1000 bucks an ounce. 699 00:40:33,600 --> 00:40:34,920 Exactly. Yeah, exactly. 700 00:40:35,720 --> 00:40:43,360 Yeah, yeah, I it's it's I'd I'd love to own that royalty if I if 701 00:40:43,360 --> 00:40:45,720 I couldn't almost stand if you've got any, any left, I'll 702 00:40:45,720 --> 00:40:50,600 I'll happily be gifted one Yeah. And then the the other funky 703 00:40:50,600 --> 00:40:54,240 kind of like WMC. They must have just had yeah 704 00:40:54,280 --> 00:40:57,800 like real now so at them. But these royalties always been 705 00:40:57,800 --> 00:41:00,400 kind of part of their, their deal making, which is wicked. 706 00:41:00,880 --> 00:41:04,720 But they, the one that came into focus last year was a royalty 707 00:41:04,720 --> 00:41:07,200 linked to the use of a drill database. 708 00:41:07,200 --> 00:41:09,800 They had this like drill database from I think diamond 709 00:41:09,800 --> 00:41:16,240 exploration and and I think IGO had some agreement with them 710 00:41:16,360 --> 00:41:18,600 that they could access the database. 711 00:41:18,640 --> 00:41:22,520 And if that database access led to a discovery, then there would 712 00:41:22,520 --> 00:41:24,760 be an applicable royalty on that discovery. 713 00:41:24,760 --> 00:41:27,960 And then it became kind of contentious last year when S S 714 00:41:27,960 --> 00:41:32,800 32 had had basically suggested that Tropicana, Tropicana, you 715 00:41:32,880 --> 00:41:35,160 know, is entitled to to to that royalty. 716 00:41:35,640 --> 00:41:37,320 That's a kind of a funky different structure, but. 717 00:41:37,920 --> 00:41:40,760 It's hard to pay that. Yeah, yeah, yeah, yeah, yeah, 718 00:41:40,800 --> 00:41:43,760 yeah, yeah. Which wouldn't be great for IGO 719 00:41:43,840 --> 00:41:47,200 and Regis, but yeah. Yeah. 720 00:41:47,200 --> 00:41:50,440 I mean, look, it's an interesting example where you 721 00:41:50,440 --> 00:41:53,280 can create royalties through a number of different methods. 722 00:41:53,280 --> 00:41:56,760 You don't only need to sell tenements in that case, you 723 00:41:56,760 --> 00:42:02,200 know, WMC had, you know, one of the most prolific geochem sort 724 00:42:02,200 --> 00:42:05,200 of databases, you know, in Australia or probably in 725 00:42:05,200 --> 00:42:10,400 Australian geoscience history. So, you know, that's a piece of 726 00:42:10,400 --> 00:42:14,880 IP that has, you know, infinite future value. 727 00:42:14,880 --> 00:42:18,600 So creating a royalty structure on the back of that, I think 728 00:42:18,600 --> 00:42:22,400 it's brilliant. And so, you know, it's, it's not 729 00:42:22,400 --> 00:42:26,360 dissimilar to to, you know, in the Pharmaceutical industry, if 730 00:42:26,360 --> 00:42:30,760 someone comes up with a new sort of, you know, formula that can 731 00:42:30,760 --> 00:42:33,880 be the base of a number of different vaccines, you know, 732 00:42:33,880 --> 00:42:38,320 getting a royalty on that, you know, that's that it's very 733 00:42:38,320 --> 00:42:40,720 comparable. Like if you create some some 734 00:42:40,720 --> 00:42:45,960 valuable IPA royalty is a perfect way to sort of extract 735 00:42:46,240 --> 00:42:49,640 rental value where you don't even know what the future use 736 00:42:49,640 --> 00:42:54,400 cases could possibly be. So, yeah, look, I'm having been 737 00:42:54,720 --> 00:42:57,760 at South 32 for a number of years and a lot of friends that 738 00:42:57,760 --> 00:43:01,680 are still, you know, at South 32, I'm obviously, you know, 739 00:43:01,720 --> 00:43:07,080 very invested in how that one plays out, you know, very strong 740 00:43:07,080 --> 00:43:09,280 team at South 32. So I'm sure they've got their 741 00:43:09,280 --> 00:43:12,320 fact base fairly well put together. 742 00:43:12,320 --> 00:43:15,800 But here we'll have to wait and see how that one, how the chips 743 00:43:15,800 --> 00:43:18,400 fall on that one. I think we should touch on 744 00:43:18,560 --> 00:43:21,920 briefly why there's a bit of a, you know, a relative lack of a 745 00:43:21,960 --> 00:43:26,440 royalty sector in Australia. Obviously, like you've said, 746 00:43:26,440 --> 00:43:29,920 heaps of royalties over assets here in Australia. 747 00:43:29,920 --> 00:43:32,320 But when it comes to the big companies you mentioned earlier, 748 00:43:32,320 --> 00:43:36,000 Trev, they're not listed here. We've got the terror, but the, 749 00:43:36,000 --> 00:43:39,640 you know, the combined market cap of ASX listed royalties is 750 00:43:39,640 --> 00:43:42,280 relatively small. So it'd be worth you just 751 00:43:42,760 --> 00:43:45,880 glossing over why, why you think that sort of is, and why the 752 00:43:45,880 --> 00:43:50,840 market formed that way. Yeah, it's one of the most 753 00:43:50,840 --> 00:43:54,800 common questions we get from investors, JD, is why isn't 754 00:43:54,800 --> 00:43:58,360 there, you know, a sort of a royalty industry on the ASX and 755 00:43:59,480 --> 00:44:05,200 you know, why, why is it sort of a bit of a forgotten sector, you 756 00:44:05,200 --> 00:44:07,760 know, until I guess the terror hit the market. 757 00:44:09,280 --> 00:44:13,320 Look, something I've given countless hours of thought over. 758 00:44:13,520 --> 00:44:17,920 I don't think there is anyone sort of logical reason for it. 759 00:44:17,920 --> 00:44:22,880 I think there was an element of first mover advantage in, you 760 00:44:22,880 --> 00:44:25,840 know the likes of Toronto and North America generally where 761 00:44:26,200 --> 00:44:31,640 you know, you had the likes of Franco and Royal Gold just 762 00:44:31,960 --> 00:44:34,880 aggressively mopping up royalties, you know, in 763 00:44:34,880 --> 00:44:37,240 Australia, you know, and globally. 764 00:44:38,040 --> 00:44:42,640 And so if you look at some of the largest royalties by sort of 765 00:44:42,640 --> 00:44:47,200 square kilometre coverage in Australia, a number of them are 766 00:44:47,200 --> 00:44:50,600 owned by Franco and Royal. And so it's a. 767 00:44:50,640 --> 00:44:54,840 Pretty big run out by Gina. Yeah. 768 00:44:54,840 --> 00:44:57,280 So, well, but I mean, particularly royalties that have 769 00:44:57,400 --> 00:45:00,160 that have sort of transacted, yeah. 770 00:45:01,200 --> 00:45:04,040 But yeah, I mean, Gina's no stranger to royalty checks, 771 00:45:04,040 --> 00:45:08,880 obviously, but so, but yeah, no, going back to why, why have 772 00:45:09,000 --> 00:45:10,560 hasn't there been more of an industry? 773 00:45:12,000 --> 00:45:18,040 Yeah, I think it's just that people started to make from when 774 00:45:18,040 --> 00:45:22,040 Franco came out of the gates in 2007 on on equity markets, you 775 00:45:22,040 --> 00:45:24,240 know, it was up and to the right, the share price chart. 776 00:45:24,520 --> 00:45:27,280 And so as you know, they were successful. 777 00:45:27,600 --> 00:45:31,000 It sort of created, you know, it was a bit of a self fulfilling 778 00:45:31,000 --> 00:45:32,920 prophecy in North American equity markets. 779 00:45:33,160 --> 00:45:35,760 More royalty companies were created in North America trying 780 00:45:35,760 --> 00:45:38,640 to replicate that same success and that same multiple and 781 00:45:38,640 --> 00:45:41,880 investors were recycling capital that they that made from 782 00:45:41,880 --> 00:45:44,640 Franco's appreciation. So I think it was this, this 783 00:45:44,640 --> 00:45:51,360 sort of, you know, this this virtuous cycle that was heavily 784 00:45:51,360 --> 00:45:56,560 North American centric and that ecosystem was picking off 785 00:45:56,640 --> 00:46:00,960 Australian royalties, you know, over, over that, that history. 786 00:46:00,960 --> 00:46:05,040 So yeah, there were a couple of attempts, you know, we speak to 787 00:46:05,040 --> 00:46:08,160 different entrepreneurs around the traps and they said, oh, I 788 00:46:08,160 --> 00:46:11,600 tried to launch a royalty company in Oz 10 years ago, but 789 00:46:12,040 --> 00:46:14,600 investors couldn't understand why I should, you know, they 790 00:46:14,600 --> 00:46:18,760 should value it at 20 times when BHP trades at 7 times. 791 00:46:18,960 --> 00:46:22,520 And look, I think that's sort of lack of understanding around the 792 00:46:22,520 --> 00:46:25,960 option value in royalties is part of the equation where you 793 00:46:25,960 --> 00:46:29,880 know, let's say you started, you built a royalty portfolio in 794 00:46:29,880 --> 00:46:32,480 Australia 10 years ago. Where are you going to go? 795 00:46:32,480 --> 00:46:37,200 You're going to list on the ASX where instos don't understand 796 00:46:37,200 --> 00:46:40,400 the valuation dynamics as well? Or are you going to go to North 797 00:46:40,400 --> 00:46:46,000 America where the same size institutions have made 3X4X5X on 798 00:46:46,000 --> 00:46:49,200 Franco already and they've got extra change in their back 799 00:46:49,200 --> 00:46:51,600 pocket to fund your new royalty company. 800 00:46:51,600 --> 00:46:55,440 So I think part of it is that the capital, you know, there's 801 00:46:55,440 --> 00:46:57,640 been momentum in the capital markets in North America and 802 00:46:57,640 --> 00:47:01,240 it's just been an easier proposition to, to, to insert 803 00:47:01,240 --> 00:47:04,560 new companies into that slipstream and not have to deal 804 00:47:04,560 --> 00:47:08,120 with educating capital markets that haven't profited from that 805 00:47:08,120 --> 00:47:11,920 industry, which I think, you know, for companies like the 806 00:47:11,920 --> 00:47:15,000 Terra, that's the challenge is. And you know, we've got some 807 00:47:15,320 --> 00:47:18,200 investors in Australia, but you know, some new investors in 808 00:47:18,200 --> 00:47:22,440 Australia say, well, I can buy Fortescue at 8 * 9 times. 809 00:47:22,720 --> 00:47:25,920 You know, why would I buy a senior royalty company at, you 810 00:47:25,920 --> 00:47:28,120 know, 20 to 30 times? It's so. 811 00:47:28,400 --> 00:47:31,760 It's so fascinating and and kind of counter intuitive what what 812 00:47:31,760 --> 00:47:34,640 you're saying there, because on the other side of that, we see 813 00:47:34,640 --> 00:47:37,280 mining companies come and list here in Australia because 814 00:47:37,280 --> 00:47:40,240 they're like Aussies and the ASX get mining. 815 00:47:40,280 --> 00:47:43,120 They understand that there's still relative to other 816 00:47:43,120 --> 00:47:45,880 countries around the world, dedicated mining, investment 817 00:47:45,880 --> 00:47:48,520 funds and these sorts of things. So as a miner, you, you'll come 818 00:47:48,520 --> 00:47:51,080 here to get a better multiple, you know, especially comparing 819 00:47:51,080 --> 00:47:53,480 to the LSE and these things. I think it's linked. 820 00:47:54,040 --> 00:47:56,360 I reckon it's I think, I think you you come and list in 821 00:47:56,360 --> 00:48:00,000 Australia because we have like greater access to equity capital 822 00:48:00,040 --> 00:48:02,080 markets. Our like you know, the the 823 00:48:02,160 --> 00:48:06,320 forthcomingness of investors to provide equity capital is what 824 00:48:06,320 --> 00:48:07,400 it's actually way better than Canada. 825 00:48:07,400 --> 00:48:10,480 I think, correct me if I'm wrong, Spencer, but I think I 826 00:48:10,480 --> 00:48:12,920 think like you know, the equity checks come a lot easier on the 827 00:48:12,920 --> 00:48:17,120 ASX and they do in in your neck of the woods and as a result. 828 00:48:17,120 --> 00:48:20,200 Being a, as a result, being a proud Australian, I, I feel like 829 00:48:20,200 --> 00:48:23,440 I can say this, there's probably more of a, a gambling culture, 830 00:48:23,520 --> 00:48:25,320 yeah, there's more degenerate gamblers in. 831 00:48:25,320 --> 00:48:29,760 Australia way more, yeah. Well, love making having a punt. 832 00:48:29,760 --> 00:48:33,200 So yeah, no, but I think Trevor, I think you've hit the nail on 833 00:48:33,200 --> 00:48:35,520 the head there. Like I think as with any 834 00:48:35,640 --> 00:48:38,800 industry, whether it's tech in Silicon Valley or, you know, 835 00:48:38,800 --> 00:48:42,720 mining in part in Australia, it's where is the, the largest 836 00:48:42,720 --> 00:48:46,160 sort of pool of risk capital at the lowest possible cost. 837 00:48:47,160 --> 00:48:51,880 And if investors don't believe a certain valuation paradigm, say 838 00:48:51,880 --> 00:48:55,240 in the royalty industry or in African gold producers or you 839 00:48:55,240 --> 00:48:58,760 name the sub sector, you know, if there's not sufficient risk 840 00:48:58,760 --> 00:49:01,280 capital or it's at the wrong price, you'll just go to a 841 00:49:01,280 --> 00:49:04,360 different capital market. So, you know, that's probably a 842 00:49:04,640 --> 00:49:06,520 quarter. Why isn't there a royalty 843 00:49:06,520 --> 00:49:09,360 industry here? And why is this such a thriving 844 00:49:09,560 --> 00:49:12,960 mining industry in in Oz still? Yeah, Yeah. 845 00:49:12,960 --> 00:49:16,840 Like why would you put a royalty on your on your project if you 846 00:49:16,840 --> 00:49:20,600 could just raise capital in the company level instead in 847 00:49:20,600 --> 00:49:23,640 general, you know, assuming you don't have egregious pricing 848 00:49:24,040 --> 00:49:27,240 dynamic supply, But yeah. But but I still think, you know, 849 00:49:27,440 --> 00:49:30,600 the mining investment funds understand how hard mining is, 850 00:49:30,760 --> 00:49:32,200 yes. And they understand that a 851 00:49:32,200 --> 00:49:37,120 royalty is a Better Business. Like it's just it's a kind of 852 00:49:37,120 --> 00:49:39,360 interesting feature of the the market. 853 00:49:40,600 --> 00:49:42,800 Yeah. I think also, and this is maybe 854 00:49:42,800 --> 00:49:46,800 a more left of centre perspective, but there's a 855 00:49:46,800 --> 00:49:51,240 natural friction between specialist lining funds and 856 00:49:51,240 --> 00:49:55,800 royalty companies in the sense that royalty companies are, you 857 00:49:55,800 --> 00:49:58,480 know, capital allocators by nature. 858 00:49:59,120 --> 00:50:02,840 And so they're almost in, yeah, correct. 859 00:50:02,840 --> 00:50:05,320 It's effective a listed investment company. 860 00:50:05,320 --> 00:50:09,680 But if you're, you know, a discretionary, you know, APM at 861 00:50:09,680 --> 00:50:13,640 a mining fund, you're charging fees on the basis that you're 862 00:50:13,640 --> 00:50:17,320 picking the right mining assets. And so the minute you put 863 00:50:17,320 --> 00:50:20,680 capital into a royalty company, you're effectively becoming a 864 00:50:20,680 --> 00:50:24,640 quasi fund of funds. You know that it's sort of a 865 00:50:24,640 --> 00:50:28,000 little bit derivative, but that is the way that some, you know, 866 00:50:28,080 --> 00:50:30,280 mining PMS view the royalty industries. 867 00:50:30,480 --> 00:50:33,840 Well, I can pick my own assets, you know, directly and directly 868 00:50:33,840 --> 00:50:36,040 invest in them. So I don't need the portfolio 869 00:50:36,040 --> 00:50:40,600 approach of a royalty company. So that is some pushback from 870 00:50:40,600 --> 00:50:44,480 some mining PMS. But you know, for every one of 871 00:50:44,480 --> 00:50:47,320 those, there's, there's, there's plenty of other investors that 872 00:50:47,320 --> 00:50:50,120 are, you know, very excited to invest in the royalty industry. 873 00:50:50,720 --> 00:50:55,240 That touches on like a yeah, another development in the, in 874 00:50:55,240 --> 00:50:58,920 the royalty space and that's like, you know, hedge funds who 875 00:50:58,920 --> 00:51:03,720 participate a lot in, in the, the equity participation of, of 876 00:51:03,800 --> 00:51:06,560 junior mining. Like here in Australia, Regal, 877 00:51:06,800 --> 00:51:10,320 Regal Regal started their own royalty fund a few years ago. 878 00:51:10,320 --> 00:51:14,440 They, they also acquired 50% of Taurus more kind of private 879 00:51:14,440 --> 00:51:17,480 equity project financing, but they had a big royalty portfolio 880 00:51:17,480 --> 00:51:19,840 themselves. You know, I'll probably see some 881 00:51:20,000 --> 00:51:22,760 synergies with that, but there's that, but also emergence of the 882 00:51:23,000 --> 00:51:25,960 new players in the royalty market who aren't, you know, a 883 00:51:25,960 --> 00:51:30,360 listed, a listed royalty company per SE, but they are instead, 884 00:51:31,480 --> 00:51:34,320 yeah, investment managers, fund managers or, or or private 885 00:51:34,320 --> 00:51:36,680 equity who are, who are bolting together these portfolios. 886 00:51:36,880 --> 00:51:40,840 What's the what's the rationale for for them you say in in doing 887 00:51:40,840 --> 00:51:44,280 this? Look, I'm, you know, talking a 888 00:51:44,280 --> 00:51:47,320 little bit out of school here, given I'm, you know, not on the 889 00:51:47,320 --> 00:51:50,880 buy side per SE. But you know, I think if you 890 00:51:50,880 --> 00:51:54,360 look at most asset management shops, you know, whether they're 891 00:51:54,360 --> 00:51:58,440 private, public equity, hedge fund or something else in 892 00:51:58,440 --> 00:52:01,880 between, you know, you've got to be good at two things. 893 00:52:02,160 --> 00:52:05,680 One, you've got to be good at sourcing deals and investments 894 00:52:05,680 --> 00:52:08,920 and vetting them and, you know, actually allocating the capital. 895 00:52:08,920 --> 00:52:10,720 That's obvious. The other thing you've got to be 896 00:52:10,720 --> 00:52:14,440 good at is raising money and, you know, bringing the money 897 00:52:14,440 --> 00:52:16,920 into the door so you can invest it and get it out the door. 898 00:52:17,120 --> 00:52:19,360 You're not saying they're just trying to offer a new product, 899 00:52:19,360 --> 00:52:24,360 are you? Well, JD, that's a fairpoint. 900 00:52:24,360 --> 00:52:25,400 I think there's the element of that. 901 00:52:25,400 --> 00:52:30,000 But I think, you know, there are some synergies where if you are 902 00:52:30,000 --> 00:52:32,400 offering a credit product through your credit fund and 903 00:52:32,400 --> 00:52:36,400 then, you know, maybe there's a royalty kicker, maybe you know, 904 00:52:36,400 --> 00:52:40,120 your credit, your lending ratios are maxed out with that issuer. 905 00:52:40,280 --> 00:52:44,520 But hey, an extra 1% royalty, you know, doesn't sort of breach 906 00:52:44,520 --> 00:52:47,400 covenants and you know, you can slot that into your royalty 907 00:52:47,400 --> 00:52:50,800 fund. But likewise, you know, if you 908 00:52:50,800 --> 00:52:54,320 have access to proprietary deal flow and you know, if you have 909 00:52:54,320 --> 00:52:58,160 access to capital, you know, the more that you can keep that sort 910 00:52:58,160 --> 00:53:01,600 of flywheel spinning, whether that's requiring other asset 911 00:53:01,600 --> 00:53:04,720 managers or, you know, spinning up extra funds. 912 00:53:05,520 --> 00:53:09,160 Happy days. You know, we're, we're obviously 913 00:53:09,360 --> 00:53:12,960 at the smaller end of town as a, you know, $200 million Aussie 914 00:53:12,960 --> 00:53:18,360 company, you know, US 1:20-ish. You know, we're essentially in a 915 00:53:18,360 --> 00:53:21,760 similar business of allocating capital investors investments, 916 00:53:22,000 --> 00:53:25,560 but then also attracting investors to buy, you know, our 917 00:53:25,560 --> 00:53:29,000 listed, our listed stock. So yeah, I think if you can 918 00:53:29,000 --> 00:53:33,720 marry those two ends of ends of the like 2 barbells and scale it 919 00:53:33,720 --> 00:53:37,120 up, you know, logically, you know, all power to I've. 920 00:53:38,240 --> 00:53:43,360 Got yeah, 22 last questions for you, Spencer, as a as someone 921 00:53:43,360 --> 00:53:46,160 who has probably studied plenty of mining history as a result of 922 00:53:46,160 --> 00:53:50,520 looking at the the deals that created royalties, worst, worst 923 00:53:50,520 --> 00:53:57,120 deal you've come across? Worst, Worst royalty deal, do 924 00:53:57,120 --> 00:53:57,720 you mean? Yeah. 925 00:53:57,840 --> 00:53:58,520 Go for it. Yeah. 926 00:53:58,520 --> 00:54:06,760 Interpret it like that, yeah. Look a funny one maybe like not 927 00:54:06,760 --> 00:54:10,400 ha ha funny, but funny, you know, if you weren't involved in 928 00:54:10,400 --> 00:54:17,680 the deal was if you look at so it's it's it's well understood 929 00:54:17,680 --> 00:54:22,960 that, you know, BHP historically held the ground at at Paleo 930 00:54:22,960 --> 00:54:26,080 Tolgoi. I guess what's sort of less 931 00:54:26,080 --> 00:54:34,080 known is that, that, that BHP actually retained when that when 932 00:54:34,080 --> 00:54:37,160 they sold well, they effectively gave that ground away to Robert 933 00:54:37,160 --> 00:54:42,040 Friedland. They retained, they retained a 934 00:54:42,040 --> 00:54:47,120 2% NSR on the projects on basically all of oil Tolgoi. 935 00:54:48,720 --> 00:54:53,360 So and then the decision was made I think back in sort of 936 00:54:53,680 --> 00:55:00,560 November 2003 to sell that 2% royalty back to Ivanhoe Mines 937 00:55:00,680 --> 00:55:06,160 for like 37 million. You know, so I think that 938 00:55:06,160 --> 00:55:10,520 royalty would easily be doing sort of circa 40 million bucks a 939 00:55:10,520 --> 00:55:16,360 year, 30 to 40 at a minimum, plus have sort of the Stardust 940 00:55:16,360 --> 00:55:21,080 of oil togos sprinkled on it. So you know whether that would 941 00:55:21,080 --> 00:55:25,560 be be easily I think a sort of a billion dollar. 942 00:55:25,800 --> 00:55:28,080 I think you'd probably get a billion dollars for that today. 943 00:55:28,080 --> 00:55:32,880 But yes, so selling that for 37 million even when the initial 944 00:55:32,880 --> 00:55:37,040 sort of discovery drill holes, you know, the, the discovery was 945 00:55:37,040 --> 00:55:39,880 humming along. So I think that's, that's a 946 00:55:40,680 --> 00:55:44,280 cautionary case study of if you've got, you know, absolute 947 00:55:44,280 --> 00:55:47,800 elephant size deposit and intersections and you've got a 948 00:55:47,920 --> 00:55:53,080 uncapped 2% NSR on, on the asset, don't go and sell it for 949 00:55:53,080 --> 00:55:56,560 $37 million. So that was that was probably 950 00:55:56,840 --> 00:55:58,600 one of the more unfortunate deals. 951 00:55:59,600 --> 00:56:02,520 But you know what that. Reminds me of is, do you 952 00:56:02,520 --> 00:56:06,600 remember hearing the story about that the royalty that the terror 953 00:56:06,600 --> 00:56:09,320 is built on Maxi? It's like I, I heard that in 954 00:56:09,320 --> 00:56:13,320 that, that, you know, when when that mine was sort of, you know, 955 00:56:13,360 --> 00:56:17,960 progressing, yada, yada. It was still uncertainty, but 956 00:56:17,960 --> 00:56:22,920 but a few times BHP had had had offered to buy back the royalty 957 00:56:23,160 --> 00:56:30,920 and, and and and basically by Luca who who owned it came, came 958 00:56:30,920 --> 00:56:32,840 back and said no, not, not 10 million. 959 00:56:33,480 --> 00:56:35,800 My numbers could be wrong here. We want we want 50 million for 960 00:56:35,800 --> 00:56:36,960 it something. Like that ten. 961 00:56:36,960 --> 00:56:39,760 I remember that #2 Gabriel spoke about that on the show. 962 00:56:39,760 --> 00:56:45,080 And and and BHP said no and now like fuck look at the valuation 963 00:56:46,160 --> 00:56:48,120 Tara. Anyway, have you heard similar? 964 00:56:48,200 --> 00:56:50,520 Yeah. Well, well, yeah. 965 00:56:50,520 --> 00:56:54,280 So I have, I guess, heard similar anecdotally. 966 00:56:55,520 --> 00:56:57,560 Yeah. So the flip side of that coin 967 00:56:57,560 --> 00:57:01,080 is, you know, not to be BHP bashing because I'm, you know, a 968 00:57:01,080 --> 00:57:04,720 proud former BHP alumni and, you know, I I had a good experience 969 00:57:04,720 --> 00:57:06,560 working for the company. And so I've got a lot of respect 970 00:57:06,560 --> 00:57:10,120 for the big fella. So the other side of that coin, 971 00:57:10,120 --> 00:57:14,240 Trav, is probably the best royalty deal in history was a 972 00:57:14,240 --> 00:57:17,880 little known deal that if you if you're obsessive about tracking 973 00:57:17,880 --> 00:57:21,120 public records, you can find this, you know, in the archives. 974 00:57:21,120 --> 00:57:25,760 But in 2001 there was a duplicate of the of doterra's 975 00:57:25,760 --> 00:57:29,560 Mac royalty that BHP successfully bought back for 976 00:57:29,560 --> 00:57:33,560 about 10 mil. So from a company from a company 977 00:57:33,560 --> 00:57:36,880 called Cyprus. So I did not know that. 978 00:57:36,880 --> 00:57:38,520 So yeah. So they get credit yeah, yeah, 979 00:57:38,520 --> 00:57:41,280 yeah. They tried to buy reportedly 980 00:57:41,280 --> 00:57:43,400 they tried to buy the other one, the doTerra one back. 981 00:57:43,400 --> 00:57:46,920 But so I think you know, to to for a balanced scorecard for my 982 00:57:47,000 --> 00:57:51,960 my former alumni at BHP, worst deals selling the Oyo Togoy 2% 983 00:57:51,960 --> 00:57:55,800 NSR, but probably one of the best deals in in buying back a 984 00:57:56,040 --> 00:57:58,520 duplicate Mac royalty for 10 mil thereabouts. 985 00:57:58,680 --> 00:58:01,400 So, yeah, yeah. You can't win them all, hey? 986 00:58:01,520 --> 00:58:03,280 You can't you can't win them all. 987 00:58:03,400 --> 00:58:04,960 You can't win them all. Yeah, they get they get some 988 00:58:04,960 --> 00:58:08,080 points for buying back. Yeah, the the duplicate totally. 989 00:58:08,280 --> 00:58:10,560 Yeah, right on BHP. Yeah, win some, you lose some. 990 00:58:10,560 --> 00:58:12,760 What's that? That's that Michael Jordan 991 00:58:12,760 --> 00:58:13,560 quote. You can't. 992 00:58:13,920 --> 00:58:15,440 You can't make a shot you don't take. 993 00:58:15,440 --> 00:58:19,280 So just got to just keep throwing those those bricks at 994 00:58:19,520 --> 00:58:21,240 the ring. What's the best royalty you've 995 00:58:21,240 --> 00:58:23,520 bought? The. 996 00:58:24,480 --> 00:58:27,680 Best deal? I don't I don't like to be too 997 00:58:27,680 --> 00:58:35,400 promotional, I guess. You know, we so look 11. 998 00:58:35,400 --> 00:58:41,840 That's that's the sort of near and dear to the heart was yeah, 999 00:58:41,840 --> 00:58:45,920 we we acquired a royalty from an automotive company. 1000 00:58:46,960 --> 00:58:49,360 It was the bottom drawer royalty. 1001 00:58:49,360 --> 00:58:52,800 They've historically been, you know, a mining exploration 1002 00:58:52,800 --> 00:58:56,560 company hollowed out as an ASX shell, an automotive company was 1003 00:58:56,560 --> 00:59:00,360 dropped into them. You know, a high grade discovery 1004 00:59:00,360 --> 00:59:03,320 is made. And then we saw that this this 1005 00:59:03,320 --> 00:59:07,040 shell still held a royalty. So we're able to buy the royalty 1006 00:59:07,040 --> 00:59:11,000 for a couple 100 grand. And you know that that royalty 1007 00:59:11,000 --> 00:59:14,880 has just come into production in the last in the last couple of 1008 00:59:14,880 --> 00:59:18,920 months. So that's been in the timeline 1009 00:59:18,920 --> 00:59:22,480 from discovery drill hole to 1st gold bar port was about six 1010 00:59:22,480 --> 00:59:25,400 years. So pretty rapid development on 1011 00:59:25,400 --> 00:59:28,440 that asset. So that's one that is sort of a 1012 00:59:28,440 --> 00:59:32,400 more recent highlight reel is that there's a few others mount. 1013 00:59:32,440 --> 00:59:34,000 Ida one or am I thinking different? 1014 00:59:36,120 --> 00:59:38,680 No, no, but. That was a shell as well, right? 1015 00:59:39,160 --> 00:59:41,280 Yeah. Man, it was from a hearing aid 1016 00:59:41,280 --> 00:59:43,720 company. From that a different shell. 1017 00:59:44,800 --> 00:59:48,360 But yeah, so that was that was another, another fun deal. 1018 00:59:48,880 --> 00:59:51,960 But no, like we've got a few royalties where what I get 1019 00:59:51,960 --> 00:59:55,200 really excited about, and this shows just how much of A 1020 00:59:55,200 --> 00:59:57,640 colossal mining nerd, royalty nerd I am. 1021 00:59:57,640 --> 01:00:02,000 But what what our team gets really excited about is, you 1022 01:00:02,000 --> 01:00:05,680 know, if we can buy royalties at really attractive prices, you 1023 01:00:05,680 --> 01:00:11,680 know, let's say 50 to 200 K on, on stranded deposits that we 1024 01:00:11,680 --> 01:00:15,560 could see ultimately feeding. You know, adjacent mills, I 1025 01:00:15,560 --> 01:00:19,080 mentioned it from the outset, but in WA, you know, it's a 1026 01:00:19,080 --> 01:00:21,760 dynamic that's really attractive and it's something we've had 1027 01:00:21,760 --> 01:00:25,000 quite a bit of success with. So I think, you know, ultimately 1028 01:00:25,000 --> 01:00:29,400 our best return return deals are deals that have that 1029 01:00:29,400 --> 01:00:33,560 characteristic where it's difficult to see exactly how 1030 01:00:33,560 --> 01:00:36,400 that comes into the mind plan. But with some Intel and with a 1031 01:00:36,400 --> 01:00:40,240 bit of analysis from our team, technically, you know, that's 1032 01:00:40,240 --> 01:00:43,240 how we can, we can see a line of sight around, you know, it's, 1033 01:00:43,400 --> 01:00:48,160 it's you can see a path to 5000 X on some of those investments. 1034 01:00:48,360 --> 01:00:50,480 They don't grow on trees and you've got to work hard to find 1035 01:00:50,480 --> 01:00:52,480 them. But you know, we've been out 1036 01:00:52,480 --> 01:00:55,360 this for quite a long time. So those are the deals that get 1037 01:00:55,360 --> 01:00:58,800 us get us most excited. Before you call Spencer, if you 1038 01:00:58,800 --> 01:00:59,960 got one of those royalties, call me. 1039 01:01:02,520 --> 01:01:06,320 Money mine royalties. Hey Spencer, this is this has 1040 01:01:06,320 --> 01:01:08,520 been awesome mate. I've learnt a heap about 1041 01:01:08,560 --> 01:01:11,360 royalties and yeah, I always love talking to someone who goes 1042 01:01:12,040 --> 01:01:13,920 very deep on a a sort of particular niche. 1043 01:01:13,920 --> 01:01:17,400 It's always awesome to to speak with those sorts of folks. 1044 01:01:17,400 --> 01:01:19,120 So appreciate you sharing your wisdom with us. 1045 01:01:20,720 --> 01:01:24,600 Appreciate that JD, I I wish my beloved California wife shared 1046 01:01:24,600 --> 01:01:27,760 the same enthusiasm about my passion for mining royalties, 1047 01:01:27,760 --> 01:01:30,960 but that's probably that's a separate conversation with the 1048 01:01:30,960 --> 01:01:32,960 beer in hand. You can talk to us whenever you 1049 01:01:32,960 --> 01:01:36,920 need that. Yeah, I appreciate that, guys. 1050 01:01:37,120 --> 01:01:39,200 Right now you are. There you go. 1051 01:01:39,320 --> 01:01:42,280 Royalty, royalty royalties and mate, we'll hand out the 1052 01:01:42,280 --> 01:01:46,640 royalty, the royalty worth of companies that keep the lights 1053 01:01:46,640 --> 01:01:49,120 on for us. GC Mineral Mining Services 1054 01:01:49,120 --> 01:01:52,560 grounded, CNV ground support. Oh, the royalty of underground 1055 01:01:52,560 --> 01:01:55,200 conferences, the Aussie MMM Underground Operators 1056 01:01:55,200 --> 01:01:58,920 Conference, which you can get $100 off your tickets with MOM 1057 01:01:58,960 --> 01:02:01,400 100. The early bird continues. 1058 01:02:01,720 --> 01:02:04,240 Oh, the royalties of insurance. CRE ground support. 1059 01:02:04,440 --> 01:02:10,520 CRE insurance. It's CRE ground support idea 1060 01:02:11,720 --> 01:02:15,000 anyway, I'll probably said Sam big ground sport K drill. 1061 01:02:15,360 --> 01:02:16,920 They don't do ground sport at all. 1062 01:02:16,920 --> 01:02:20,440 Saltbush Contracting, they haul all. 1063 01:02:20,520 --> 01:02:23,120 If you've got even busted up ground sport in the blown up 1064 01:02:23,120 --> 01:02:25,200 rock, they'll haul that for you. Yep. 1065 01:02:25,320 --> 01:02:30,560 Oh Miles is well he gets ground support out of like crushes and 1066 01:02:30,560 --> 01:02:35,440 shit like Miles contracting. The Mike sponsor, the Maddie 1067 01:02:35,440 --> 01:02:39,680 Mike sponsor, Maddie Mike sponsor and sweat bloody 1068 01:02:39,960 --> 01:02:42,720 underground exploration gurus. Quadrant project engineering. 1069 01:02:42,960 --> 01:02:46,160 Holy shit there's heaps of people in and cross boundary 1070 01:02:46,160 --> 01:02:47,720 energy. Give Timmy Taylor a call. 1071 01:02:49,640 --> 01:02:52,400 Go Gold. Information contained in this 1072 01:02:52,400 --> 01:02:55,160 episode of Money of Mine is of general nature only and does not 1073 01:02:55,160 --> 01:02:57,800 take into account the objectives, financial situation 1074 01:02:57,840 --> 01:02:59,840 or needs of any particular person. 1075 01:03:00,160 --> 01:03:03,200 Before making any investment decision, you should consult 1076 01:03:03,200 --> 01:03:06,240 with your financial advisor and consider how appropriate the 1077 01:03:06,240 --> 01:03:09,920 advice is to your objectives, financial situation and needs.