1 00:00:00,040 --> 00:00:02,840 Right on, buddy miners. We've got another another 2 00:00:02,840 --> 00:00:06,600 Indarba episode, The bloody. The fruits are flying off the 3 00:00:06,600 --> 00:00:09,080 tree out of Indarba and we're heading into first quantum 4 00:00:09,120 --> 00:00:13,800 territory. Yeah, mate, this is a a really a 5 00:00:13,800 --> 00:00:15,640 really awesome chat that we've got to have with with Mike 6 00:00:15,640 --> 00:00:17,800 Christie. Mike Christie heads up the the 7 00:00:17,800 --> 00:00:19,440 geology work streams director of geology. 8 00:00:19,440 --> 00:00:22,480 Their first quantum are a company we should spend more 9 00:00:22,480 --> 00:00:25,720 time following because they are, they're entrepreneurial. 10 00:00:25,800 --> 00:00:27,880 They they, they, they build stuff themselves. 11 00:00:27,880 --> 00:00:30,160 Their geology team works across all of the company. 12 00:00:30,160 --> 00:00:32,479 Whenever they look at an asset, they've created serious value by 13 00:00:32,759 --> 00:00:36,320 by buying assets, you know, that are undervalued, like, you know, 14 00:00:36,320 --> 00:00:39,160 developing minds in places that are usually too risky, sometimes 15 00:00:39,160 --> 00:00:40,800 losing their social license along the way. 16 00:00:40,800 --> 00:00:43,680 But it's a really impressive company, and I come around, come 17 00:00:43,680 --> 00:00:46,480 out of that conversation with Mike, just feeling grateful for 18 00:00:46,480 --> 00:00:48,040 having it. Yeah, absolutely. 19 00:00:48,120 --> 00:00:51,360 Mike is, he's written some punchy sort of thought pieces, I 20 00:00:51,360 --> 00:00:54,200 guess you could call them on on LinkedIn and the like. 21 00:00:54,240 --> 00:00:56,480 He's spent a lot of time, you know, boots on the ground in 22 00:00:56,480 --> 00:01:00,280 like you say, Trev, riskier parts of the world from the DRC 23 00:01:00,280 --> 00:01:03,720 to Zambia to Panama. But, you know, by and large, 24 00:01:03,720 --> 00:01:06,960 they've got a lot of stuff done and yeah, a real, a real wealth 25 00:01:06,960 --> 00:01:10,560 of knowledge from the exploration front to, you know, 26 00:01:10,560 --> 00:01:13,600 they're just that geology sense in a, in a much broader 27 00:01:13,600 --> 00:01:16,720 perspective. So yeah, grateful that we had 28 00:01:16,720 --> 00:01:20,800 the chance to pick his brain for a good 30 or 40 minutes. 29 00:01:20,840 --> 00:01:24,160 Yeah, well, you can tell why they go overseas to the risky 30 00:01:24,160 --> 00:01:26,120 jurisdictions. They understand the risk because 31 00:01:26,120 --> 00:01:28,480 they know people like CRE insurance are there to manage 32 00:01:28,480 --> 00:01:30,000 the risk for it. They really it's. 33 00:01:30,240 --> 00:01:31,520 Just take the risk off your hands. 34 00:01:31,640 --> 00:01:34,880 It goes hand in hand, the bloody ass Perseus and waffle. 35 00:01:34,880 --> 00:01:37,000 Bloody good. They manage risk. 36 00:01:37,800 --> 00:01:41,640 They're even doing western NSW mining risk now with their 37 00:01:41,640 --> 00:01:43,840 orange office. Piece of cake after you've done. 38 00:01:43,920 --> 00:01:49,480 Western NSW has never felt safer, never felt that risk 39 00:01:49,480 --> 00:01:52,040 mitigated. First Quantum had a few hiccups 40 00:01:52,040 --> 00:01:54,800 in the in the DRC, but you know, these days they're very, very 41 00:01:54,800 --> 00:01:56,400 comfortable and established in Zambia. 42 00:01:56,400 --> 00:01:58,440 In fact, you, you speak to Zambians, they think First 43 00:01:58,440 --> 00:02:01,720 Quantum is a Zambian company. But but you know, if they had 44 00:02:01,720 --> 00:02:04,920 CRE around back in the DRC days, I think that I think things 45 00:02:04,920 --> 00:02:06,680 would be similar. They wouldn't have had to to 46 00:02:06,680 --> 00:02:09,600 leave when they did. Well, like it rhymes DRCCRE, 47 00:02:09,600 --> 00:02:11,520 like it's just a match made in heaven. 48 00:02:11,680 --> 00:02:16,400 So bloody keep a share, go say get A to him in orange and let's 49 00:02:16,400 --> 00:02:19,800 get into first quantum all. Right, money miners. 50 00:02:19,920 --> 00:02:24,440 We've got a special guest in Mike Christie here at in Daba. 51 00:02:24,800 --> 00:02:27,760 I guess we've been thinking about getting on the show for 52 00:02:27,760 --> 00:02:30,480 for quite some time. So we're excited we can make it 53 00:02:30,480 --> 00:02:33,600 happen. Mike works at First Quantum, has 54 00:02:33,600 --> 00:02:37,520 got a wealth of experience in exploration geologist background 55 00:02:38,040 --> 00:02:43,120 and has done a phenomenal amount for the the sort of geosciences 56 00:02:43,120 --> 00:02:46,560 in in Australia and in the broad exploration industry. 57 00:02:46,560 --> 00:02:50,120 So we're planning to get you on, Mike, and we want to start the 58 00:02:50,120 --> 00:02:52,920 conversation going back to a LinkedIn post you wrote a few 59 00:02:52,920 --> 00:02:56,560 months ago about Western miners and sort of posed the question 60 00:02:56,560 --> 00:02:59,520 to you, Have Western mining companies lost the plot when it 61 00:02:59,520 --> 00:03:03,640 comes to exploration? Yeah, look, thanks, JD Travis, 62 00:03:03,640 --> 00:03:06,160 it's great to be with you guys. It's strange. 63 00:03:06,160 --> 00:03:08,560 We came all the way here to Cape Town to do it rather than doing 64 00:03:08,560 --> 00:03:13,960 it in Perth. Yeah, that that post has really 65 00:03:15,000 --> 00:03:17,800 energized quite a lot of responses from a variety of 66 00:03:17,800 --> 00:03:21,880 people. And I think I started writing it 67 00:03:21,880 --> 00:03:23,320 just as an e-mail to a colleague. 68 00:03:24,720 --> 00:03:26,960 And then I sort of started the thought process and ended up 69 00:03:26,960 --> 00:03:29,680 thinking, oh, I might post this and see what sort of reaction I 70 00:03:29,680 --> 00:03:33,000 got. Because it was spurred by 71 00:03:33,000 --> 00:03:36,840 looking at a, a recent report from SNP who do a lot of data 72 00:03:36,840 --> 00:03:40,800 analysis for exploration and cost of development and and so 73 00:03:40,800 --> 00:03:42,120 forth in the, in the copper world. 74 00:03:42,520 --> 00:03:44,680 And of course copper in the last few years has been very much 75 00:03:44,680 --> 00:03:48,000 the, the, the metal du jour in terms of, you know, we're going 76 00:03:48,000 --> 00:03:50,000 to need more and more of it for the electrical transition. 77 00:03:51,200 --> 00:03:54,960 And yet the, the discovery rate of what we would call world 78 00:03:54,960 --> 00:03:58,080 class proper deposits has been inexorably declining. 79 00:03:59,560 --> 00:04:05,400 And so I wanted to really look at that in the context of what 80 00:04:05,920 --> 00:04:08,960 the both the junior sector and the major sector were going 81 00:04:08,960 --> 00:04:12,160 through in terms of the the change in dynamics, particularly 82 00:04:12,160 --> 00:04:16,200 in the last 10 years or so. And what we've seen is, is a 83 00:04:16,200 --> 00:04:20,720 whole new source of capital coming into the markets from the 84 00:04:20,720 --> 00:04:25,480 Middle East from and from China. And we've seen the the Chinese 85 00:04:25,480 --> 00:04:28,880 being very smart in the way that they have capitalized on new 86 00:04:28,880 --> 00:04:32,720 discoveries, particularly in here in Africa, but throughout 87 00:04:32,720 --> 00:04:37,200 South America since as well. And that hasn't necessarily 88 00:04:37,200 --> 00:04:39,080 translated into the exploration space. 89 00:04:39,560 --> 00:04:42,880 So that capital is not necessarily flowing into the 90 00:04:42,880 --> 00:04:49,160 traditional TSX or ASX juniors. And and the majors seem to be 91 00:04:49,400 --> 00:04:53,720 gun shy of developing deposits. So they're waiting for the 92 00:04:53,720 --> 00:04:56,440 juniors to make those discoveries in the remote parts 93 00:04:56,440 --> 00:04:58,600 of the world that sometimes they're afraid to go to. 94 00:05:00,480 --> 00:05:01,600 And it just hasn't been happening. 95 00:05:01,680 --> 00:05:04,760 And you look at the the graph of discovery's success in the last 96 00:05:04,760 --> 00:05:07,800 10 years and it's miserable. I mean, Kumail Kakula was really 97 00:05:07,800 --> 00:05:13,960 the last big one and other than that, a handful in the last 20 98 00:05:13,960 --> 00:05:16,640 years of what we would call world class copper discoveries, 99 00:05:16,640 --> 00:05:20,440 things capable of producing 250, three, 100,000 tons of copper a 100 00:05:20,440 --> 00:05:23,200 year. So that's really what spurred my 101 00:05:23,200 --> 00:05:27,120 post. How much of this sort of comes 102 00:05:27,280 --> 00:05:31,200 to the the point of permitting and approvals and that whole 103 00:05:31,200 --> 00:05:36,200 process taking longer and longer being a disincentive for majors 104 00:05:36,200 --> 00:05:39,960 so the capital gets push towards brownfield expansion exploring 105 00:05:39,960 --> 00:05:42,520 around the mine you've already got the permits for and set up. 106 00:05:42,520 --> 00:05:44,440 Do you do you think about that sort of balance match? 107 00:05:44,480 --> 00:05:48,120 Yeah, no, the balance is certainly an important one and 108 00:05:48,560 --> 00:05:56,160 undoubtedly the permitting and the the social stories 109 00:05:56,160 --> 00:06:00,280 surrounding modern developments is pushing out the timeline. 110 00:06:00,760 --> 00:06:03,360 In some cases, it will stop the timeline and there will just be 111 00:06:03,360 --> 00:06:08,160 places we can't develop mines. But in many places, it really is 112 00:06:08,160 --> 00:06:14,320 about taking a discovery from those first few drill holes into 113 00:06:14,320 --> 00:06:16,680 a feasibility study. And then how long does it take 114 00:06:16,680 --> 00:06:19,160 from that stage where you know you've got an economic project 115 00:06:19,480 --> 00:06:21,160 through to actually building the mine? 116 00:06:21,400 --> 00:06:25,200 And that seems to be the phase that has been really pushed out. 117 00:06:25,320 --> 00:06:27,280 And typically in the copper industry, I think it's now 118 00:06:27,280 --> 00:06:31,720 running at about 17 years. So people say we need to double 119 00:06:31,720 --> 00:06:33,920 the amount of copper we're mining in the next sort of 20 120 00:06:33,920 --> 00:06:35,800 years. How are we going to do that? 121 00:06:36,280 --> 00:06:40,560 Because we can't develop the the quantity of minds if it takes 17 122 00:06:40,560 --> 00:06:44,120 years to to to do that. We needed to discover them 123 00:06:44,120 --> 00:06:46,520 several years ago and that's not happening. 124 00:06:46,920 --> 00:06:51,720 So yeah, it is. I mean, big companies generally 125 00:06:51,720 --> 00:06:55,760 like stable jurisdictions, but it's interesting to see how even 126 00:06:55,760 --> 00:06:59,160 they are now extending into places like Argentina and of 127 00:06:59,160 --> 00:07:02,000 course into Mongolia and to other countries whereby 128 00:07:02,000 --> 00:07:04,800 previously they would have been seen as probably off the radar 129 00:07:05,520 --> 00:07:07,960 in some of those countries. Like Argentina is now, you know, 130 00:07:08,000 --> 00:07:10,480 really on a good path and, and we're very comfortable there. 131 00:07:10,840 --> 00:07:15,520 So I think that the real gap at the moment is the funding into 132 00:07:15,520 --> 00:07:19,000 the junior sector. And so those discoveries are few 133 00:07:19,000 --> 00:07:21,920 and far between. And, and you saw how BHP Lepton 134 00:07:21,920 --> 00:07:25,760 Filo in, in South America. And I'm sure if there's a 135 00:07:25,760 --> 00:07:28,400 similar discovery here in in Africa, we'll see the same 136 00:07:28,400 --> 00:07:31,560 thing. You, you know, you, you hit up 137 00:07:31,640 --> 00:07:33,960 first quantum exploration efforts and, and had it for a 138 00:07:33,960 --> 00:07:37,600 long time. And when, when you think about 139 00:07:37,600 --> 00:07:41,320 who like, who is most likely to discover, you know, new, new 140 00:07:41,320 --> 00:07:46,040 deposits, new ore bodies, The, the, does it make more sense 141 00:07:46,040 --> 00:07:48,480 that it would be a, a major who has like, you know, far better 142 00:07:48,480 --> 00:07:51,400 balance sheet and capability and ability to pay, pay geologists 143 00:07:51,400 --> 00:07:53,400 and use the best, the best data, etcetera? 144 00:07:53,400 --> 00:07:56,040 Or is it just much more naturally fitting to the junior 145 00:07:56,280 --> 00:07:59,640 who has more risk tolerance? It depends very much. 146 00:08:00,400 --> 00:08:03,000 I don't actually think it's a junior major thing anymore. 147 00:08:03,360 --> 00:08:08,560 I think it's more about the the thought processes of what's 148 00:08:08,560 --> 00:08:10,000 going on. I mean, there's some wonderful 149 00:08:10,000 --> 00:08:11,920 juniors who are prepared to take risks. 150 00:08:12,560 --> 00:08:17,560 And what we've migrated through in the last 10 or 15 years is a 151 00:08:17,560 --> 00:08:20,800 transformation from geochemical surface exploration, which found 152 00:08:20,800 --> 00:08:24,560 an awful lot of ore bodies, as did prospecting before it, to 153 00:08:24,560 --> 00:08:27,960 more conceptual and heavy geophysics based exploration. 154 00:08:28,600 --> 00:08:32,320 That's expensive. It's got a longer timeline and 155 00:08:32,360 --> 00:08:36,640 it needs a real commitment. And I think that's where people 156 00:08:36,640 --> 00:08:39,760 like Ivanhoe have really won because Robert Frieden was 157 00:08:39,760 --> 00:08:43,760 prepared to bankroll deep exploration drilling in the 158 00:08:43,760 --> 00:08:47,280 Congo in the way that probably very few juniors would have been 159 00:08:47,280 --> 00:08:50,040 able to to do. So it's more about having that 160 00:08:50,040 --> 00:08:53,000 funding flow. So this combination of a junior 161 00:08:53,120 --> 00:08:58,400 working together in partnership with a, a major or a funding 162 00:08:58,400 --> 00:09:01,120 group, whether that be out of the Middle East, the Far East or 163 00:09:01,120 --> 00:09:04,240 wherever, that combination can work really well. 164 00:09:04,520 --> 00:09:07,680 But this combination of having to go back to the market every 165 00:09:07,680 --> 00:09:10,640 few months and raise the next $1,000,000, the next $2,000,000 166 00:09:10,880 --> 00:09:12,800 just to fund the the next rule hole. 167 00:09:13,040 --> 00:09:15,680 That is where, you know, we're really seeing things come 168 00:09:15,680 --> 00:09:18,600 unstuck because unless the market gets the results every 169 00:09:18,920 --> 00:09:22,360 every quarter, your share price dives and and you have to dilute 170 00:09:23,480 --> 00:09:26,120 the heck out of it. You mentioned Chinese 171 00:09:26,120 --> 00:09:29,480 competitors in there and we we often see them pop up at the end 172 00:09:29,480 --> 00:09:31,400 stage, buying the project, buying the mine. 173 00:09:32,040 --> 00:09:34,520 Are there things the Western miners can learn from actually 174 00:09:34,520 --> 00:09:38,240 how they approach geology? Maybe in Africa? 175 00:09:38,240 --> 00:09:40,160 Other parts of the world? Yeah. 176 00:09:40,160 --> 00:09:46,440 Look, I, I think we, we've seen a a big change there in the last 177 00:09:46,440 --> 00:09:50,480 decade as well. Generally the the Chinese 178 00:09:50,480 --> 00:09:53,280 companies were picking up established assets with a 179 00:09:53,280 --> 00:09:56,080 feasibility study in the, the sort of what we do, we call the 180 00:09:56,080 --> 00:09:59,040 low risk investment. I think that's changed now where 181 00:09:59,040 --> 00:10:00,960 they are putting in money at an earlier stage. 182 00:10:01,480 --> 00:10:04,560 But to date we haven't seen that in terms of bankrolling junior 183 00:10:04,560 --> 00:10:07,760 exploration. I think there are some moves in 184 00:10:07,760 --> 00:10:13,480 that direction now, but the partnership that Ivanhoe made in 185 00:10:13,480 --> 00:10:18,280 the in the Congo was a very logical one in that it was not a 186 00:10:18,280 --> 00:10:20,160 project they could afford to fund themselves. 187 00:10:20,160 --> 00:10:23,320 It was perhaps not perceived to be the safest investment 188 00:10:23,320 --> 00:10:26,440 destination in the world. So splitting that risk is 189 00:10:26,440 --> 00:10:28,840 somewhere where the market's definitely going to hit, even 190 00:10:28,840 --> 00:10:32,400 between major companies. You're going to see a lot more 191 00:10:32,400 --> 00:10:36,920 in terms of major companies working together in destinations 192 00:10:36,920 --> 00:10:40,240 where, you know, to build a reasonable sized copper mine. 193 00:10:40,240 --> 00:10:43,080 Now you're talking about things in the multiple billions of 194 00:10:43,080 --> 00:10:46,120 dollars and if you've got to spend $10 billion building the 195 00:10:46,120 --> 00:10:50,160 mine somewhere in a remote part of the jungle of South America, 196 00:10:50,160 --> 00:10:53,120 then sharing that risk with someone is is going to be on. 197 00:10:53,120 --> 00:10:57,080 So I think that's where the the Chinese investment is, is being 198 00:10:57,080 --> 00:10:59,520 particularly smart. In the last 10 years, they've 199 00:10:59,840 --> 00:11:03,280 they've started moving further down the curve in terms of the 200 00:11:03,280 --> 00:11:05,760 investment risk and they're looking at projects that are 201 00:11:05,760 --> 00:11:09,720 probably pre feasibility stage. And there are a number of those 202 00:11:09,760 --> 00:11:12,520 in particularly in the northern part of Latin America through 203 00:11:12,520 --> 00:11:18,480 the Ecuador Colombia area and and indeed in in parts of Africa 204 00:11:19,440 --> 00:11:21,680 in the DRC, they've basically wiped the floor. 205 00:11:21,720 --> 00:11:26,320 I mean, they've, they've really managed to to dominate seen 206 00:11:26,320 --> 00:11:29,720 there and we've seen the Dr. CS copper production treble in the 207 00:11:29,720 --> 00:11:33,240 last last decade. So there's a lot to be said for 208 00:11:33,240 --> 00:11:35,960 that. Thank God DRC copper production 209 00:11:35,960 --> 00:11:38,640 travelled because that's a bloody so it's cross boundary 210 00:11:38,640 --> 00:11:40,280 energy. You're demanding a lot of copper 211 00:11:40,280 --> 00:11:43,440 wire for these hybrid power plants they're putting in all 212 00:11:43,440 --> 00:11:46,080 around the world. It is like that is going to be 213 00:11:46,080 --> 00:11:52,040 full of copper, DRC copper, Australian copper, bloody every 214 00:11:52,040 --> 00:11:55,200 copper known to man so. It's a circular reference. 215 00:11:55,200 --> 00:11:57,160 We're in the DRC. We're seeing some copper mines. 216 00:11:57,520 --> 00:12:01,360 You would see the power station supplying the power to the to 217 00:12:01,360 --> 00:12:03,760 the copper mine. Exactly, exactly all. 218 00:12:03,760 --> 00:12:08,080 And look, they are absolute global experts as independent 219 00:12:08,080 --> 00:12:11,840 power producers and we're talking wind, solar, batteries, 220 00:12:12,280 --> 00:12:15,360 thermal base, light, light, the rigid digit power. 221 00:12:15,360 --> 00:12:18,040 Energy, they do it all. And to penetrate the Australian 222 00:12:18,040 --> 00:12:22,480 market, they have made the first big decision they make to do 223 00:12:22,480 --> 00:12:26,240 that was higher the most exclusive business development 224 00:12:26,240 --> 00:12:28,360 person in Australia, and that's Tim Taylor. 225 00:12:28,360 --> 00:12:32,200 So you can tell this company is serious because Timmy doesn't 226 00:12:32,200 --> 00:12:34,640 come cheap. So I get in touch with Timmy 227 00:12:34,640 --> 00:12:38,520 Taylor and the CBA team for how they can give you some hybrid 228 00:12:38,520 --> 00:12:39,720 power. Go CVA. 229 00:12:39,840 --> 00:12:43,320 Tim knows power. So I think they are making smart 230 00:12:43,320 --> 00:12:46,800 decisions and one wonders whether the Western companies 231 00:12:46,800 --> 00:12:51,120 have sort of fallen behind that in a sense that in some cases 232 00:12:51,120 --> 00:12:54,280 they have not invested in until almost it's too late. 233 00:12:55,560 --> 00:12:58,360 In other cases they've probably made some poor decisions. 234 00:12:59,520 --> 00:13:03,880 And other than some quite inspired stories like the BHP 235 00:13:03,880 --> 00:13:07,880 Explore program, which I I fully acknowledge as as being a 236 00:13:07,880 --> 00:13:12,280 wonderful incentive for junior explorers, there's very little 237 00:13:12,760 --> 00:13:18,640 major support for juniors at that first sort of exploratory 238 00:13:18,760 --> 00:13:23,760 stage. You refer to a bit of a change 239 00:13:23,760 --> 00:13:28,600 in approach to exploration and I hate to bring up AI and machine 240 00:13:28,600 --> 00:13:32,720 learning as it's a, you know, overused phrase these days. 241 00:13:32,720 --> 00:13:35,280 But I think it's particularly relevant here because there's 242 00:13:35,520 --> 00:13:39,120 people in the Copper Belt that have been, you know, quite 243 00:13:39,120 --> 00:13:43,720 loudly using this approach in how they, you know, that they've 244 00:13:43,720 --> 00:13:46,640 bought assets, but how they expand the assets and how they 245 00:13:46,640 --> 00:13:49,800 go about things. And I'm came to learn from you 246 00:13:49,880 --> 00:13:54,280 how the average kind of investor can think about a company that 247 00:13:54,360 --> 00:13:57,400 promotes their use of AI in exploration broadly. 248 00:13:58,280 --> 00:14:03,760 Yeah, AI. There's a lot of hot air about 249 00:14:03,840 --> 00:14:09,480 AI these days. It is a fantastic tool for 250 00:14:09,480 --> 00:14:14,920 speeding up the process, whether that be the expiration process 251 00:14:14,960 --> 00:14:17,000 or all sorts of other things around the mining. 252 00:14:18,520 --> 00:14:22,320 I've got two people on my team who've got PhDs in in machine 253 00:14:22,320 --> 00:14:25,120 learning and and AI and we're applying those in very different 254 00:14:25,120 --> 00:14:31,840 ways. And to my knowledge, to date, 255 00:14:31,840 --> 00:14:34,760 there've been no great discoveries by AI. 256 00:14:35,720 --> 00:14:38,600 Undoubtedly some companies are employing the technology 257 00:14:38,600 --> 00:14:42,400 extremely effectively in terms of processing geophysics, in 258 00:14:42,400 --> 00:14:46,480 terms of accumulating enormous datasets, are making much more 259 00:14:46,480 --> 00:14:50,400 of them than we could through manual or analogue ways in the 260 00:14:50,400 --> 00:14:53,080 past. So that to me is where the key 261 00:14:53,080 --> 00:14:56,960 comes in. And certainly we're beginning to 262 00:14:56,960 --> 00:14:59,520 employ that technology and I'm seeing a lot of a lot of 263 00:14:59,520 --> 00:15:05,040 companies do that more recently. But I don't think at this stage 264 00:15:05,280 --> 00:15:08,080 it's not a silver bullet. It's not going to produce the X 265 00:15:08,080 --> 00:15:11,400 marks, the spot drill here that people are talking about. 266 00:15:11,720 --> 00:15:15,520 Unfortunately, a lot of politicians, particularly here 267 00:15:15,520 --> 00:15:18,840 in Africa, have sort of assumed that this is going to be the the 268 00:15:18,840 --> 00:15:21,280 manner from heaven and they're suddenly going to be able to 269 00:15:21,280 --> 00:15:23,080 find every mineral deposit in their country. 270 00:15:23,800 --> 00:15:28,440 And we've been involved in sponsoring a, a large airborne 271 00:15:28,840 --> 00:15:31,680 survey in Zambia. It's a gravity magnetic survey 272 00:15:31,960 --> 00:15:33,240 over the traditional copper belt. 273 00:15:33,440 --> 00:15:35,680 It's actually the first time that whole area's been flown for 274 00:15:35,680 --> 00:15:40,640 50 years, partly because of the sort of mesh of, of small 275 00:15:40,640 --> 00:15:43,680 tenements and, and speculative land holders. 276 00:15:44,080 --> 00:15:47,880 So what we were able to do was fly the whole copper belt with 277 00:15:47,880 --> 00:15:53,440 modern, the, the best resolution you can basically do and come up 278 00:15:53,440 --> 00:15:57,800 with a holistic model. So, you know, sadly a lot of 279 00:15:57,800 --> 00:16:00,280 people then take that as, oh, you must know where the copper 280 00:16:00,280 --> 00:16:01,960 deposits are. It's not that easy. 281 00:16:03,480 --> 00:16:07,200 There's a whole process after that of building A3 dimensional, 282 00:16:07,200 --> 00:16:10,440 sometimes 4 dimensional model of, of that geological history 283 00:16:10,440 --> 00:16:12,400 of the copper belt, trying to understand what the 284 00:16:12,400 --> 00:16:15,000 relationships are between all the rocks before you can then 285 00:16:15,000 --> 00:16:17,280 start to get predictive about drilling deep holes. 286 00:16:17,840 --> 00:16:20,560 And we need to drill deep holes now because the, the big deposit 287 00:16:20,560 --> 00:16:24,440 serves have all been found. So you've, you've got to 288 00:16:24,440 --> 00:16:27,840 translate that information into exploration targeting. 289 00:16:28,160 --> 00:16:31,600 And that's where I think the AI really starts to come into into 290 00:16:31,600 --> 00:16:36,320 play. The we've been, we've been 291 00:16:36,320 --> 00:16:39,240 thinking a lot about, you know, where are the, where are the 292 00:16:39,240 --> 00:16:42,680 remaining like big, big deposits still still to be found? 293 00:16:42,720 --> 00:16:45,960 And it's not a very commercial question to ask. 294 00:16:45,960 --> 00:16:50,600 And, you know, but, but if, if the entire world was you could, 295 00:16:50,600 --> 00:16:53,360 you could mine equally. The governments are all the 296 00:16:53,360 --> 00:16:56,600 same, you know, drilling costs were all kind of equal. 297 00:16:56,960 --> 00:17:00,560 Where? Where would you look for the you 298 00:17:00,560 --> 00:17:03,200 know, the best, the likely best undeveloped deposits? 299 00:17:03,520 --> 00:17:05,680 Well, it sort of depends what you want to look for. 300 00:17:07,880 --> 00:17:10,280 Yeah. And you want big or small and 301 00:17:10,280 --> 00:17:12,160 you want it an open pit or do you want it underground? 302 00:17:13,280 --> 00:17:15,720 And, and at the end of the day, of course, what you want is 303 00:17:15,720 --> 00:17:17,280 something that's going to pay back money. 304 00:17:18,599 --> 00:17:26,880 And in, in my view, really if you want an open pit large scale 305 00:17:26,880 --> 00:17:32,080 copper mine, then the places in the world where you can find 306 00:17:32,080 --> 00:17:35,240 that near surface are diminishingly small. 307 00:17:35,480 --> 00:17:38,920 And it basically it's come down to the jungle clad parts of the 308 00:17:38,920 --> 00:17:42,600 Andes in the in the northern part of South America, perhaps 309 00:17:42,600 --> 00:17:46,840 Central America and perhaps Far East Russia if you're really 310 00:17:46,840 --> 00:17:49,680 keen. And I think those are really the 311 00:17:49,680 --> 00:17:52,360 only two parts of the world where you're likely to see that. 312 00:17:53,800 --> 00:17:57,160 I think there are very good prospects perhaps in Central 313 00:17:57,160 --> 00:18:00,440 Asia as well. We've recently started an 314 00:18:00,440 --> 00:18:03,320 initiative in Kazakhstan which which I'm very bullish about. 315 00:18:05,160 --> 00:18:09,560 Most of the porphyries there are relatively low grade, but it's a 316 00:18:09,560 --> 00:18:12,160 good destination. The cost structure is very low 317 00:18:12,160 --> 00:18:13,400 there. The infrastructure is just 318 00:18:13,720 --> 00:18:16,760 fantastic. So the there's the ability there 319 00:18:16,760 --> 00:18:21,360 to make lower grade minds work. I think the, I guess the other 320 00:18:21,360 --> 00:18:25,960 part of the the response is that what are you looking for and are 321 00:18:25,960 --> 00:18:27,840 you looking for copper porphyries Because we all know 322 00:18:27,840 --> 00:18:30,160 that the story of copper porphyries has been 1 of 323 00:18:30,160 --> 00:18:32,920 declining grade over the last 10 or 15 years. 324 00:18:33,360 --> 00:18:37,200 So now there is a litany of porphyry projects out there in 325 00:18:37,200 --> 00:18:40,960 the world at .2 to .3% copper and most of them are going 326 00:18:40,960 --> 00:18:44,760 nowhere. It needs a complete step change 327 00:18:44,760 --> 00:18:49,880 in the terms of the copper price and or the operating costs of 328 00:18:49,880 --> 00:18:53,920 that mine, whether it's through new technology, employing all of 329 00:18:53,920 --> 00:18:57,000 the new tech that we like to use in some of our minds, the 330 00:18:57,000 --> 00:18:59,920 trolley assist, all of the electrical drills, electrical 331 00:18:59,920 --> 00:19:01,880 trucks, all of that. And that will bring the cost 332 00:19:01,880 --> 00:19:04,840 structure down. And I, I see more of a 333 00:19:04,920 --> 00:19:07,600 incremental change. So I'm not sure that we're ever 334 00:19:07,600 --> 00:19:12,800 going to really get down to the .2% copper porphyry mining 335 00:19:14,080 --> 00:19:17,600 unless there is a really quite significant uptick in in the 336 00:19:17,600 --> 00:19:20,360 copper price because nobody's prepared to make that big 337 00:19:20,360 --> 00:19:23,200 decision to go in to invest in those at the moment. 338 00:19:23,640 --> 00:19:27,200 So one of our big focuses is to look for sediment hosted copper, 339 00:19:27,480 --> 00:19:32,000 which has typically a much more higher grade profile. 340 00:19:32,760 --> 00:19:38,440 Kamawa's the best example and they're more restricted around 341 00:19:38,440 --> 00:19:41,360 the world. Certainly the Central African 342 00:19:41,360 --> 00:19:46,360 copper belt is the main example, but all the deposits through 343 00:19:46,960 --> 00:19:50,840 Poland and the Kuppu Shifa and indeed in Central Kazakhstan are 344 00:19:50,840 --> 00:19:52,600 other good examples. So that's where we're putting a 345 00:19:52,600 --> 00:19:55,480 lot of our effort is to try to find those high grade deposits 346 00:19:55,480 --> 00:19:57,120 because still today great is king. 347 00:19:57,480 --> 00:20:01,400 And if you want to develop a mine, if if as Ivanhoeve very 348 00:20:01,400 --> 00:20:06,160 well proven, if you've got 3 to 5% copper in an underground, you 349 00:20:06,160 --> 00:20:08,920 can develop that for much lower capital costs than you can with 350 00:20:08,920 --> 00:20:12,680 other with these big porphyries, which really is starting to cost 351 00:20:12,680 --> 00:20:16,160 10s of billions. A bit of a different end of the 352 00:20:16,520 --> 00:20:20,160 mining spectrum, but on the plant side with the tech 353 00:20:20,160 --> 00:20:23,880 advancements in processing and just extracting more and more 354 00:20:24,000 --> 00:20:26,600 out of what you've you've kind of got, are you bullish on that 355 00:20:26,600 --> 00:20:29,400 front at all? Yeah, Because I said, I think 356 00:20:29,400 --> 00:20:32,360 they're they're more incremental at this stage. 357 00:20:33,400 --> 00:20:37,080 I think if we get to the point where a sulfide leach technique 358 00:20:37,680 --> 00:20:40,280 is actually proven to work and there's lots of people working 359 00:20:40,280 --> 00:20:46,600 on it, then then you could see a steep change in costs in the way 360 00:20:46,600 --> 00:20:50,720 that we saw with SXCW sort of 30 years ago, where suddenly all of 361 00:20:50,720 --> 00:20:53,800 these oxide deposits became economic that weren't before. 362 00:20:54,680 --> 00:20:58,320 And really that, that then COP kept the copper price down at 363 00:20:58,320 --> 00:21:02,160 about $0.60 for years and years and years because there were 364 00:21:02,160 --> 00:21:06,120 major discoveries all through South America of these oxide cap 365 00:21:06,280 --> 00:21:09,680 deposits and SXCW could process them at a very low cost. 366 00:21:10,200 --> 00:21:13,400 So if if sulfide leach technology started to work and 367 00:21:13,400 --> 00:21:16,400 we didn't have to mill the bejesus out of, you know, 368 00:21:17,080 --> 00:21:19,440 hundreds of millions of tons of rock every year, then yes, that 369 00:21:19,440 --> 00:21:23,440 could make a step change. I'd love to hear a bit about the 370 00:21:23,720 --> 00:21:26,040 the relationship. This is a sort of question 371 00:21:26,040 --> 00:21:29,160 that's been inspired from a mutual friend Ahmed of your 372 00:21:29,160 --> 00:21:32,200 exploration team and the the broader company itself. 373 00:21:32,400 --> 00:21:36,320 First, Quantum came to hear about perhaps what other miners 374 00:21:36,320 --> 00:21:40,280 can learn as it can improve exploration and discoveries 375 00:21:40,640 --> 00:21:43,680 across the industry and how you guys sort of go about leveraging 376 00:21:43,680 --> 00:21:46,720 your expertise to sort of maximum potential. 377 00:21:48,120 --> 00:21:49,960 Sure. I guess there's several parts to 378 00:21:49,960 --> 00:21:53,640 that. Exploration has been very 379 00:21:53,640 --> 00:21:59,720 complementary to the history of First Quantum which really has a 380 00:22:00,160 --> 00:22:04,920 bit over a 20 year lifetime, a company that grew very rapidly, 381 00:22:04,920 --> 00:22:09,480 but it actually originally grew out of building reprocessing 382 00:22:09,520 --> 00:22:12,480 plant in Zambia, a small deposit called Bonner in Kubwa. 383 00:22:14,160 --> 00:22:18,200 And and then exploration added to that by finding some deposits 384 00:22:18,200 --> 00:22:22,000 nearby First Launchee and then Frontier on the DRC side of the 385 00:22:22,000 --> 00:22:25,920 border. And it was a rapidly exploding 386 00:22:25,920 --> 00:22:27,600 story. And that and the cash flow from 387 00:22:27,600 --> 00:22:30,920 that allowed them to to purchase Konsanci, which was sort of the 388 00:22:30,920 --> 00:22:34,240 deal of the century. So it's been very complementary. 389 00:22:34,960 --> 00:22:40,000 And if you look at the history of of the company, exploration 390 00:22:40,000 --> 00:22:42,760 has found about about 5 million tons of contained copper. 391 00:22:43,200 --> 00:22:47,680 But brownfields do exploration and and essentially incremental 392 00:22:47,680 --> 00:22:50,400 additions to our deposits has added something in the order of 393 00:22:50,640 --> 00:22:52,760 12 to 15,000,000 tons of contained copper. 394 00:22:53,120 --> 00:22:57,440 So it's, it's horses for courses and that's what we're seeing 395 00:22:57,440 --> 00:23:01,360 around the world is that actual greenfields discoveries are 396 00:23:02,680 --> 00:23:07,880 diminishingly small and compared to these enormous brownfields 397 00:23:07,880 --> 00:23:10,800 developments and redevelopments as we're seeing particularly in 398 00:23:11,040 --> 00:23:16,360 in Chilean places at the moment. So for First Quantum, our job 399 00:23:16,560 --> 00:23:20,320 throughout that period as an exploration group has really 400 00:23:20,720 --> 00:23:24,680 been been threefold 1 to go out and try and you know, look for 401 00:23:24,680 --> 00:23:29,320 the Holy Grail, the big new development, 10 million tons of 402 00:23:29,320 --> 00:23:31,240 copper or more. Those are very, very rare 403 00:23:31,240 --> 00:23:35,600 discoveries and we know that. So in the meantime, we spend a 404 00:23:35,600 --> 00:23:39,000 lot of time trying to add value to our existing deposits. 405 00:23:39,680 --> 00:23:41,280 We've had a lot of success in that area. 406 00:23:41,800 --> 00:23:45,080 Just a recent discovery near our little Chile mine in Turkey, 407 00:23:45,480 --> 00:23:47,320 which is going to add 10 years to the my life. 408 00:23:47,320 --> 00:23:48,840 It's fantastic. And the guys there who are 409 00:23:48,840 --> 00:23:51,480 looking at basically finishing up this year have suddenly got a 410 00:23:51,480 --> 00:23:56,480 whole new future ahead of them. And, and we've added a lot of 411 00:23:56,760 --> 00:24:00,600 life to places like Concentri and, and we're working very hard 412 00:24:00,600 --> 00:24:03,760 now at Sentinel and Zambia to, to increase those brownfield 413 00:24:05,120 --> 00:24:07,760 tons, which once you build a plant, it's where all the value 414 00:24:07,760 --> 00:24:11,960 is. The the third part is, is really 415 00:24:13,000 --> 00:24:15,200 about assisting our business development team. 416 00:24:15,280 --> 00:24:19,080 And 1st Quantum has acquired a lot of copper through M&A over 417 00:24:19,080 --> 00:24:20,720 the years. I think it's something in the 418 00:24:20,720 --> 00:24:23,360 order of 60 million tons of contained copper have been 419 00:24:23,360 --> 00:24:27,840 acquired through that period. We don't have geologists in a 420 00:24:27,840 --> 00:24:31,560 specialist M and A-Team like some of the bigger companies do 421 00:24:31,800 --> 00:24:35,320 we basically my guys, the exploration guys get pulled out 422 00:24:35,320 --> 00:24:37,920 of the Bush to suddenly go and rush in to look at a project in 423 00:24:38,200 --> 00:24:40,560 Brazil or Kazakhstan or wherever it happens to be. 424 00:24:40,880 --> 00:24:45,480 So we're a very integrated part of the corporate development, 425 00:24:45,800 --> 00:24:49,400 the business development side of the company, which is not 426 00:24:49,400 --> 00:24:51,320 something I've seen very much in other companies. 427 00:24:51,320 --> 00:24:53,760 They tend to have these silos of different, different groups who 428 00:24:53,760 --> 00:24:58,040 don't always talk to each other. And I think that's one of one of 429 00:24:58,040 --> 00:25:01,320 our successes. We've we've been able to to 430 00:25:01,320 --> 00:25:05,800 manage that process and be able to really understand the risks 431 00:25:05,800 --> 00:25:10,360 involved for pretty early stage projects in some cases. 432 00:25:11,120 --> 00:25:14,200 Sentinel in Zambia was a good example where it had a handful 433 00:25:14,200 --> 00:25:17,320 of holes in it. We went in and looked at it and 434 00:25:17,320 --> 00:25:20,000 thought wow, this looks like this actually could be quite 435 00:25:20,000 --> 00:25:24,640 substantial and I was all in favour for a a joint venture. 436 00:25:25,240 --> 00:25:27,360 Went back, talked to my boss and he said Nah, bugger it, we'll 437 00:25:27,360 --> 00:25:31,120 buy it. And we paid $240 million about 3 438 00:25:31,120 --> 00:25:34,640 weeks later and bought this thing with no real resource on 439 00:25:34,640 --> 00:25:37,360 it. And we built a $2 billion mine 440 00:25:37,360 --> 00:25:41,440 on top of it within two years. So that sort of quick decision 441 00:25:41,440 --> 00:25:44,560 making and the ability to act really fast on the technical 442 00:25:44,560 --> 00:25:48,800 advice of a geology team and the engineering team has I think 443 00:25:48,800 --> 00:25:50,840 stood us very well over the years compared to the 444 00:25:50,880 --> 00:25:53,000 bureaucratic process in a lot of the majors. 445 00:25:54,120 --> 00:25:57,960 It's it's really interesting you talk to, you talk to geologists 446 00:25:57,960 --> 00:26:01,800 and you ask them, you know, yeah, which of the producers, 447 00:26:01,800 --> 00:26:05,280 like major producers would like, would you actually want to work 448 00:26:05,280 --> 00:26:06,880 out? Would you, you know, feel like 449 00:26:06,880 --> 00:26:09,920 you're maximizing or utilizing your skills and having a crack, 450 00:26:09,920 --> 00:26:13,440 maybe find something and 1st quantum always comes up as 451 00:26:13,440 --> 00:26:16,040 opposed to the others where, yeah, maybe you'll be that's 452 00:26:16,040 --> 00:26:17,480 iron ore. That's not if you were as a 453 00:26:17,480 --> 00:26:18,840 geologist for a major or anything like that. 454 00:26:18,840 --> 00:26:22,000 But it's the propensity to take risk that kind of keeps popping 455 00:26:22,000 --> 00:26:24,400 up, but in a recurring way. That propensity to take risk 456 00:26:24,400 --> 00:26:28,280 that's kind of inherent to 1st Quantum has also led to some 457 00:26:28,280 --> 00:26:33,680 like challenging times as well. Not just the Cobra Panama black 458 00:26:33,680 --> 00:26:38,160 issue, which is like super, super recent, but front, front 459 00:26:38,160 --> 00:26:40,520 Frontier in the day. No, it wasn't Frontier in the 460 00:26:40,520 --> 00:26:41,080 day. I say it was. 461 00:26:41,560 --> 00:26:45,000 It was Frontier, yeah, where the the license was revoked back in 462 00:26:45,000 --> 00:26:47,200 2009, Yeah. Yeah. 463 00:26:47,200 --> 00:26:52,600 So yes, we take a lot of risks. And if you don't take risks, you 464 00:26:52,600 --> 00:26:56,360 go nowhere. And I was having a conversation 465 00:26:56,360 --> 00:26:58,200 with some of the juniors here at the conference in the last few 466 00:26:58,200 --> 00:27:00,920 days and and they're some of them spending their last dollar 467 00:27:01,480 --> 00:27:03,720 to drill the last hole. But it's like, well, they could 468 00:27:03,720 --> 00:27:05,600 choose to spin that out over a year or two. 469 00:27:06,600 --> 00:27:09,840 So, so first Quantum has grown out of taking risks, going where 470 00:27:09,840 --> 00:27:14,360 others fear to trade. And I think going into the DRC 471 00:27:14,360 --> 00:27:19,640 IN992000 when it was just recovering from civil war and 472 00:27:19,640 --> 00:27:21,400 everything else, that was a really gutsy move. 473 00:27:21,720 --> 00:27:24,800 And people sort of said, well, we, we built 2 mines there. 474 00:27:24,800 --> 00:27:26,320 We were in the process of building a third. 475 00:27:26,320 --> 00:27:29,640 And people say, oh jeez, I bet you wish you'd never been there 476 00:27:29,640 --> 00:27:31,600 because you'd lost the assets and everything else. 477 00:27:31,600 --> 00:27:34,080 Well, if we hadn't done that, we wouldn't have had the cash flow 478 00:27:34,080 --> 00:27:35,440 to build the company in the way we did. 479 00:27:35,440 --> 00:27:42,760 So it's, yeah, it's, it's a 2 edged sword that you take the 480 00:27:42,760 --> 00:27:46,960 risks and certainly building a $10 billion mine in, in Panama 481 00:27:46,960 --> 00:27:50,480 is a significant risk. We're optimistic that that 482 00:27:50,480 --> 00:27:54,200 situation will get resolved. But in the meantime, the, the 483 00:27:54,200 --> 00:27:57,640 company has this ability to pick itself back up off the floor, 484 00:27:57,840 --> 00:28:00,200 dust itself off and go look for the next great thing. 485 00:28:00,400 --> 00:28:03,520 And we're in a very lucky situation that we've got three 486 00:28:03,520 --> 00:28:08,640 potential substantial copper deposits to to build between Tak 487 00:28:08,640 --> 00:28:10,920 attacker and Argentina, which is probably the next one off the 488 00:28:11,040 --> 00:28:14,320 off the rank Hikira in Peru, which we've had for a number of 489 00:28:14,320 --> 00:28:18,920 years and and now a joint venture with Rio and Lagranga. 490 00:28:19,240 --> 00:28:23,400 So not many companies have that sort of pipeline projects to to 491 00:28:23,400 --> 00:28:27,800 back them up, but spreading that risk into different 492 00:28:27,800 --> 00:28:30,280 jurisdictions and now through partnerships with people like 493 00:28:30,280 --> 00:28:33,000 Rio, that's, that's going to become an increasingly important 494 00:28:33,000 --> 00:28:34,560 part of the the equation, I think. 495 00:28:35,560 --> 00:28:38,000 Mike, you've got years more experience on us. 496 00:28:38,000 --> 00:28:42,440 I'm very interested to hear your view on that boldness you speak 497 00:28:42,440 --> 00:28:46,000 to in the mining industry. The, the industry, particularly 498 00:28:46,000 --> 00:28:49,240 in in Australia, I think prides itself on the, the characters 499 00:28:49,240 --> 00:28:52,840 and these sorts of people who took a lot of risk and were 500 00:28:52,840 --> 00:28:54,360 successful. You know, you don't talk so much 501 00:28:54,360 --> 00:28:57,800 about the ones that weren't. But has that changed over your 502 00:28:57,800 --> 00:28:59,160 career? Do you think that boldness is 503 00:28:59,160 --> 00:29:02,720 missing? Yeah, look, I can only speak 504 00:29:02,720 --> 00:29:05,560 from my personal experience. I, I started out my career with 505 00:29:05,560 --> 00:29:08,000 Rio Tinto and, and on a technical level it was 506 00:29:08,000 --> 00:29:10,120 fantastic. I mean, I learnt so much in 10 507 00:29:10,120 --> 00:29:15,400 years with Rio, but then I worked in several companies 508 00:29:15,400 --> 00:29:18,560 after that, which had a real risk aversion. 509 00:29:19,480 --> 00:29:21,640 And I was working at increasingly senior levels in 510 00:29:21,640 --> 00:29:27,400 companies working with a board who I would present multiple 511 00:29:27,960 --> 00:29:30,400 opportunities to that I really thought were a slam dunk. 512 00:29:30,400 --> 00:29:35,520 They just weren't prepared to go that last mile to to make the 513 00:29:35,520 --> 00:29:38,440 investment. And yeah, you don't win them 514 00:29:38,440 --> 00:29:39,600 all. You can't win them all. 515 00:29:41,040 --> 00:29:44,520 But I think now we're in this situation, as I mentioned 516 00:29:44,520 --> 00:29:47,760 before, where I think a lot of the majors are really gunshot to 517 00:29:47,760 --> 00:29:49,640 go out and do these big developments. 518 00:29:50,640 --> 00:29:55,240 And so, you know, they're much more comfortable about putting 519 00:29:55,240 --> 00:29:59,240 their money into Brownfield's expansions at Escondider or 520 00:29:59,240 --> 00:30:01,480 where but I mean Escondider can't expand forever. 521 00:30:01,480 --> 00:30:06,680 I mean, it's there is a limit I think to that equation and the 522 00:30:06,680 --> 00:30:09,320 grades are getting lower and lower and power cuts costs are 523 00:30:09,320 --> 00:30:13,760 going through the roof. And it's, I think people just 524 00:30:13,920 --> 00:30:18,840 really have to look now at balancing that equation with, 525 00:30:19,680 --> 00:30:22,240 but probably what is going to be a lot of deep drilling in new 526 00:30:22,240 --> 00:30:26,160 environments to try and understand where these the 527 00:30:26,160 --> 00:30:32,400 deeper deposits are because and, and how to mine them more 528 00:30:32,400 --> 00:30:33,920 effectively. You know, I mean, we've got 529 00:30:34,120 --> 00:30:36,320 really only two or three companies in the world who are 530 00:30:36,320 --> 00:30:38,680 really good bulk underground miners. 531 00:30:39,840 --> 00:30:43,200 And that was that IP was in EUCRIS and now wrapped up in 532 00:30:43,200 --> 00:30:45,080 Newmont and I'm sure they will do well with it. 533 00:30:45,800 --> 00:30:48,200 And Rio's busy trying to develop that at a togroy. 534 00:30:49,440 --> 00:30:53,680 So, so I think that's, that's the area technology 535 00:30:54,040 --> 00:30:58,360 technologically where we really need to be looking at because I, 536 00:30:58,360 --> 00:31:02,040 I think the days of finding these big multi billion ton open 537 00:31:02,040 --> 00:31:04,200 pits in your surface are disappearing fast. 538 00:31:07,480 --> 00:31:10,600 Block caves that are deep and with little little surface 539 00:31:10,600 --> 00:31:13,840 mineralisation. It's a different payoff profile 540 00:31:13,840 --> 00:31:15,120 as well, right? Absolutely. 541 00:31:15,560 --> 00:31:19,200 And, you know, I remember the early days of, of soul gold and 542 00:31:19,200 --> 00:31:21,960 talking to Nick Mather at the time when he was drilling some 543 00:31:21,960 --> 00:31:25,560 of the the first holes there at Alcala. 544 00:31:25,560 --> 00:31:28,320 And it was like fantastic holes, Nick, well done. 545 00:31:28,440 --> 00:31:30,640 You know, and he was saying, yeah, but nobody's taking any 546 00:31:30,640 --> 00:31:33,040 notice. And of course, eventually the 547 00:31:33,120 --> 00:31:36,880 the world cottoned onto that story and the share price went 548 00:31:36,880 --> 00:31:39,400 ballistic for a while. It's come a bit down to, to 549 00:31:39,480 --> 00:31:44,800 earth now because of the reality of, of developing something like 550 00:31:44,800 --> 00:31:48,200 that. And it's one thing doing it in 551 00:31:48,200 --> 00:31:50,760 South Australia, it's another thing trying to do it in the, in 552 00:31:50,760 --> 00:31:54,800 the high Andes of Ecuador. And there's, there's a lot of 553 00:31:54,800 --> 00:31:57,120 sensitivities, sensitivities around that. 554 00:31:57,120 --> 00:32:00,120 And you've seen how Rio struggled in the early days of 555 00:32:00,120 --> 00:32:01,720 all. You told you to make, make that 556 00:32:01,720 --> 00:32:03,920 block cave work. They had to redesign the whole 557 00:32:03,920 --> 00:32:08,440 thing, as I understand it. So it's not a simple equation. 558 00:32:09,800 --> 00:32:13,080 And you look at projects like Pebble and, and resolution and, 559 00:32:13,080 --> 00:32:17,160 and some of those and sat there for 30 years or more without 560 00:32:17,160 --> 00:32:19,840 being developed. So they will happen ultimately. 561 00:32:20,440 --> 00:32:24,840 But the risk profile in that versus going out looking for new 562 00:32:24,840 --> 00:32:27,000 higher grade underground deposits is what people need to 563 00:32:27,000 --> 00:32:30,960 be thinking about. And I don't know that people are 564 00:32:30,960 --> 00:32:32,960 really appreciating that that equation. 565 00:32:33,360 --> 00:32:37,200 So hence our push into sediment hosted copper territory. 566 00:32:37,200 --> 00:32:39,720 It's a, it's a very different exploration model to a porphyry. 567 00:32:40,120 --> 00:32:43,080 Instead of looking for a nice bright magnetic BLOB in an 568 00:32:43,080 --> 00:32:46,480 image, you're basically having to build a whole geological 569 00:32:46,480 --> 00:32:50,240 framework picture of a sedimentary basin and try and 570 00:32:50,240 --> 00:32:52,320 understand what the fluid flow was in that basin. 571 00:32:52,320 --> 00:32:55,800 It's more like oil exploration in a sense than than the 572 00:32:56,120 --> 00:32:58,120 traditional copper exploration for porphyries. 573 00:32:58,520 --> 00:33:02,520 So, So it's a very different equation in that you've got to, 574 00:33:04,040 --> 00:33:07,360 it's a long time frame, it's a lot of deep drilling and a lot 575 00:33:07,360 --> 00:33:11,120 of dust is on the way, but you use that to build your 576 00:33:11,120 --> 00:33:15,760 geological picture. So yeah, hopefully we can find 577 00:33:15,760 --> 00:33:19,200 more sediment hosted copper, which in an underground mining 578 00:33:19,200 --> 00:33:21,400 perspective is a far easier proposition. 579 00:33:21,400 --> 00:33:24,120 And we've seen that from from the, the really quite wonderful 580 00:33:24,120 --> 00:33:28,600 development at Kamala, which I think Ivanhoe and Xijin really 581 00:33:28,920 --> 00:33:30,680 deserve some pretty good credit for. 582 00:33:30,680 --> 00:33:34,640 They they have done that at a minimum cost for the amount of 583 00:33:34,640 --> 00:33:36,040 copper production coming out of that. 584 00:33:36,560 --> 00:33:39,120 And it's about grade and it's about a very slick development. 585 00:33:41,440 --> 00:33:45,320 What's the the the best thing that the the industry could do 586 00:33:45,320 --> 00:33:47,680 to improve the probability of success with exploration? 587 00:33:50,360 --> 00:33:57,320 Take some risks and better risks and better risks and really 588 00:33:57,320 --> 00:34:02,600 focus on science. You know, I, I see many, many 589 00:34:02,600 --> 00:34:08,560 junior proposals come over my desk and my team goes and 590 00:34:08,560 --> 00:34:10,400 investigates them all over the world. 591 00:34:11,920 --> 00:34:16,679 And a surprisingly small number of them are really using top 592 00:34:16,679 --> 00:34:19,760 class geoscience to to understand what they're what 593 00:34:19,760 --> 00:34:22,280 they're looking at. They're rehashing old data. 594 00:34:22,679 --> 00:34:25,639 They're taking soil samples or rock chip samples in an area 595 00:34:25,639 --> 00:34:28,679 that's been well sampled before. They're drilling shallow holes. 596 00:34:29,000 --> 00:34:31,639 They're not really conceptualizing what could be. 597 00:34:31,639 --> 00:34:34,760 And they're desperate just to get that next drilling stepped 598 00:34:34,760 --> 00:34:39,480 out into the market. So it's, it's not really, and I, 599 00:34:40,000 --> 00:34:42,679 I blame the market for that in a sense that it's, it's just 600 00:34:42,679 --> 00:34:47,040 driving this short term news flow rather than trying to 601 00:34:47,040 --> 00:34:50,040 encourage a company like FILO to go and drill their 1 1/2 602 00:34:50,040 --> 00:34:53,239 kilometer deep hole to look for the the next best thing. 603 00:34:53,600 --> 00:34:57,160 So I think since that discovery, everybody with a, a dud porphyry 604 00:34:57,160 --> 00:34:59,480 in the Andes is drilling a lot of deep holes underneath trying 605 00:34:59,480 --> 00:35:00,920 to find out if there's a mother lode there. 606 00:35:01,880 --> 00:35:04,280 So that's good and, and hopefully there will be some 607 00:35:04,280 --> 00:35:08,000 more discoveries like that. I still think that project is 608 00:35:08,000 --> 00:35:11,440 going to be decades away before it actually produces any copper, 609 00:35:11,440 --> 00:35:13,880 but it, it will be a world class deposit for sure. 610 00:35:14,360 --> 00:35:18,200 So I do think that some enhanced geoscience and I think that's 611 00:35:18,200 --> 00:35:20,080 where the majors have a really big part to play. 612 00:35:20,440 --> 00:35:24,360 You know, we, we pride ourselves and I know Rio and BHP and 613 00:35:24,360 --> 00:35:26,920 others do as well on having top class teams. 614 00:35:26,920 --> 00:35:29,280 We, we really try to have the best structural geologists, 615 00:35:29,280 --> 00:35:33,360 geochemists, and now increasingly people with AI and 616 00:35:33,360 --> 00:35:37,640 programming skills to, to synthesize data and make the 617 00:35:37,640 --> 00:35:42,440 best predictive models we can. But you know, there's a limited 618 00:35:42,440 --> 00:35:44,760 amount of crossover between them and the juniors that have the 619 00:35:44,760 --> 00:35:47,000 ground. So we've got to make that 620 00:35:47,000 --> 00:35:50,480 process work better. Last one from me, Mike, coming 621 00:35:50,480 --> 00:35:56,720 at it from a financial lens, is there an over reliance on NPV 622 00:35:56,840 --> 00:36:03,480 analysis and IRS? Does that forget the optionality 623 00:36:03,520 --> 00:36:06,160 that's inherent in long life projects? 624 00:36:07,600 --> 00:36:09,200 Yeah. And it's a question we ask 625 00:36:09,200 --> 00:36:11,480 ourselves and I think particularly people like BHP 626 00:36:11,480 --> 00:36:14,640 must have asked themselves at all the time, because, you know, 627 00:36:14,640 --> 00:36:17,320 they're looking at assets that, that they want multi 628 00:36:17,320 --> 00:36:19,760 generational assets that we're there for 50 years. 629 00:36:21,000 --> 00:36:26,840 And, and so do we. But when you calculate those 630 00:36:26,840 --> 00:36:30,480 things on an MPV, the, the future returns more than 1020 631 00:36:30,480 --> 00:36:33,920 years away diminish to the point of not being very useful. 632 00:36:35,000 --> 00:36:37,480 So you've really got to get your, your capital back. 633 00:36:37,680 --> 00:36:40,960 I think that's where the, the Chinese have won because they've 634 00:36:41,040 --> 00:36:44,480 been looking at it in terms of, of, of copper production and 635 00:36:44,480 --> 00:36:46,960 revenue rather than an MPV basis. 636 00:36:47,080 --> 00:36:48,760 Everything is driven by revenue in China. 637 00:36:50,320 --> 00:36:52,680 And that's just a function of the way the politics works. 638 00:36:53,720 --> 00:36:59,240 So they will, they will build an asset that will have a long 639 00:36:59,560 --> 00:37:04,120 future cash flow without really worrying too much about the the 640 00:37:04,120 --> 00:37:08,320 payback on, on that. And that's that's the 641 00:37:08,320 --> 00:37:09,720 difference. And I think that's where they've 642 00:37:09,720 --> 00:37:11,840 been able to take some risks that that we haven't. 643 00:37:13,560 --> 00:37:18,040 So yeah, it's, it's, it's a hard one. 644 00:37:18,040 --> 00:37:23,760 I think the real restriction at the moment, it's clearly not a 645 00:37:23,760 --> 00:37:25,800 lack of copper deposits. The world has lots of them. 646 00:37:26,880 --> 00:37:33,640 It is the really rapidly escalating cost of the capital. 647 00:37:35,000 --> 00:37:38,920 And if we look at it over the last sort of 15 years or so, 648 00:37:40,640 --> 00:37:46,480 we've seen the the cost of capital treble or quadruple for 649 00:37:47,040 --> 00:37:49,440 an equivalent development where operational costs might have 650 00:37:49,440 --> 00:37:52,160 doubled in that time. The price of coppers doubled in 651 00:37:52,160 --> 00:37:54,840 that time. But the cost of building these 652 00:37:54,840 --> 00:37:57,400 big deposits, partly because they're low grade and partly 653 00:37:57,400 --> 00:38:00,160 because they're in pretty difficult parts of the world has 654 00:38:00,240 --> 00:38:01,600 has gone up by three to four times. 655 00:38:01,920 --> 00:38:06,120 So we're now talking about $30,000 per tonne of copper 656 00:38:06,120 --> 00:38:09,840 production a year, whereas when we built Sentinel, it was around 657 00:38:09,840 --> 00:38:14,000 7 or $8000 a tonne. So your payback was, you know, 658 00:38:14,600 --> 00:38:16,920 copper price at the time was probably 4 1/2 or 5000. 659 00:38:16,920 --> 00:38:18,760 Your payback was a couple of years away. 660 00:38:19,400 --> 00:38:22,760 Now you're talking about not getting a payback for, you know, 661 00:38:23,000 --> 00:38:25,240 really quite a long time. And that applies to the 662 00:38:25,240 --> 00:38:27,600 brownfields developments. You've seen some of the, the 663 00:38:27,600 --> 00:38:32,240 announcements recently by BHP and Cadelco in South America and 664 00:38:32,520 --> 00:38:36,160 they're vast 10s of billions of dollars going in basically just 665 00:38:36,160 --> 00:38:40,400 to keep level production going over the next 10 years. 666 00:38:42,800 --> 00:38:46,080 So it's, it's a diminishing equation where you're having to 667 00:38:46,080 --> 00:38:50,200 spend more and more capital to get that production even to keep 668 00:38:50,200 --> 00:38:55,240 it going, but certainly on a Greenfield's development and and 669 00:38:55,240 --> 00:38:58,480 that's then stopping companies going ahead to to build them. 670 00:38:58,800 --> 00:39:01,560 So they're just investing the capital in, in expanding what 671 00:39:01,560 --> 00:39:05,600 they've got. So, yeah, it's it, it really, 672 00:39:06,920 --> 00:39:10,560 I'm not a great believer in the the Copper Cliff because I've 673 00:39:10,560 --> 00:39:12,920 been in the copper game long enough to have been shown these 674 00:39:12,920 --> 00:39:17,560 diagrams of, of peaking copper a few years away and how it's all 675 00:39:17,560 --> 00:39:19,760 going to fall off a Cliff and it actually never happens. 676 00:39:20,040 --> 00:39:22,800 I could show you something from 15 years ago that said it was by 677 00:39:22,800 --> 00:39:28,320 2025 would be have have, you know, a really diminishing 678 00:39:28,320 --> 00:39:30,240 profile. But we continue to grow that 679 00:39:30,240 --> 00:39:35,200 that copper production every year by two to 3%, but it's 680 00:39:35,200 --> 00:39:40,320 largely around discovery of near mine resources and and expanding 681 00:39:40,320 --> 00:39:42,160 those operations not through Greenfields. 682 00:39:42,160 --> 00:39:44,840 Greenfields is making a a really small contribution to that. 683 00:39:46,440 --> 00:39:48,600 Fantastic, Mike. We're pretty pumped we could 684 00:39:48,800 --> 00:39:50,960 finally get you on the show, so thanks for making the time for 685 00:39:50,960 --> 00:39:51,760 us. Yeah, pleasure. 686 00:39:52,160 --> 00:39:54,280 Great to be here. Very, very good. 687 00:39:54,360 --> 00:39:58,560 Bloody fancy background there. Love the love the oh here. 688 00:39:58,560 --> 00:40:02,240 That background may have been used on other publications. 689 00:40:02,680 --> 00:40:04,720 Yeah, I'm grateful. We gotta use it once, yeah? 690 00:40:05,160 --> 00:40:08,040 Yeah, yeah, I've can't. I'm curious to see where it's 691 00:40:08,040 --> 00:40:09,960 popped up, but if you're the people, use that. 692 00:40:09,960 --> 00:40:11,480 There's a lot of interviews in front of it. 693 00:40:11,840 --> 00:40:14,120 Credit to the Edin Arbor team for putting it there for us. 694 00:40:14,120 --> 00:40:17,800 But yeah, maybe you might see it in a CNBC interview sometime. 695 00:40:18,080 --> 00:40:20,200 I'll bet I'll love. So how good's Jim Cramer? 696 00:40:20,720 --> 00:40:23,320 It's funny. I'll bet all I'm CNBCI can 697 00:40:23,320 --> 00:40:24,400 picture. That'd be me. 698 00:40:24,400 --> 00:40:26,440 What a mother. Yeah, I didn't see him there, 699 00:40:26,440 --> 00:40:29,720 but you know, same time home he. Might have saw you but JD. 700 00:40:29,840 --> 00:40:30,960 It's true. It's true. 701 00:40:31,400 --> 00:40:32,880 Right. Oh, thanks to all the bloody 702 00:40:32,880 --> 00:40:35,360 partners. Mineral Mining services, 703 00:40:35,520 --> 00:40:38,760 grounded Sandvik ground support, CRA Insurance, cage drill, 704 00:40:38,760 --> 00:40:43,320 Saltbush contracting, Swick, Watro energy and at Watro. 705 00:40:43,400 --> 00:40:44,960 Project Engineering. Fuck. 706 00:40:45,520 --> 00:40:48,440 That'll do Potro energy. It could be an offshoot. 707 00:40:48,640 --> 00:40:51,840 My mind was moving already ahead to who we had in the show cross 708 00:40:51,840 --> 00:40:53,760 boundary. Energy and 100 bucks off your 709 00:40:53,760 --> 00:40:55,960 Aussie MMM Underground Operators tickets. 710 00:40:56,240 --> 00:40:59,480 Here's the card MOM 100 it's $300. 711 00:40:59,520 --> 00:41:02,600 Hoodoo money miners, hoodoo right eye money miners. 712 00:41:02,600 --> 00:41:06,880 Little special trade at the back end of the show here for in the 713 00:41:06,880 --> 00:41:11,400 lead up of underground Operators conference, Aussie MMM Adelaide 714 00:41:12,040 --> 00:41:14,960 April 7th to 9th. And we've got one of the big 715 00:41:14,960 --> 00:41:19,400 dogs, one of the, you know, one of the best friends of Oz IMEM, 716 00:41:19,400 --> 00:41:24,000 you'd say Epirock now. And representing Epirock today, 717 00:41:24,000 --> 00:41:27,560 Martin Waldman, the global portfolio manager for 718 00:41:27,600 --> 00:41:32,160 underground trucks dialing in from the Northern hemisphere. 719 00:41:32,160 --> 00:41:33,680 Welcome to money of mine, copper. 720 00:41:35,280 --> 00:41:37,600 Thank you very much and thank you for inviting. 721 00:41:37,600 --> 00:41:40,240 Me. Oh absolute, absolute pleasure. 722 00:41:40,240 --> 00:41:44,880 Thank Oz IMEM for that, mate. Mate said last underground 723 00:41:44,880 --> 00:41:46,400 operators conference a couple of years ago. 724 00:41:47,360 --> 00:41:50,360 I guess the feel of the industry in terms of automation, 725 00:41:50,360 --> 00:41:53,200 electrification, haulage and everything has probably changed 726 00:41:53,200 --> 00:41:55,680 a lot. How much has it changed from the 727 00:41:55,680 --> 00:41:57,520 epiroxide? What are you seeing the big 728 00:41:57,520 --> 00:42:01,080 ticket items at the moment? I would say, I mean the, the 729 00:42:01,080 --> 00:42:05,880 main focus is still electrification and automation. 730 00:42:05,880 --> 00:42:07,760 That's still the, the big, the big thing. 731 00:42:08,200 --> 00:42:11,360 Of course, the we have continued to continue to develop our 732 00:42:11,360 --> 00:42:14,560 machines or customers. I would say they have also 733 00:42:14,560 --> 00:42:19,880 started to get more and more used to operating electrified 734 00:42:19,880 --> 00:42:24,960 machines. So that's small, small step 735 00:42:24,960 --> 00:42:28,160 forwards around for both us and and our customers. 736 00:42:28,560 --> 00:42:30,920 Yeah, right. So what specific machinery are 737 00:42:30,920 --> 00:42:34,520 we going to see? What normally you guys have just 738 00:42:34,520 --> 00:42:37,680 a big, some big, I don't know how you get the machines in 739 00:42:37,680 --> 00:42:40,840 there. What is going to be the showcase 740 00:42:40,880 --> 00:42:44,400 item? For for the mine, starting with 741 00:42:44,400 --> 00:42:46,360 the mine tracks, we will not have, we will not have the 742 00:42:46,360 --> 00:42:47,920 machine. That machine will be shifting 743 00:42:47,920 --> 00:42:51,000 straight later on this spring. But that is a completely new 744 00:42:51,240 --> 00:42:56,840 mine track with a new new frame, new basically a new cab. 745 00:42:57,000 --> 00:42:59,280 But the big thing is a complete new drivetrain. 746 00:42:59,280 --> 00:43:03,520 We have removed all the basically all the moving 747 00:43:03,520 --> 00:43:07,480 components such as shafts, transmissions, axles and those 748 00:43:07,480 --> 00:43:09,400 things that are placed with electrical motors. 749 00:43:09,400 --> 00:43:12,920 So we still, we start with the diesel engine, but that's kind 750 00:43:12,920 --> 00:43:15,120 of the only thing that the component that is the same as 751 00:43:15,120 --> 00:43:17,560 previous model, but the rest is, is new. 752 00:43:18,560 --> 00:43:21,760 And then we do, we do similar things for the for the loaders, 753 00:43:22,360 --> 00:43:24,320 but then we're still keeping a transmission. 754 00:43:25,320 --> 00:43:27,520 So that's the big thing within the material handling. 755 00:43:27,920 --> 00:43:32,120 And of course we're doing similar, I shouldn't say similar 756 00:43:32,120 --> 00:43:33,680 because it's not, it's not the same thing. 757 00:43:33,680 --> 00:43:36,720 But we we already like to find the drill rigs of course, and 758 00:43:36,720 --> 00:43:39,680 that is what we will display at the show. 759 00:43:40,800 --> 00:43:44,160 Are we offering any discounts in Adelaide for purchase of this 760 00:43:44,160 --> 00:43:47,600 equipment? It's like 2020% off or 761 00:43:47,600 --> 00:43:50,840 something. Usually you've got everything on 762 00:43:50,840 --> 00:43:53,640 show you want to. Sell to come and talk doesn't. 763 00:43:53,680 --> 00:43:55,520 We will see. Right, all right, I'll. 764 00:43:55,600 --> 00:43:57,280 I'll bring him. I'll bring him to you. 765 00:43:57,760 --> 00:44:00,200 Right, mate? Well, I look forward to seeing 766 00:44:00,200 --> 00:44:02,000 you in Adelaide April 7th to 9th. 767 00:44:02,000 --> 00:44:04,080 Cannot bloody. Why have you been to every 768 00:44:04,080 --> 00:44:07,280 underground operators? No, So this will be my first 769 00:44:07,280 --> 00:44:10,520 time we would have a big group of people coming over from 770 00:44:10,520 --> 00:44:12,360 Sweden. So everybody's more than welcome 771 00:44:12,360 --> 00:44:14,160 to join us. Mate, you have a good. 772 00:44:14,160 --> 00:44:16,680 Discussion, hang around me, I'll give you the guided. 773 00:44:16,680 --> 00:44:17,960 Absolutely. We'll have a great time. 774 00:44:17,960 --> 00:44:19,960 Absolutely right. Thanks very much, mate. 775 00:44:20,000 --> 00:44:21,400 Look forward to seeing you. Thank you. 776 00:44:23,400 --> 00:44:25,920 Right. The information contained in 777 00:44:25,920 --> 00:44:28,760 this episode of Money of Mine is of general nature only and does 778 00:44:28,760 --> 00:44:31,520 not take into account the objectives, financial situation 779 00:44:31,600 --> 00:44:33,640 or needs of any particular person. 780 00:44:33,880 --> 00:44:36,920 Before making any investment decision, you should consult 781 00:44:36,960 --> 00:44:40,000 with your financial advisor and consider how appropriate the 782 00:44:40,000 --> 00:44:43,680 advice is to your objectives, financial situation and needs.