1 00:00:00,520 --> 00:00:04,520 Maddie in this chat Spartan and Middlesex gets mentioned and 2 00:00:04,520 --> 00:00:07,640 Ding Ding Ding for JDI. Righto money miners. 3 00:00:07,640 --> 00:00:10,720 Another bloody great yarn delivered by Axis Mine and 4 00:00:10,720 --> 00:00:12,520 Technology. Have a look at that bloody hat 5 00:00:12,520 --> 00:00:13,760 trap. How good's the hat? 6 00:00:13,760 --> 00:00:16,560 How good's the champ Orry behind you, The champ Gyro? 7 00:00:16,680 --> 00:00:19,080 Jesus Christ, I wouldn't. If anyone's thinking of any 8 00:00:19,080 --> 00:00:22,440 other bloody supplier, give yourself an uppercut 'cause that 9 00:00:22,440 --> 00:00:26,760 Axis Mine and Technology is all you need to think about forever. 10 00:00:27,200 --> 00:00:30,080 The the the Gyros and the the Yaris are actually even better 11 00:00:30,080 --> 00:00:31,800 than the hat and the hat's. Pretty good tribe bought one. 12 00:00:31,920 --> 00:00:33,560 Yeah, Yeah, just out in his room. 13 00:00:33,560 --> 00:00:35,240 Right. Let's rip in, mate. 14 00:00:35,240 --> 00:00:38,960 We have got a bloody brilliant little fundy chat coming with 15 00:00:39,080 --> 00:00:42,000 Maddie Gryphon from Maple Brown Abbott. 16 00:00:42,600 --> 00:00:46,360 Mate, I've been watching Suits. Can we get your name on the 17 00:00:46,360 --> 00:00:48,840 company? It's all about getting your name 18 00:00:48,840 --> 00:00:51,080 on the door. Maple Brown Abbott Gryphon. 19 00:00:51,520 --> 00:00:54,520 It could be after this. Yeah. 20 00:00:54,560 --> 00:00:58,160 The business was founded about 40 years ago and by Mr Mabel 21 00:00:58,160 --> 00:01:00,600 Brown and Mr Abbott. So I think I've probably got 22 00:01:00,840 --> 00:01:02,360 very little to no chance of that happening. 23 00:01:02,360 --> 00:01:03,760 So it's a. It's a pretty good name in the. 24 00:01:03,760 --> 00:01:06,760 Industry and don't give up hope. Don't give up hope. 25 00:01:06,800 --> 00:01:11,240 Oh mates were girl ripping you in so you're buddy. 26 00:01:11,320 --> 00:01:16,200 Actually I won't read the boys notes about what you do because 27 00:01:16,200 --> 00:01:18,000 that'll that's degrading to them. 28 00:01:18,000 --> 00:01:21,520 Boys, lay the land about who this Maddie Gryphon Fuller is. 29 00:01:23,040 --> 00:01:24,280 Oh, let's, let's root straight in. 30 00:01:24,280 --> 00:01:26,440 So we've, we've tried to get Maddie on the show for a little 31 00:01:26,440 --> 00:01:28,080 while. Then we've finally managed to 32 00:01:28,080 --> 00:01:29,640 make it happen, which we're very pumped about. 33 00:01:29,640 --> 00:01:32,880 So Maddie, I wouldn't speak too much for him, but he runs the, 34 00:01:33,640 --> 00:01:36,800 the Aussie small caps fund. So a generalist, but quite a, 35 00:01:36,800 --> 00:01:40,920 quite a bent at the moment, about 1/4 of the portfolio in 36 00:01:41,080 --> 00:01:44,360 resources and a lot of the names that we love to chat about. 37 00:01:44,360 --> 00:01:47,320 So in honour of you, Maddie, Michael, I thought we'd start 38 00:01:47,320 --> 00:01:53,120 with uranium. So Paladin and Boss Energy both 39 00:01:53,200 --> 00:01:57,560 in the portfolio and I heard you do an interview maybe 8:00 or so 40 00:01:57,560 --> 00:02:01,720 months ago talking about the the supply side narrative that sort 41 00:02:01,720 --> 00:02:04,760 of sits behind uranium. We've sort of talked about it 42 00:02:04,760 --> 00:02:07,480 quite a bit on the potty. But yeah, keen to keen to hear 43 00:02:07,800 --> 00:02:10,360 how you came across picking these two names to start with in 44 00:02:10,360 --> 00:02:13,640 the the wider world of uranium. Yeah, that's right. 45 00:02:13,680 --> 00:02:17,120 I mean, you know, uranium has been talked about a lot in your 46 00:02:17,120 --> 00:02:21,000 show by a lot of smart people. So I guess the the difference in 47 00:02:21,000 --> 00:02:23,520 where my view is versus what a lot of the rest of the market 48 00:02:23,520 --> 00:02:25,880 is. I'm probably less of a Super 49 00:02:25,880 --> 00:02:29,360 Bowl on the demand side. I don't see sort of uranium 50 00:02:29,360 --> 00:02:32,000 reactors being rolled out like they were in in the 70s or 80s. 51 00:02:32,400 --> 00:02:35,000 I just think it becomes very hard politically in a lot of 52 00:02:35,000 --> 00:02:38,680 Western countries given these very expensive builds over 10 to 53 00:02:38,680 --> 00:02:42,280 15 years sort of programmes and you really need to have that 54 00:02:42,280 --> 00:02:45,120 industrial base in place. So I think that becomes a bit 55 00:02:45,120 --> 00:02:47,040 difficult. What we'll probably see in the 56 00:02:47,040 --> 00:02:51,000 Western world is extension of lives continue and then you 57 00:02:51,000 --> 00:02:55,400 supplement that with Chinese, Indian, Middle Eastern roll outs 58 00:02:55,400 --> 00:02:58,160 which come online. So I think that leads to some 59 00:02:58,160 --> 00:03:00,920 slight growth in uranium demand over the kind of the next 10 or 60 00:03:00,920 --> 00:03:05,040 15 years, noting that uranium demand over the past 30 years 61 00:03:05,040 --> 00:03:08,040 has gone pretty much nowhere. I think that probably steps up 62 00:03:08,040 --> 00:03:09,440 to maybe one or two percent a year. 63 00:03:10,080 --> 00:03:12,320 The interesting thing we're starting to hear a bit more of 64 00:03:12,640 --> 00:03:16,160 recently is in the US particularly these capacity 65 00:03:16,160 --> 00:03:19,040 upgrades. So the ability for existing 66 00:03:19,040 --> 00:03:24,200 reactors to add, say 5 to 10% on top of existing capacity for 67 00:03:24,200 --> 00:03:28,560 pretty low CapEx, the likes of Constellation, some of those US 68 00:03:28,560 --> 00:03:29,840 producers are starting to do that. 69 00:03:29,840 --> 00:03:32,720 So that's probably some incremental positive news for 70 00:03:32,720 --> 00:03:35,480 the space. In terms of the stocks, Boston 71 00:03:35,480 --> 00:03:37,760 Paladin, it's quite simple actually. 72 00:03:38,280 --> 00:03:39,920 Our process is pretty earnings focused. 73 00:03:40,000 --> 00:03:42,880 We don't go too far down the value chain in terms of 74 00:03:42,880 --> 00:03:45,120 exploration. We want to see production and 75 00:03:45,120 --> 00:03:46,520 cash flow within two to three years. 76 00:03:47,560 --> 00:03:50,400 So Boston Paladin were effectively Aussie uranium 77 00:03:50,400 --> 00:03:53,440 stocks which fit the bill. We did get quite a lot of 78 00:03:53,440 --> 00:03:56,000 comfort on the projects on the restarts there, spent a lot of 79 00:03:56,000 --> 00:03:59,480 time with management and sort of related companies around space 80 00:03:59,480 --> 00:04:02,760 to get comfort on that. But essentially it's a pretty 81 00:04:02,760 --> 00:04:04,880 limited subset of stocks in uranium. 82 00:04:05,800 --> 00:04:07,360 They will kind of have hairs on them. 83 00:04:07,400 --> 00:04:09,880 So you've got to put up with the a few issues and all of them, 84 00:04:09,880 --> 00:04:13,840 and I'm sure we'll talk about some of those, but that that was 85 00:04:13,840 --> 00:04:16,360 a decision driving past the Paladin into the fund over the 86 00:04:16,360 --> 00:04:18,920 past couple of years. Well, we'll start, start on 87 00:04:18,920 --> 00:04:22,960 Paladin, start on Paladin then as a as an equity holder, what 88 00:04:22,960 --> 00:04:26,840 was your, I guess initial reaction to the Fission merger? 89 00:04:27,760 --> 00:04:31,520 Yeah, it's an interesting one. I look, it's long dated, so that 90 00:04:31,720 --> 00:04:34,720 project's probably only going to be in production post 2030. 91 00:04:36,720 --> 00:04:39,680 Taking a view on the project, it's it's a difficult part of 92 00:04:39,680 --> 00:04:41,800 the world. It's provided there's obviously 93 00:04:41,800 --> 00:04:44,960 a lot of permitting challenges to get through and there's 94 00:04:44,960 --> 00:04:47,840 issues around kind of freezing, you know, the ground there to 95 00:04:47,840 --> 00:04:49,440 get, get the production ramping up. 96 00:04:49,440 --> 00:04:51,960 So it's not without challenges. Having said that, it is a very 97 00:04:51,960 --> 00:04:54,760 high quality project, high quality deposit should be very 98 00:04:54,760 --> 00:04:56,960 low cost, reasonable size producer. 99 00:04:56,960 --> 00:04:59,280 I can see value in excess of where Paladin's paid. 100 00:04:59,320 --> 00:05:02,240 So I think they've, they've bought it quite well, added a 101 00:05:02,240 --> 00:05:05,600 pretty, you know, depressed time in, in the short term cycle of 102 00:05:05,600 --> 00:05:07,560 your earning. I just don't, I don't think 103 00:05:07,560 --> 00:05:11,040 taking pounds out of the market or consolidating supply is a bad 104 00:05:11,040 --> 00:05:13,360 thing either. I think that can only sort of 105 00:05:13,360 --> 00:05:15,320 lead to better things on, on a pricing dynamic. 106 00:05:15,320 --> 00:05:18,960 So reasonably positive overall, noting that it is quite long 107 00:05:18,960 --> 00:05:21,360 dated. I think Paladin just becomes 108 00:05:21,360 --> 00:05:24,880 kind of the, the growth uranium option for many investors. 109 00:05:24,880 --> 00:05:27,840 It's, it's big, it's got hundreds of millions of pounds. 110 00:05:28,680 --> 00:05:30,040 There's plenty of optionality there. 111 00:05:30,040 --> 00:05:33,320 So I think if and when we start to see the spot price, spot 112 00:05:33,320 --> 00:05:36,680 price tick back up, Paladin probably sort of attracts some 113 00:05:36,720 --> 00:05:38,640 of the global investors to that growth pipeline. 114 00:05:38,920 --> 00:05:41,920 It was, it was looking at the the fly over thing of the 115 00:05:41,920 --> 00:05:44,520 fission project. It looked bloody easy. 116 00:05:44,520 --> 00:05:47,520 It was all green and everything. They don't put all the snow on 117 00:05:47,520 --> 00:05:51,640 the, on the animation of what the project project looks like 118 00:05:51,920 --> 00:05:55,000 there and, and, and it looks like, oh, that's pretty easy to 119 00:05:55,000 --> 00:05:56,480 get to. But from what I've heard that 120 00:05:56,840 --> 00:06:00,160 those projects are so remote and the logistical challenge of 121 00:06:00,160 --> 00:06:03,840 developing them is, you know, something not to be 122 00:06:03,840 --> 00:06:06,840 underestimated. But then you look at the Fission 123 00:06:06,840 --> 00:06:10,200 project being right next door to next Gen. 124 00:06:10,200 --> 00:06:14,520 So you got two projects very close in a very remote area. 125 00:06:14,520 --> 00:06:17,400 It just makes obviously so much logical sense that there'll be 126 00:06:17,760 --> 00:06:21,840 one stand alone operation there instead of two. 127 00:06:22,360 --> 00:06:26,120 How do you see all that possibly tying up crystal ball tying 128 00:06:26,120 --> 00:06:27,920 mate? No, good point. 129 00:06:27,920 --> 00:06:30,400 And I mean, you know, the remoteness and, and the 130 00:06:30,400 --> 00:06:33,520 challenges around location, weather, all that sort of stuff. 131 00:06:34,320 --> 00:06:37,200 When you look at the project, it's the 350,000 tonne per annum 132 00:06:37,200 --> 00:06:40,560 mil and it's going to cost over a billion dollars at the moment 133 00:06:40,720 --> 00:06:42,160 to build. So that just kind of goes to the 134 00:06:42,160 --> 00:06:44,280 challenges of how expensive and how difficult it's going to be. 135 00:06:45,080 --> 00:06:46,160 Absolutely agree with your point. 136 00:06:46,440 --> 00:06:48,480 Right next to next Gen definitely makes sense. 137 00:06:48,720 --> 00:06:51,000 Should be a lot of synergies in finding those operations. 138 00:06:51,640 --> 00:06:55,000 Having said that, you know, not covering the mining space for a 139 00:06:55,000 --> 00:06:56,280 long time. There's been a lot of sensible 140 00:06:56,280 --> 00:07:00,080 acquisitions over time, things that make sense, but it depends 141 00:07:00,080 --> 00:07:02,040 on the people at the time, depends on whether you guys get 142 00:07:02,040 --> 00:07:05,800 involved, you know, board type sashes, that kind of thing. 143 00:07:05,800 --> 00:07:09,000 So on on paper makes sense, but let's see how it plays out. 144 00:07:09,000 --> 00:07:10,840 There's still kind of a long time to go on those projects. 145 00:07:12,120 --> 00:07:15,680 Matt the, the, the, the, what's on boss is obviously what I want 146 00:07:15,680 --> 00:07:19,440 to talk about. I actually, I, I listened to as 147 00:07:19,440 --> 00:07:21,360 a poddy you, you must have done years ago. 148 00:07:21,400 --> 00:07:23,840 I think it was 2019 or something, but you would you 149 00:07:23,840 --> 00:07:25,880 were talking about the importance of of founder LED 150 00:07:25,880 --> 00:07:27,760 businesses. You you spoke about at the time, 151 00:07:28,640 --> 00:07:30,680 you know, selling all of your PA and, and putting it all in the 152 00:07:30,680 --> 00:07:32,720 fund. And, and and that's like that's 153 00:07:32,720 --> 00:07:36,040 alignment to you is you're fully aligned with yeah, and you know 154 00:07:36,040 --> 00:07:38,520 where I'm going with this line of comment, you know, you're 155 00:07:38,560 --> 00:07:41,720 going yeah. So how do you how do you like, 156 00:07:41,720 --> 00:07:44,680 you know, there's only I get there's only a limited number of 157 00:07:45,160 --> 00:07:47,920 of places you can allocate your capital given the given what you 158 00:07:47,920 --> 00:07:50,920 articulated with uranium. But when you see the MD and two 159 00:07:50,920 --> 00:07:53,720 other directors selling, you know, 70 plus percent of their, 160 00:07:54,200 --> 00:07:57,480 of their shareholding in, in, in BOS, What's the read through on 161 00:07:57,480 --> 00:07:59,680 the on the alignment kind of factor for you? 162 00:08:00,400 --> 00:08:04,520 Yeah, look, I, I, I completely get the point of Boss management 163 00:08:04,520 --> 00:08:07,400 and boards selling big stakes. Stakes and companies is always a 164 00:08:07,400 --> 00:08:08,560 red flag and it's never a good thing. 165 00:08:08,560 --> 00:08:12,520 So would I prefer to see them sell 20 or 30% of the holding 166 00:08:12,520 --> 00:08:14,240 and do that over stage period? Absolutely. 167 00:08:14,240 --> 00:08:17,360 So I think that was, that's definitely an issue and that's 168 00:08:17,360 --> 00:08:20,080 created some problems. I think it's worth just 169 00:08:20,080 --> 00:08:22,880 remembering where BOSS has been on the journey. 170 00:08:23,000 --> 00:08:25,520 Duncan joined that company in early 2017. 171 00:08:27,040 --> 00:08:29,760 He put 100 grand in his own money in at the start at four 172 00:08:29,760 --> 00:08:32,080 cents. So that's a pretty good 173 00:08:32,080 --> 00:08:34,280 indication of just sort of the value that's been created over 174 00:08:34,280 --> 00:08:36,840 the time that he's been there over that several years. 175 00:08:38,200 --> 00:08:40,559 He took over a project which obviously didn't work under your 176 00:08:40,559 --> 00:08:42,200 rating. One had a lot of issues around 177 00:08:42,720 --> 00:08:44,520 the drilling side, the flows, the plant. 178 00:08:44,520 --> 00:08:46,880 So all those problems have been solved over time. 179 00:08:48,360 --> 00:08:51,000 I certainly don't begrudge him taking money off the table, 180 00:08:51,000 --> 00:08:54,440 especially considering you did put more in and during COVID and 181 00:08:54,440 --> 00:08:58,400 in a placement post that as you say, the quantum's problematic, 182 00:08:58,400 --> 00:09:00,600 but it's, it's done now. So we've kind of got to move on 183 00:09:00,600 --> 00:09:04,120 and assess where we're at. I think the, the update they put 184 00:09:04,120 --> 00:09:06,360 out the other day, along with the guidance for the next three 185 00:09:06,360 --> 00:09:09,560 years is kind of exactly in line with the ramp up profile they 186 00:09:09,560 --> 00:09:11,160 previously communicated to the market. 187 00:09:12,120 --> 00:09:14,320 There's obviously a month or two delay at the start there, which 188 00:09:14,320 --> 00:09:16,880 is not unusual in a lot of these Commission projects. 189 00:09:16,880 --> 00:09:20,240 But all the early signs seem pretty positive. 190 00:09:21,320 --> 00:09:23,440 I was up on site probably six or nine months ago. 191 00:09:23,440 --> 00:09:24,960 I got a pretty good read through about what they're doing 192 00:09:24,960 --> 00:09:27,280 differently, how that ramp up profile looks. 193 00:09:27,280 --> 00:09:30,160 So I'm I'm fairly comfortable with that, noting that it is 194 00:09:30,640 --> 00:09:34,280 still quite early on in these ISR mines do take 2-3 years to 195 00:09:34,280 --> 00:09:36,160 ramp up fully. So there's it's not without 196 00:09:36,160 --> 00:09:38,280 risk, but I think a lot of those boxes have been ticked. 197 00:09:38,280 --> 00:09:42,120 Now the the other thing I'd probably say in defence and you 198 00:09:42,120 --> 00:09:46,920 know at the time that Duncan and the board sold, the price is 550 199 00:09:46,920 --> 00:09:50,160 or 6 bucks. So there was a lot priced at 200 00:09:50,160 --> 00:09:52,400 that point. Were you assuming you're running 201 00:09:52,400 --> 00:09:57,440 price over $100 kind of forever clear ramp up and commissioning? 202 00:09:57,440 --> 00:10:00,600 We had sell side numbers, which still we're assuming some sales 203 00:10:00,600 --> 00:10:03,440 in, in Fr 24 and 25 looking a bit too optimistic. 204 00:10:04,120 --> 00:10:06,000 So to be honest, we were actually trimming our position 205 00:10:06,000 --> 00:10:10,720 at the same time. So selling when when price is 206 00:10:10,720 --> 00:10:13,080 expensive is kind of kind of what you do. 207 00:10:13,080 --> 00:10:14,760 And we're looking at the now saying, well, the share price 208 00:10:14,760 --> 00:10:17,720 has retraced 35%. There's been a pretty good start 209 00:10:17,720 --> 00:10:20,160 to commissioning. Not even still the way to go 210 00:10:20,160 --> 00:10:23,080 there, but I actually think it's something worth another look for 211 00:10:23,080 --> 00:10:26,160 people in Mississippi the first time and something that we've 212 00:10:26,240 --> 00:10:27,920 added a little bit to the position in recent weeks as 213 00:10:27,920 --> 00:10:29,720 well. So if they're, if they're down 214 00:10:29,720 --> 00:10:33,000 35% now, like 'cause the, the, the whole thing about these 215 00:10:33,000 --> 00:10:37,480 uranium equities was trying to back solve, you know, the free 216 00:10:37,480 --> 00:10:39,880 cash flow they're gonna generate to what they're being valued at 217 00:10:39,880 --> 00:10:41,680 the moment. And it just didn't seem it was 218 00:10:42,000 --> 00:10:44,160 adding up. And especially considering boss 219 00:10:44,160 --> 00:10:48,720 isn't like a multi decade operation, it does have a no the 220 00:10:48,840 --> 00:10:53,640 it's yeah, it's it's not a 20 year life, but it's coming back 221 00:10:53,640 --> 00:10:56,560 down to where it is now sub sub 4 bucks. 222 00:10:56,560 --> 00:11:00,440 Is it starting to maybe make a bit more sense about what 223 00:11:00,440 --> 00:11:02,120 they're going to make and what it's being valued? 224 00:11:02,920 --> 00:11:03,880 Yeah, definitely. Yeah. 225 00:11:03,880 --> 00:11:05,640 I think the valuation is a lot more reasonable now. 226 00:11:07,360 --> 00:11:10,240 Look, longer term, I do think there's upside from Ghouls Dam 227 00:11:10,240 --> 00:11:12,600 and Janssen, some of the other ground they've got around 228 00:11:12,600 --> 00:11:15,400 Honeymoon, which will either be tied in or have a separate 229 00:11:15,400 --> 00:11:17,520 plant. So I think that probably does 230 00:11:17,520 --> 00:11:20,160 provide you a 20 year view. And I know there's a lot more 231 00:11:20,160 --> 00:11:22,680 work going on in terms of drilling studies out there at 232 00:11:22,680 --> 00:11:25,400 the moment. So that hopefully will eventuate 233 00:11:25,400 --> 00:11:27,680 over the next 6 to 12 months. So you get a bit more visibility 234 00:11:27,680 --> 00:11:29,320 on that growing production profile. 235 00:11:31,600 --> 00:11:33,480 But yeah, going back to the point, I definitely think 236 00:11:33,480 --> 00:11:35,520 there's, there's more value now. The cash flows over the next 237 00:11:35,520 --> 00:11:37,760 couple of years will take some time to ramp up. 238 00:11:37,760 --> 00:11:39,960 But when you're looking at sort of two to three years time when 239 00:11:39,960 --> 00:11:42,920 they're at full production, you're probably getting to a 240 00:11:42,920 --> 00:11:45,960 kind of 10% free cash per yield, which is not too bad. 241 00:11:46,760 --> 00:11:48,880 Uranium's interesting though. I mean there is a very limited 242 00:11:48,880 --> 00:11:50,520 set of uranium companies to invest in. 243 00:11:50,520 --> 00:11:52,840 So we're positive on the uranium price. 244 00:11:52,840 --> 00:11:55,520 I do think we're kind of one or two years into what will be a 245 00:11:55,800 --> 00:12:00,200 five to seven year cycle. Where can you play that is 246 00:12:00,440 --> 00:12:02,640 essentially some of the majors like Camico and Kazanoprom, 247 00:12:02,640 --> 00:12:04,000 which have got a lot of that contracted. 248 00:12:04,080 --> 00:12:06,040 So there's not a huge amount of spot price leverage. 249 00:12:06,600 --> 00:12:08,320 Boss has got a lot of spot price leverage. 250 00:12:08,440 --> 00:12:09,760 Paladin's got a fair bit as well. 251 00:12:10,360 --> 00:12:13,600 And I think just trying to in certain valuations on these 252 00:12:13,600 --> 00:12:17,440 things can be a bit troublesome given they will just trade the 253 00:12:17,440 --> 00:12:20,120 spot price sentiment. We've had a fairly weak six 254 00:12:20,120 --> 00:12:24,120 months in uranium spot price feedback I've got is that people 255 00:12:24,120 --> 00:12:28,320 have been more focused on securing enrichment capacity and 256 00:12:28,320 --> 00:12:30,760 that and that's led to sort of weakness in contracting over the 257 00:12:30,760 --> 00:12:32,840 first half of the year. I think that'll flow through 258 00:12:32,840 --> 00:12:34,440 into better contracting in the second half. 259 00:12:34,800 --> 00:12:38,080 I do think we'll see a step up in spot price and it's probably 260 00:12:38,080 --> 00:12:40,760 important to note that the actual term price has kept 261 00:12:40,760 --> 00:12:43,360 ticking up. We're at about 80 bucks a pound 262 00:12:43,360 --> 00:12:47,760 now on the term price with ceilings up, you know one 25130. 263 00:12:48,600 --> 00:12:50,800 So again that that just probably goes to the underlying strength 264 00:12:50,800 --> 00:12:53,000 of that market and just the dynamics we serve the next few 265 00:12:53,000 --> 00:12:56,400 years. Hard to hard to put evaluation 266 00:12:56,400 --> 00:12:58,160 of these things. I think once the spot price 267 00:12:58,160 --> 00:13:00,280 starts to recover if when that happens, I think a lot of these 268 00:13:00,280 --> 00:13:02,520 things if you're given and the equity starts to recover in mind 269 00:13:02,520 --> 00:13:05,400 with that. The the obvious stock that's you 270 00:13:05,400 --> 00:13:08,800 know, not, not, not in your portfolio there is next Gen. 271 00:13:08,800 --> 00:13:10,880 And is that just a function of the fact that you you have to 272 00:13:10,880 --> 00:13:13,040 own something that you think will have earnings 2 years from 273 00:13:13,040 --> 00:13:15,640 now? Yeah, Yeah, pretty much. 274 00:13:15,640 --> 00:13:17,120 I mean Next Gen's interesting look, it's 1:00. 275 00:13:17,120 --> 00:13:21,120 We we could own if we wanted to. Generally on the on the earnings 276 00:13:21,120 --> 00:13:23,760 certainty side, we want stuff in in production or profitability 277 00:13:23,760 --> 00:13:26,280 within two or three years. I think when it's a project as 278 00:13:26,280 --> 00:13:29,040 high quality and as obvious as Next Gen that it will be in 279 00:13:29,040 --> 00:13:31,480 production, I'm more happy to take that risk on getting 280 00:13:31,480 --> 00:13:35,080 involved a bit earlier that that's kind of an interesting 281 00:13:35,080 --> 00:13:37,440 one. I mean, we're sort of at a, a 282 00:13:37,440 --> 00:13:38,960 bit of a stage now where they need to progress some 283 00:13:38,960 --> 00:13:41,240 permitting. What happens with CapEx 284 00:13:41,240 --> 00:13:43,000 estimates, how does the funding come through? 285 00:13:43,400 --> 00:13:46,320 There's some milestones that can take off over the next 6 or 12 286 00:13:46,320 --> 00:13:48,440 months, which could rewrite that project. 287 00:13:49,520 --> 00:13:51,520 But I, I do think over the next few years, that's just going to 288 00:13:51,520 --> 00:13:53,320 be more driven by the uranium price than anything. 289 00:13:53,360 --> 00:13:54,920 The, the broad parameters are kind of set. 290 00:13:55,480 --> 00:13:59,640 There's not too much they can do in terms of construction issues 291 00:13:59,640 --> 00:14:03,080 or, or massive delays in terms of project that could derail it 292 00:14:03,200 --> 00:14:05,560 over the short term. So again, I I think that just 293 00:14:05,560 --> 00:14:07,520 comes back to being driven by where the spot price heads in 294 00:14:07,520 --> 00:14:11,520 the next 12 months. JD, out of respect, I'll stop 295 00:14:11,520 --> 00:14:14,360 talking about uranium. I could keep going, but I'll let 296 00:14:14,360 --> 00:14:17,600 you keep things moving. I, I was just came to hear your 297 00:14:17,600 --> 00:14:21,680 thoughts, Matt, obviously you're an Aussie fun going at ASX 298 00:14:21,680 --> 00:14:24,240 stocks, but we've mentioned a few names with Canadian 299 00:14:24,240 --> 00:14:25,840 relations. I just wanted to hear if you had 300 00:14:25,840 --> 00:14:28,400 any thoughts on the news we've heard about, you know, them 301 00:14:28,400 --> 00:14:33,240 clamping down on M&A and just how you see Canada as a as a 302 00:14:33,240 --> 00:14:35,200 jurisdiction for mining projects? 303 00:14:36,080 --> 00:14:37,360 Yeah, it's, it's an interesting one. 304 00:14:37,360 --> 00:14:40,600 I haven't, I saw the headlines. I haven't read in huge amount of 305 00:14:40,600 --> 00:14:42,480 detail what's what's happened there. 306 00:14:42,480 --> 00:14:45,800 But look, I think basically what'll happen is if, if Canada 307 00:14:46,280 --> 00:14:48,720 cracks down on M&A, you know the capital for elsewhere, the 308 00:14:48,720 --> 00:14:50,200 companies are listed on other exchanges. 309 00:14:50,840 --> 00:14:53,920 I know one of the things the ASX has been doing to arrest the 310 00:14:53,920 --> 00:14:56,640 sort of decline in IP OS and the amount of companies leaving the 311 00:14:56,640 --> 00:15:00,640 board through through M&A is actually incentivizing some of 312 00:15:00,640 --> 00:15:03,720 these companies to dual list. So we've seen the likes of 313 00:15:03,720 --> 00:15:08,040 metals acquisition, capstone, It sounds like that process of dual 314 00:15:08,040 --> 00:15:10,200 listing is becoming a lot easier on the ASX. 315 00:15:10,880 --> 00:15:13,840 So I do think we see probably more companies gravitate 316 00:15:13,840 --> 00:15:16,960 towards, towards Australia's investment destination. 317 00:15:17,560 --> 00:15:20,960 I, I think it probably just hurts, hurts Canadian stock 318 00:15:20,960 --> 00:15:24,360 exchanges to be honest. The money will flow somewhere 319 00:15:24,360 --> 00:15:28,080 and Canada is going to be too restrictive in terms of who can, 320 00:15:28,160 --> 00:15:29,800 who can take over companies. And that's sort of seeing the 321 00:15:29,800 --> 00:15:31,400 companies. We'll, we'll just move to other 322 00:15:31,400 --> 00:15:33,640 exchanges is my view. NextGen dual listed as well. 323 00:15:33,640 --> 00:15:36,160 It's amazing when you see these these companies on other 324 00:15:36,160 --> 00:15:39,560 exchanges dual list on the ASX they because the ASX is 325 00:15:39,560 --> 00:15:42,200 obviously like their their incentivize to get more, more 326 00:15:42,200 --> 00:15:45,080 ASX listings. That's how ASX reaches their KP 327 00:15:45,160 --> 00:15:48,440 is, but they will, they will offer all of these like pretty 328 00:15:48,840 --> 00:15:52,120 insane waivers to these, you know, Canadian listed companies, 329 00:15:52,120 --> 00:15:54,920 etcetera to dualist. And that means that they don't 330 00:15:54,920 --> 00:15:57,800 have to comply with the same like there are certain listing 331 00:15:57,800 --> 00:15:58,960 rules that they'll be exempt from. 332 00:15:59,600 --> 00:16:01,680 It's kind of, it's interesting, you know, they play, you get to 333 00:16:01,680 --> 00:16:03,800 play by a different set of rules when you get the dual listing on 334 00:16:03,800 --> 00:16:06,080 the ASX because ASX just wants you over here because you're a 335 00:16:06,080 --> 00:16:08,640 big company. Pretty much, yeah. 336 00:16:08,640 --> 00:16:10,160 And that's the issue. I mean, there's just been a 337 00:16:10,160 --> 00:16:13,560 complete lack of new companies listing on the ASXA lot of 338 00:16:14,000 --> 00:16:15,240 especially in the industrial space. 339 00:16:15,240 --> 00:16:17,480 We've seen the whole building material space pretty much get 340 00:16:17,480 --> 00:16:19,440 hollowed out through through M and A lately. 341 00:16:19,440 --> 00:16:21,920 So the ASX wants to get listing numbers up. 342 00:16:21,920 --> 00:16:25,120 I think their approach has been, look, if you've good enough to 343 00:16:25,200 --> 00:16:28,280 list in Canada or the US or or New Zealand, then you should be 344 00:16:28,280 --> 00:16:31,280 good enough the ASX. So it's always interesting 345 00:16:31,280 --> 00:16:33,160 though seeing just the the differences of reporting 346 00:16:33,160 --> 00:16:35,240 requirements, the differences in some of the waves you talk 347 00:16:35,240 --> 00:16:36,520 about. So you've got to be comfortable 348 00:16:36,520 --> 00:16:38,360 with that sort of stuff before you can actually invest in those 349 00:16:38,360 --> 00:16:41,040 companies. One of those ones that is now 350 00:16:41,040 --> 00:16:43,880 listed here is Meadows Acquisition Corp that you've, 351 00:16:44,000 --> 00:16:46,280 you've mentioned you're a holder coming from the New York Stock 352 00:16:46,280 --> 00:16:48,840 Exchange where they've got another listing and they were 353 00:16:48,840 --> 00:16:51,520 super, super well received when they came on. 354 00:16:51,600 --> 00:16:55,240 I think they up the, the IPO amount of money that they took 355 00:16:55,240 --> 00:16:59,200 in twice and then they had a bit of a, a sort of bumpy start, 356 00:16:59,200 --> 00:17:01,760 obviously getting a lot of love on the, the copper thematic side 357 00:17:01,760 --> 00:17:03,920 of things. But the last quarter on a 358 00:17:03,920 --> 00:17:06,839 production side of things was you know, a bit how you going. 359 00:17:06,839 --> 00:17:09,280 How do, how do you see the the company going forward? 360 00:17:09,280 --> 00:17:13,119 Obviously a high pedigree sort of management team with an asset 361 00:17:13,119 --> 00:17:15,680 that a lot of people have taken a liking to. 362 00:17:15,680 --> 00:17:18,200 What's your sort of view of it? Yeah, we're we're pretty 363 00:17:18,200 --> 00:17:20,920 positive on the name. Look, I've got no great insights 364 00:17:20,920 --> 00:17:24,200 into where Copper's heading. You know, we're, we're taking 365 00:17:24,200 --> 00:17:26,560 three sitting in Sydney. So for us to have a a huge 366 00:17:26,880 --> 00:17:28,880 hugely differentiated view on copper is pretty difficult. 367 00:17:28,880 --> 00:17:31,240 But we're pretty comfortable with the commodity and and the 368 00:17:31,240 --> 00:17:34,120 drivers there. So finding copper exposure has 369 00:17:34,120 --> 00:17:36,360 been quite difficult on the on the ASX, especially ones of 370 00:17:36,360 --> 00:17:39,440 screen value, which I think metals acquisition does. 371 00:17:40,320 --> 00:17:41,960 We've done a fair bit of work there around kind of the 372 00:17:41,960 --> 00:17:45,120 structure, the the turn around. There is complexity in that 373 00:17:45,120 --> 00:17:48,440 story and I think that's probably led to the opportunity 374 00:17:48,440 --> 00:17:50,960 and where the valuation is for some other copper peers. 375 00:17:51,720 --> 00:17:53,200 In terms of the quarterly production numbers. 376 00:17:53,200 --> 00:17:56,480 Look it is going to be lumpy. It is a pretty high grade, low 377 00:17:56,480 --> 00:17:58,160 volume mine going through a turn around. 378 00:17:58,160 --> 00:18:00,640 So no surprise they're going to have good quarters and bad 379 00:18:00,640 --> 00:18:03,560 quarters based on when high grade Stokes come into the mine 380 00:18:03,560 --> 00:18:07,360 and different other things. I think there's there's quite a 381 00:18:07,360 --> 00:18:09,520 lot of work that's gone into that three year production ramp 382 00:18:09,560 --> 00:18:11,080 up. They show on the plan. 383 00:18:11,640 --> 00:18:13,640 I would back Mick and the team to turn around. 384 00:18:13,640 --> 00:18:17,160 I mean, you know, hearing about how Blinkle operated that mine, 385 00:18:18,560 --> 00:18:20,720 some of the challenges there. I think getting a good operator 386 00:18:20,720 --> 00:18:23,960 in really does provide a lot of a lot of opportunity, although 387 00:18:23,960 --> 00:18:26,360 it's not a quick fix. I mean clearly the constraint 388 00:18:26,360 --> 00:18:29,560 there is ventilation that's going to take a couple of years 389 00:18:29,560 --> 00:18:32,400 to get rolled out fully through the mine and that's really where 390 00:18:32,400 --> 00:18:34,560 you start to see those productivity gains. 391 00:18:35,400 --> 00:18:37,600 There's some other interesting upside angles there. 392 00:18:37,600 --> 00:18:40,000 I mean you've got you've got a zinc resource, you've got a 393 00:18:40,000 --> 00:18:42,360 bunch of remnant areas which kind of aren't in the reserve or 394 00:18:42,360 --> 00:18:45,040 the mine plan, You've got a very underutilised mill which 395 00:18:45,200 --> 00:18:47,160 probably needs a little bit of CapEx to get back to those 396 00:18:47,160 --> 00:18:50,160 levels. But I think once once the team 397 00:18:50,160 --> 00:18:53,000 gets into good operating rhythm, starts to deliver some pretty 398 00:18:53,000 --> 00:18:56,960 consistent quarters, that's when we can start to think about kind 399 00:18:56,960 --> 00:18:59,600 of what's next. I know the market's concerned as 400 00:18:59,600 --> 00:19:01,560 well about potential acquisitions. 401 00:19:01,720 --> 00:19:03,480 It is called Mills Acquisition Corp system. 402 00:19:05,080 --> 00:19:07,520 I I don't think they're going to blow their brains out on doing 403 00:19:07,520 --> 00:19:09,720 anything too stupid. I think it would have to be 404 00:19:10,280 --> 00:19:13,080 pretty value accretive. You've got quite aligned and 405 00:19:13,080 --> 00:19:14,440 incentivised management team there. 406 00:19:14,440 --> 00:19:18,200 So I think the quick wins for them are really fixing up CSA. 407 00:19:18,760 --> 00:19:21,520 Maybe there's some some other things they can do in the region 408 00:19:21,520 --> 00:19:23,600 which are kind of smaller deals which add a bit of value. 409 00:19:24,640 --> 00:19:26,960 But I think to do something bigger in a step out would have 410 00:19:26,960 --> 00:19:28,480 to be quite compelling for them at this stage. 411 00:19:28,480 --> 00:19:30,720 It's. Got to be it's hard to find the 412 00:19:30,720 --> 00:19:33,640 quality. Like they are very deep, but 413 00:19:33,640 --> 00:19:38,200 the, it's the quality of that ore body is just miles ahead of 414 00:19:38,720 --> 00:19:41,120 everything else. Like finding quality copper. 415 00:19:41,440 --> 00:19:46,280 Unless someone finds a frigging bloody VMS deposit at 5% in the 416 00:19:46,280 --> 00:19:48,720 next frigging month. It's there's nothing just 417 00:19:48,720 --> 00:19:50,960 jumping out. It's like, do you look at it and 418 00:19:50,960 --> 00:19:55,960 think, would you do M&A just for the sake of it or is it going to 419 00:19:55,960 --> 00:20:00,080 be more detrimental? Yeah, good point. 420 00:20:00,080 --> 00:20:03,240 And I guess that's the problem with having a high quality asset 421 00:20:03,280 --> 00:20:04,720 that's kind of better than anything else out there. 422 00:20:04,720 --> 00:20:05,840 You're always going to be diluting. 423 00:20:05,920 --> 00:20:08,680 We've probably seen that with Duterra lately. 424 00:20:08,680 --> 00:20:11,640 You know, Duterra is quite an interesting one, the terrible, 425 00:20:11,640 --> 00:20:14,520 one of the best, probably the best royalty stream in the 426 00:20:14,520 --> 00:20:15,880 world. But anything you're going to buy 427 00:20:15,880 --> 00:20:18,520 is going to be dilated to that. It was, it was similar to 428 00:20:18,520 --> 00:20:20,200 Sandfire years ago. You know, Sandfire had one of 429 00:20:20,200 --> 00:20:23,560 the best copper assets. In terms of grading costs and, 430 00:20:23,560 --> 00:20:25,320 and anything that we're going to buy was going to be diluted. 431 00:20:25,320 --> 00:20:26,720 So that led to some indigestion there. 432 00:20:26,720 --> 00:20:29,560 So yeah, it, it's going to have to be something pretty good for, 433 00:20:29,720 --> 00:20:33,120 for Mac to to buy. I think the quality angle is 434 00:20:33,120 --> 00:20:34,440 interesting. I mean, definitely the quality 435 00:20:34,440 --> 00:20:37,680 of of these all bodies is decreasing and you've got to 436 00:20:37,680 --> 00:20:40,200 make trade offs between how low you're willing to go on the 437 00:20:40,200 --> 00:20:42,880 quality side compared to where sort of valuation is. 438 00:20:43,320 --> 00:20:44,920 We love to spit ball. You know what? 439 00:20:44,920 --> 00:20:46,240 What? What's Mac going to buy? 440 00:20:46,920 --> 00:20:49,600 And there's so many like, you know, players in that cobar 441 00:20:50,000 --> 00:20:51,320 region. And when you look at the lay of 442 00:20:51,320 --> 00:20:54,520 the land of the, the, the, the juniors out there, where can you 443 00:20:54,520 --> 00:20:57,680 sort of, you know, see the most value of creative synergies at 444 00:20:57,680 --> 00:21:01,240 the moment? Yeah, in the Cobar region, I 445 00:21:01,240 --> 00:21:05,320 mean the obvious one's really I find it hard to see Mac 446 00:21:05,320 --> 00:21:08,680 Bollinger really I think there's probably some asset type deals 447 00:21:08,680 --> 00:21:12,240 to do the the great cobar asset that I really have would fit 448 00:21:12,280 --> 00:21:15,680 quite nicely with Mac. I think potentially some of the 449 00:21:15,680 --> 00:21:19,160 zinc that that Mac has could go through really is peak mill. 450 00:21:19,160 --> 00:21:22,880 So I think there's probably more synergies in terms of how those 451 00:21:22,880 --> 00:21:24,920 assets come together and which mills they go through rather 452 00:21:24,920 --> 00:21:26,960 than needing to do full kind of M&A. 453 00:21:26,960 --> 00:21:31,120 Other than that, I mean there's some interesting exploration 454 00:21:31,120 --> 00:21:33,000 ground. I think having having a mill 455 00:21:33,000 --> 00:21:35,160 that operates well in that region will provide power over 456 00:21:35,160 --> 00:21:37,040 time. It's just going to be a matter 457 00:21:37,040 --> 00:21:40,640 of I think metals acquisition needs to sort out how big CSA 458 00:21:40,640 --> 00:21:42,880 can get. It's still quite early in the 459 00:21:42,880 --> 00:21:45,920 journey there of cutting resources and reserves and just 460 00:21:45,920 --> 00:21:49,080 planning out probably five to seven years because they may 461 00:21:49,080 --> 00:21:51,240 well have enough of the raw material to fill the mill 462 00:21:51,240 --> 00:21:53,720 without needing to get anyone else's product through there. 463 00:21:54,160 --> 00:21:58,600 And but it's just the it's the life risk there in terms of how 464 00:21:58,600 --> 00:22:03,880 deep can you go and keep the keep the ground from bloody 465 00:22:03,880 --> 00:22:07,040 squeezing in, like keep extending the ventilation to 466 00:22:07,560 --> 00:22:10,520 that's it's, it's very similar to Gualia. 467 00:22:10,520 --> 00:22:14,160 Like it just everything just slows down so much at frigging 468 00:22:14,200 --> 00:22:17,560 1800 metres deep. Well, the future of DSI is 469 00:22:17,560 --> 00:22:19,960 looking great with bloody everything getting deeper in the 470 00:22:19,960 --> 00:22:23,120 cobar region. Isn't there bloody any M And I 471 00:22:23,360 --> 00:22:29,640 more DSI bolts, the deepest CSI guys, more DSI bolts, more DSI 472 00:22:29,640 --> 00:22:36,120 bolts per metre per depth. So exponential bloody growth for 473 00:22:36,120 --> 00:22:38,760 DSI coming. And when I was setting up the, 474 00:22:38,760 --> 00:22:41,480 when I was setting up the call with Matt Gryphon, I was 475 00:22:41,480 --> 00:22:43,120 speaking with him and he said he'd, you know, he's been on a 476 00:22:43,120 --> 00:22:47,160 site visit out out to the cobar there and he just knew, sort of 477 00:22:47,160 --> 00:22:50,080 bakes it into his model. Once they get the DSI orders in, 478 00:22:50,080 --> 00:22:53,720 they come and fill this place up and they'll be gone 345 479 00:22:53,720 --> 00:22:55,240 kilometres deep there. Not a problem. 480 00:22:56,080 --> 00:22:57,960 Rest. Assured why don't they what JD 481 00:22:57,960 --> 00:23:01,560 but the the DSI bloody portal sets will be just getting 482 00:23:01,960 --> 00:23:04,120 that'll that's how they'll be holding up CSI. 483 00:23:04,120 --> 00:23:08,600 So look my queries about CS as depth and the finite life. 484 00:23:08,600 --> 00:23:13,760 There not a problem because DSI making it happen holds the mind. 485 00:23:13,760 --> 00:23:15,600 Together and it holds the model together. 486 00:23:16,360 --> 00:23:19,240 Go Derek Head. That's they've got. 487 00:23:19,280 --> 00:23:21,560 It's like but it's offset by the grade. 488 00:23:22,200 --> 00:23:23,920 No, that it's a great point, Yeah. 489 00:23:24,000 --> 00:23:26,480 And, and look, we are in Genesis as well, which owns Gwalia. 490 00:23:27,320 --> 00:23:30,080 I went out to Gwalior last year, went all the way down, 1800 491 00:23:30,080 --> 00:23:31,280 metres down decline to the bottom. 492 00:23:31,880 --> 00:23:34,800 And you can see the challenges that depth has. 493 00:23:34,840 --> 00:23:37,080 You know, we got stuck behind a broken down truck coming up. 494 00:23:37,080 --> 00:23:40,240 So, but, but again, that's, that's the opportunity for these 495 00:23:40,240 --> 00:23:44,400 guys to, you know, make it meals acquisition, rally, Genesis, the 496 00:23:44,400 --> 00:23:48,120 guys who good operators get good people and they're that's the 497 00:23:48,120 --> 00:23:50,800 opportunity to turn around some of these deep minds, which have 498 00:23:50,800 --> 00:23:53,520 challenges. I think with Gualia as well, 499 00:23:53,520 --> 00:23:55,800 just taking the pressure off Gualia in terms of the tonnes 500 00:23:55,800 --> 00:23:58,120 bringing USC and I think that's kind of a game changer there. 501 00:23:58,120 --> 00:24:00,920 So there's always risks with Zeke minds. 502 00:24:02,040 --> 00:24:03,640 You know, you can have seismic events, you can have other 503 00:24:03,640 --> 00:24:06,120 issues happen at any time. But again, that's just part of 504 00:24:06,120 --> 00:24:09,120 the the risk involved in investing in resources. 505 00:24:10,120 --> 00:24:12,560 And we we certainly take all those risks into account upfront 506 00:24:12,560 --> 00:24:14,240 and that really drives position sizing. 507 00:24:14,360 --> 00:24:17,280 So high risk companies get a lower weight in the fund for 508 00:24:17,280 --> 00:24:19,400 that reason. And it means that if something 509 00:24:19,400 --> 00:24:22,160 does go wrong or blow up, hopefully it doesn't wipe out 510 00:24:22,160 --> 00:24:24,280 our returns. I just came up with a deal idea, 511 00:24:25,040 --> 00:24:28,320 JD and Maddie, and it's I'd love, I'd love to bounce it off 512 00:24:28,320 --> 00:24:31,800 you off your mat. So obviously IGO where where 513 00:24:31,800 --> 00:24:34,200 the, where the well, they weren't really under bidders on 514 00:24:34,200 --> 00:24:36,480 Mac, but the deal blew up because it got late, but it was, 515 00:24:36,480 --> 00:24:38,880 you know, IGO where there and thereabouts in the in the 516 00:24:38,880 --> 00:24:43,120 process when Glencore was selling Mac and and now more 517 00:24:43,120 --> 00:24:45,400 than back then, IGO is desperate for copper. 518 00:24:45,400 --> 00:24:48,200 They need, they need a bloody, you know, they want copper. 519 00:24:48,200 --> 00:24:52,800 They've got an identity crisis. What if IGO acquired Mac today 520 00:24:52,960 --> 00:24:54,480 and Mick McMullen runs the vehicle? 521 00:24:54,480 --> 00:24:56,920 Would you, you guys that? Well, that's not too bad, trap. 522 00:24:57,840 --> 00:25:01,280 I I put one reason why it wouldn't happen because Ivan 523 00:25:01,640 --> 00:25:03,880 just got into the hot seat six months ago. 524 00:25:04,720 --> 00:25:06,560 Yes, there's a, there's a couple of soft issues there. 525 00:25:06,640 --> 00:25:08,560 A big payout would make a few problems go away. 526 00:25:08,560 --> 00:25:10,280 That's all right. Take the hard drive on the way. 527 00:25:10,280 --> 00:25:11,720 Home. I was about to say that. 528 00:25:14,320 --> 00:25:15,400 Matt, what are your thoughts on that one? 529 00:25:15,880 --> 00:25:20,520 Oh look, interesting one. I'd probably say the where Igos 530 00:25:20,520 --> 00:25:23,600 at the moment Nova, Nova obviously operates pretty well. 531 00:25:23,600 --> 00:25:25,680 I don't think there's too many improvements to be made there 532 00:25:27,240 --> 00:25:29,960 with the Green Bush's JV that's sort of non operators there. 533 00:25:29,960 --> 00:25:33,400 So it would be hard for someone else to come in and make huge 534 00:25:33,400 --> 00:25:35,080 operational improvements to Igos assets. 535 00:25:35,080 --> 00:25:40,160 I would have thought given Igos in large cap index we it sort of 536 00:25:40,160 --> 00:25:41,600 fell out of a universe few years ago. 537 00:25:41,640 --> 00:25:45,920 So not as close anymore, but interesting, but unlikely I 538 00:25:45,960 --> 00:25:48,840 would say. We can always dream Travers 539 00:25:48,840 --> 00:25:50,200 like, hey, Maddie, we've got a thing. 540 00:25:50,440 --> 00:25:53,680 As long as it's recorded, we've got it in case it happens. 541 00:25:53,960 --> 00:25:57,280 So like probably a good segue into Genesis that you mentioned 542 00:25:57,280 --> 00:26:00,920 before, another one of your holdings there. 543 00:26:02,320 --> 00:26:05,320 And, and probably in line with the, you know, silver, like Red 544 00:26:05,320 --> 00:26:11,960 mergers gone through Genesis, you know, big, big future growth 545 00:26:11,960 --> 00:26:14,040 coming from Tower Hill. And it looks like, you know, 546 00:26:14,040 --> 00:26:17,600 they've got a plan to, you know, change that location of that 547 00:26:17,600 --> 00:26:21,640 terminal for the, the, the terminus for that railway 548 00:26:21,640 --> 00:26:26,280 instead of extent diverting it. But the, the big question is for 549 00:26:26,280 --> 00:26:31,680 that growth of that company is the consolidation with Red 5. 550 00:26:31,920 --> 00:26:34,680 Do you, what horizon are you putting on that? 551 00:26:34,680 --> 00:26:37,120 Because that will be a game changer for that region. 552 00:26:37,160 --> 00:26:38,920 And it's. I'm sure it's going to happen 553 00:26:39,080 --> 00:26:41,600 eventually. Yeah, it could. 554 00:26:41,600 --> 00:26:43,320 Do I look, I don't think it's near term. 555 00:26:43,320 --> 00:26:46,640 I actually think Genesis has got more than enough on their plate 556 00:26:46,680 --> 00:26:48,800 organically that they don't really need to look at M&A. 557 00:26:48,840 --> 00:26:51,840 If you look at that five year growth plan, there's a lot to 558 00:26:51,840 --> 00:26:55,360 exceed on Tower Hill approvals is really the key one. 559 00:26:55,360 --> 00:26:57,480 And I think that's, to be honest, that's probably where 560 00:26:57,480 --> 00:27:00,440 rally's spending like 70% of the time just trying to get those 561 00:27:00,440 --> 00:27:03,200 approvals done because that is such a big value driver. 562 00:27:04,000 --> 00:27:06,920 My, my sense is that it's probably more likely you'll see 563 00:27:07,040 --> 00:27:11,280 bolt on M&A around the, the JC mill of Mount Morgans around 564 00:27:11,280 --> 00:27:13,640 that area. And then you can potentially 565 00:27:13,640 --> 00:27:17,040 look at maybe a new mill at, at Gualia just to put the Tower 566 00:27:17,040 --> 00:27:18,720 Hill stuff through. And that's right there. 567 00:27:18,720 --> 00:27:23,240 So longer term, I'd expect maybe maybe a new bills at Gualia, 568 00:27:24,360 --> 00:27:27,360 potentially a Red 5 takeover if there's still if there's a bit 569 00:27:27,360 --> 00:27:30,320 of value there and we can see the synergies and then bolting 570 00:27:30,320 --> 00:27:33,400 on some of some of the other deposits around Labour to 571 00:27:33,400 --> 00:27:36,200 interfere through that mill. Look, there's a lot going on 572 00:27:36,200 --> 00:27:37,880 there. I think the thesis really is 573 00:27:37,880 --> 00:27:40,080 that it's not cheap on this year's earnings or next year's 574 00:27:40,080 --> 00:27:42,600 earnings, but it's one of the few Aussie gold companies with a 575 00:27:42,600 --> 00:27:45,800 good growth profile, which is severely lacking in space. 576 00:27:46,640 --> 00:27:49,360 Certainly back the team there, you know, we were with them on 577 00:27:49,360 --> 00:27:50,840 the journey through the Saracen days. 578 00:27:51,240 --> 00:27:53,480 I know how conservative they are and setting numbers. 579 00:27:53,720 --> 00:27:56,320 There's just always some some level of upside and some things 580 00:27:56,320 --> 00:27:59,240 they're not telling the market there that always tend to just 581 00:27:59,240 --> 00:28:01,080 lead to small beats and small upgrades. 582 00:28:02,000 --> 00:28:04,120 And the execution has been second to none over the the 583 00:28:04,240 --> 00:28:07,240 period in the market. So that makes Genesis a really 584 00:28:07,240 --> 00:28:09,720 attractive proposition for us without needing to look at any 585 00:28:09,720 --> 00:28:13,520 sort of M and AI think they can easily get to 400,000 oz, you 586 00:28:13,520 --> 00:28:15,160 know, potentially 500 on what they've got. 587 00:28:15,840 --> 00:28:18,440 And you look at the resource base there, there's 15,000,000 588 00:28:18,440 --> 00:28:22,560 ounces in resource across that group with I think only three in 589 00:28:22,560 --> 00:28:26,200 reserves. So a high gold price, a bit more 590 00:28:26,200 --> 00:28:27,640 work in some of these other deposits. 591 00:28:27,640 --> 00:28:29,960 And you could see a lot of that kind of shift from resource to 592 00:28:29,960 --> 00:28:32,080 reserve and really build up that production profile. 593 00:28:32,480 --> 00:28:35,680 Sounds like they need bloody K drill to convert that bloody 13 594 00:28:35,680 --> 00:28:38,120 million ounces of resource into reserves. 595 00:28:38,120 --> 00:28:41,760 A bit more pepperon needed. Get it up to indicated and 596 00:28:41,760 --> 00:28:43,600 measured. Get it into reserves. 597 00:28:43,800 --> 00:28:49,520 The future of Genesis is hanging by a thread for K Drill to take. 598 00:28:50,000 --> 00:28:52,920 I can feel it. Mate, you know, get get some 599 00:28:52,920 --> 00:28:56,000 indicated answers, get some, get some more than 30 answers while 600 00:28:56,000 --> 00:28:57,320 you're there, get some measured answers. 601 00:28:57,400 --> 00:28:59,480 Mate, that might have 20 million oz by the end of it. 602 00:28:59,680 --> 00:29:02,120 Get some uncategorized answers in the mine plan. 603 00:29:02,120 --> 00:29:03,080 Actually, don't do that. That's. 604 00:29:05,280 --> 00:29:08,200 Just Genesis either, fellas. You you think about all those 605 00:29:08,200 --> 00:29:10,880 explorers and as soon as Matt Gryphons, you know he's talking 606 00:29:10,880 --> 00:29:14,280 about them, All of them. I can already feel the phone 607 00:29:14,280 --> 00:29:17,320 buzzing for Ryan O'Sullivan. They all want to get taken out. 608 00:29:17,320 --> 00:29:18,800 They want Genesis to take them out. 609 00:29:19,000 --> 00:29:21,240 All they need to do is pepper in a few more holes. 610 00:29:21,240 --> 00:29:24,240 And who else would you rather have do it than Buddy K Drew? 611 00:29:24,480 --> 00:29:27,480 Yeah, and look, Ryan's been given a lot of love, but Drew 612 00:29:27,480 --> 00:29:29,680 Harvey's email is in the show notes. 613 00:29:29,680 --> 00:29:33,680 Give Drew some love as well, and he'll introduce you to the team 614 00:29:33,680 --> 00:29:36,880 and you will get answers. That's all you need to know. 615 00:29:37,160 --> 00:29:40,200 And more answers, JD. More of a takeover premium. 616 00:29:40,520 --> 00:29:42,400 You don't have to worry about Drew not going hard at the footy 617 00:29:42,480 --> 00:29:45,960 mate. He he goes real hard at the at 618 00:29:45,960 --> 00:29:50,280 the footy go Australia. But how would that magic like 619 00:29:50,280 --> 00:29:53,480 that combination come together? Because now to be, you know, 620 00:29:53,480 --> 00:29:57,560 red, red fives are bigger market cap than than Genesis. 621 00:29:57,560 --> 00:30:01,720 So that obviously creates some who's getting the premium. 622 00:30:03,240 --> 00:30:04,880 Yeah, no, exactly. And there's obviously a lot of 623 00:30:04,880 --> 00:30:08,960 other stuff in in red now with the Silver Lake assets and sugar 624 00:30:08,960 --> 00:30:11,520 zone in Canada. So I, I think it's just too 625 00:30:11,560 --> 00:30:13,760 difficult in the near term. I wouldn't probably expect that 626 00:30:13,760 --> 00:30:15,880 to to really happen. I think Genesis has got more 627 00:30:15,880 --> 00:30:18,480 than enough to to execute on over the next sort of three or 628 00:30:18,480 --> 00:30:21,680 four years in their own plate. I would just think, you know if 629 00:30:21,680 --> 00:30:25,240 you look through the history of Saracen and Northern Star, the 630 00:30:25,240 --> 00:30:30,640 Big M and A, there was kind of a pretty very attractive prices, 631 00:30:30,640 --> 00:30:32,720 distressed assets coming out of large companies. 632 00:30:33,160 --> 00:30:35,200 They were kind of no brainers there rather than having to 633 00:30:35,200 --> 00:30:39,440 really pay up for assets. So I probably wouldn't expect 634 00:30:39,440 --> 00:30:42,000 anything huge out of Genesis on the M&A front in the new term. 635 00:30:42,160 --> 00:30:45,560 But do you think, do you think they would do any mill upgrade 636 00:30:45,560 --> 00:30:49,800 or mill expansion at Gualia knowing that the most optimum 637 00:30:49,800 --> 00:30:55,120 case is getting that king of the hills massive new mill and 638 00:30:55,120 --> 00:30:57,800 possibly expanding that a bit? Could do. 639 00:30:57,800 --> 00:30:59,600 I mean, it comes back to my earlier comment that there's a 640 00:30:59,600 --> 00:31:01,040 lot of things that make sense in resources. 641 00:31:01,040 --> 00:31:03,400 And a lot of the time these obvious deals don't happen 642 00:31:03,400 --> 00:31:06,000 because of personalities that he goes evaluations. 643 00:31:06,000 --> 00:31:09,360 So you get these situations where 2 brand new mills are 644 00:31:09,360 --> 00:31:11,760 built right next to each other when one could have done and 645 00:31:11,760 --> 00:31:15,280 that's just the way it is. But yeah, it it's going to come 646 00:31:15,280 --> 00:31:18,600 down to I guess the the relative share prices of people at a time 647 00:31:19,880 --> 00:31:21,000 whether any of that happens or not. 648 00:31:21,920 --> 00:31:23,040 Yeah, right. What are you and what do you 649 00:31:23,040 --> 00:31:25,400 think about the M&A? So we're talking when you're 650 00:31:25,400 --> 00:31:28,800 talking about Hoover and UPS and around the Laverton and that 651 00:31:28,800 --> 00:31:31,800 sort of things like just literally pinching the few of 652 00:31:31,800 --> 00:31:36,280 the juniors to get a bit of extra feed and is, yeah, they're 653 00:31:36,280 --> 00:31:39,120 not, they're going to just sort of what would you say a bit more 654 00:31:39,120 --> 00:31:42,880 bit like Remelius historically before the Spartan thing, like 655 00:31:42,880 --> 00:31:45,960 just taking little dribs and drabs instead of big deals. 656 00:31:47,040 --> 00:31:48,000 I think, I think that's probably it. 657 00:31:48,000 --> 00:31:50,440 I mean the one the one reasonable sized one there is 658 00:31:50,440 --> 00:31:53,440 magnetic which looks like a a very good deposit and and that 659 00:31:53,440 --> 00:31:58,600 could go through probably either the Granny Smith mill or through 660 00:31:59,480 --> 00:32:01,800 through the Daisy mill unless they go loans. 661 00:32:01,800 --> 00:32:05,360 So otherwise there are a number of other small junior sort of 662 00:32:05,360 --> 00:32:08,680 operators around there. The other, the other potential 663 00:32:08,680 --> 00:32:11,480 is that W Australia undergrounds could be revisited and that 664 00:32:11,480 --> 00:32:14,960 could could be more economic now given gold price and in a 665 00:32:14,960 --> 00:32:16,960 different operator. So there's just lots of 666 00:32:16,960 --> 00:32:19,680 optionality in Genesis. I just think the five year plan 667 00:32:19,680 --> 00:32:22,840 they've laid out is probably unlikely to end up in that form 668 00:32:22,840 --> 00:32:24,600 in five years. I think it's a good base case, 669 00:32:25,120 --> 00:32:27,200 but there's a lot of optionality around other things, how they 670 00:32:27,200 --> 00:32:29,640 could, you know, reroute different deposits through 671 00:32:29,640 --> 00:32:32,520 different mills. And I think any of that's just 672 00:32:32,520 --> 00:32:34,440 pure upside to where the company's trading today. 673 00:32:36,440 --> 00:32:40,080 Then if you, if you kind of look, look elsewhere in the the 674 00:32:40,080 --> 00:32:43,280 ASX gold landscape, if if there was ever, you know, producer 675 00:32:43,320 --> 00:32:46,600 that is just being easy for investors to sit and forget over 676 00:32:46,600 --> 00:32:49,800 the last like I don't know, eight years it's been Perseus, 677 00:32:49,800 --> 00:32:53,400 they've yeah, created tremendous value there and it makes a lot 678 00:32:53,400 --> 00:32:56,000 more cash than than other other golds when you look across the 679 00:32:56,000 --> 00:32:58,280 board. What's, but what's the 680 00:32:58,280 --> 00:33:01,520 investment like case for, for holding it now after a period of 681 00:33:01,520 --> 00:33:02,800 you know, great operational delivery? 682 00:33:03,960 --> 00:33:05,640 Yeah. I mean, you say first, this is 683 00:33:05,800 --> 00:33:08,840 certainly get, I mean it, it does operate in interesting 684 00:33:08,840 --> 00:33:12,080 parts of Africa and there's always things going on in in 685 00:33:12,080 --> 00:33:14,640 different parts of Africa. There's lots of risk there is, 686 00:33:14,760 --> 00:33:16,560 that's true. But the operational delivery has 687 00:33:16,560 --> 00:33:18,200 been great, yeah. Yeah, no, well, that's the 688 00:33:18,200 --> 00:33:19,920 thing. And actually, you know, to give 689 00:33:19,920 --> 00:33:22,360 credit to the whole African sector, the, the operational 690 00:33:22,360 --> 00:33:25,160 delivery has been far better out of African producers and has out 691 00:33:25,160 --> 00:33:26,960 of the Aussies over the last 5-10 years. 692 00:33:27,920 --> 00:33:30,240 You look at what Wax's been able to do, what Resolute's been able 693 00:33:30,240 --> 00:33:34,160 to do recently in Perseus, they've navigated very tough 694 00:33:34,400 --> 00:33:37,000 economic times, a very tough country risk over there to 695 00:33:37,000 --> 00:33:39,760 deliver great results. And I think that's, that's 696 00:33:39,760 --> 00:33:41,200 really shown through in the cash that generated. 697 00:33:41,320 --> 00:33:44,840 Whereas you look at the Aussie producers and Aussie gold prices 698 00:33:44,840 --> 00:33:46,280 have been going up. The costs have been kind of 699 00:33:46,280 --> 00:33:48,640 going up in line with that. So there hasn't been that 700 00:33:48,680 --> 00:33:51,400 operating leverage come through Perseus today. 701 00:33:51,400 --> 00:33:55,440 I think the the Aucorp deal was very smart, done a very good 702 00:33:55,440 --> 00:33:57,480 time without much of A premium being paid. 703 00:33:58,400 --> 00:34:00,400 You know that that stock would probably be a lot higher today 704 00:34:00,400 --> 00:34:03,160 if it had kept trading. So I think they've done very 705 00:34:03,160 --> 00:34:06,440 well there. That adds to the growth profile. 706 00:34:06,440 --> 00:34:09,639 I think you'll see some life extensions out of Edican, out of 707 00:34:09,639 --> 00:34:13,400 EARE, even Sisigre maybe. And then once you layer in nine 708 00:34:13,400 --> 00:34:17,199 Zaga on top, you're up to kind of 700 and seven 50,000 oz for a 709 00:34:17,199 --> 00:34:22,120 few years and it can be funded purely through through cash. 710 00:34:22,960 --> 00:34:26,600 The other benefit is that all court being a kind of 711 00:34:26,600 --> 00:34:29,760 underfunded junior had to go optimise around open pit 712 00:34:29,760 --> 00:34:33,199 underground, bit of a challenge in terms of how they were going 713 00:34:33,199 --> 00:34:34,920 to mine that. Whereas process can probably 714 00:34:34,920 --> 00:34:39,400 come in, spend a bit more CapEx, take a big open pit, get more, 715 00:34:40,199 --> 00:34:42,520 get more answers through and probably a low cost base. 716 00:34:42,520 --> 00:34:45,199 So I think economically it makes a lot of sense to them as well. 717 00:34:45,199 --> 00:34:47,800 And the relationship with the terms of your government seems 718 00:34:47,800 --> 00:34:50,960 to be pretty good too. Trades at three 3.4 times next 719 00:34:50,960 --> 00:34:54,040 12 month EBITDA, which is yeah like and has been a better 720 00:34:54,040 --> 00:34:57,520 margin preservation than the ASX also then then the WA based 721 00:34:57,520 --> 00:35:00,720 Goldie's who yeah, Yep, command command a high multiple. 722 00:35:00,720 --> 00:35:03,760 But that's just the the way that the the market is willing to, 723 00:35:04,160 --> 00:35:08,920 yeah, I guess like reward the the geopolitical, you know, risk 724 00:35:08,920 --> 00:35:11,760 aversion. Matt, have you looked in in West 725 00:35:11,760 --> 00:35:13,560 Africa? Obviously you've picked Perseus 726 00:35:13,560 --> 00:35:16,400 there, but Resolute's been a really strong performer of late 727 00:35:16,400 --> 00:35:21,120 and West African also in comparison with Perseus has a 728 00:35:21,120 --> 00:35:23,600 sort of great operational track record since they brought 729 00:35:23,880 --> 00:35:27,360 Sambrado online a few years ago. Have you looked into them and is 730 00:35:27,360 --> 00:35:31,160 like one of the reasons that they have a bit of a spread 731 00:35:31,160 --> 00:35:33,240 across a couple W African geographies the winner there? 732 00:35:33,240 --> 00:35:35,000 Are there other sort of reasons why? 733 00:35:35,840 --> 00:35:41,320 Yeah, we have owned West three to Zambrado construction and 734 00:35:41,320 --> 00:35:42,720 ramp up did very well out of that stock. 735 00:35:43,160 --> 00:35:45,960 Resolute One is one that I've been following for 15 years 736 00:35:45,960 --> 00:35:47,880 without owning and then eventually pulled the trigger 737 00:35:48,040 --> 00:35:50,800 probably 18 months ago. Didn't own it up until pretty 738 00:35:50,800 --> 00:35:52,040 recently. So it was a pretty good 739 00:35:52,040 --> 00:35:54,840 contributor for us. I, I definitely think Percy is 740 00:35:54,840 --> 00:35:56,640 having to spread across different African countries does 741 00:35:56,640 --> 00:36:00,240 help, especially when you look at the political landscape, the 742 00:36:00,280 --> 00:36:04,960 influence of Russia, some of the other, you know, activities 743 00:36:04,960 --> 00:36:08,520 going on in Bikini Faso and Mali, does see those countries a 744 00:36:08,600 --> 00:36:10,680 bit challenged. I think people have the 745 00:36:10,680 --> 00:36:13,040 perception that the African risk is probably greater than it 746 00:36:13,040 --> 00:36:15,560 actually is. When you look through all the 747 00:36:15,560 --> 00:36:18,440 coups that happen, all the terrorist events in, in these 748 00:36:18,440 --> 00:36:21,520 countries, gold is kind of the one industry that just keeps 749 00:36:21,520 --> 00:36:24,200 going. The government doesn't really 750 00:36:24,200 --> 00:36:27,000 nationalise assets unless there's an ownership dispute. 751 00:36:27,000 --> 00:36:31,480 So if you've got clear ownership over an operating asset, that 752 00:36:31,480 --> 00:36:34,360 stuff through and production's been pretty consistent. 753 00:36:34,360 --> 00:36:37,200 So I'm probably less worried about the political side, but it 754 00:36:37,200 --> 00:36:38,960 does. It doesn't help when you've got, 755 00:36:40,280 --> 00:36:42,840 you know, Mali building their own gold refineries and forcing 756 00:36:42,840 --> 00:36:45,640 everyone to sell to them. And what does that mean in terms 757 00:36:45,640 --> 00:36:48,800 of price? Mckenney's raised royalty rates 758 00:36:48,800 --> 00:36:50,920 harder to get money out of the country there. 759 00:36:50,920 --> 00:36:56,320 So, so they post Resolute and WAFF have done very well, still 760 00:36:56,320 --> 00:36:58,760 look fairly cheap, but processes the peak just because they've 761 00:36:58,760 --> 00:37:00,800 got the spread. I think they're in more stable 762 00:37:00,800 --> 00:37:03,440 environments over there and and they've got the growth lever of 763 00:37:03,440 --> 00:37:05,680 Nine Zahu coming through, which I think adds a lot of value. 764 00:37:06,960 --> 00:37:10,800 Then there's the two premier undeveloped projects, Spartan 765 00:37:10,800 --> 00:37:13,800 and the Grey. And you own, you own both of 766 00:37:13,800 --> 00:37:15,880 them. And they're obviously like 767 00:37:15,880 --> 00:37:18,480 pretty, pretty different projects in almost every single 768 00:37:18,480 --> 00:37:20,640 way. Like what's, what's the kind of 769 00:37:20,760 --> 00:37:22,120 like the rationale for holding both? 770 00:37:23,040 --> 00:37:25,200 Yeah. Look, to be honest, it's, it's 771 00:37:25,200 --> 00:37:28,760 stock specific on both of them. So again, with with gold, we're 772 00:37:28,760 --> 00:37:30,120 pretty positive on the gold outlook. 773 00:37:30,120 --> 00:37:33,440 But the reason we own these 4 gold stocks is because we like 774 00:37:33,440 --> 00:37:34,840 the stocks, we like the management teams. 775 00:37:35,280 --> 00:37:37,440 We think there's plenty of upside as long as the gold price 776 00:37:37,440 --> 00:37:39,640 kind of holds in line with where consensus is. 777 00:37:40,120 --> 00:37:43,880 So Spartan, we got involved in the, in the raising $0.40 last 778 00:37:43,880 --> 00:37:46,480 year. So we did miss, you know the 1st 779 00:37:46,520 --> 00:37:49,240 300% of the run up, but that's typical for us. 780 00:37:49,240 --> 00:37:51,200 We want to see some runs on the board. 781 00:37:51,200 --> 00:37:53,640 We want to see things get a bit dearest before we get involved. 782 00:37:54,680 --> 00:37:57,960 I, I do see substantial upside to where that is. 783 00:37:57,960 --> 00:37:59,960 I was up on site there a couple of weeks ago. 784 00:38:00,600 --> 00:38:03,640 The what's been underappreciated I think is just the value of the 785 00:38:03,800 --> 00:38:07,320 infrastructure in place there. It's effectively a new mine that 786 00:38:07,320 --> 00:38:10,440 only operated for a few years, ready to be restarted with 787 00:38:10,440 --> 00:38:12,880 permits, everything in place. So just need to get some trucks 788 00:38:12,880 --> 00:38:16,760 and work out what they are going to do with the mill in terms of 789 00:38:16,760 --> 00:38:18,600 the expiration side. I think it's going to be 790 00:38:18,600 --> 00:38:22,200 important to see what the indicated number is at never, 791 00:38:22,200 --> 00:38:24,360 never out of this upcoming resource. 792 00:38:24,960 --> 00:38:28,480 That really then drives thinking around how big production could 793 00:38:28,480 --> 00:38:31,640 be, how long the mine life is. You layer in pepper on top of 794 00:38:31,640 --> 00:38:35,040 that and you know, you can start to model up really attractive 795 00:38:35,040 --> 00:38:38,120 cash flows for at least a sort of 6-7 year period. 796 00:38:39,840 --> 00:38:41,480 So I still, I still think there's more to go there. 797 00:38:41,480 --> 00:38:44,240 And I the other thing with that story is that exploration 798 00:38:44,240 --> 00:38:46,040 decline will be a game changer for them. 799 00:38:47,560 --> 00:38:50,840 Once you're underground, they, they can drill twice as fast, 800 00:38:50,840 --> 00:38:54,480 half the cost. So delineating those ore bodies 801 00:38:54,480 --> 00:38:56,440 will be a lot quicker and a lot easier. 802 00:38:57,280 --> 00:38:59,920 The exploration decline effectively ends in or never, 803 00:38:59,920 --> 00:39:01,040 never. So you've done your whole 804 00:39:01,040 --> 00:39:03,600 development. You can just start mining and 805 00:39:03,600 --> 00:39:06,040 then allows a bit of focus on some more regional targets as 806 00:39:06,040 --> 00:39:09,280 well. And just given how that old gas 807 00:39:09,280 --> 00:39:13,480 coin, they just completely sort of misread the geology on that 808 00:39:13,480 --> 00:39:16,600 site, you'd have to think there's potentially more repeats 809 00:39:16,600 --> 00:39:20,240 of the structure and potentially more expression can be done 810 00:39:20,240 --> 00:39:22,400 there. So still very attractive to 811 00:39:22,400 --> 00:39:23,600 Spartan. I think Simon's done an 812 00:39:23,600 --> 00:39:26,320 incredible job. The mentality he's got running 813 00:39:26,320 --> 00:39:29,720 our company, the team he's built underneath them, very part of 814 00:39:29,720 --> 00:39:32,760 that Northern Star school. So he's certainly been been the 815 00:39:32,760 --> 00:39:35,560 right man there. Degray is an interesting one. 816 00:39:36,600 --> 00:39:39,160 We took part pretty recently in the last placement of the dollar 817 00:39:39,160 --> 00:39:41,840 ten. The view there on Degray is 818 00:39:41,840 --> 00:39:44,120 that, look, that funding was probably a bit of a shock to the 819 00:39:44,120 --> 00:39:45,480 market. I think people probably expected 820 00:39:45,480 --> 00:39:47,280 the equity raise to be done after the debt had been locked 821 00:39:47,280 --> 00:39:49,120 away. That was maybe the opportunity 822 00:39:49,120 --> 00:39:52,800 for us coming in being new to the register, just seeing that 823 00:39:53,360 --> 00:39:55,840 the funding now is effectively in place, provided they can 824 00:39:55,880 --> 00:39:59,120 convert this debt, which sounds quite likely, they'll have about 825 00:39:59,120 --> 00:40:01,200 a 2 to $300 million buffer on top. 826 00:40:01,200 --> 00:40:04,080 So there's not. Too many concerns about another 827 00:40:04,280 --> 00:40:06,960 raise or or anything for the next couple of years until they 828 00:40:06,960 --> 00:40:08,520 start to really get towards commissioning. 829 00:40:09,600 --> 00:40:11,680 But that stock really has just been left behind in the gold 830 00:40:11,680 --> 00:40:13,920 rally. You've got 10 million oz 831 00:40:13,920 --> 00:40:18,880 resource, 500 five, 50,000 oz a year, production completely 832 00:40:18,880 --> 00:40:20,720 unhedged and the stock's gone nowhere. 833 00:40:21,720 --> 00:40:24,640 So to us that is a tier one asset. 834 00:40:25,440 --> 00:40:28,080 I think you you're obviously in the wrong part of the lesan 835 00:40:28,080 --> 00:40:31,320 curve now where you're financing and building to counter that. 836 00:40:31,320 --> 00:40:35,000 You still do have some news flow to come out on studies around 837 00:40:35,120 --> 00:40:38,600 with Neil in terms of that maybe adding another hundred 150,000 838 00:40:38,600 --> 00:40:41,120 oz. So by the time you get that 839 00:40:41,120 --> 00:40:45,040 through, you're at call it 700,000 oz a year for at least 840 00:40:45,040 --> 00:40:46,680 six years. That does become a very 841 00:40:46,680 --> 00:40:50,120 attractive asset, especially in a goal space where the majors 842 00:40:50,120 --> 00:40:53,680 and mid tiers have, you know, stable production assets, 843 00:40:54,720 --> 00:40:57,200 complete lack of growth, complete lack of new projects 844 00:40:57,200 --> 00:40:59,720 that have been built and very good cash flows coming through. 845 00:41:00,440 --> 00:41:03,320 So it just seems like quite an obvious MMA target to me over 846 00:41:03,320 --> 00:41:06,720 the next couple of years. Because it'd be it's bloody 847 00:41:06,720 --> 00:41:09,720 risky if they try to build a 10 million tonne operation with a 848 00:41:09,920 --> 00:41:11,760 brand new company, brand new team. 849 00:41:12,160 --> 00:41:14,640 That's fucking recipe for disaster I reckon. 850 00:41:15,640 --> 00:41:17,200 Absolutely, no, fully, fully agree. 851 00:41:17,200 --> 00:41:19,480 I mean, I do think there's, there's been a huge amount of 852 00:41:19,480 --> 00:41:21,400 detail and a lot of work that's gone into those studies. 853 00:41:22,040 --> 00:41:24,880 There's good people they've they've got on board who've 854 00:41:25,960 --> 00:41:28,000 who've built the projects in the past. 855 00:41:28,000 --> 00:41:30,200 You can manage that well. But look at great like the 856 00:41:30,200 --> 00:41:32,600 history of the, the gold space over the last four or five years 857 00:41:32,600 --> 00:41:34,680 in terms of bringing on new projects has been pretty tough. 858 00:41:36,320 --> 00:41:39,640 Building something that size with the pox plant up in the 859 00:41:39,640 --> 00:41:44,120 Pilgrim is not going to be easy. So I whether we own it into 860 00:41:44,120 --> 00:41:48,120 commissioning in 2-3 is time I'm not so sure about, but I can see 861 00:41:48,120 --> 00:41:49,400 some catalysts in the short term. 862 00:41:49,400 --> 00:41:52,440 I can see a share price that's really like the gold price and I 863 00:41:52,440 --> 00:41:56,320 can see some potential MMA appeal out there in a in in the 864 00:41:56,320 --> 00:41:58,440 gold market that I think we're going to see a lot more in the 865 00:41:58,440 --> 00:42:00,720 next year or two. Odie Reckon's going to have a 866 00:42:00,720 --> 00:42:03,560 look at it. There's look, there's two that 867 00:42:03,560 --> 00:42:05,680 stand out for me. The first one is ACNECO. 868 00:42:06,840 --> 00:42:09,600 They've been up at conferences in the past saying there's kind 869 00:42:09,600 --> 00:42:12,120 of three premium mining destinations in the world of 870 00:42:12,120 --> 00:42:14,880 which one is WA and they don't have anything. 871 00:42:16,040 --> 00:42:19,480 Wai believe they operate epoxy plan or two in their portfolio 872 00:42:19,480 --> 00:42:20,840 as well. So they've got experience there. 873 00:42:22,560 --> 00:42:25,000 So I wouldn't be surprised if they were if they were 874 00:42:25,000 --> 00:42:27,720 interested. And the other one is Gold Fields 875 00:42:27,720 --> 00:42:33,360 through kind of Gold Rd, they own half of Greer already. 876 00:42:33,360 --> 00:42:36,040 They own a stake in Gold Rd. I understand there's been some 877 00:42:36,040 --> 00:42:39,520 management changes in in Goldfields internationally and 878 00:42:39,520 --> 00:42:42,400 in Australia and they might have more of a growth mindset. 879 00:42:42,400 --> 00:42:47,120 So rolling up gold road and degrade would potentially make 880 00:42:47,120 --> 00:42:48,240 sense at some point as well there. 881 00:42:48,520 --> 00:42:50,480 They probably, I don't think they've got the POC's 882 00:42:50,480 --> 00:42:53,280 experience, but do they at? Any of their operations? 883 00:42:53,280 --> 00:42:56,240 No, but I mean you can, you'd hope you can bring in people to, 884 00:42:56,600 --> 00:43:00,560 to kind of take care of that. I kind of look at SSR, the old 885 00:43:00,560 --> 00:43:03,720 Lassa when they started up Sherpa, the sulphide plant 886 00:43:03,720 --> 00:43:05,360 there. And I don't think they had any 887 00:43:05,360 --> 00:43:07,840 POC experience before, but that kind of commissioned really well 888 00:43:07,840 --> 00:43:10,760 and and produced what it should. So I think if you've got the 889 00:43:10,760 --> 00:43:12,760 right people there, it's it's known technology. 890 00:43:13,720 --> 00:43:16,520 It's not as much of black boxes as people may think. 891 00:43:16,880 --> 00:43:19,040 Nothing that Nathan Stewart has can't fix. 892 00:43:19,320 --> 00:43:23,120 Bloody God, love me back back. Just to finish off on Spartan 893 00:43:23,120 --> 00:43:26,080 when you talked about the value of the infrastructure there and 894 00:43:26,080 --> 00:43:29,360 that and that probably bodes well for the Spartan investment 895 00:43:29,720 --> 00:43:33,760 if they don't get taken over. But it's looking like more than 896 00:43:33,760 --> 00:43:37,560 not that Remelius is going to get them eventually. 897 00:43:37,560 --> 00:43:40,120 Well, they've got the foot on them at the moment, but do you 898 00:43:40,120 --> 00:43:44,520 think that actual infrastructure may not be used at all if 899 00:43:44,520 --> 00:43:47,120 Remelius takes them and they're gonna just send it all to 900 00:43:47,120 --> 00:43:52,760 checkers and maybe expand checkers to take everything 901 00:43:52,760 --> 00:43:54,920 instead of having Dalgaranga and checkers? 902 00:43:55,760 --> 00:43:59,320 Yeah, it could, It could do I, I kind of haven't worked through 903 00:43:59,320 --> 00:44:01,960 the full mass and where all that that would go. 904 00:44:01,960 --> 00:44:06,480 I mean, having having the mill right there at Delgaranga is 905 00:44:06,480 --> 00:44:08,640 quite useful and also having just the flexibility around 906 00:44:08,640 --> 00:44:10,640 having multiple mills in the region would help. 907 00:44:11,960 --> 00:44:14,520 Remilius, I think they're going to build Rebecca as well. 908 00:44:14,520 --> 00:44:16,080 They might need to build there so they could move some 909 00:44:16,080 --> 00:44:19,320 equipment down that way. I do think for Emilius, it does 910 00:44:19,320 --> 00:44:22,600 make a lot of sense to to have Spartan in their portfolio at 911 00:44:22,600 --> 00:44:25,880 some point. They've got two years left at 912 00:44:26,000 --> 00:44:29,600 Penny, which is really the cash cow in the next couple of years. 913 00:44:29,600 --> 00:44:32,520 And then that production profile starts to drop off from the back 914 00:44:32,520 --> 00:44:35,520 end of FY20 6. I don't know what the expiration 915 00:44:35,520 --> 00:44:37,880 upside is there where that can be extended, but to have 916 00:44:37,880 --> 00:44:42,680 something like a a Spartan a plug in from FI 27 on would to 917 00:44:42,680 --> 00:44:46,200 me it looks like it could make a lot of sense to combine those 918 00:44:46,200 --> 00:44:50,160 two, obviously at the right price and assuming assuming it 919 00:44:50,200 --> 00:44:53,040 can happen there. Given you're a generalist, Matt, 920 00:44:53,080 --> 00:44:56,560 I'd, I'd be keen to just pick your, your brain on, on the 921 00:44:56,560 --> 00:44:59,680 wider sort of things you're seeing in regards to labour 922 00:44:59,680 --> 00:45:03,600 inflation, cost inflation across the economy and how this sort of 923 00:45:03,600 --> 00:45:07,560 plugs into resource projects, whether that be through mining 924 00:45:07,560 --> 00:45:10,920 services companies or just, you know, construction bills. 925 00:45:10,920 --> 00:45:12,240 What are you sort of seeing on that front? 926 00:45:12,800 --> 00:45:15,560 Yeah, sure. So the labour pressure is really 927 00:45:15,560 --> 00:45:18,680 heavies quite a lot. One of the things I do is 928 00:45:18,680 --> 00:45:22,200 actually track the mining services job ads for all the 929 00:45:22,200 --> 00:45:24,320 listed mining services supplies. I've been doing that for quite a 930 00:45:24,320 --> 00:45:27,920 few years now that the job openings really did peak around 931 00:45:27,920 --> 00:45:30,880 early 2022 when the labour shortages become the most acute 932 00:45:31,960 --> 00:45:33,160 as we're coming out of the COVID period. 933 00:45:33,160 --> 00:45:36,840 There was a lot going on in lithium, iron ore, nickel and 934 00:45:36,840 --> 00:45:39,880 that kind of thing. And since that peak 2 1/2 years 935 00:45:39,880 --> 00:45:42,920 ago, we've actually seen the job openings fall about 40%. 936 00:45:43,760 --> 00:45:45,840 So that heat really has completely come out of the 937 00:45:45,840 --> 00:45:48,800 labour market. If you talk to the gold players, 938 00:45:48,800 --> 00:45:52,160 who generally are the marginal users of labour, like the gold 939 00:45:52,160 --> 00:45:55,840 companies get a bit squeezed in tight markets because iron ore 940 00:45:55,840 --> 00:45:59,720 companies, lifting companies offer much higher salaries, 941 00:45:59,720 --> 00:46:01,280 better working conditions, all that sort of stuff. 942 00:46:02,760 --> 00:46:04,840 There's much less of an issue in terms of staff turnover, 943 00:46:04,840 --> 00:46:06,120 absentees and that kind of thing. 944 00:46:06,120 --> 00:46:09,080 So I think from an Aussie perspective, we're starting to 945 00:46:09,080 --> 00:46:10,320 see some better results flow through. 946 00:46:10,320 --> 00:46:13,280 I think there's much better chance of going, it's now being 947 00:46:13,280 --> 00:46:16,440 hit costs coming in on budget, just given that labour and that 948 00:46:16,440 --> 00:46:17,880 productivity side's getting a lot better. 949 00:46:19,120 --> 00:46:21,560 And across the economy generally we we're seeing that too. 950 00:46:21,560 --> 00:46:24,640 I mean, the building construction side, you've had 951 00:46:24,640 --> 00:46:27,760 this huge pipeline of residential homes, which is now 952 00:46:27,760 --> 00:46:30,360 coming to an end given home building and things through 953 00:46:30,360 --> 00:46:32,160 COVID. So you're starting to see 954 00:46:32,160 --> 00:46:33,680 tradies and like free up a little bit. 955 00:46:34,920 --> 00:46:37,520 Some of the areas that are still a bit tied around hospitals, 956 00:46:37,520 --> 00:46:41,240 aged care, childcare, it's moving in the right direction. 957 00:46:42,160 --> 00:46:43,640 So that that sort of things has eased. 958 00:46:43,640 --> 00:46:45,720 I think the labour pressures aren't really there anymore. 959 00:46:46,240 --> 00:46:47,960 I don't think it's going to necessarily translate into a 960 00:46:47,960 --> 00:46:49,720 lower costs. You're still seeing wage 961 00:46:49,720 --> 00:46:53,120 pressure, wage rises going up three, 4% a year. 962 00:46:53,640 --> 00:46:55,480 That will flow through. I think where people will get 963 00:46:55,480 --> 00:46:59,400 the benefit is on productivity, less in terms of recruitment, 964 00:47:00,400 --> 00:47:03,760 less staff absenteeism, less turnover that that should really 965 00:47:03,760 --> 00:47:07,040 help across the mining sector and just industrials more, more 966 00:47:07,120 --> 00:47:12,600 importantly. Madam, I'm kind of keen to, to, 967 00:47:12,600 --> 00:47:16,080 to peel into some of your, your energy stocks that you've got on 968 00:47:16,080 --> 00:47:19,600 the on the oil and gas side. There's, there's our two year 969 00:47:19,600 --> 00:47:23,800 flag to us Cooper Energy and and Karoon, yeah, Karoon, Karoon, 970 00:47:24,040 --> 00:47:28,520 you know, screen sort of pretty, pretty absurdly, you know, load, 971 00:47:28,520 --> 00:47:30,680 load multiple at the moment. There was a recent activist 972 00:47:30,680 --> 00:47:35,200 campaign to yeah, prevent like for them to introduce this 973 00:47:35,200 --> 00:47:37,000 Capital Management framework and pay dividends. 974 00:47:37,000 --> 00:47:39,280 Looks like their cash flow is going to be, you know, quite, 975 00:47:39,280 --> 00:47:42,440 quite attractive. But there's some, some doubt in 976 00:47:42,440 --> 00:47:45,440 the market that the, the, the board of management team are, 977 00:47:45,520 --> 00:47:48,480 are actually going to allocate that in a way that's best for 978 00:47:48,480 --> 00:47:50,960 shareholders. Do you take a, a, a view on, 979 00:47:50,960 --> 00:47:53,120 there on, on the Capital Management of Karuna? 980 00:47:53,120 --> 00:47:54,960 You just, you basically just look at the the value 981 00:47:54,960 --> 00:47:57,200 proposition, the cash flow and look at the multiple and just 982 00:47:57,200 --> 00:47:59,840 think this is as good a place as any to allocate capital right 983 00:47:59,840 --> 00:48:01,600 now. Yeah, that's that's the main 984 00:48:01,600 --> 00:48:04,960 thesis really is just the cash flow that can be generated from 985 00:48:04,960 --> 00:48:07,920 these assets provided they are producing it at the rates they 986 00:48:07,920 --> 00:48:09,360 should. There's obviously been some 987 00:48:09,360 --> 00:48:10,920 challenges that both assets lately. 988 00:48:11,440 --> 00:48:14,600 I think, you know, playing devil's advocate, one of the 989 00:48:14,600 --> 00:48:16,920 reasons for the acquisition of the US probably was to diversify 990 00:48:16,920 --> 00:48:20,040 way a bit from the Brazilian asset, given some reliability 991 00:48:20,040 --> 00:48:22,280 issues there, which probably weren't well known to the 992 00:48:22,280 --> 00:48:27,560 market, given it had a couple of good years of operations. the US 993 00:48:27,560 --> 00:48:31,400 being, you know, relatively small in terms of value 994 00:48:31,400 --> 00:48:34,160 accretion and and IRR probably just goes to the fact that 995 00:48:34,160 --> 00:48:37,000 you're coming from Brazil buying the Gulf of Mexico, you're gonna 996 00:48:37,000 --> 00:48:39,200 have to pay more and and those assets trade on on high 997 00:48:39,200 --> 00:48:41,560 multiples. So that that was always kind of 998 00:48:41,560 --> 00:48:44,640 the valuation differentially and why they were never going to get 999 00:48:44,640 --> 00:48:46,120 much accretion on that, that asset. 1000 00:48:47,280 --> 00:48:49,320 When I look at the activist campaign, I kind of do agree 1001 00:48:49,320 --> 00:48:50,320 with it with quite a lot of that. 1002 00:48:50,320 --> 00:48:53,560 I think as shareholders we do want to see Capital Management 1003 00:48:54,080 --> 00:48:57,760 especially given where the stocks trading now if cash flow 1004 00:48:58,640 --> 00:49:02,080 does what it should, it's on like you say absurd multiples in 1005 00:49:02,080 --> 00:49:05,520 terms of free cash flow yields. I think a lot of that can be 1006 00:49:05,520 --> 00:49:09,120 diverted to paying sustainable dividends to shareholders and 1007 00:49:09,120 --> 00:49:12,640 potentially share buy back. Certainly I'll be pushing the 1008 00:49:12,640 --> 00:49:15,520 company to to buy back shares rather than do any more M&A at 1009 00:49:15,560 --> 00:49:19,000 least to the levels. I do think though, if they can 1010 00:49:19,000 --> 00:49:20,760 again, it's it's just about getting the operating rhythm, 1011 00:49:20,760 --> 00:49:22,760 getting some good quarters out, showing the cash flow come 1012 00:49:22,800 --> 00:49:27,560 through. the US had a bit of a false start, but the large part 1013 00:49:27,560 --> 00:49:29,800 of the production downgrade there was actually on the gas 1014 00:49:29,800 --> 00:49:32,880 side, just given the Henry hub gas price had fallen so low. 1015 00:49:33,480 --> 00:49:36,320 That's actually very low value in terms of the the volume that 1016 00:49:36,320 --> 00:49:38,280 comes out of that. So it wasn't actually a big, it 1017 00:49:38,280 --> 00:49:39,480 wasn't as bad as a headline rate. 1018 00:49:40,680 --> 00:49:43,240 US gas prices have recovered a fair bit since then. 1019 00:49:43,240 --> 00:49:46,200 So we may actually see, you know, top end of guidance. 1020 00:49:46,200 --> 00:49:48,400 So even upgrade just with gas coming back in, which could be 1021 00:49:48,400 --> 00:49:51,560 good for optics and there has been a bit of exploration to 1022 00:49:51,560 --> 00:49:54,600 success and a couple more wells that drilling now, which if 1023 00:49:54,600 --> 00:49:57,560 successful, just kind of adds that, that great profile over 1024 00:49:57,560 --> 00:49:59,400 there and could turn sentiment a little bit. 1025 00:50:00,200 --> 00:50:02,240 So it's, it's, it hasn't been an easy one. 1026 00:50:02,480 --> 00:50:03,760 I, I do think they're good operators. 1027 00:50:03,760 --> 00:50:08,040 I do think Julian's a very good CEO knows the regions very well. 1028 00:50:08,120 --> 00:50:10,280 It's they've just had a few issues in terms of reliability 1029 00:50:10,280 --> 00:50:11,640 and some other problems going on. 1030 00:50:11,640 --> 00:50:13,800 But I don't think it's anything that that can't be solved or 1031 00:50:13,800 --> 00:50:17,080 turned around and. Then and then Cooper different, 1032 00:50:17,200 --> 00:50:20,160 different play. Is this like basically just the 1033 00:50:20,480 --> 00:50:23,800 the East Coast gas crisis has a has a the obvious beneficiary of 1034 00:50:24,160 --> 00:50:26,760 of that? Pretty much, pretty much the, 1035 00:50:26,760 --> 00:50:29,760 the macro side in the East Coast gas market is pretty well known 1036 00:50:29,760 --> 00:50:31,120 to people. I don't think I'd be telling you 1037 00:50:31,120 --> 00:50:33,720 anything to you there to say that, you know, there's a gas 1038 00:50:33,720 --> 00:50:36,040 shortage coming up and spot prices are sparking in, you 1039 00:50:36,040 --> 00:50:38,520 know, in Victoria when the weather's cold and the wind 1040 00:50:38,520 --> 00:50:41,000 doesn't blow. So that's all very supportive of 1041 00:50:41,000 --> 00:50:42,800 the gas price over the medium term. 1042 00:50:43,400 --> 00:50:45,600 I think what's happened on Cooper, again, this is a company 1043 00:50:45,600 --> 00:50:48,280 I followed for a long time. We've only got involved in 1044 00:50:48,280 --> 00:50:51,120 probably 6 or 12 months ago now that we've seen a lot of the 1045 00:50:51,120 --> 00:50:52,640 negative catalysts come out of the way. 1046 00:50:52,640 --> 00:50:58,040 The BMG decommissioning was a massive overhang on them that's 1047 00:50:58,160 --> 00:51:03,200 done gone Orbost. I think they've made some some 1048 00:51:03,200 --> 00:51:05,160 very good productivity improvements there coming from 1049 00:51:05,160 --> 00:51:08,560 the the CRO they hired a year ago that looks like it's 1050 00:51:08,560 --> 00:51:11,080 operating more consistently at high rates. 1051 00:51:11,080 --> 00:51:13,160 There's more they can put in the spot market that is actually 1052 00:51:13,160 --> 00:51:14,440 quite accretive to earnings there. 1053 00:51:15,080 --> 00:51:18,040 So I think that all bust asset as that just operates more 1054 00:51:18,040 --> 00:51:19,720 consistently over the next couple of years. 1055 00:51:19,880 --> 00:51:22,440 You see the cash flow generation profile of the group. 1056 00:51:23,080 --> 00:51:26,120 The way I view Cooper is you had a, they've got a fair bit of 1057 00:51:26,120 --> 00:51:29,600 debt at the moment, but there's very minimal CapEx to spend over 1058 00:51:29,600 --> 00:51:32,320 the next couple of years. If they do what they should do 1059 00:51:32,320 --> 00:51:35,280 on cash flow, the debt gets fully repaid over the next two 1060 00:51:35,280 --> 00:51:38,440 years and you're then the situation where they can start 1061 00:51:38,440 --> 00:51:42,640 thinking about gross plants in the Otway Basin where they've 1062 00:51:42,640 --> 00:51:44,680 got an extremely underutilised plant. 1063 00:51:45,080 --> 00:51:48,800 They've got resources in the basin there that are kind of 1064 00:51:48,800 --> 00:51:52,240 ready to develop and that could come to the mix kind of towards 1065 00:51:52,240 --> 00:51:55,160 the back end of the decade. And I don't think that's being 1066 00:51:55,160 --> 00:51:56,360 valued by the market at the moment. 1067 00:51:56,360 --> 00:51:59,960 I think essentially what you're getting at $0.20 is current cash 1068 00:51:59,960 --> 00:52:03,560 flows with a bit of a discount, not assuming anything improves 1069 00:52:03,560 --> 00:52:06,000 at all, boss, not assuming any of the growth projects work or 1070 00:52:06,000 --> 00:52:08,880 have any value. And I think that'll probably be 1071 00:52:08,880 --> 00:52:10,320 realised over the next couple of years. 1072 00:52:10,720 --> 00:52:13,840 The one thing I would say though is oil and gas is becoming a big 1073 00:52:13,840 --> 00:52:17,680 boys game like it is the cost of rigs, the cost of developments 1074 00:52:17,680 --> 00:52:21,720 is serious dollars. Now we've seen with Cooper that 1075 00:52:21,880 --> 00:52:25,640 BMG abandonment programme blew out to I think $380 million at 1076 00:52:25,640 --> 00:52:28,080 the end of it, and that's just to abandon the field that's not 1077 00:52:28,080 --> 00:52:31,040 producing anymore. So I think at some point we need 1078 00:52:31,040 --> 00:52:32,520 to see a bit of consolidation there. 1079 00:52:33,840 --> 00:52:36,520 I wouldn't be surprised that ends up as part of Beach or one 1080 00:52:36,520 --> 00:52:38,880 of those other players down there, but just think Oil and 1081 00:52:38,880 --> 00:52:40,960 Gas is becoming a real scale game. 1082 00:52:42,160 --> 00:52:45,240 Matt, given given you're a generalist, how do you think 1083 00:52:45,240 --> 00:52:48,640 about sizing all of these positions and and sizing the 1084 00:52:49,360 --> 00:52:52,400 energy component, the materials component, the the mining 1085 00:52:52,400 --> 00:52:54,920 services component as a portion of your portfolio? 1086 00:52:55,520 --> 00:52:58,040 Yeah, good question. So we we generally earn around 1087 00:52:58,040 --> 00:53:01,800 40 stocks in the fund position sizes. 1088 00:53:01,800 --> 00:53:04,640 We don't go below kind of one one half percent positions. 1089 00:53:04,640 --> 00:53:06,240 We just want to have a bit of conviction and things. 1090 00:53:06,240 --> 00:53:09,880 And then the top end, some of the more stable industrial 1091 00:53:10,040 --> 00:53:13,240 compounding type businesses can get up to five 6% positions. 1092 00:53:14,080 --> 00:53:17,600 What we do, our process comes down to trade off between what 1093 00:53:17,600 --> 00:53:20,520 the upside is, what the quality of the company and the assets 1094 00:53:20,520 --> 00:53:23,520 are and the corporate governance and then overlying risk factors. 1095 00:53:24,120 --> 00:53:28,920 So when we think about resources companies, the quality is 1096 00:53:28,920 --> 00:53:33,040 generally quite poor, the price takers, there's a lot of 1097 00:53:33,080 --> 00:53:34,840 exogenous factors that can affect results that are 1098 00:53:34,840 --> 00:53:37,600 completely out of control. They've got limited lives. 1099 00:53:37,600 --> 00:53:40,640 So they generally score pretty poorly on that, that quality 1100 00:53:40,640 --> 00:53:42,800 philtre. And then overlying some of the 1101 00:53:42,800 --> 00:53:44,880 risks, again you've got commodity price, currency, 1102 00:53:44,880 --> 00:53:50,040 whether political risks, you know, high capital spend, so 1103 00:53:50,240 --> 00:53:53,040 score quite high on risk. So that generally means for us 1104 00:53:53,040 --> 00:53:56,160 to resources companies are lower on the on the weights. 1105 00:53:57,200 --> 00:54:00,920 We try to identify risks and and quality upfront and position 1106 00:54:00,920 --> 00:54:03,320 size appropriately for that. Some of the biggest stocks in 1107 00:54:03,320 --> 00:54:07,160 the fund are you know, an example would be a defensive 1108 00:54:07,160 --> 00:54:10,160 tech company that grows earnings 15% a year and has a 10 year 1109 00:54:10,160 --> 00:54:14,200 growth runway structural growth driver where we can we've got a 1110 00:54:14,200 --> 00:54:15,560 pretty narrow distribution of earnings. 1111 00:54:15,560 --> 00:54:18,280 You can be pretty certain where they can come in and you can see 1112 00:54:18,280 --> 00:54:19,960 them expanding into a bigger market over time. 1113 00:54:20,520 --> 00:54:23,360 Whereas something like a gold company, the gold price moving 1114 00:54:23,360 --> 00:54:26,040 up a couple of 100 bucks or down a couple 100 bucks really can 1115 00:54:26,120 --> 00:54:27,320 blow out the earnings and the cash flow. 1116 00:54:27,320 --> 00:54:30,880 And that that's a struggle for us on earning certainty because 1117 00:54:30,880 --> 00:54:33,400 we really do value the earning streams of these companies more 1118 00:54:33,400 --> 00:54:36,840 than anything. Really interesting mate. 1119 00:54:36,920 --> 00:54:40,440 The the I'll let you go, JD, because I was going to pivot to 1120 00:54:40,440 --> 00:54:44,480 an overrated, underrated. Get mining services in there. 1121 00:54:44,600 --> 00:54:47,880 Yeah. Yeah, I mean, go for one of the 1122 00:54:48,280 --> 00:54:51,720 two of the names that you sent through SRG. 1123 00:54:52,280 --> 00:54:55,760 They do a lot of construction and sort of services work. 1124 00:54:55,760 --> 00:54:59,480 And then PRN, you know, a more kind of traditional mining 1125 00:54:59,480 --> 00:55:01,720 services name. What's the what's the thesis 1126 00:55:01,720 --> 00:55:04,160 there? Tell me how they fucking make 1127 00:55:04,160 --> 00:55:09,400 money, Parenti specifically and how you analyse it because I do 1128 00:55:09,400 --> 00:55:11,680 not understand it. Especially when you're talking 1129 00:55:11,680 --> 00:55:15,120 like the big quantums of debt that they hold and bloody low 1130 00:55:15,120 --> 00:55:18,720 margins and how do you get a bloody see the value in it? 1131 00:55:19,960 --> 00:55:21,960 Great point. And look, I've been covering 1132 00:55:22,080 --> 00:55:25,200 mining services stocks for kind of 16 years since I started the 1133 00:55:25,200 --> 00:55:27,560 industry. And it's been a really tough 1134 00:55:27,560 --> 00:55:30,000 bunch of companies to cover. Like every year something blows 1135 00:55:30,000 --> 00:55:32,960 up on a contract or there's too much debt or there's the work 1136 00:55:32,960 --> 00:55:35,840 dries up. So it's been this kind of death 1137 00:55:35,840 --> 00:55:37,600 spiral for a lot of these companies over time. 1138 00:55:38,320 --> 00:55:40,560 What's been a big change over the last few years, and I think 1139 00:55:40,560 --> 00:55:43,880 COVID and labour shortages really drove this, was a lot of 1140 00:55:43,880 --> 00:55:46,640 these companies seeing the value they actually provide to clients 1141 00:55:46,640 --> 00:55:49,800 and actually starting to charge a bit more for that and, and get 1142 00:55:49,800 --> 00:55:52,880 more favourable terms. So the pendulum's definitely 1143 00:55:52,880 --> 00:55:56,000 swung back towards contractors. A lot of the contracts now are 1144 00:55:56,000 --> 00:55:58,440 alliance style, you know, cost plus type things. 1145 00:55:58,440 --> 00:56:03,720 You're not taking big fixed cost risk or risk on, on items that 1146 00:56:03,720 --> 00:56:05,880 are outside your control. So that risk of blowing up on 1147 00:56:05,920 --> 00:56:07,760 projects kind of isn't there anymore. 1148 00:56:07,840 --> 00:56:11,200 For the most part. They they've also seen investors 1149 00:56:11,200 --> 00:56:13,080 want better returns. I mean, these things have been 1150 00:56:13,080 --> 00:56:16,240 operating at 510% return on capital, which just isn't good 1151 00:56:16,240 --> 00:56:18,080 enough for the amount of CapEx and debt they spend. 1152 00:56:19,160 --> 00:56:22,080 You're seeing a lot of companies now moving towards 15 to 20% on 1153 00:56:22,080 --> 00:56:24,880 the return side. So I think overall for mining 1154 00:56:24,880 --> 00:56:28,120 services, that has been a big tailwind over the last couple of 1155 00:56:28,120 --> 00:56:29,720 years. I think there's probably more of 1156 00:56:29,720 --> 00:56:33,120 a a rewrite in the sector to come as people just come back to 1157 00:56:33,120 --> 00:56:35,680 the sector and see the quality of the earnings and the returns 1158 00:56:35,680 --> 00:56:38,040 have actually improved and they're a lot more discipline on 1159 00:56:38,040 --> 00:56:41,600 the on the capital side. The risk with that is there's 1160 00:56:41,600 --> 00:56:43,680 not a huge amount of work around at the moment. 1161 00:56:43,680 --> 00:56:45,680 So the contract has dried up a bit. 1162 00:56:46,840 --> 00:56:49,560 Does some of this pricing discipline start to dissipate 1163 00:56:49,560 --> 00:56:51,760 and it gets more competitive? You're the way it returns. 1164 00:56:52,400 --> 00:56:55,320 I think the other thing you've got to be aware of is mining 1165 00:56:55,320 --> 00:56:57,360 services. Just a cycle of the pendulum 1166 00:56:57,360 --> 00:56:59,200 swings between the miners and contractors. 1167 00:56:59,200 --> 00:57:01,960 And at the moment we're heavily in favour of the contractors. 1168 00:57:02,000 --> 00:57:05,960 But as soon as you start to have rental companies making 20% 1169 00:57:05,960 --> 00:57:08,880 returns, contract miners making 20% returns, labour hire 1170 00:57:08,880 --> 00:57:11,720 companies making those returns, by the time it gets to the miner 1171 00:57:11,720 --> 00:57:13,960 it's almost so expensive. They just go, well, let's go 1172 00:57:13,960 --> 00:57:17,160 back to doing ourselves. So we're at a good point in the 1173 00:57:17,160 --> 00:57:19,520 cycle now. I think there's still a bit more 1174 00:57:19,520 --> 00:57:22,160 to go, but I'm getting a bit more weary on the medium term. 1175 00:57:23,040 --> 00:57:26,280 Parenti is an interesting one. I mean, Barminco is by far the 1176 00:57:26,280 --> 00:57:29,360 biggest driver in that business. They've been on the same journey 1177 00:57:29,360 --> 00:57:32,720 as everyone else in terms of big CapEx, a lot of debt, a lot of 1178 00:57:32,720 --> 00:57:35,520 new projects. They've really pulled back now 1179 00:57:35,520 --> 00:57:39,440 to being more focused on returns, driving free cash flow 1180 00:57:39,480 --> 00:57:42,000 through that business. The guidance they've got, the 1181 00:57:42,960 --> 00:57:46,160 FY24, which you should see the results in a month or two, are 1182 00:57:46,160 --> 00:57:48,000 for free cash flow to be 100 million bucks. 1183 00:57:48,720 --> 00:57:50,240 That's a 10% free cash flow yield. 1184 00:57:50,240 --> 00:57:54,880 And then next year, you can probably get 150 plus debts, 1185 00:57:54,880 --> 00:57:58,760 really been managed down to a very appropriate gearing level. 1186 00:57:58,760 --> 00:58:01,520 And I think we're at the point now where you actually need a 1187 00:58:01,520 --> 00:58:03,440 bit of debt in these businesses to drive returns. 1188 00:58:03,800 --> 00:58:07,520 So extra cash that comes out of these operations can be invested 1189 00:58:07,520 --> 00:58:11,040 into good growth projects where they've got good tenure with 1190 00:58:11,120 --> 00:58:14,600 good clients or we'll start to see capital returns. 1191 00:58:14,600 --> 00:58:16,880 I think Parenti will probably reinstate a dividend they've got 1192 00:58:16,880 --> 00:58:19,680 to buy back ongoing, which there's more to do there. 1193 00:58:19,680 --> 00:58:23,640 So that one kind of has flown under the radar a bit. 1194 00:58:24,280 --> 00:58:26,160 You know, you look at some of the other contract miners like 1195 00:58:26,160 --> 00:58:29,440 in RW demands that have had big RE ratings, Parenti's kind of 1196 00:58:29,440 --> 00:58:32,000 got nowhere. I think the proof will be in 1197 00:58:32,160 --> 00:58:34,800 free cash flow coming out, a couple of contract renewals 1198 00:58:34,800 --> 00:58:36,400 which have been coming through which are positive. 1199 00:58:37,560 --> 00:58:39,120 I think the market's kind of missed that one and that's 1200 00:58:39,360 --> 00:58:41,440 that's probably a good pick for the next six months for. 1201 00:58:41,800 --> 00:58:44,200 US, yeah, I think and like bombing goes the interesting one 1202 00:58:44,200 --> 00:58:47,840 because you could see where they were heading in terms of trying 1203 00:58:47,840 --> 00:58:50,760 to, as you said, part partner with bigger companies probably 1204 00:58:50,760 --> 00:58:53,480 on more favourable terms like they've just extended. 1205 00:58:53,480 --> 00:58:55,640 They've obviously got a good partnership with Regis. 1206 00:58:56,480 --> 00:59:01,080 The IGI ones really fallen off a Cliff with Cosmos getting 1207 00:59:01,080 --> 00:59:05,800 canned. Nova's and Flying Fox and Nova 1208 00:59:05,800 --> 00:59:10,480 and Forestonia are finishing soon so it's sort of opened them 1209 00:59:10,480 --> 00:59:12,120 up a bit. You might get the double whammy 1210 00:59:12,120 --> 00:59:15,440 if they they're front runner for Spartan so that'll bloody help 1211 00:59:15,440 --> 00:59:18,440 things along. But have you got much insight 1212 00:59:18,440 --> 00:59:24,080 into how those contracts are structured? 1213 00:59:24,080 --> 00:59:28,080 Like is there more less scheduler rates because I know, 1214 00:59:28,080 --> 00:59:31,920 I know they wanted were at Agnew with Goldfields. 1215 00:59:31,920 --> 00:59:33,840 I think that was full schedule of rates. 1216 00:59:33,840 --> 00:59:36,360 I'm not sure about the other ones if there's much cost plus 1217 00:59:36,680 --> 00:59:38,800 coming in yet or not. You'd know more than me. 1218 00:59:40,280 --> 00:59:41,920 No, sorry. Yeah, on the contract mining 1219 00:59:41,920 --> 00:59:43,440 side, it is more schedule of rates. 1220 00:59:43,440 --> 00:59:46,840 The my comment around the fixed price to cost plus is more in 1221 00:59:46,840 --> 00:59:49,440 the instant construction jobs, which is the guarantee. 1222 00:59:49,440 --> 00:59:51,680 So, yeah, sorry, I should have clarified that. 1223 00:59:51,680 --> 00:59:54,480 But I, I think in terms of their contract book, they're they've 1224 00:59:54,480 --> 00:59:58,640 had some issues with nickel mines and IGO coming off. 1225 00:59:58,640 --> 00:59:59,920 So that's been a bit of a headwind. 1226 01:00:00,480 --> 01:00:02,560 There's been some renewals. There's there's some opportunity 1227 01:00:02,560 --> 01:00:05,240 I think in Africa as well to grow in, in places like 1228 01:00:05,240 --> 01:00:08,920 Botswana, even even Tanzania, some of some of the East and 1229 01:00:08,920 --> 01:00:11,200 West African countries. So there is a bit of growth 1230 01:00:11,200 --> 01:00:15,160 potentially there, but I would view that as being a lower 1231 01:00:15,160 --> 01:00:17,440 growth proposition for the next few years, but more of a capital 1232 01:00:17,440 --> 01:00:20,120 return story. I think once you start, once the 1233 01:00:20,120 --> 01:00:22,240 market starts to see the cash flow generated there that gets 1234 01:00:22,240 --> 01:00:24,320 returned to shareholders in meaningful amounts. 1235 01:00:25,040 --> 01:00:27,280 That probably drives the rewrite rather than. 1236 01:00:27,600 --> 01:00:30,000 I'm not really expecting big earnings upgrades over the next 1237 01:00:30,000 --> 01:00:32,440 few years for that one. They make more money in Africa, 1238 01:00:32,440 --> 01:00:34,160 a lot of those companies than Australia. 1239 01:00:34,720 --> 01:00:38,000 The DDH 1 acquisition, that's probably like, I know it's 1240 01:00:38,000 --> 01:00:40,840 probably not as big as Barminka, but it's still a pretty big arm. 1241 01:00:40,840 --> 01:00:45,280 Now considering DDH one bought Swift before Parenti bought DDH 1242 01:00:45,280 --> 01:00:49,160 one, how do you think that's going to be sort of value or 1243 01:00:49,160 --> 01:00:52,080 creative eventually? Like as I know there was some 1244 01:00:52,080 --> 01:00:55,160 knocks on that takeover by a lot of. 1245 01:00:55,160 --> 01:00:57,720 Holders, yeah, it was an interesting one. 1246 01:00:57,720 --> 01:01:00,880 I mean, the market probably hasn't had a favourable view of 1247 01:01:00,880 --> 01:01:02,160 drilling companies quite a while now. 1248 01:01:02,160 --> 01:01:04,400 A lot of them listing drilling, listed drilling companies have 1249 01:01:04,400 --> 01:01:10,040 had issues over the years. It's super cyclical and and 1250 01:01:10,400 --> 01:01:12,840 provided a lot of challenges. So the market wasn't that 1251 01:01:12,840 --> 01:01:15,040 positive on that one. I I do think it makes sense over 1252 01:01:15,040 --> 01:01:16,640 time. I mean, they, they did have a 1253 01:01:16,640 --> 01:01:19,440 small OS drill kind of fleet there, which there are some 1254 01:01:19,440 --> 01:01:22,080 synergies and some costs they can take out. 1255 01:01:22,160 --> 01:01:26,160 It gives them a, you know, operating base to utilise tax 1256 01:01:26,160 --> 01:01:29,160 losses in Australia as well. So from a purely financial 1257 01:01:29,160 --> 01:01:31,880 sense, they've got a lot of tax losses in the parenti group in 1258 01:01:31,880 --> 01:01:36,600 Australia bringing on a a big Aussie earnings base and DDH can 1259 01:01:36,600 --> 01:01:39,960 utilise that and and get some better cash flow in the timing 1260 01:01:40,240 --> 01:01:42,680 probably wasn't ideal. We have seen expiration ticked 1261 01:01:42,680 --> 01:01:46,160 down. So I think there's that 1262 01:01:46,160 --> 01:01:47,840 expiration side of it's probably struggling a bit. 1263 01:01:47,880 --> 01:01:50,480 I'll probably say that, you know, I wouldn't be surprised 1264 01:01:50,480 --> 01:01:52,080 that underperforms the acquisition case. 1265 01:01:53,200 --> 01:01:56,000 But having Swift there, having some of the, the iron ore 1266 01:01:56,120 --> 01:01:58,520 business I think is called Ranger, which is a bit more 1267 01:01:58,520 --> 01:02:01,720 stable in terms of production drilling that is that's a pretty 1268 01:02:01,720 --> 01:02:04,440 good base to that business. And if and when the expiration 1269 01:02:04,440 --> 01:02:08,040 cycle resumes, there's quite a lot of leverage there on the 1270 01:02:08,040 --> 01:02:11,080 upside. And when that'll be, I don't 1271 01:02:11,080 --> 01:02:12,080 know. I'd be kind of surprised how 1272 01:02:12,080 --> 01:02:14,480 weak exploration spending and and junior capital raises have 1273 01:02:14,480 --> 01:02:17,280 been given the Aussie gold prices at 3500 bucks. 1274 01:02:17,280 --> 01:02:20,480 But you have to think at some point the the rig start turning 1275 01:02:20,480 --> 01:02:22,560 again and DH will be one of the beneficiaries. 1276 01:02:23,320 --> 01:02:27,400 Can they definitely use the tax losses of Barmingo with the 1277 01:02:27,600 --> 01:02:30,400 entity they bring in? Yeah, my my understanding is I 1278 01:02:30,400 --> 01:02:31,360 can. Yeah, OK. 1279 01:02:31,480 --> 01:02:33,200 Yeah, yeah. Interesting. 1280 01:02:33,600 --> 01:02:35,040 Matt, you ready for overrated? Underrated. 1281 01:02:35,120 --> 01:02:36,800 Well, here we go. Let's do it. 1282 01:02:36,960 --> 01:02:40,480 All right, We'll, we've, we've JD and I have beeped out a big 1283 01:02:40,480 --> 01:02:44,480 list here, So I reckon we'll we'll go with the the succinct 1284 01:02:44,480 --> 01:02:46,920 version. But if you you know, if, if any 1285 01:02:46,920 --> 01:02:49,680 of us are just want want you to elaborate why, we'll ask why or 1286 01:02:49,680 --> 01:02:53,040 if you feel the need to, to give A1 sentence of why, then then 1287 01:02:53,040 --> 01:02:54,440 please Chuck it in there as well. 1288 01:02:54,920 --> 01:02:57,160 Sure. All righty, overrated, 1289 01:02:57,240 --> 01:02:59,320 underrated Matt Gryphon, you ready? 1290 01:02:59,560 --> 01:03:03,000 Owning physical uranium or gold bars instead of the miners. 1291 01:03:05,640 --> 01:03:09,880 Look, given I run a equity fund, I have to say that's overrated 1292 01:03:12,200 --> 01:03:13,440 to be honest. It's been, it's been the best 1293 01:03:13,440 --> 01:03:15,920 strategy over the last probably couple of decades. 1294 01:03:15,920 --> 01:03:18,480 But I do think we're at a point now where you get more leverage 1295 01:03:18,480 --> 01:03:21,440 out of the equities and there's big valuation disparities there. 1296 01:03:21,960 --> 01:03:25,400 Yeah. Participating in IPOs for mining 1297 01:03:25,400 --> 01:03:28,920 companies. Probably overrated. 1298 01:03:29,520 --> 01:03:31,400 We don't really do many IP OS in general. 1299 01:03:32,320 --> 01:03:34,880 I haven't, yeah. A lot of the mining companies 1300 01:03:34,880 --> 01:03:37,160 have listed kind of exploration size if it's too small for us 1301 01:03:37,160 --> 01:03:38,560 anyway. So it's not a huge pipeline 1302 01:03:38,560 --> 01:03:41,880 there for us. Passive investing's distortion 1303 01:03:42,160 --> 01:03:46,280 on financial markets. Look, I think that's probably, 1304 01:03:46,280 --> 01:03:49,680 that's probably fairly rated. I think there is a fair bit of 1305 01:03:49,680 --> 01:03:51,520 distortion and I think it probably does get overplayed a 1306 01:03:51,520 --> 01:03:53,760 little bit. But in terms of active 1307 01:03:53,760 --> 01:03:56,320 management, you know, if there is distortion from passive, it's 1308 01:03:56,360 --> 01:03:58,760 it should be great for us because it just means there's 1309 01:03:58,760 --> 01:04:01,440 more opportunities that that aren't being picked up. 1310 01:04:01,440 --> 01:04:03,000 So potentially a positive tailwind. 1311 01:04:04,160 --> 01:04:06,800 African risk as a sort of broader jurisdiction. 1312 01:04:07,880 --> 01:04:10,000 I think it's overrated. As I said before, I I think a 1313 01:04:10,000 --> 01:04:14,240 lot of these African risks are kind of overstated, especially 1314 01:04:14,240 --> 01:04:15,640 in the gold space. I just don't see too many 1315 01:04:15,640 --> 01:04:21,680 impacts to gold mines over time. Iron ore staying above 100 USA 1316 01:04:21,680 --> 01:04:25,360 tonne for the next 24 months. Yeah, interesting one. 1317 01:04:25,360 --> 01:04:27,400 And I know, I know you guys did the thing at the end of last 1318 01:04:27,400 --> 01:04:30,720 year where everyone's bearish fit for the US iron ore and it's 1319 01:04:30,720 --> 01:04:33,160 still over 100 bucks. Look, I don't know. 1320 01:04:33,200 --> 01:04:34,960 I know. Yeah, we're not. 1321 01:04:34,960 --> 01:04:36,760 We're not macro guys. It's hard to make a call. 1322 01:04:36,760 --> 01:04:39,080 I've been probably a bit surprised it's held up so well. 1323 01:04:39,080 --> 01:04:42,920 But given how weak China's been, if China does turn the corner 1324 01:04:42,920 --> 01:04:44,840 and start to get more positive, you have to say probably, it 1325 01:04:45,200 --> 01:04:46,640 probably does hold up to these levels. 1326 01:04:46,640 --> 01:04:49,520 So maybe that's underrated, I guess. 1327 01:04:50,880 --> 01:04:55,200 The the influence of the recent Aussie government funding on 1328 01:04:55,200 --> 01:04:57,520 critical minerals and and downstream processing and 1329 01:04:57,520 --> 01:05:01,040 whatnot. Yeah, I think that's overrated. 1330 01:05:02,280 --> 01:05:04,680 My quick view on that is I think the government's probably going 1331 01:05:04,680 --> 01:05:05,920 to lose a lot of money on this stuff. 1332 01:05:06,640 --> 01:05:10,000 You know, there's always money around for good projects, and a 1333 01:05:10,240 --> 01:05:12,360 lot of these projects need government funding, need it for 1334 01:05:12,360 --> 01:05:14,800 a reason, because equity markets and debt markets aren't willing 1335 01:05:14,800 --> 01:05:16,880 to fund it. I don't really get the whole 1336 01:05:16,880 --> 01:05:20,200 point of building out all this critical infrastructure in 1337 01:05:20,200 --> 01:05:22,560 Australia or parts of the supply chain and not the full thing 1338 01:05:22,560 --> 01:05:25,920 without the operating base here. So overrated for me. 1339 01:05:27,720 --> 01:05:31,560 Short selling. I think that's fairly right. 1340 01:05:31,560 --> 01:05:33,520 I think shorties have a place we're we're long only. 1341 01:05:33,560 --> 01:05:36,000 I think shorting's very hard. Probably not something I can do 1342 01:05:36,000 --> 01:05:38,880 successfully. But I've got no issues with 1343 01:05:38,880 --> 01:05:40,280 short sellers. I've got no issues with people 1344 01:05:40,280 --> 01:05:43,440 taking different views to me. The debate's healthy, I think, 1345 01:05:43,440 --> 01:05:46,880 at least in good markets. We've never met a short seller 1346 01:05:46,880 --> 01:05:48,280 in Australia. No, they don't exist. 1347 01:05:48,280 --> 01:05:50,160 None. Of them, they're all everyone's 1348 01:05:50,160 --> 01:05:53,040 long only apparently on the show anyway. 1349 01:05:53,800 --> 01:05:55,040 We believe you. But Maddie? 1350 01:05:56,760 --> 01:05:58,640 Yeah. Similar to the the iron ore 1351 01:05:58,640 --> 01:06:04,800 question, what's your view on 6% SPOD being under or over 1500 1352 01:06:04,800 --> 01:06:09,640 USA tonne in let's say in two years time? 1353 01:06:10,280 --> 01:06:12,480 Yeah. Look, I'm firmly convinced to 1354 01:06:12,480 --> 01:06:14,960 view that lithium's going to be challenged for a while. 1355 01:06:14,960 --> 01:06:18,600 So I think it'll be under. The views are based on a couple 1356 01:06:18,600 --> 01:06:22,360 of things. I just think hybrids are taking 1357 01:06:22,360 --> 01:06:24,800 over from full electric vehicles and there's much less lithium 1358 01:06:24,800 --> 01:06:27,520 needed. I don't think some of those 1359 01:06:27,760 --> 01:06:30,880 Chinese supply sources like Africa or the pedilites really 1360 01:06:31,160 --> 01:06:33,240 turn off necessarily where people think they're doing this. 1361 01:06:33,240 --> 01:06:37,600 So I do think in two years we probably have a pretty tough 1362 01:06:37,600 --> 01:06:43,440 market for lithium. Buying instead of building. 1363 01:06:44,880 --> 01:06:49,360 Yeah, I think that's underrated in terms of I think buying over 1364 01:06:49,360 --> 01:06:51,480 building is better strategy at the moment. 1365 01:06:52,040 --> 01:06:54,720 If you look at building, it is getting a lot harder. 1366 01:06:55,920 --> 01:06:59,560 Permitting, native title, environmental, those timelines 1367 01:06:59,560 --> 01:07:03,160 are just massively blowing out. So the value in having existing 1368 01:07:03,160 --> 01:07:05,720 infrastructure there is huge. I think that goes to the 1369 01:07:05,720 --> 01:07:08,520 starting point as well. And you look at some of these 1370 01:07:08,520 --> 01:07:11,720 projects like Mick Philomise from Regis, which has just been 1371 01:07:11,720 --> 01:07:13,280 caught up in permitting for so long. 1372 01:07:13,880 --> 01:07:15,680 It's kind of destroyed the project. 1373 01:07:15,760 --> 01:07:18,600 Like they built it when they thought they would be making 1374 01:07:18,600 --> 01:07:21,240 really good money now. But we're now at a point where 1375 01:07:21,240 --> 01:07:23,600 the economics are challenged just because it's taken so long, 1376 01:07:24,040 --> 01:07:26,680 the permitting and and the construction side's really blown 1377 01:07:26,680 --> 01:07:30,480 out so a bit hard. How about going on site visits? 1378 01:07:31,400 --> 01:07:35,200 Oh, underrated. I try to go to as many sites as 1379 01:07:35,200 --> 01:07:36,440 I can. I think there's a huge amount of 1380 01:07:36,440 --> 01:07:38,760 value in getting out there, seeing things first hand, 1381 01:07:39,320 --> 01:07:42,680 getting a sense of the people on site, you know, the next labour 1382 01:07:42,680 --> 01:07:45,520 management down, what sort of people are, what their 1383 01:07:45,520 --> 01:07:48,560 incentives are. And yeah, I think it's time very 1384 01:07:48,560 --> 01:07:52,000 well spent. Is it sometimes detrimental but 1385 01:07:52,080 --> 01:07:54,760 and clouds your judgement when you get the fluff fest up there? 1386 01:07:55,560 --> 01:07:57,960 Yeah, but you get that meeting management in in an office 1387 01:07:57,960 --> 01:07:59,720 anyway. You know, you've got to take 1388 01:07:59,720 --> 01:08:01,120 everything with a bit of a grain of salt. 1389 01:08:01,120 --> 01:08:04,200 In this industry, one of the things we do is just 1390 01:08:04,360 --> 01:08:06,440 consistently meet people over time, go to sites. 1391 01:08:06,440 --> 01:08:09,600 Over time, you build up a track record of knowing people, 1392 01:08:09,600 --> 01:08:12,600 knowing who you can trust, who's conservative, who's aggressive. 1393 01:08:12,600 --> 01:08:15,640 And I don't think you get that from one side visit to one 1394 01:08:15,640 --> 01:08:16,720 meeting. I think that's really something 1395 01:08:16,720 --> 01:08:17,760 you've got to build up over time. 1396 01:08:19,240 --> 01:08:24,319 Regis. Oh, resources, I'd say probably 1397 01:08:24,319 --> 01:08:27,560 overrated. I I just see a bit of a 1398 01:08:27,560 --> 01:08:29,120 challenge in terms of jigs and ending. 1399 01:08:29,640 --> 01:08:31,920 I think they've probably got to acquire something given 1400 01:08:32,000 --> 01:08:35,800 Philomise looks a bit tough. So look, nothing against the 1401 01:08:35,800 --> 01:08:37,240 team or the company, I just think there's better 1402 01:08:37,240 --> 01:08:38,359 opportunities than gold at the moment. 1403 01:08:38,840 --> 01:08:42,319 And the and the royalty climb. Yeah, yeah, that's hanging out 1404 01:08:42,319 --> 01:08:43,359 too. Who knows where that goes. 1405 01:08:43,399 --> 01:08:45,680 That's that's really interesting, the history on that 1406 01:08:45,680 --> 01:08:47,359 one. How about sand fire? 1407 01:08:49,000 --> 01:08:51,319 San Fi's probably overrated just on valuation. 1408 01:08:51,359 --> 01:08:54,160 I think I really like what Brendan and the team have done 1409 01:08:54,160 --> 01:08:56,240 with that company. I think they've got got the 1410 01:08:56,240 --> 01:09:00,240 operations humming build bringing on that Mathura project 1411 01:09:00,240 --> 01:09:01,840 and ramping it up has gone really well. 1412 01:09:02,319 --> 01:09:05,680 I struggle to see what the next level of growth is post FY25. 1413 01:09:05,720 --> 01:09:08,920 So there's there's maybe some more M&A that has to happen 1414 01:09:08,920 --> 01:09:11,680 there or or some other some other projects that come in. 1415 01:09:11,680 --> 01:09:14,479 But I just think on a valuation perspective, we prefer metals 1416 01:09:14,479 --> 01:09:19,439 acquisition vibe, investing vibe. 1417 01:09:19,880 --> 01:09:22,240 Yeah. Yeah, look, I mean, it probably 1418 01:09:22,240 --> 01:09:25,120 has a space of people for us. We're we're very fundamental 1419 01:09:25,120 --> 01:09:27,560 bottom up. We enjoy doing the models. 1420 01:09:27,560 --> 01:09:30,200 I enjoy talking to people, getting as much information as I 1421 01:09:30,200 --> 01:09:32,760 can. Sometimes you do have to get a 1422 01:09:32,760 --> 01:09:37,000 vibe on things positive and negative, but 99% of what we do 1423 01:09:37,000 --> 01:09:39,399 is hopefully backed up by facts and information. 1424 01:09:40,120 --> 01:09:43,000 Although it does reach a point where, you know, the sort of 1425 01:09:43,000 --> 01:09:45,880 rule I think we operate on is if you think you've got about 70 or 1426 01:09:45,880 --> 01:09:48,040 80% of what you need to know, that's enough to invest. 1427 01:09:49,160 --> 01:09:52,080 Doing that extra 10 to 20% of work does take a long time, is 1428 01:09:52,080 --> 01:09:53,760 pretty hard, and you do miss out on opportunities. 1429 01:09:53,760 --> 01:09:57,360 So you can get a bit of a vibe in there as well. 1430 01:09:57,880 --> 01:10:00,760 Matey Griffith, if you ever need a vibe mate, I'll let you know 1431 01:10:00,760 --> 01:10:04,560 what the vibes are because I'm a vibe. 100% vibe here. 1432 01:10:07,280 --> 01:10:11,040 That in a similar sort of vein of thought, Fintwit, are you a 1433 01:10:11,040 --> 01:10:13,960 user? I'm not, but one of the other 1434 01:10:13,960 --> 01:10:15,440 guys on the team is, I give it all of him. 1435 01:10:16,120 --> 01:10:18,880 I'll try to steer clear, but I'd rather read like quality reports 1436 01:10:18,880 --> 01:10:20,120 and annual reports and other things. 1437 01:10:20,120 --> 01:10:22,840 But one of the guys on the team loves it. 1438 01:10:22,840 --> 01:10:25,520 So he he's on top of that and he takes care of that for us. 1439 01:10:26,200 --> 01:10:30,920 Capstone Copper. Look, I think, yeah, probably 1440 01:10:30,920 --> 01:10:34,480 overrated again compared to Mac. I haven't. 1441 01:10:35,000 --> 01:10:36,040 I've done a huge amount of work on them. 1442 01:10:36,120 --> 01:10:39,360 From a cursory glance, it's big, it's copper, it's got growth, 1443 01:10:39,360 --> 01:10:42,360 it's ticks all the boxes. There have been a few guidance 1444 01:10:42,360 --> 01:10:45,280 misses over the last few years and I'm just a bit worried about 1445 01:10:45,280 --> 01:10:48,400 the track record on a few of the assets and especially given 1446 01:10:48,400 --> 01:10:50,360 there's a ramp up phase coming on a couple layers. 1447 01:10:50,360 --> 01:10:52,280 So that could present a few challenges. 1448 01:10:52,720 --> 01:10:55,600 And it does screen as as recently expensive as well. 1449 01:10:55,600 --> 01:10:58,440 So not one for us at the moment, but one that might look 1450 01:10:58,440 --> 01:11:01,360 interesting at some point. How about Mada? 1451 01:11:02,640 --> 01:11:04,920 Yeah, maybe it's done an incredible job. 1452 01:11:06,240 --> 01:11:08,160 It's hard to say at the moment. I mean it's, it's been such a 1453 01:11:08,160 --> 01:11:10,360 good growth story. There's such a strong pipeline 1454 01:11:10,360 --> 01:11:13,520 of geographies, different parts of business they go can go into 1455 01:11:13,920 --> 01:11:16,400 my concern in the short term there is just around this labour 1456 01:11:16,400 --> 01:11:18,480 shortage easing and what that means. 1457 01:11:18,480 --> 01:11:20,400 I mean they've really been a bit beneficiary of that. 1458 01:11:21,040 --> 01:11:24,080 I think if they can get through the next 12 months and continue 1459 01:11:24,080 --> 01:11:28,240 this growth profile, then that's kind of that set the business 1460 01:11:28,240 --> 01:11:30,280 works, you know, there's no doubts in it. 1461 01:11:30,360 --> 01:11:32,240 So I think there's a pretty critical period coming up. 1462 01:11:33,320 --> 01:11:35,800 There are a few competitors trying to start up, you know, 1463 01:11:35,840 --> 01:11:38,920 small internal type major divisions which might eat away 1464 01:11:38,920 --> 01:11:41,440 them a bit. And then it's just a question of 1465 01:11:41,440 --> 01:11:44,360 do the miners start to see labour more freely available so 1466 01:11:44,400 --> 01:11:47,800 use more of their own labour compared to using major a bit 1467 01:11:47,800 --> 01:11:49,320 more. So it's going to be a very 1468 01:11:49,320 --> 01:11:50,880 interesting 6 or 12 months ahead for them. 1469 01:11:50,880 --> 01:11:53,360 I think that's really going to make a break the model and and 1470 01:11:53,360 --> 01:11:54,800 whether it can keep trading on the multiples. 1471 01:11:54,800 --> 01:11:58,880 It does ionic clay RAF deposits out of Brazil. 1472 01:12:00,120 --> 01:12:03,600 Yeah, interesting. Look, a lot of those are kind of 1473 01:12:03,600 --> 01:12:05,960 early stage for us. So I've met with most of them. 1474 01:12:05,960 --> 01:12:07,240 I haven't done a huge amount of work. 1475 01:12:07,640 --> 01:12:12,560 If they work, it's probably very bearish for anyone that's not an 1476 01:12:12,560 --> 01:12:16,000 ionic clay president, rarest producer, because there's so 1477 01:12:16,000 --> 01:12:19,520 much potential supply at such low cost to come out of there 1478 01:12:19,520 --> 01:12:22,160 that it might just suppress the price and destroy a lot of the 1479 01:12:22,160 --> 01:12:25,080 Hard Rock projects. Obviously, they face challenges 1480 01:12:25,080 --> 01:12:28,520 in terms of permitting, ramping up CapEx, Rarest, it's not easy 1481 01:12:28,520 --> 01:12:31,040 in terms of getting the processing all the downstream 1482 01:12:31,040 --> 01:12:33,200 right. So depending how far they want 1483 01:12:33,200 --> 01:12:35,040 to go on that track could be a bit hard. 1484 01:12:35,960 --> 01:12:38,680 I'd probably say fairly rated risks are probably evenly 1485 01:12:38,680 --> 01:12:40,680 balanced at the moment. What about what about the 1486 01:12:40,680 --> 01:12:43,320 payability of those rare earths by China? 1487 01:12:44,360 --> 01:12:47,800 Yeah, that's another question. I mean, you know, recoveries, 1488 01:12:47,800 --> 01:12:53,240 payabilities it all, it's quite no paid market rare earths, it's 1489 01:12:53,360 --> 01:12:55,360 been quite difficult from an investment perspective. 1490 01:12:55,360 --> 01:12:58,000 We, we don't, we have not held anything in space for quite a 1491 01:12:58,000 --> 01:13:00,560 while. Yeah. 1492 01:13:00,560 --> 01:13:01,840 It's just just too many questions, Sir. 1493 01:13:01,840 --> 01:13:03,080 OK. For us, that whole space. 1494 01:13:04,520 --> 01:13:10,280 Nickel mines. Interesting look. 1495 01:13:10,280 --> 01:13:11,840 I'm probably pretty bearish on the nickel price. 1496 01:13:11,840 --> 01:13:16,600 I just think the whole trend towards LFP batteries has taken 1497 01:13:16,600 --> 01:13:19,520 a bit away from the nickel growth story, as well as 1498 01:13:19,520 --> 01:13:22,360 probably the the more bearish view on battery sizes with plug 1499 01:13:22,360 --> 01:13:25,000 insurance. Nickel mines is interesting 1500 01:13:25,000 --> 01:13:26,920 because I do own the resource and I think that's becoming an 1501 01:13:26,920 --> 01:13:29,280 increasingly valuable asset because a lot of the stuff we're 1502 01:13:29,280 --> 01:13:32,160 hearing out of Indonesia is that they're going to be resource 1503 01:13:32,160 --> 01:13:35,880 constrained. So that becomes probably more 1504 01:13:35,880 --> 01:13:37,680 valuable than what the market gives in credit for. 1505 01:13:39,000 --> 01:13:42,240 There's a lot of risk there in terms of Chinese ownership. 1506 01:13:42,480 --> 01:13:47,120 Being in Indonesia just becomes a bit too hard for us at at the 1507 01:13:47,120 --> 01:13:50,000 moment. AIC mines. 1508 01:13:51,120 --> 01:13:52,280 Yeah, I haven't looked in too much details. 1509 01:13:52,280 --> 01:13:53,800 One I probably need a bit of work on. 1510 01:13:54,560 --> 01:13:56,840 I've heard good things about management and the operations, 1511 01:13:57,680 --> 01:13:59,960 potentially one of those next year of juniors to come through 1512 01:13:59,960 --> 01:14:02,400 in the copper space. The junior copper market has 1513 01:14:02,400 --> 01:14:07,320 been tough like those small scale producers have tended not 1514 01:14:07,320 --> 01:14:09,600 to make any money even in good copper prices. 1515 01:14:09,600 --> 01:14:12,560 So I'd have to check on their plans. 1516 01:14:12,560 --> 01:14:14,680 But I think you need a bit of scale in that space to make 1517 01:14:14,680 --> 01:14:18,160 money, but too early for me to make a call and it needs a bit 1518 01:14:18,160 --> 01:14:21,240 of work on that one. The last one for me BH. 1519 01:14:21,240 --> 01:14:24,320 PS Big bet on Podash. Yeah. 1520 01:14:24,800 --> 01:14:28,200 Look, I don't know the first thing about being Podash, to be 1521 01:14:28,200 --> 01:14:30,440 honest. I follow Podash loosely when, 1522 01:14:30,640 --> 01:14:32,720 you know, a few junior companies have Podash assets over the 1523 01:14:32,720 --> 01:14:35,200 years, again, that that's a big boys game. 1524 01:14:35,200 --> 01:14:38,040 It's a it's, it's a tough market to understand. 1525 01:14:38,040 --> 01:14:43,880 It's kind of up here, sorry. Meadows X. 1526 01:14:45,160 --> 01:14:48,120 Yeah, we've got a good history with Metals X actually, I've 1527 01:14:48,120 --> 01:14:50,120 been down to Renison in the past. 1528 01:14:50,120 --> 01:14:52,200 It's a, it's a great mine if you get a chance to go down there. 1529 01:14:53,360 --> 01:14:55,840 We did make a lot of money back back on it probably five or six 1530 01:14:55,840 --> 01:14:59,360 years ago. We've missed it this time just 1531 01:14:59,720 --> 01:15:03,080 given the the company's had probably some operational 1532 01:15:03,120 --> 01:15:06,640 hiccups, which has meant we've we've kind of steeped clear. 1533 01:15:07,040 --> 01:15:11,800 Haven't had a big view on tin really, but could be 1534 01:15:11,800 --> 01:15:13,720 interesting. Yeah, I think that's probably 1535 01:15:13,840 --> 01:15:16,480 underrating. Bloody beautiful. 1536 01:15:17,080 --> 01:15:19,200 Awesome. She's wicked mate. 1537 01:15:19,320 --> 01:15:21,960 Thanks for chatting with us. That was right in our 1538 01:15:21,960 --> 01:15:23,800 wheelhouse. Loved it. 1539 01:15:24,320 --> 01:15:29,080 I'm always so impressed by the generalist investors that can 1540 01:15:29,560 --> 01:15:31,840 talk in great detail across so many different sectors. 1541 01:15:31,840 --> 01:15:34,480 So thanks for making the time and chatting with us, Matt. 1542 01:15:35,240 --> 01:15:36,360 No worries. Thanks guys to be on the show. 1543 01:15:36,760 --> 01:15:38,400 Appreciate it. You beauty. 1544 01:15:38,400 --> 01:15:40,480 That was a fucking brilliant chat. 1545 01:15:40,480 --> 01:15:43,640 I love, I love talking. I'll say it every time we talk 1546 01:15:43,640 --> 01:15:45,920 about this sort of stuff. I love talking about shit I know 1547 01:15:45,920 --> 01:15:49,680 a bit about. I'll repeat myself. 1548 01:15:50,160 --> 01:15:53,520 That was what a bloody JC. Awesome. 1549 01:15:54,840 --> 01:15:57,160 It was great. Cutler Cutler partners to thank 1550 01:15:57,160 --> 01:15:59,480 Hey. Yeah mate at the bloody top of 1551 01:15:59,480 --> 01:16:03,360 the show we are great friends at Axis porn and tech Look at the 1552 01:16:03,880 --> 01:16:07,520 look at the great hat the traps got on and who who else we have 1553 01:16:07,520 --> 01:16:09,520 in the show. A bit of K drill gonna go bloody 1554 01:16:09,520 --> 01:16:13,840 powder, Leonora and Laverton region and DSI keeping Kobar 1555 01:16:13,840 --> 01:16:18,600 alive in the rest of the world. Also got CRE insurance. 1556 01:16:18,600 --> 01:16:21,680 WA waterboards get wet solutions. 1557 01:16:22,120 --> 01:16:23,840 Verify. Verify. 1558 01:16:24,480 --> 01:16:29,400 Mineral mining services Silverstone CRE insurance WA 1559 01:16:29,440 --> 01:16:32,240 water balls mate and use a spark shark spark. 1560 01:16:32,240 --> 01:16:35,160 Just mention them all twice. We'll say a few a few times. 1561 01:16:36,720 --> 01:16:39,360 How good Spark and how good is JD and Trap? 1562 01:16:39,360 --> 01:16:44,400 Hoodoo Hoodoo Go Australia Information contained in this 1563 01:16:44,400 --> 01:16:47,160 episode of Money of Mine is of general nature only and does not 1564 01:16:47,160 --> 01:16:49,800 take into account the objectives, financial situation 1565 01:16:49,840 --> 01:16:51,840 or needs of any particular person. 1566 01:16:52,160 --> 01:16:55,200 Before making any investment decision, you should consult 1567 01:16:55,200 --> 01:16:58,240 with your financial advisor and consider how appropriate the 1568 01:16:58,240 --> 01:17:01,920 advice is to your objectives, financial situation and needs.