Another Successful Meeting Of Minds – And Mines: The Africa Down Under Conference Goes From Strength To Strength.
By Our Man in Oz / www.minesite.com
At first glance it seems odd that anyone would even consider organising a conference on African mining in Australia. At second glance it seems even odder that about 1,000 people, many from Africa, trek across the Indian Ocean each year to attend the African Down Under (ADU) forum in Perth. Whatever the explanation for its success - and possible reasons include the pleasure of meeting in a safe city, and the mixing of two very mining-focussed cultures in the same pot - there is no doubt ADU is a remarkable success, and second only, in terms of the numbers of delegates and hangers-on, to Australia’s premier mining conference, the Diggers & Dealers forum in Kalgoorlie. Last week’s ADU, despite the lingering aftershocks of the global financial crisis, was on a par with the 2008 event. There was a whiff of deals in the air as African diggers mixed with Aussie dealers and a surprisingly large number of chief executives found the time to spruik their stocks.
Over the two-days of ADU a total of 29 chief executives gave presentations, some even finding time to man their corporate booths to field questions from stray investors. One such was Bill Turner, managing director of Anvil Mining, a company fast shaking off the pain caused by last year’s copper-price crash. In what might be called a “boothside” chat, Minesite’s Man in Oz got a private update on how a US$200 million financing and sales agreement with Trafigura, one of the world’s biggest commodities traders, has ensured the success of Anvil’s new flagship Kinsevere mine in Congo.
“Teaming up with Trafigura means we can push ahead with construction of stage two of the Kinsevere mine”, Bill said. “First production of copper cathode from the solvent-extraction, electro-winning plant, is scheduled in early 2011, and will grow steadily towards the targeted 60,000 tonnes of metal a year. Most of the engineering and design work is complete, along with civil and concrete work. About 80 per cent of the major items of plant have been ordered.” On the market, Anvil has been in recovery mode for the past 10 months, rebounding strongly from the dark days last November when some financially stressed investor was forced to take A52 cents a share in a panicked exit, only to watch the stock shoot back up to A$3.26 in mid-August. It’s now trading at around A$2.65.
Nkwe Platinum also proved to be a drawcard with executive director, Peter Landau, filling in at the last minute for chief executive, Maredi Mphahlele. One of a growing band of Aussie-companies which call Africa home, Nkwe is an emerging success story in the tight-knit world of platinum. Seen by some observers as following in the footsteps of one of Australia’s most successful mining “exports”, Aquarius Platinum, Nkwe is active on both the eastern and western limbs of the Bushveld intrusive, which is home to the lion’s share of the world’s platinum group minerals. Plum asset in the Nkwe portfolio is a strip of tenements along the eastern limb which include the Garatau and Tubatse deposits. An option held by mining giant, Xstrata, over a 50 per cent stake in the project area is perhaps the biggest vote of confidence in Nkwe’s mine plan, which is to be become the producer of a million ounces of PGMs. “The vision we have for Nkwe is to become one of the world’s top four vertically integrated platinum producers,” Peter said. On the market, Nkwe has recovered from its low of A11 cents reached in March to trade recently at A25 cents. That said, the company looks set for a further re-rating when feasibility studies are completed on the Garatau project in the December quarter, and Tubatse in the last quarter of 2010.
Craig Williams, chief executive of Equinox Minerals, also attracted a following when he delivered the latest news from his company’s world-class Lumwana project. “Mine performance is still ramping up”, Craig said, adding that mine management needed to “focus on material movement to maintain that momentum”. That curious remark about material movement was an oblique reference to a shortage of earthmoving equipment, the major hurdle encountered during the commissioning of Lumwana, a mine heading for annual output of 170,000 tonnes of copper a year. “The underperformance we have suffered has been primarily due to truck and shovel availability, but we are continuing to ramp up to successfully move towards an anticipated production rate of 20 million tonnes [of ore] a year.” On the market, Equinox has recovered strongly from its low of A95 cents to its current level of around A$2.95.
Mark Calderwood, CEO of Perseus Mining, Stephen Stone from Azumah, Mike Griffiths from Chalice Gold, Mark Bojanjac from Adamus, John Borshoff from Paladin, John Lewins from Platinum Australia and Andrew Drummond from Minemakers, were also on the speakers list, with the people running companies proving to be a much bigger attraction than the passing parade of African politicians who had popped over the ditch for a spot of shopping. As with all African conferences there was a touch too much government, including an opening address from Australia’s foreign affairs minister (and local member for Perth’s inner suburbs), Stephen Smith, a man who rarely sees a mine.
Criticism, however, of a remarkably successful event is perhaps a little unfair, even if it is hard to explain why a delegation from the Johannesburg Stock Exchange booked a booth and delivered a paper. Perhaps that had more to do with arranging a JSE marketing visit to coincide with the Springboks rugby tour of Australia and New Zealand, than it did with matters financial – though such a conclusion might justifiably be termed churlish. It would also be churlish to suggest that this was a conference in the wrong country, if not on the wrong continent. The truth is that for whatever reason a curious connection is being forged (or re-forged after those dreadful apartheid years) between two countries which once had so much in common.
Perhaps the best explanation of what’s happening is that the shared interest in mining is drawing Africans and Australians together. An additional factor is Australia’s, and especially Perth’s, large expatriate population of South African and Zimbabwean professionals spotting opportunities to re-export their skills back “home”, while maintaining a safe residential address in Oz. It is no coincidence that five of the top 10 companies listed as having Perth as their home market on the ASX are really Africans in disguise. Paladin, Extract, Aquarius, Centamin and Equinox are all mining and/or exploring in Africa while maintaining their head offices in Perth. And that’s a trend that’s only likely to accelerate as companies such as Nkwe, Azumah, Anvil, Platinum Australia, Perseus, Adamus, Chalice, Gryphon, Deep Yellow, Ampella, Globe Metals, and Sundance grow their African projects while maintaining strong Australian connections.
AVM Price at posting:
$2.63 Sentiment: None Disclosure: Not Held
