Lots to talk about, deals to be done as Diggers draws curtain on 2019
A gold price rising to above $2200 an ounce has provided the perfect backdrop to end this year’s edition of the Diggers & Dealers Mining Forum.
As more than 1000 miners, explorers, brokers, bankers and journalists – or almost half of this year’s record crowd of 2400 – lined up for last night’s gala awards dinner in the giant marquee outside the Goldfields Arts Centre, there were more highlights to discuss than just a record bullion price.
Incoming Diggers chairman Jim Walker says the diversity of commodities (re)presented over the three days was a highlight – even though almost half of companies presenting were in gold, other commodities ranged from rare earths to potash to base metals, bauxite and iron ore – as was the volume of exploration and development projects on display.
“That is our growth pipeline because at subsequent Diggers we should be able to see these projects advance and – hopefully – turn into profitable mines,” Walker said.
The other “growth pipeline” was on display on Wednesday night at a packed WA School of Mines-Women in Mining event that gave the next generation of STEM professionals the opportunity to mingle with WASM alumni who have achieved success in the industry.
There are expectations that highly regarded WASM alumni Sabina Shugg, the newly appointed director of WASM’s Kalgoorlie campus, will be able to encourage a rise in student intake complemented by closer ties with the industry that should deliver employment opportunities for graduates – and a win-win for all.
Peter Klinger reflects on another positive @diggersndealers where the rising gold price was the talk of the town.
— Investor Insight (@cp_investor) August 7, 2019
Argonaut analyst James Wilson pointed to a tick-up in investor focus on those companies who were delivering exploration success or had existing resources that had so far proved difficult to develop.
“For me, the key themes at Diggers were that stranded resources, particularly in gold, have all got a bulls eye on them because everyone is buying growth,” Wilson said.
“The (share) paper of the mid-tiers is worth a lot of money at the moment and so to do a deal with scrip will be very enticing.”
Just look at Saracen Mineral Holdings’ (ASX: SAR) deal to buy smaller peer Bligh Resources (ASX: BGH) or Silver Lake Resources’ (ASX: SLR) takeover of EganStreet Resources (ASX: EGA) as examples of owners of smaller deposits being in hot demand.
As Saracen boss Raleigh Finlayson said in his presentation yesterday afternoon, the entire gold sector is considered to be “ex-growth”, a clear signal to others that the next wave of growth will have to come through acquisition.
Although Northern Star Resources (ASX: NST) tried its hardest to hose down persistent rumours it was buying half or maybe all of the Super Pit, it didn’t stop the guessing game on the next deal – fuelled in no small part by Northern Star itself in its presentation when it highlighted opportunities for mid-tier players like it to move up into the next enterprise category headed by Newcrest Mining.
A marriage between Northern Star and Evolution Mining (ASX: EVN) would do nicely.
Certainly the gold bulls have piled into the newest ASX-listed producer, Gold Road Resources (ASX: GOR), which jumped to another record close yesterday of $1.495 to value the owner of half of the world-class Gruyere gold mine at $1.2 billion. Gold Road’s stock was trading at 65¢ on December 31.
Stunning share price performances across the gold sector will do nothing, of course, to quieten the call from investors for a pile of dividends to complement the capital growth.
Irrespective of your political leanings, watching John Howard work his magic with the Diggers crowd on Monday was impressive. Granted, he was preaching to the converted but to see the adulation with which he was greeted by delegates – measured by the number of selfies that popped up across social media – was akin to watching teenagers at a Justin Bieber concert.
Independence Group (ASX: IGO) boss Peter Bradford spent a significant amount of time in his presentation talking up nickel’s increasing role in the electric vehicle boom – he is awaiting delivery of his Tesla – in a boon for the most exciting nickel sulphide explorer on the ASX, St George Mining (ASX: SGQ), while BHP Nickel West boss Eddy Haegel confirmed that his team had begun drilling at the Seahorse greenfields prospect on the Nullarbor.
Lynas Corp (ASX: LYC) managing director Amanda Lacaze lived up to her billing as a top-rate presenter with another compelling delivery of her rare earths story while Bellevue Gold (ASX: BGL) boss Steve Parsons got the crowd excited talking up his namesake project’s high grades.
Members of our Fosterville team with Former Australian Prime Minister John Howard after he delivered the keynote address @diggersanddealers pic.twitter.com/8k0ADwRsto
— Kirkland Lake Gold (@KirklandLakeGld) August 5, 2019
Not surprisingly, gold featured prominently among the coveted gongs handed out at the gala dinner last night.
Australia’s most famous and successful prospector Mark Creasy, whose credits include pegging the ground where the Jundee, Bronzewing and Nova orebodies were discovered, received the GJ Stokes Memorial Award, adding to the gongs he has collected over his long and varied career.
Northern Star was named Dealer of the year for its value-adding acquisition of the Pogo gold mine in Alaska while Bellevue was named Emerging Company for its exploration success at the namesake project in the northern Goldfields.
The Gina Rinehart-controlled Roy Hill Holdings, run by Barry Fitzgerald, was named Digger of the year for the successful ramp-up of the 55mtpa iron ore project in the Pilbara.
Another Barry FitzGerald, the veteran resources journalist, received the Media award, fitting recognition of his continued leading coverage of the mining sector. In the past year alone, Fitzy broke the stories of Rio Tinto’s Winu copper discovery in the Kimberley and Creasy’s Silver Knight nickel-copper find in the Fraser Range. Fitzy, who has mentored a generation of mining journalists, was the inaugural Media winner in 2003 and is the first journalist to twice win the gong.
And a big congratulations to Samuel La Macchia, a fourth-year mining engineering student at the WA School of Mines who was awarded the Ray Finlayson Medal for Leadership and Academic Excellence.
— Peter Klinger (@peterklinger) August 7, 2019
FRUIT AND VEG
Finally, for those who wonder how we survive three days and four nights of hard-core networking, it is thanks to the support of the Aggreko-sponsored coffee and the BASF-sponsored fresh fruit juice stands.
For the record, Diggers delegates went through more than 90kg of coffee beans, about 470 litres of milk and 2000kg of apples, carrots and oranges.
That’s it from Diggers for another year. Time to recharge the batteries and try to pick the winners for the coming 12 months.
Peter Klinger is Cannings Purple’s Director of Media Strategy. He has provided strategic communications advice on more than $1 billion worth of corporate transactions over the past year. Peter is a former Business Editor of The West Australian and has also worked for The Times (London) and the Financial Review. Contact Peter
Cannings Purple’s market-leading Investor Relations team was on the ground in Kalgoorlie-Boulder for the full three days of Diggers & Dealers.
More Cannings Purple news:
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- Miners need to talk to us, “not just among themselves”
- How good is Diggers? – an ex-PM, the gold price and Trump
- Miners shouldn’t have to apologise: John Howard
- Gold will glitter at Diggers…but that won’t be all
- Stories told (and sold) in Noosa point towards Diggers
- Cannings Purple tops M&A table for third straight year
- Nobody is going to tell your story for you
- If you can’t say it on the ASX, can you say it at all?
- Clear communications in Africa: the expert view
Photos thanks to Gold Industry Group:
The image of #mining was a hot topic at our @diggersndealers breakfast yesterday with @DeloitteER as panelists Kelly Carter, Raleigh Finlayson, David Morrison AO & Dr Leeora Black discussed transparency, owning our stories & leveraging the collective. #dnd2019 #gold #goldmining pic.twitter.com/gHn1i1PI7n
— Gold Industry Group (@ausgoldindustry) August 7, 2019