A touch of vaudeville

If it was promoted on a Broadway billboard, Diggers and Diggers 2005 would have starred the vaudevillian duo Andrew Forrest and Michael ‘Lucky Legs’ Kiernan, a Mongolian trapeze act and ‘The Man Who Can Breathe Through His Ears’, Owen Hegarty.

Critics would have panned the finale which, with all due respect to president of BHP Billiton’s Nickel West, Jimmy Wilson, was well below the conference standard and another legacy of recent takeover acquisition WMC Resources.

There was backstage cattiness and a chorus line of explorers and junior miners, each trying to sing louder than the last.

And there was the star and his transport.

Ivanhoe Mines chairman and mining promoter extraordinaire, Robert Friedland, flew in for only a couple of hours from Mongolia in his 737 Boeing business jet, but left a more lasting impression with a company car, which was parked all day for every day of the conference in the best and most conspicuous parking spot at the Goldfields Arts Centre.

Were his staff always the first to arrive, had Friedland paid for the spot or did his star status earn him the position? No-one seemed to know.

So, let’s look at the show.

Top billing Messrs Forrest and Kiernan are joint venture partners in a Pilbara iron ore prospect called Mindy Mindy.

The ‘Twig and Lucky Legs’, as they are known to each other, are also parties to a joint bid through the National Competition Council to force open access to Pilbara iron ore fortunes.

They want Rio Tinto and BHP Billiton to share their railways, however, they both insist they don’t need access themselves.

So why are they going to the trouble of hiring lawyers and fighting a cause that once already (for Hope Downs heiress Gina Rinehart) has ended in favour of the oligopoly?

Mr Forrest insisted, repeatedly, at Diggers and Dealers that Fortescue Metals’ prospects in the Chichester Range did not depend on access to Rio’s line to achieve production.

He is committing to the construction of 250 kilometres of rail at a cost of $560 million in a total project cost of almost $2 billion.

He says development of Mindy Mindy does depend on using part of BHPB’s line.

Mr Kiernan had a different story – Mindy Mindy could use Fortescue Metals’s new line.

So who is driving the challenge to rail access? Mr Forrest is, according to Mr Kiernan.

It is all for the benefit of Mindy Mindy, according to Mr Forrest.

Mr Kiernan had his own separate sideshow, which specialised in criticism of WMC Resources, to which ConsMin was selling nickel offtake until BHPB took over WMC in May.

WMC was aloof, not overly concerned about the welfare of its junior nickel mining clients and unwilling to negotiate on off-take agreements, Mr Kiernan said.

All had changed with the new owners. And ConsMin’s good relationship with BHPB extended to the Pilbara, where the company is discussing rail access for Mindy Mindy, according to Mr Kiernan.

BHPB, on the other hand, was saying nothing. Mr Wilson’s presentation was dominated by a video, which documented the company’s new nickel partners at Kambalda.

WA Business News later discovered that WMC had committed to presen-ting at Diggers and Dealers well before BHPB’s takeover offer, and the new owner was obliged to carry it through. Imagine the company’s surprise when it was named Dealer of the Year.

Mongolia was the buzzword in greenfields exploration, given its proximity to China.

Ivanhoe’s copper and gold motherlode Oyu Tolgoi, as outlined in Mr Friedland’s presentation, took on proportions that defied imagination, except when he explained 570km of drill core had been logged. It was enough to make most geologists in the conference room whistle as they would be lucky to be given the budget to drill one tenth of that before the mine was in production.

Mr Friedland also promoted the fact that many Australians were responsible for the work done so far, which may account for the local skills shortage.

And last but not least, the speedy presentation of Oxiana’s Owen Hegarty prompted the question from the audience of whether the managing director could breathe through his ears and was the skill an advantage when working in Laos where the company has its Sepon copper and gold mines?

We suspect his acceleration was powered by an almost 10 per cent surge that morning in Oxiana’s share price on takeover speculation.