21/03/2006 - 21:00

ConsMins’ plan for the future

21/03/2006 - 21:00

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If outgoing Consolidated Minerals Ltd managing director Michael Kiernan is a rough diamond, his anointed successor, the smooth urbane Rodney Baxter, is the polished result.

ConsMins’ plan for the future

If outgoing Consolidated Minerals Ltd managing director Michael Kiernan is a rough diamond, his anointed successor, the smooth urbane Rodney Baxter, is the polished result.

Introducing the 44-year-old South African and former top executive of international mining giant Anglo American plc at a recent presen-tation to bankers, stockbrokers and analysts in Perth, Mr Kiernan proclaimed: “He’s got more bloody qualifications than anyone in this room.”

It was a typically sweeping exaggeration for which Mr Kiernan is well known but made clear the point that after an international search, Mr Baxter was Mr Kiernan’s clear successor choice from July 1.

Mr Kiernan, also chairman of Croesus Mining NL and Monarch Resources Ltd, will remain on the ConsMins board as a non-executive director.

It will be Mr Baxter’s task to execute ConsMins’ four phase expansion plan of extending its current WA manganese, chromite and nickel production and marketing base; instigating near future growth strategy by adding zinc and copper to the production mix from mid 2007, then iron ore from 2008; seeking new acquisitions; and internationalising the company.

His targets have already been set by Mr Kiernan – 2005-2006 net profit of $30 million, $85 million for 2006-2007 and $115 million profit for the following year.

Mr Baxter has the pedigree for a company with international aspirations.

He was recruited to ConsMins in February 2005 from the dual role as projects director with Anglo American plc and divisional director with Anglo American Platinum Corp, where he spent nine years.

In his short time at ConsMins, Mr Baxter’s multi-commodity expertise in a complex global marketplace has played a key role in the development of the company’s nickel business and establishment of a new zinc copper business via ConsMins’ 33 per cent stake in Perth company Jabiru Metals Ltd, a stake likely to increase in the coming months.

ConsMins is targeting a nickel resource worth over $2 billion at its expanding Beta Hunt and East Alpha projects near Kambalda. The mine is expected to see nickel concentrate production up from the current 5,000 tonnes a year to 25,000t/year in two to three years.

The company has committed $45 million to fast track exploration and development of the East Alpha ore body via twin declines from nearby Beta Hunt, where third quarter 2006 production is expected to take output to 9,000-10,000t/year.

The proposed $50 million second phase will push production to 25,000t/year. Jabiru Metals’ $56 million Jaguar zinc/copper project, near Leonora, is scheduled for production in mid 2007.

The project involves a decline development to produce 20,000t/year of zinc in concentrate, 8,000t/year of copper in concentrate and 800,000oz/year of silver over a five year mine life.

ConsMins’ Mindy Mindy iron ore deposit, near BHP Billiton’s big Mt Newman mine and a 50/50 joint venture with Fortescue Metals Group Ltd, is scheduled for production at five million t/year in 2008 over a projected 20 year mine life.

Mr Kiernan has confirmed the company’s potential and logical off take discussions with BHP Billiton, Rio Tinto and “my old mate Twiggy Forrest (Fortescue Metals).”

It will all come down to the margins.

At Woodie Woodie, in the Pilbara, ConsMins produces 1 mt/year of manganese over a 15 year mine life, while chromite ore production from Coobina, near Newman, is up to 250,000t/year over five years.

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