THE purchase of BHP Billiton’s Ravensthorpe nickel mine is set to shine the spotlight on First Quantum Minerals, an international mining company founded in Perth 13 years ago.
THE purchase of BHP Billiton’s Ravensthorpe nickel mine is set to shine the spotlight on First Quantum Minerals, an international mining company founded in Perth 13 years ago.
News reports last week of the $372 million sale of the mothballed mine have often referred to First Quantum as a Canadian company, given its Toronto listing, however its management hub is in Perth despite the miner holding no Australian assets until now.
The Perth connection stems from chairman and chief executive Philip Pascal, who has worked at the Argyle diamond project and Hamersley Iron, and First Quantum’s only executive director, Martin Rowley, a former Bond Group senior executive.
The pair founded the company in 1996 and swooped on a copper opportunity in Zambia after the country was pressured by the World Bank to change the way it handled its mining industry.
“It was just an opportunity to buy some large copper assets which had been poorly managed by governments and we’ve turned them around into very successful operations,” Mr Rowley told WA Business News.
First Quantum’s Canadian connection was then cemented when it sought a listing there in 1996.
“I made the decision because the first assets that Quantum had were in Africa and the Australian stock exchange really didn’t have any familiarity with African assets back in the mid 1990s. We listed those assets in what was then the best venture capital market for junior resource companies, Vancouver,” Mr Rowley said.
It’s a trend that other Perth-based resource companies have followed, including Anvil Mining, Equinox Minerals and more recently Magma Metals and Mantra Resources, with local investors more risk-averse compared to their counterparts in London and North America.
Before the end of the 1990s, First Quantum delivered its first copper-producing operation with an output of 10,000 tonnes a year, a fraction of the 380,000t of copper the company is expected to produce this year from its African mines.
The company is also listed on the London Stock Exchange and its total shareholder base is 90 per cent institutions, predominately from Europe and North America.
Despite the overseas connections, Mr Rowley said he and Mr Pascall had never felt the urge to shift the management base.
“At first we were criticised because we had a London office and we had African operations and we lived in Perth,” Mr Rowley said.
“Both of us have discussed [moving] but we like living in Perth; it’s where our families are.”
First Quantum plans to spend a further $164 million to bring the Ravensthorpe mine back into operation, and the total transaction will be funded out of the company’s $1 billion cash reserves, half of which was raised through a convertible bond issue during the year following demand by UK institutions.
With its first Australian asset under its belt, Mr Rowley said the company has no intention of listing on the local bourse and was not looking at any other Australian assets.
He said First Quantum will be looking to bed three major deals announced over the past month, including the go ahead with the $437 million Kevitsa nickel mine in Finland and the $284 million acquisition of AIM-listed company Kiwara.
