Success hasn’t dimmed the enthusiasm of Terry Streeter, Miles Kennedy and a host of others for the challenges of new mining ventures.
Success hasn’t dimmed the enthusiasm of Terry Streeter, Miles Kennedy and a host of others for the challenges of new mining ventures.
MOST of us, were we fortunate enough to pocket tens of millions of dollars, wouldn’t be stuck for ideas on how to use it. Not many of us would be itching to go back to work, either.
But among the Western Australians who have made a killing from the mining industry, there’s an overwhelming tendency to get straight back to business.
Few seem prepared to drop out of the business world and enjoy the spoils of success; most seem addicted to trying to do it all over again.
Terry Streeter started investing in resources stocks more than 40 years ago, using funds from his fruit and vegetable business. His success in backing not one but two junior explorers that went from start-up to mining – Jubilee Mines and Western Areas – delivered him a fortune estimated at more than $200 million.
Yet he is back doing it all again, getting into another couple of start-up ventures he hopes can replicate his earlier successes.
“My son’s been saying to me. ‘Why don’t you give it away?’ But I like it,” Mr Streeter told WA Business News.
“I like the risk, I like the challenges, I like to see these companies stand on their feet and develop these projects.”
It’s not so much about the money, he said, but the thrill and satisfaction of creating projects and getting them off the ground.
It is perhaps not surprising that the sort of personalities able to stomach the huge risk in the exploration sector, and who can bury their lives in the complex and consuming task of building an idea into a major business, are then not content to simply sit back and enjoy the simple life.
And while in other industries those who succeed in one business may see a role within an even bigger company as their logical next step, those in the mining industry seem to be wired a little differently.
Take, for example, Craig Williams.
Mr Williams guided Equinox on to the Australian Securities Exchange back in 2004, promoting a copper deposit in Zambia that numerous companies had previously tried – and failed – to develop.
By last year, that unloved deposit was well into production and at the core of a mining house that North American giant Barrick Gold had decided was worth $7.3 billion. The Barrick takeover of Equinox stopped Mr Williams’ own dramatic expansion plans for the company, which was targeting major acquisitions around the world.
The company Mr Williams had dedicated his working life to suddenly belonged to someone else; but before 2011 was out, Mr Williams had already lined up his next venture.
Orecorp, an as-yet unlisted company headquartered in Subiaco, has secured Mr Williams’ services as chairman. The company is still in the very early stages of exploration, having secured ground in Mauritania and Ethiopia prospective for gold, base metals and uranium.
Like Mr Williams, Kerry Harmanis found his way back into exploration when his project, Jubilee Mines, was taken over by Xstrata for $3 billion at the top of the nickel market in 2007.
While Mr Harmanis has knocked back dozens upon dozens of requests for his services as a director, he has nevertheless found a way to indulge his ongoing interest in the resources sector.
His vehicle is Talisman Mining, an exploration play focused on an area north-east of Meekatharra.
With a 14 per cent stake, Mr Harmanis is Talisman’s largest shareholder; and while he has declined a board seat, he has helped furnish the company with many members from the old Jubilee team.
While starting over from scratch may seem a daunting proposition, building a successful venture is generally much easier second time around.
Most importantly, money – the lifeblood of exploration companies – invariably follows management that has delivered in the past.
Men such as Messrs Streeter, Williams and Harmanis have long lists of investors sitting on large piles of money courtesy of their efforts, and who are eager to back any new venture with their names attached.
The thrill and satisfaction of building a business does not diminish the more it is repeated, according to Mr Streeter.
“[The satisfaction] is as strong as it was with the first investment I made, in Great Boulder Gold Mines in 1969,” he said.
“I thought that was wonderful, I doubled my money from $700 to $1,400 and I thought that was great.
“You still get the satisfaction out of exploration, and the satisfaction out of the people you work with as well.”
With mining entrepreneurs, in particular, there appears to be a sense of looking to replicate that original success by doing it again.
Given the difficulty and unpredictability of exploration, it would seem that one would be on a hiding to nothing when trying to follow up one major discovery and success with another. But anyone doubting that lightning can strike twice need only look at Nick Giorgetta.
He sold Equigold, the company he had founded, to Lihir Gold in 2008 for $1.1 billion.
The following year, he and his colleagues took control of gold explorer Regis Resources.
Today, the company has moved into production and up the ranks of Australia’s largest gold miners, with Regis now worth more than $1.7 billion, helped along by outstanding exploration results.
The career path of Miles Kennedy, meanwhile, has gone full circle.
He’d already had a fine career by the time he set up Sandfire Resources, having helped establish Macraes Mining (now OceanaGold) and Kimberley Diamond Co (taken over by Gem Diamonds in 2007 for $300 million).
Sandfire made the discovery of a lifetime when it struck copper at its DeGrussa prospect. The fairy-tale find had a sour ending, however, when Mr Kennedy and his co-founder Karl Simich had a very public falling out over the direction of the company.
Rather than walk away from the industry, Mr Kennedy has rebuilt a suite of interests that happen to involve some very familiar territory.
One company he now chairs, Resource & Investments, has become the largest landholder surrounding Sandfire’s DeGrussa discovery, courtesy of its recent acquisition of the old Fortnum gold mine and associated tenements. While the gold project should be a goer, Mr Kennedy is also convinced that the region should produce more DeGrussa-esque discoveries.
Another venture, MOD Resources, has taken Mr Kennedy to New Zealand in the form of the Sams Creek gold deposit – a project he first came across back in 1983 while working for Macraes.
And he’s even back in the diamond business, through his role as managing director of London-based Lonrho Mining, which is exploring for and producing diamonds in Angola.
Mr Kennedy told WA Business News he had previously tried taking breaks from the industry but simply couldn’t stay away.
“I’ve had boats, I’ve sat on them for months and bored myself stiff and driven my wife crazy,” he says.
After almost three decades of working in exploration, he said the passion remained strong.
“I love exploration and I love working with a team of geologists I’ve had around me for a long time; we like being explorers, finding things and bringing them up to the stage where hopefully they all turn into mines,” Mr Kennedy said.
It’s a sentiment shared by Ian Burston, a man who is the definitive ‘veteran’ of the Australian mining industry.
Mr Burston has spent the best part of five decades in the industry, having previously been the head of Rio Tinto’s iron ore arm as well as managing director of iron ore miners Portman and Aztec Resources (both of which have since been taken over).
Most people Mr Burston’s age – his 77th birthday is in sight – would be well and truly retired by now.
Instead, he’s spent much of the past 18 months traipsing around Nigeria of all places, piecing together his new iron ore venture, Energio.
The company, which recently backdoor listed on the ASX, is looking to develop an iron ore project in Nigeria under the watchful (and very hands-on) eye of Mr Burston.
On top of that, he is also the chairman of mining services group NRW Holdings and African Iron, which has just been acquired by South Africa’s Exxaro Resources.
While Mr Burston admits Energio is set to be his swansong, he enjoys being in the industry as much as ever.
“You retire to do what you want to do, not to do what you have to do,” he said.
“I’ve always been interested in this stuff, and I just think it’s keeping me active.”
Mr Burston said his wife had been understanding about his career, but hinted that she has previously suggested retirement.
“I’ve had differences of opinion on this with my wife, it’s fair to say,” he said.
“I tell her that’s why the marriage has hung together for 48 years, I’ve been away for 46 of them.”
The Nigeria venture appears to hold particular importance for Mr Burston, given its potential to benefit the country.
“Anything like this, where you’re in the position to influence things and bring something significant to pass, is something you should be thankful for and proud of,” Mr Burston told WA Business News.
“There’s a lot of things to be proud of with what we’re doing in Nigeria, and one of those is we’re helping the nation.”
The Nigerian capital of Abuja may not be the sort of place most normal people would like to spend their retirements.
But then again, successful mining entrepreneurs are rarely normal people.
