Perseverance, a focus on geology and financial discipline and some good breaks are what’s needed to make a mining titan, some of the industry’s leaders told a conference put on by former Sprott CEO Rick Rule in Florida last week.
Industry legends including Canadian mining luminary Robert Quartermain, Agnico Eagle Mines (TSX: AEM; NYSE: AEM) chair Sean Boyd, Osisko Development (TSXV: ODV; NYSE: ODV) chair and CEO Sean Roosen, and Vizsla Copper (TSXV: VCU; US-OTC: VCUFF) CEO Craig Parry discussed the backstories on their multibillion-dollar successes.
“Persistence and tenacity are everything in this business,” Parry said during the Mining Legends panel on July 11 at the Rule Symposium in Boca Raton. “You need to stay focused and keep pushing forward, even when things get tough.”
Quartermain, co-chair of Dakota Gold (NYSE-A: DC), steered Pretium Gold through a $3 billion deal for its Brucejack gold project in British Columbia. Boyd has transformed Agnico Eagle into one of the largest gold producers globally with a market capitalization of C$52 billion ($38bn), far bigger than Barrick Gold’s (TSX: ABX; NYSE: GOLD). Roosen discussed his journey from acquiring the Canadian Malartic asset in an C$88,888 distress sale to selling it for C$4 billion ($2.9bn).
Parry, who is also Inventa Capital co-founder and managing partner, said assessing projects on size, cost and success probability had underpinned his achievements. These include the Athabasca Basin and the Sierra Madre silver discoveries of the Panuco project Vizla is developing in Mexico.
“You’ve got to kiss a lot of frogs – drill and kill projects quickly,” Parry said.
Boyd recounted Agnico Eagle’s rise from a $50-million revenue company in 1998, crediting the company’s success to a high-quality asset approach, strong team trust and sound geological assessments.
“We knew what we were good at, and mining is tough enough. So, let’s just stick to what we’re good at,” Boyd said, highlighting the importance of focusing on core competencies.
The legends were candid about their mistakes and the lessons learned. Boyd shared an early financing misstep where Agnico Eagle turned down a critical capital deal, leading to financial struggles. He stressed the importance of maintaining financial control.
“Never put yourself in a position where the banks can tell you how to run a mine,” Boyd advised.
Quartermain detailed one of his prior companies holding a challenging project in Russia that they could not sell at a profit due to jurisdictional risks and issues. He said local partnerships were fundamental, and understanding geopolitical risks is paramount when starting a project.
Roosen, who also founded Osisko Gold Royalties (TSX: OR; NYSE: OR), shared a lesson from his time developing the Canadian Malartic project, today Canada’s largest open-pit gold mine. Underestimating community relations nearly derailed the project, he said. They planned to move 20% of the town of Malartic, including 205 homes, without fully appreciating the complexities and sensitivities involved.
In the early stages, the team faced significant resistance from the community, resulting in strained relations and mounting opposition.
Roosen and his team reassessed their approach. They understood that gaining the trust and support of locals was critical for the project’s success, he said. By improving communication, addressing concerns and actively involving the community in the decision-making process, they rebuilt trust and eventually moved forward with the project.
The discussion also delved into personal investment philosophies. Roosen said his bets last year were on companies like Patriot Battery Metals (TSX: PMET; ASX: PMT) and Dakota Gold, emphasizing the importance of backing strong management teams. “I’d rather back the jockey than the horse,” he said.
Parry also enjoyed a good run upwards with Patriot. He described how a chance meeting with an Australian colleague led to an investment in the company at about C70¢ per share, which eventually soared to C$20.
Boyd, maintaining a singular focus, has only ever invested in Agnico Eagle to avoid conflicts of interest.
Looking ahead, the panellists outlined their current projects. Roosen is focused on the Cariboo gold project in British Columbia. and the Tintic copper-gold project in Utah. Parry is enthusiastic about Vizsla’s silver district in Mexico and several ventures in the Athabasca Basin.
Boyd said Agnico Eagle’s major projects, underpinned by the Detour Lake and Canadian Malartic assets, were set to continue generating stable dividend payments. At the same time, Quartermain is excited about Dakota Gold’s promising drill results at the Maitland gold project in South Dakota.
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