The psychology of exploration those that talk about it, those that back it and those that do it. CET Discovery Day, February 2014

Transcription

1 The psychology of exploration those that talk about it, those that back it and those that do it CET Discovery Day, February 2014

2 Where is Nova? In Western Australia a mining friendly, low political risk jurisdiction Relatively close to sealed highway and accessible to Kalgoorlie (north) and Esperance port (south) Relatively short commuter flight from Perth & drive in/out from Norseman & Esperance 2

3 What is Nova? 3

4

5 A snapshot Less than two years ago. Sirius was an unknown penny dreadful Perth-based explorer Not much money, sick share price Doing unfashionable exploration in obscure areas But with a supportive board and shareholders, and an idea Down to its last roll of the dice Now. Nova-Bollinger is a globally significant nickel project It is a technically low risk, financially robust, low cost producer-to-be, with a very desirable product Fraser Range is Australia s hottest exploration address Sirius has prime position in a new unexplored province Development team in place & exploration ramping up $100 million cash 5

6 Why the Fraser Range? Alignment of the planets. The discovery of Tropicana providing focus on the gold potential ultimately from WMC s diamond exploration group s sampling program The legacy of the 1960 s nickel exploration program by Newmont (David Trywhitt) and WMC (Roy Woodall) proving the Thompson belt concept The accident of Skylab attracting Creasy to the area The intuition of INCO and Falconbridge but their ultimate failure to execute Big company syndrome The patient accumulation of ground by Creasy the beauty of being private The systematic geochemical sampling by Creasy the beauty of deep pockets The acquisition and release of geophysical surveys (magnetics and gravity) by the WA Government a crucial enabler 6

7 Why the Fraser Range like the Thompson belt? 7

8 Why the Fraser Range like the Thompson belt? 8

9 Why the Fraser Range treasure from the sky 9

10 The discovery story A textbook case study Release of regional geophysical data as a proxy for geology enabled Sirius to identify discrete bite-size targets (and not be driven and led astray by the same regional airborne surveys as everyone else) Release of WA Government regional geochemical sampling data enabled the prioritisation of these targets with the Eye being the first to be tested Soil sampling by Sirius confirmed a strong Ni-Cu-Co soil anomaly over what is now Nova A WA Government co-funded drillhole provided further confidence, although this hole had to be abandoned Reconnaissance geochemical drilling confirmed subsurface Ni-Cu-Co enrichment but without PGE s - this nearly threw us off the scent Ground EM geophysics defined an anomaly that was far too big and strong to be meaningful, and was also bereft of any nickel and copper anomalism this nearly threw us off the scent! 10

11 The discovery story government geophysics 11

12 The discovery story early reconnaissance 12

13 The discovery story government geochemical data 13

14 The discovery story government geochemical data 14

15 The discovery story old fashioned bootleather 15

16 The discovery story geochemical sampling 16

17 The discovery story geochemical sampling 17

18 The discovery story the failed drill hole 18

19 The discovery story sulphide or just laterite? Po Pt Cpy Drilling defined a blanket of Ni-Cu-Co enrichment (but not over the subsequently defined EM anomaly!) Lack of PGE s was a concern! Nature of underlying rock was a concern! BUT traces of disseminated pyrrhotite-pentlanditechalcopyrite (see microphoto on left)??

20 The discovery story EM too good to be true 20

21 The discovery story a three hole gamble 21

22 The discovery story as it happened 2pm Friday 20 th 52m down hole the last roll of the dice Malcolm Gollan logging 7pm 181m down hole too dark to continue but is that sulphide?? 6am Saturday after a freezing night contemplating what the future may hold. 9am Saturday 21 st July discovery day

23 The discovery story the long drive home 23

24 About Sirius A purpose-designed company (shell + ground + people + cash) Alignment of circumstances (Croesus + Apex + Creasy) Alignment of stakeholders (tailor made board + supportive shareholders) Sense of purpose (clear objectives + simple strategy) Creasy re-capitalised Croesus shell way deal involving Creasy, Croesus and Apex: Bennett selected Creasy ground, raised money, renamed company & put the team together Redesigned the company structure to benefit from success (compulsory sale of unmarketable parcels, capital consolidation, raised more money and issued options Resulted in the creation of an old fashioned exploration company, with access to prospective unexplored ground, the cash to explore it, the people to do it, with a unified board and supportive major shareholders, able to pursue its strategic objectives rather than being beholden to short term market expectation, & do or die trying 24

25 A myriad possible outcomes of every decision 25

26 Spreadsheet exploration 26

27 Closing comments Geologists vs Explorers Science vs Art Big Company syndrome Retro-rationalisation Technology vs Thought Talk vs Action Industry structure Pawns & Pawnbrokers Careers vs Lives Equity Capital Markets 27