FinnAust Mining PLC ORD 0.01P (LON:FAM) Managing Director Roderick McIllree caught up with DirectorsTalk to discuss recent announcements, their work programme, metallurgy and what investors should expect over the coming months
Q1: Now Rod, Pituffik continues to evolve quite nicely and there have been a couple of announcements since we last spoke, can you talk us through those?
A1: I guess what we try and do here is not to have too many of these kinds of announcements and sort of save up 3 or 4 appropriate announcements that are worth everybody’s time listening to these segments and I think we’re certainly in a position to do that at the moment.
I think if you’re looking back over the last several items there’s been some pretty significant developments, first of all I guess the acquisition of Avannaa was a big move that hasn’t necessarily sort of sprouted any value for shareholders at the moment but we’re very pleased with that acquisition, there’s going to be a lot more news coming on those 2 projects over the next 6, 12 and 18 months.
We had the approval for the social impact assessment by the Greenland government, that was in its own right demonstrates a process timeline that we’re adhering to, I think one of the important things that if shareholders go right back to the first time you and I started speaking about this project, and really listen to these interviews, what people will recognise is that for the last 12 months we have delivered on every single thing that we said we were going to do. The approval for the social impact assessment in addition to the environmental impact assessment goes a long way to demonstrating a permitting pathway and an associated timeline so they’re going well.
Final results, look no surprises there, just a couple of key points I guess that are worth pointing out. First of all the management team at FinnAust Mining has taken the view, and it’s been a view that I’ve expressed a couple of times, that we’re not in this for the salaries, obviously people need to live, we try and mitigate the cost for our team by having critical people as major significant shareholders in the company. So I think one point to make about those final results are that if people go through and look at salaries that people receive, we like to think that we’re pretty competitively priced and shareholders should take a little bit of comfort that our interests are aligned with them.
The most important of the RNS’s out over the last 3 months really are the work programme being completed at Pituffik, we had a pretty good year this year, Danish Geological Survey obviously performed very well, we expanded the project about two thirds of the way into the field season probably put on an extra 20% or 30% on top of what we had planned. So I think just the ability to operate in these areas with high quality service providers at very competitive rates is worth just really banging the drum about because we like to think we can operate efficiently and cheaply and produce a good product so we hope that shareholders and interested parties are satisfied with that work programme. It was a lot of effort that went into that, all of those samples now are back with the Danish Survey in Denmark and shortly will be on their way to various laboratories, the results of which will feed into the resource estimation which I guess really is the last part of the puzzle for what we’re trying to demonstrate here.
The last one, today’s announcement, it kind of just says it all. It is something that we’ve been highlighting about Pituffik for a number of months and the fact that this is a primarily ilmenite goes a long way towards its commerciality, a very positive development Giles, something that’s really going to assist us with our calculations moving forward.
So all in all, very pleased with the last 3-6 months, again it’s all going according to plan.
Q2: So some very positive developments there, you touched on the work programme that you’ve completed this year, what do you think it will ultimately lead to?
A2: Well obviously we’ve got in the vicinity of 500 individual sample sites whether they are auger drilling, off-shore vibracore, near-shore vibracore, we did some infill bathymetry if you like in the very shallow marine environment to tie our geological models together. I think what these types of work programmes produce is a very high quality data set, both in terms of the geological model, the actual samples themselves and not just that, the results that they spit out, these numbers that we expect to come back from here and there were areas that surprisingly high grade on this project. I think ultimately what that will develop into is an SRK generated resource, we had SRK competent person visit site, they certainly have a better understanding of the project now I think it’s fair to say and we’re working with them and the Danish Geological Survey to produce this resource, the results of which will feed into generating that ultimate or maiden number for the project. So a critical piece of work that needed to be done, it’s done, I think that people can be fairly comfortable that there’s going to be a reasonably compelling number at the end of the year, I think that’s going to be a given.
Q3: Can we talk about the metallurgy, it seems like it’s indicating that you’ve had some sort of breakthrough here, can you tell us what it means in simple terms?
A3: I think there’s two key parts of this, there’s the ilmenite which is a primary ilmenite, it’s not un-oxidized, it’s fresh and it has been mechanically eroded. The host rock if you like is a basalt, sits within a broader sedimentary basin, over the millennia, several tens of thousands of years, there’s been mechanical erosion that put this ilmenite material on the beach, it’s been naturally sorted to a certain extent by mother nature. What we’re finding though is the differential in specific gravity i.e. the weight of the ilmenite mineral and its host minerals, the sands, the quartz from the broader basin area, there is a very neat divide that can be tapped into by gravity. So what we’re finding here is whilst we knew we had a very homogenous ilmenite over the entire project area, what we’re is we can actually separate it very neatly using just simple gravity to produce that the concentrate of this high quality ilmenite.
Now the metallurgy is ongoing but I think that internally we’re pretty confident that this will pass the sniff test for the chloride sulphate processing routes which is pretty important. It is a mineral that has high process efficiency so I think it’s more and more that metallurgy has demonstrated that it’s simple to separate, it’s of a high quality chemical nature and we believe that shortly it is going to be recognised as a premium product, we’ve said this all along.
So it’s a pretty important development in terms of the metallurgical evolution, today’s announcement is something that should give everyone confidence that this project is moving forward in pretty big leaps and bounds.
Q4: What’s next for shareholders, what can we expect to see from FinnAust Mining over the next several months?
A4: I think that there’s the natural evolution of the results feeding into the resource then maybe a little bit of news about the Disko and the Kangerluarsuk projects, continuous metallurgic development in terms of the chloride process. We’re still working on the shipping aspect and I guess the process design, these are two things that we hope to have announced to the market before the end of the year, that shipping aspect is actually one of the more critical pieces of the overall development scenario. Finally, we’re still working as hard as we possibly can to get some off-takes in place before the bulk sample occurs next year so between now and February I think there are some pretty significant pieces of the puzzle yet to be demonstrated to the broader market, certainly internally we know about them but I think between now and then end of Q1 next year they’ll be some further significant developments that everybody will be quite pleased with.
