australasia outlook issue 1

PEOPLE CULTURE TRAVEL PROPERTY BUSINESS WINE SPORT ENTERTAINMENT

Bad Boss tipsThings only bad managers say and do…

Endocoal The Bowen Basin’s next emerging coal producer

cEll aquaculturE Reaching out to new markets

phillips rivEr Mining Interview with Jason Stirbinskis

City Square Rio Tinto’s new HQ

Inside

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Welcome! Welcome to the first issue of Australasia Business Outlook, a digital and print magazine aimed at an international readership comprising business people, property owners, wealthy investors and migrants. It reaches a diverse section of society, not only in Australia, New Zealand but internationally.

Established in 1974, the Outlook series was originally developed by Consyl Publishing and was purchased by TNT Publishing in 2010. The business now aims to establish an even bigger footprint in the territories where it was once prominent, while conquering new markets.

Finely balanced content makes this magazine a must for any business operating globally with connections to Australasia. Our remit embraces coverage of key business components and best practice around operations, enterprise efficiency, productivity, HR, corporate social responsibility, energy and environment, sales and marketing, IT, communications, finance and much more. It is essential reading for business leaders who want to keep up to date with news affecting Australasia, be enlightened by informative features and share the successful strategies of their peers.

This month we look at what makes a bad boss, the ASX and profile some of the biggest companies in Australia, with the common theme being resources.

Enjoy the magazine! Ian Armitage Editor

editorial editor – Ian ArmitageSub editors – Jahn Vannisselroy Janine Kelso Tom Sturrock Writers – Colin ChineryJane Bordenave Robert Michaels

BuSineSSadvertising Sales manager – Sean Brettresearchers – Nicholas DaviesStuart Shirra

Sales administrators – Katherine EllisDaniel George

accountSFinancial controller - Suzanne Welsh

Production & deSigndesign & Production manager – Lisa Ferronimages: Getty news: NZPA, AAP, SAPA

digital & itHead of digital marketing & development – Syed Ahmad

tnt PuBliSHing ceo - Kevin Ellis chairman - Ken Hurst Publisher - TNT Multimedia Limited

TNT Multimedia Limited,10 Greycoat Place, London, SW1P 1SBtntmagazine.com

enquirieSTelephone: 0061 (0)2 8518 1223Fax: Email: [email protected]

SuBScriPtionS Call: 0061 (0)2 8518 1223Email: [email protected]

www.australasiaoutlook.com

30

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44 48 52

60 704 www.australasiaoutlook.com

06 NEWS

12 Bad BoSS tipS

14 EuropEaN dEBt criSiS: rEaSoN to

Worry

16 aSX LimitEd: iNvESt iN auStraLia

18 EvENtS

20 cELL aquacuLturE While global fish stocks remain under threat, Cell Aquaculture is reaching out to new markets

24 cENtraL pEtroLEum Exploration and production company Central Petroleum has assembled the biggest prospective acreage package in Australia

30 cLEaNSEaS tuNa Cleanseas is a company with a long history of innovation and excellence within the seafood industry

34 coNSoLidatEd tiN miNES Consolidated Tin Mines is engaged in tin exploration and development in Queensland

38 coNtiNENtaL coaL Coal remains the cheapest and globally in-demand power generator says Perth-based Continental Coal executive Jason Brewer

44 EmpirEd Ian Armitage talks to Empired’s chief executive officer and managing director Russell Baskerville

fEatu

rES

fEatur

ES


Contents

PEOPLE CULTURE TRAVEL PROPERTY BUSINESS WINE SPORT ENTERTAINMENT

Bad Boss tips

Things only bad managers

say and do…

Endocoal

The Bowen Basin’s next

emerging coal producer

cEll aquaculturE

Reaching out to new markets

phillips rivEr

Mining

Interview with Jason

Stirbinskis

City Square

Rio Tinto’s

new HQ

Inside

48 ENdocoaL Coal explorer Endocoal aims to be the Bowen Basin’s next emerging coal producer

52 ENviroNmENtaL cLEaN tEchNoLogiES The need for cleaner industries is now more prevalent than ever says ECT’s Adam Giles

56 frEEdom foodS FNP Group CFO Rory Macleod talks to Ian Armitage

60 froNtiEr rESourcES Peter McNeil, chairman and managing director of Frontier Resources Ltd, talks about a great 2011

64 grocoN The award-winning Pixel is a groundbreaking eco-building, developed and built by Grocon

70 iNtra INTRA plans to invest in Tanzania’s first privately funded coal mine and coal-fired power plant

76 pacific iNduStriaL compaNy PIC is currently involved in building City Square, a 47-storey office skyscraper under construction in Perth

82 pErSEuS miNiNg The rapid growth of Africa’s mining industry is to continue into the future

88 South BouLdEr miNES Lorry Hughes, CEO of Perth-based South Boulder Mines, tells us that his main focus is to getting to potash production in Eritrea

92 phiLLipS rivEr miNiNg Jason Stirbinskis, managing director of Phillips River Mining NL, talks to Australasia Business Outlook

co

vEr

6

Sport


Sport

Australian underdog Samantha Stosur stunned the mighty Serena Williams to win the U.S. Open final - her first Grand Slam tennis title.

In doing so, Stosur became the first Australian woman in 31 years to capture a major singles championship.

Stosur, 27, seeded ninth, beat the 28th-seeded Williams 6-2, 6-3.

“I’m still kind of speechless,” Stosur said in a news conference. “I can’t actually believe I won this tournament.

“I had to believe I had a chance to win,” she added. “I think having two victories over her in the past definitely helped me feel it was possible.”

The game was surrounded by controversy with Williams yelling “Come on!” before a point was over during the second set.

Stosur managed to get the frame of her racket on the ball but had no chance to return it.

Chair umpire Eva Asderaki of Greece awarded Stosur a penalty point for verbal interference, and that point broke Williams’ serve.

Tournament referee Brian Earley, asked by television commentator Pam Shriver off-camera about the situation, said that Asderaki had made the correct call and that such a call had been made earlier in the tournament.

Williams approached the umpire and shouted, “Aren’t you the one who screwed me over the last time here?” which seemed to refer to Asderaki as the chair umpire of the 2009 semi-final match against Kim Clijsters at the Open when Williams was called for a foot fault

on a second serve, aimed a profane tirade at the lineswoman who called it, then was assessed a penalty point for unsportsmanlike conduct that was also the match point.

Asderaki was not in the chair for that match, and that penalty point was assessed only after consultation with Early.

After the match, Williams hugged Stosur and didn’t shake the umpire’s hand.

Stosur sat next to Williams and the two laughed and appeared to be having a good time.

“She was cracking them today,” Williams said. “She definitely hit hard and went for broke. I think sometimes a lot of people were putting me as the favourite, and I was definitely trying not to put myself as the favourite.”

The statistics did tell a story. Williams got in only 35 percent of her first serves in the first set, and made 11 unforced errors.

Stosur broke her twice, served 67 percent and hit nine clean winners. From the sixth game of the first set to the first game of the second, Stosur won 13 straight points.

“I give her all the credit because she really played phenomenal and she deserved to be the U.S. Open champion this year,” Williams said.

StoSur winS u.S open

7

Sport


Manufacturing

New Zealand manufacturing growth slowed for a third month in August as global economic growth faltered, the U.S. had its credit rating cut and Europe’s sovereign debt crisis grabbed headlines again.

The BNZ-Business New Zealand performance of manufacturing index slipped 0.3 points to 52.9, remaining above the 50 level, which indicates expansion.

Deliveries was the fastest growing component last month at 55.8, followed by new orders at 54.3, production at 53.7 and finished stocks at 52.3.

The employment component fell to a contracting 49.2.

“August’s PMI continues a remarkably steady run over recent months, but masks considerable and widening variation in the detail,” BNZ economist Doug Steel said in his report. “While this variation reflects the many factors pushing and pulling the economy, it is encouraging to see the overall trend remain positive.”

BNZ expects manufacturing to make a smaller contribution to economic growth in the second quarter data, and is picking 0.2% expansion in the three months through June 30.

manufacturing growth slows for third month

Mining

Business

Commodities giant Glencore has dropped all conditions attached to its A$1.017 billion takeover bid for West Australian nickel miner Minara Resources.

Glencore launched the offer in August, offering to mop up the 27 percent stake in Minara that it did not already own.

Glencore has so far secured an additional interest in Minara of only 0.54 percent, giving it a current stake of 73.54 percent, according to a notice lodged with the Australian Securities Exchange.

The offer is expected to remain open until at least October 10.Minara’s key asset is the Murrin Murrin nickel laterite mine in WA.

New Zealand consumer confidence fell from a seven-month high in September, led by Wellington residents, while Aucklanders were more buoyant, suggesting the opposing influences of state sector job cuts and the Rugby World Cup.

The ANZ-Roy Morgan Consumer Confidence measure fell 0.7 points to 112.6.

The future conditions index fell 0.6 points to 117.5 and the current conditions index fell 0.9 points to 105.2.

glencore drops

nZ consumer

takeover conditions

slips in september

minara

confidence

Sport

8

Mining

Rio Tinto has announced plans to spend $US833 million ($A813.0 million) on power and fuel infrastructure under plans to increase iron ore production in Western Australia’s Pilbara region.

The investment is part of a five-year programme started in 2010 to increase the mining giant’s production capacity in the region by 50 percent to 333 million tonnes per annum (Mtpa) by the first half of 2015.

Rio Tinto said $US520 million of the investment would be spent on upgrading the miner’s integrated power and gas network, while $US313 million was earmarked for fuel infrastructure facilities.

Both the power and fuel projects are needed to support annual production capacity of 283 Mtpa, a level Rio Tinto expects to meet in towards the end of 2013.

The fuel project will also help support the planned expansion to 333 Mtpa, from 225 Mtpa currently.

“This investment marks yet another significant step towards the expansion of iron ore production by 50 percent in the five years to 2015, a timeline we recently brought forward by six months,” chief executive iron ore and Australia Sam Walsh said in a statement.

“These projects provide certainty in meeting our power and fuel supply requirements, both now and into the future.”

Government

Thousands of public sector workers and their families rallied in Sydney on September 8 in protest of the public sector wage gap and job cuts.

Unions leaders say more than 30,000 workers gathered as part of a massive protest against the NSW government’s industrial changes and the O’Farrell government’s public sector reforms.

Carrying flags and waving placards, a sea of teachers, nurses, police, firefighters and other public servants flooded into the Domain just before midday, for what has been described as a “day of chaos”.

“I stand here and see over 30,000 people from across the state in front of me, who have spoken with their feet and taken action today to come here and send a very clear message to Barry O’Farrell,” Unions NSW secretary Mark Lennon told the crowd.

“Stop the cuts, restore our rights, because Barry we’re not going to take it anymore.”

O’Farrell described the protest as “pointless”.

“It’s just chaos for the sake of chaos,” he told reporters.

He questioned the legality of some of the action, particularly by ferry workers.

Their decision to walk off the job to protest against plans to franchise out Sydney Ferries was “an act of bastardry”, he said.

Mass Union protest

sYDneY CBDDisrUpts


rio spenDs Big on

e X p a n s i o niron ore

SportBusiness

9

Sport

New Zealand beat Japan 83-7 in their second World Cup Pool A match.

The All Blacks, who led 38-0 at halftime, totally outclassed the Asian champions, recording their second straight win.

The makeshift All Blacks, with Richie McCaw, Dan Carter and Mils Muliania among those missing injured, scored 13 tries at a rate of one every six minutes.

“The big thing for us was to improve ... to really get the structure of our game right,” said All Blacks skipper Keven Mealamu.

“But we have still got a few things that we can work away at. Next week (against France) will be another big step up for us.”

Coach Graham Henry said: “We started slowly, but it was a better performance than last week.”

Toyota has said that continuing industrial action will hurt its Australian manufacturing operations and warned that the cars can be made elsewhere.

Toyota Australia president and chief executive Max Yasuda said Altona was competing with other Toyota plants around the world to supply export markets.

“We are already under severe competitive disadvantage due to currency, high local costs and reduced volumes,” he said in a statement.

He added that industrial action at this time could only hurt Toyota Australia’s case to maintain its export programme.

“If Australian operations are uncompetitive and perceived as unreliable, these cars can be made at another Toyota plant,” Yasuda said.

More than 3000 employees walked off the job earlier this month over a wage claim, with further industrial action planned at Toyota’s Altona manufacturing plant in Melbourne’s west and parts centres in Melbourne and Sydney.

Fair Work Australia granted an interim order suspending industrial action planned for last Thursday and Friday but rejected Toyota’s application to suspend further 24-hour stoppages planned for later this week and next week.

The Australian Manufacturing Workers’ Union has said employees have not had a pay rise since early 2010 but Toyota could only offer an immediate one percent rise, and the issue was the timing of the increases.

Toyota says its offer of 11 percent over 39 months is fair and reasonable and that it has varied the timing of the payments in response to employee concerns, with unions yet to accept or reject that offer.

ToyoTa issues all BlacksThrashj a p a n

warningsTrike


10 www.australasiaoutlook.com

Former Virgin Blue chief operating officer Andrew David has been named the new chief executive of Tiger Airways’ Australian operations, the airline has announced.

Tiger has been seeking a new Australian CEO since Crawford Rix left in July when the air safety watchdog extended Tiger’s initial week-long grounding over safety concerns.

Tony Davis, group president of Tiger Airways Holdings, stepped into the role in a temporary basis after Rix’s departure.

Prior to leading Virgin, Andrew David held a number of senior management roles including chief information officer at Air New Zealand and general manager of Pacific Airlines.

He will begin his new role at Tiger Airways Australia on October 17.

Acting CEO of Tiger Airways Holdings, Chin Yau Seng, described David as a proven performer within the industry.

“We are pleased to welcome Andrew David as the new CEO of Tiger Airways Australia. He brings a wealth of airline business experience and a proven leadership track record,” he said.

Tiger Airways Australia returned to the sky on August 12, six weeks after being grounded by the Civil Aviation Safety Authority over safety concerns.

Business

AustrAliAn CEOtigEr nAmEs nEw

Sport

gEts undErwAy

rugBy in AuCklAnd

wOrld CuP

The seventh Rugby World Cup has been officially declared open at Eden Park Stadium in Auckland, New Zealand.

The president of the International Rugby Board Bernard Lapasset set the ball rolling for the 48-match tournament, which will reach its climax with the final at the same venue on October 23.

The first match between New Zealand and Tonga started immediately after the opening ceremony at 8.30pm local time on September 9.

The rugby world is primarily focused on the All Blacks and their quest to end their 24-year wait for World Cup glory so the pressure is pretty much off the Boks, which makes them a formidable proposition.


Mining

Pike River Coal receivers have negotiated full and final insurance payout deal for creditors.

Under the terms of the deal, which still requires formal execution, 29 percent shareholder New Zealand & Gas will facilitate an early payment plan for the mine’s 465 unsecured creditors.

Priority right holders Bank of New Zealand and the owners of leased mining equipment will be paid out a total of $29.5 million.

Despite having priority rights, NZOG says it will continue to support West Coast businesses and families affected by the November 19 disaster, which claimed 29 lives when the mine exploded, by offering

an early repayment scheme for unsecured creditors.

Under the proposals, unsecured creditors will be paid up to a cap of $10,000 plus 20 percent of any outstanding amount above that, up to a capped aggregate of $10.5 million.

Some 243 unsecured creditors are expected to be paid in full and another 222 partially repaid under these arrangements.

“Hopefully all of Pike River’s creditors can receive full payment when the sale of the mine occurs,” NZOG chief executive David Salisbury said.

“For the mine workers, contractors and suppliers this has been a very stressful time, emotionally and financially.”

Pike RiveR CoalReCeiveRs negotiateinsuRanCe Payout

12

M anagers are busy people. Every day brings new challenges and not enough hours to accomplish what

they need to do. But no matter how busy they are, the best make time for their people and they make sure they WATCH WHAT THEY SAY.

What a manager says and does and their style figures more heavily than anything else in keeping employees productive, loyal and happy. Often, when an employee quits their job, they do so because of problems with their bosses. Who many times have you heard a friend say, “I’d still be there even for that pittance of a salary if it weren’t for that awful boss”? You’ve probably even said it.

The following list will set the good bosses from the god-awful ones.

1. Embarrass EmployEEs in public

At some point, nearly everyone has observed someone being ridiculed in public at work. I can remember a time when I was chastised almost daily in front of my team for

not understanding a set of new instructions. And my partner Clare left her job because her manager would yell criticisms at her in front of long lines of people at the checkout.MAnAgErS, TAkE nOTE!

2. Don’t follow up on EmployEE iDEas

Employees thrive on providing ideas and feedback, but if mistrust is part of the set-up, they won’t commit to results. And there is nothing more frustrating than putting your efforts into planning initiatives for the future of a company only to discover that you wasted your time as directors had already put together a list of ideas. The result is unprepared, uninterested staff. Due to lack of interest, actions are often ignored and never mentioned again. “I don’t pay you to think” is what a bad manager says when an employee offers an idea he doesn’t like.

3. if you Don’t want this job, i’ll finD

somEonE who DoEs

Most of us have heard this in the workplace at some point of another. great

T h i n g s o n l y b a d m a n a g e r s s a y a n d d o


by ian armitage

BA D B O S S t i p s

13

Bad Boss Tips FEATURE

leaders understand the importance of not saying something like this and know that to get and keep great people, they have to let people own their jobs. Good leaders give people responsibilities and let them know that their contributions have value. BAD managers though love to remind employees that “You work for me.” They never fail to remind you that someone else would take the job if you ever got sick of it or let the lousy manager down in some way.

4. I won’T have you on FaceBook whIle

you’re supposed To Be workIng

The fact is even the best workers need a mental break and sites like this are the perfect opportunity for them to get them. Telling your employees that they’re banned from the Internet while they’re on “work time” is one of the most costly mistakes bosses make. If good workers want a mental break during the day, they should be able to go on Facebook.com, or whatever, without fear of managerial reprisal. They’re not robots. They need to stop and shake off the corporate cobwebs every now and then. After all, they could be on the verge of your next million-dollar product idea, so don’t upset them!

5. I’ll Take IT under advIsemenT

There are certain words that we never use in real life—only in business and only in ways that let us know that the speaker is somehow better than us. “I’ll take it under advisement” means “Go away, I don’t care AND don’t speak to me again unless I ask you to.” It definitely hasn’t been taken onboard.

6. who gave you permIssIon To do

ThaT?

People who obsess about hierarchy and permission ARE THE DEVIL! All bad managers, without exception ask this question. These are the people you’d

be better off avoiding, especially in relationships that give them power over your life and career.

7. make unrealIsTIc demands

My point here is that good managers enforce rules and regulations. Poor managers enforce unrealistic rules that cause employees to feel like children. I worked under a boss once who, upset at being left out of staff chitchat and general conversation, proclaimed that, thenceforth, there was to be no talking, joking or laughter in the office, as it was unprofessional. I’m not joking.

8. Ignore proFessIonal growTh needs

This is the worst mistake a manager or boss can make. When employees take steps for self-development, it’s important for you to be their biggest cheerleaders. Adult learning research repeatedly shows that management reinforcement of training is what makes it stick; yet too often trainers have heard managers’ last minute excuses to not attend a training initiative. How many of you reading have been denied a professional development opportunity because your own manager said that it would take too much time away from work? Be honest!


moTIvaTIng musTs 1. Give constructive feedback in private.2. Follow up on employee ideas.3. Give frequent praise.4. Support employee development.5. Allow flexibility and realistic freedoms.


d e b t c r i s i s : european

A s w o r l d p o w e r s s e e k t o c o n t a i n E u r o p e ’ s d e b t c r i s i s , A u s t r a l a s i a B u s i n e s s O u t l o o k a s k s , s h o u l d w e b e w o r r i e d ? By Ian Armitage

r e a s o n t o w o r r y ?

Global finance officials have this week pledged to take “bolder moves” to confront the European debt crisis that

threatens to plunge the world into another deep recession.

Australia, New Zealand and other countries outside of Europe fear the economic fallout from the crisis. They are raising the pressure on Europeans to settle their differences and agree on a plan to rescue heavily indebted European countries.

US Treasury Secretary Timothy Geithner bluntly told officials at a meeting of the International Monetary Fund that time was running short to stave off potential domino-style defaults in Europe. European governments, he said, need to join with the European Central Bank to provide stronger support to calm market fears.

He said the ECB, the central bank for the 17 nations that use the euro as a common currency, should make sure that financially troubled countries trying to reform their

economies can get loans at affordable rates and that European banks have access to the capital they need to operate.

Fears that Greece is in danger of defaulting on its debt have rattled Australian and global markets. Such a development would add to the stress for major banks in France and Germany that have a large exposure to Athens’ debt. It also would further strain on other heavily indebted Portugal and Ireland, and even bigger economies such as Italy and Spain.

The IMF panel, which sets policy for the 187-nation lending institution, has pledged to work decisively and in a coordinated way to deal with Europe’s debt crisis.

It said it stood ready to back further efforts to deal with the crisis beyond bailout support for Greece, Portugal and Ireland.

“Today, we agreed to act decisively to tackle the dangers confronting the global economy,” the IMF’s managing director, Christine Lagarde, told reporters.

Australian Foreign Minister Kevin Rudd

15

Debit Crisis FEATURE

said that Australia is “well positioned” to weather the current volatility in global financial markets, but must remain vigilant.

“Australia, of course, is well positioned against these international challenges,” he told journalists in New York.

“The economy is strong.“Nonetheless, we must remain

absolutely vigilant, as we’ve learnt from the experiences of the last several years through the global financial crisis of 2008,” Rudd said.

“This is a wild beast, the global economy.“Our job is to tame the beast to the

greatest extent we can and in Australia we are well positioned, and we are strong in doing so.”

Treasurer Wayne Swan said was hopeful European leaders would be able to get their

economies firing again but warned it’s vital for global economic confidence that they overcome any political gridlock.

“I’m slightly more optimistic the Europeans will make some progress,” Swan told ABC Radio following meetings with his G20 counterparts in Washington.

“The problem we have at the moment in terms of global growth is two of the big economic engines in the global economy aren’t firing.”

Apart from the troubles in Europe, the US is also in strife.

The Australian share market has recently fallen to near its global financial crisis lows, amid fears another global recession was on the way.

Keep up to date with this crisis on our website www.australasiaoutlook.com.


16 australasia business outlook

A S X L i m i t e d : I n v e S t I n A u S t r A L I AW i t h a r e l a t i v e l y h i g h - g r o w t h a n d l o w - i n f l a t i o n e c o n o m y s u p p o r t e d b y r o b u s t p o l i t i c a l a n d e c o n o m i c i n s t i t u t i o n s , a n d a n i n t e r n a t i o n a l l y c o m p e t i t i v e b u s i n e s s s e c t o r , A u s t r a l i a n o w r a n k s a s t h e 1 4 t h l a r g e s t e c o n o m y i n t h e w o r l d m e a s u r e d b y G D P , a n d t h e f o u r t h l a r g e s t i n t h e A s i a P a c i f i c r e g i o n . By Robert Michaels

Australia’s economy is strong. It is a relatively high-growth and low-inflation economy supported by robust political and

economic institutions, and an internationally competitive business sector.

“The Australia economy is strong,” Australian Foreign Minister Kevin Rudd said recently.

Australia ranks as the 14th largest economy in the world measured by GDP, and the fourth largest in the Asia Pacific region.

Its three largest trading partners – China, Japan and the United States - are the three largest economies in the world; and its two largest investment partners - the US and

UK – are home to the world’s largest capital markets.

Such solid trade and investment relations have helped see real economic growth average 3.0 percent per annum over the past decade, positioning Australia as one of the stronger performers among developed countries during the period.

This steady economic growth has also been aided by a resources boom that has seen its economy emerge as one of the largest global suppliers of raw materials.

The resources sector makes up around 7.5 percent of Australia’s total economy, with the remainder being comprised of financial services (10.8 percent), manufacturing (9.3 percent) and construction (7.8 percent).

Spurred by its healthy political and economic position, Australia has become an attractive investment destination for global investors as well as home to many major multinational financial services providers. With a diverse investor group comprised of 40 percent foreign investors, 40 percent domestic institutional investors and 20 percent retail investors the Australian equity market is well placed in the global economy.

There are many reasons, then, to invest in Australian shares.

17australasia business outlook

ASX FEATURE

MArket cApitAliSAtionA$1.3 TrillionnuMber of liSted coMpAnieS2225new liStingS (fY to dAte)12cApitAl rAiSed (fY to dAte)A$5,768 MillionS&p/ASX 2004296.55MSci globAl indeX rAnking8th(As at 31 August 2011)

facilities, as well as through the financial system stability oversight conducted by the Reserve Bank of Australia (RBA). ASIC also supervises ASX Group’s own compliance as a listed public company.

StrAtegY AnAlYSiS

ASX reported underlying net profit after tax of A$356.6 million is up 7.2 percent on the prior year in its 2011 full year result. Statutory net profit after tax was very close to that of A$352.3 million, up 7.4 percent year on year. Composition of that outcome was operating revenue excluding interest and dividends of A$617.6 million which was up five percent, cash operating expenses of A$135.5 million up a modest one percent, underlying earnings per share of 204 cents per share up 5.7 percent year on year, and off the statutory accounts, statutory earnings per share of 201.6 cents per share, up 5.9 percent. The end game of the financial year, ASX said, was a final dividend of 93 cents per share fully franked, bringing the full year dividend up 5.8 percent to 183.2 cents per share.

Website: www.asxgroup.com.au

About ASX liMited

ASX Group is the brand name for ASX Limited. It was created by the merger of the Australian Stock Exchange and the Sydney Futures Exchange in July 2006 and is today one of the world’s top 10 listed exchange groups measured by market capitalisation.

Functioning primarily as a market operator, clearing house and settlement system facilitator, ASX also oversees compliance with its operating rules, promotes standards of corporate governance among Australia’s listed companies and helps to educate retail investors.

As a multi-asset class, vertically-integrated exchange, ASX provides opportunities at every stage of the market services value chain. Its activities span primary and secondary market services, including capital formation, capital allocation and hedging, trading and price discovery (Australian Securities Exchange); central counterparty risk transfer (ASX Clearing Corporation); and securities settlement for both the equities and fixed income markets (ASX Settlement Corporation).

ASX services a diverse domestic and international customer base, including issuers (such as corporations and trusts) of a variety of listed securities and financial products, investment and trading banks, fund managers, hedge funds, commodity trading advisers, brokers and proprietary traders, market data vendors and retail investors.

ASX relies on the work of its wholly owned subsidiary, ASX Compliance, to provide the monitoring and enforcement of operating rules. By providing systems, processes and services needed for a fair, orderly and transparent market, ASX inspires confidence in the markets. Such strict quality assurance is integral to ASX’s long-term commercial success.

Confidence in ASX is further reinforced by the Australian Securities and Investments Commission’s (ASIC) regulation across all trading venues and clearing and settlement

ASX’s Market Statistics

18 australasia business outlook

What’s on

Melbourne Cup Carnival448 Epsom Rd, Flemington, Victoria, 303129 Oct – 05 NovThe Melbourne Cup Carnival is a weeklong celebration of racing, food and wine, fashion and entertainment. It’s when fabulous Flemington becomes the corporate, social and sporting epicentre of Australia. The event not only captures the imagination of Melburnian’s but attracts visitors nationwide and from all points of globe. The Melbourne Cup Carnival is comprised over four unique racedays: AAMI Victoria Derby Day; Emirates Melbourne Cup Day; Crown Oaks Day; and Emirates Stakes Day.www.melbournecup.com

Crave Sydney international Food FeStival

Sydney, New South Wales, 20001 Oct – 31 OctCrave Sydney International Food Festival celebrates Sydney as a global dining destination enhanced by regional New South Wales produce and wine. The full festival program is available on the Crave Sydney website.www.cravesydney.com.au

rugby World Cup FinalEden Park, Auckland, New Zealand23 Oct Staged every four years, the Rugby World Cup is the biggest event on the Rugby calendar and has grown to be the third largest sporting event in the world.Rugby World Cup 2011 will be a six-week festival of Rugby featuring the top players from all parts of the globe.The Tournament’s 48 matches will be playing in 13 venues spread over the North and South Islands of New Zealand, showing off the country to the full. Off the field, visitors will discover a country that boasts scenery that is as spectacular as it is diverse.www.rugbyworldcup.com

19australasia business outlook

What’s on

AFL GrAnd FinALMCG, Melbourne, Victoria1 OctHas there ever been a more clearcut division between the best, and the rest in the AFL? No! It really is a two horse race for The 2011 Toyota AFL Grand Final. A strong Hawthorn effort aside nobody could challenge the dominance of reigning premiers Collingwood or a rejuvenated Geelong Cats, who seem to have once more found their hunger for the ultimate prize. But who will win? Watch and find out. www.mcg.org.au

institute oF QuArryinG AustrALiA’s 54th AnnuAL ConFerenCeCrowne Plaza, Hunter Valley, NSW12 Oct – 15 OctThe Institute of Quarrying Australia is open to everyone with appropriate qualifications and/or experience in, or supplying to, the surface mineral extractive and processing industries. This includes hard-rock quarrying, sand and gravel, recycling, special sands, cement, lime, gypsum, clays, coal, slate, asphalt, ready-mixed concrete and concrete products. The Institute also embraces all the professional and consultancy services which support the industry, and there is a special section reserved for those engaged in the supply of plant, equipment, materials and services. www.alloccasionsgroup.com/IQA2011

nZ Food innovAtion showCAseViaduct Events Centre, Westhaven, Auckland, NZ16 Oct – 18 Oct True food Innovation is not just about a good food idea. It’s about successfully and safely commercialising that idea. The NZ Food Innovation Showcase will lead visitors on a journey of discovery. See how food manufacturers are using purpose built food processing facilities to help commercialise food ideas for markets in NZ and around the world. www.nzfoodinnovationshowcase.co.nz

Peter Burns, Executive Director of Perth-based Cell Aquaculture says he is operating in “an insatiable market.” He has good reason. The

world’s oceans are becoming fished out, populations are increasing and more and more people are chasing less and less fish.

In a new report the UN Food and Agriculture Organisation (FAO) paints another bleak picture of the state of global fisheries. Fish consumption has reached an all-time high while 32 percent of world fish stocks is estimated to be overexploited, depleted or recovering, and need to be

urgently rebuilt.Against this backdrop Burns’ company

has developed the ‘Cell’ System - a sophisticated yet simple and economical land-based recirculating aquaculture system delivering premium seafood in an environmentally responsible manner consistently throughout the year. “For a company like us, able to produce a sustainable, high quality product, the market potential is quite simply enormous.

“We’ve built what has become very much a quality-focused product, targeted at the mid high end of the market. The way we


c e l l a q u a c u l t u r e

l a n d i n g t h eb i g f i s h

While global fish stocks continue to be under threat, the rising output from top quality Western Australian

aquaculture pioneer and innovator Cell Aqua is reaching out to new markets. By Colin Chinery

grow fish is not the cheapest, in fact it’s a fairly costly exercise but at the end of it we produce a very high quality product. Our major customers are here in Australia where we service and supply a lot of the mining sector for example, and have developed retail products selling through the IGA, Farmer Jack’s and Food Works supermarket chains. The feedback we are getting has been exceptional and very very encouraging.”

The Cell food growing system originated in 1997 when Cell Aqua chairman Perryman Leach identified ‘a massive window of opportunity’. With an engineering background and extensive experience of intensive farming, Leach set out to investigate whether proven farming methods could be replicated in the seafood industry.

Aware of environmental issues inherent with existing aquaculture, he concluded there was immense opportunity if a system could be developed incorporating low risk, low water usage, and truly re-circulating and environmentally-friendly.

Leach was also looking for a method operationally economical in a controllable environment, locatable anywhere in the

world on the market’s doorstep, effective in either fresh or salt water, and producing consistently fresh, high end premium seafood. With the intensive development of the Cell system, he achieved all objectives.

At its heart is a tested and proven filtration technology, with each production unit modular in design, enabling efficient containerised transport, relocation and scalability to meet market demand.

Providing there is access to power and water, the system can be set up and operated anywhere in the world where premium seafood markets exist. A typical production cycle producing premium grade finfish is five months for plate-size fish and eight months for filleting size.

The process begins in the hatcheries, “the engine room to our whole operation,” says Peter Burns. “Getting a consistent supply of quality small baby fish allows us to build a good and consistent supply of high quality product at the other end.”

While the hatchery and breeding operation is controlled here production has been outsourced, the baby fish flown offshore to company plants in Malaysia and

Cell Aquaculture FEATURE

www.australasiaoutlook.com 21



Thailand. There they are grown to market size, processed, and flown back as the finished product to Australia or on to export markets.

“We started by producing in Australia but production costs here are fairly high; the biggest inputs are labour, power and feed. So we looked at countries such as Thailand and Malaysia where we can get a much lower cost yet still produce an equally quality product.”

Cell Aqua has set out to build a footprint in a number of countries and key strategic regions and looks to expand from there. In Thailand it is targeting a current production capacity of around 150 tonnes of barramundi per annum with an expansion programme in place that will take this to 1,000 tonnes. Barramundi is its Number One species, a

hearty, fast growing, premium white flesh game fish with strong established demand in domestic and international markets. Australian barramundi has a high yield when filleted and has an excellent preparation diversity – it can be baked, pan fried, deep fried, grilled, cooked whole and sashimied.

”We aim to scale these facilities up along with a number of production projects we’re looking at, feeding the product into our processing, value adding and distribution arm, which we are also building up.”

Vertical integration is a core strategy and feature of Cell Aqua’s ‘Hatch to Dispatch’ operation.

“We are one of the main pioneers of land-based re-circulating aquaculture and have developed the entire vertically-integrated business model.

“We basically control all the different elements of the supply chain and over the years have sought to develop and perfect each step from hatching to harvesting, processing, packaging, branding and distribution. This allows us to be firmly in control of product quality all the way through.”

R&D is another key. “We’ve always seen this as a big part of our future, and while our business model has been built around the

One of the biggest challenges in this sector is getting

the consistency of supply, freshness, quality and sizing



barramundi, over time we want to introduce a whole range of seafood species.

“We are also looking at new and different techniques in the production process, different types of husbandry, reducing production costs, and broadening the end-market product range.”

The land-based re-circulating part of the aquaculture industry is very new however. Its successes are few and there have been failures. “As with other operators in this sector, this has made it difficult for us to raise development capital, and represents our biggest challenge” says Burns.

”Since we’ve started to get runs on the board and develop investor confidence we’ve been able to steadily raise capital as we go” – there have been recent and sizeable inputs from European and USA investment funds – “but we’d like to grow the business faster.

While Australia will remain the main focus of expansion, Burns sees a huge potential in Europe, the US, Japan and other markets in South East Asia. “We are strong, passionate team and a very prosperous and sustainable business. We are certainly in the right sector. Food and its global availability is going to become an increasingly big issue, and the sustainability,

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environmental focus and other aspects of our business model put us in good stead to develop. We don’t cut corners on any of these areas, and we are very actively developing our ‘Eco-Star™’ brand to communicate these unique attributes.

“One of the biggest challenges in this sector is getting the consistency of supply, freshness, quality and sizing etc. Supplying the retail sector or the restaurant markets as we do for example, we have the confidence that our products will be available 365 days a year - and we can guarantee this by being in control of all these supply links right the way through.

“Go to a restaurant, look at the menus, and you might read ‘Fish of the Day’ – and that’s usually because they don’t know what fish is coming in! With us they do.”

Powerhouse Australia has the potential to replace all its high value liquid transport fuel imports and become a net exporter to SE

Asia, India and China. Likewise coal. That’s the prediction of leading insider John Heugh of Perth-based Central Petroleum, one of the most dramatically undervalued resource groups trading on the ASX.

Central Petroleum is a junior exploration and production company operating in the biggest package of prospective acreage in Australia - over 270,000 sq. km. Its core strategy, the development of a central Australian petroleum hub connected to appropriate infrastructure and allowing the export to domestic and overseas markets of both primary energy resources and value added petroleum and helium products.

Earlier this month (September) a new report valued its unconventional gas and

oil resources in central Australia at $412 million.” Exciting times,” says Heugh. But Central’s MD goes on to caution that this is a very preliminary report based on early stage exploration, and “something that will need re-visiting on a frequent basis because the unconventional industry in Australia has only just started to get off the ground.” A recent valuation put a value of $1.75-$2.16 per share on Central’s longer term interests, making this one of the most undervalued resource stocks trading on the ASX.

Central Petroleum’s acreage includes the majority of the Pedirka Basin in Northern Territory and South Australia, most of the Amadeus Basin in Northern Territory, all of the known Lander Trough in NT, and approximately 25,000 km2 of the Southern Georgina Basin. Put together and you have a land holding close to half the size of Texas.

The potential is “clearly enormous”, says


O Z D E S ER TE X P L O R I N G T H E

O Z D E S ER T

We believe the oil and gas potential

of central Australia has been significantly

overlooked and the area remains one of the true

under-explored and under-developed proven petroleum provinces in

the country

Heugh, who co-founded Central Petroleum in 1998 in a countercyclical strategy aimed at securing large acreage tracts with substantial prospective target structures.

Central Australia contains one commercial oil field and a commercial gas field with another large gas discovery undeveloped. Further commercial accumulations are set to be realised, with the potential for monetization of oil resources through trucking, rail or pipeline infrastructure. There is also potential for monetisation of possible large gas resources via Gas to Liquids (GTL) Fischer Tropsch (FT) processing to produce zero sulphur diesel, naphtha, jet fuel and LNG technology.

“Very large coal accumulations present in the Pedirka Basin are also being explored with a view to examining monetisation via very large scale beneficiation and export, coal to liquids (CTL), co-generation of power

Central Petroleum FEATURE


Exploration and production company Central Petroleum has assembled the biggest prospective acreage package in Australia. And the potential is massive, arguably mind-blowing, as Managing Director John Heugh tells Australasia Business Outlook. By Colin Chinery

and underground coal gasification (UCG). Any gas produced by UCG or coal gasification could be applied conceptually to value adding processes such as FT liquid production,” says John Heugh.

What could this mean for the average Australian? “We’ve got the biggest package of prospective ground in Australia which we own 100 percent aside from five very small prospect blocks where we own from 75-80 percent. In the Pedirka Basin we have discovered very thick intersections of coal which an independent geologist has put as an exploration target tonnage of over 800 billions tonnes. This is very significant because we have already embarked upon the process of attracting funding and technical expertise aimed at producing a 60,000 barrel per day GTL plant based on underground coal gasification.

“There are potential coal tonnages out there at reasonably shallow depths for UCG production, which roughly translated would give us the potential to produce well in excess of three million barrels of oil a day. At that level Australia not only replaces all of

its import requirements for liquid transport fuels but also has potential for turning itself into a net exporter of high value liquid transport fuel to SE Asia, India and China. Plus the shallow coal potential to enable Australia to export coal to China and India for many, many years to come.”

Heugh puts the progressive asset-realising time scale at anywhere from six months to ten years. “We are looking at three ways to monetize our assets. The first one starts off with oil exploration discovery.



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If we are successful in bringing in the Surprise-1 well in the Amadeus Basin as a commercial producer by trucking oil to Port Darwin, we could literally be in a cash flow position in as little as six to 12 months.

“As an intermediate term project we are looking at gas and helium into helium export and mini-LNG for the transport industry- and that’s probably three to five year programme. To monetize gas we might discover into GTL and/or LNG, a five to seven year programme and finally for coal into UCG and GTL and for coal export and to bring that up to anywhere near its full potential; we are looking at a five to ten year time frame. Expansion therefore should be dramatic. So there’s sufficient coal there to fuel major

industries for hundreds of years, as distinct from the 20 or so years lifetimes of many projects.”

Mind-blowing numbers agrees Heugh. “And we are not alone. A report on a neighbouring acreage close to Central’s for example, reports access to 27 billion barrels of recoverable oil in unconventional acreage.”

Australia has two unique advantages, says Central’s MD. “Firstly we are the best positioned country of any to export to China and India. Secondly we are a First World country regarded as having one of the very lowest levels of sovereign risk in the world, and with a fiscal regime – if we can oust this current Government - that will remain very



proven petroleum provinces in the country.“But we are not estate agents. A lot of

juniors set themselves up to be taken over or make a quick buck by selling parcels of land. That’s not us. We aim to grow this company as serious and genuine explorationists, targeted on discovering and producing major petroleum and coal related products. At the end of this month we hope to have kicked off three liquid-focused drillings that should bring considerable attention to Central Petroleum. Yes, exciting times.”

attractive. So yes these are exciting times, and I think Australia already now is being regarded as the country that will probably take over from the Middle East in terms of ready supply, certainly of LNG.

“And so far as Central Petroleum is concerned we have the biggest land position and prospective acreage in Australia by a long shot. We believe the oil and gas potential of central Australia has been significantly overlooked and the area remains one of the true under-explored and under-developed


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SuStainable

Cleanseas is a company with a long history of innovation and excellence

within the seafood industry. by Robert Michaels

S E A F O O D

Australian aquaculture company Cleanseas

recently announced that it has been successful in breeding one of the world’s most endangered fish species - the bluefin tuna.

The company said in June it had managed to produce bluefin from its offshore Arno Bay facility on South Australia’s Eyre Peninsula.

Bluefin has become a focus amongst environmentalists in recent years, with calls for a global fishing ban from some groups.

Stocks in the Mediterranean and in waters around Australia are seriously threatened.

But, Cleanseas may have developed a solution – and two world-first transfers of batches of fingerlings were carried through successfully from onshore nursery tanks to sea cages “for controlled grow-out trials in the ocean environment”.

Cleanseas said at the time that the 90 fingerlings, which were generally between 8 and 10cm long and weigh up to 15 grams, had been weaned on to a manufactured diet and transferred to a 25 metre offshore holding pen.

A test sample of a similar number of fish has been kept in the nursery tanks, while progress of both

groups was tracked.Cleansea managing director Clifford Ashby said: ““This

is the world’s first transfer of Southern Bluefin Tuna fingerlings to the ocean. These recent steps achieved by Cleanseas are part of a long term, international project to propagated production of Southern Bluefin Tuna.

“It is another significant step forward for us. It is not only a critical stage for Clean Seas Tuna, but also places Australia at the forefront of technological initiatives being undertaken in global marine aquaculture,” he added. “The pioneering nature of the breeding programme means that every stage produces a challenge for our skilled production, research and development and grow-out teams and we are closely monitoring these fingerlings with great anticipation.”

Cleanseas is at the “forefront” of environmental best practice.

Its farming activities go “above and beyond” all required legislation and world’s best practice standards.

Cleanseas FEATURE


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Cleanseas FEATURE

The use of natural feeds, minimal stocking densities and site fallowing practices, delivers a fish, which is totally sustainable.

“The Australian Southern Bluefin Tuna fishery is one of the most closely managed fisheries in the world,” Cleanseas’ website says. “Caught in the wild between December and March, a tightly controlled annual harvest has been held at the same level for nearly 20 years. The exciting advances in the industry are reflected in the recovering wild stocks.

“Operating to certified ISO 14001 and ISO 9001 standards, and with certification by Friend of the Sea (Sustainable Seafood) for Kingfish and Mulloway we remain committed to quality every step of the way, from water to pack,” it adds. “Our comprehensive environmental engagement is also leading Cleanseas towards being carbon neutral.”

In August Cleanseas announced that Clifford Ashby had resigned as managing director and CEO of the company and would be leaving in October to take up a senior position with a leading Australian agribusiness group.

Ashby would continue with the company as a non-executive director, it said.

An international search is being undertaken to identify a suitable candidate to replace Ashby and Paul Steere, an independent director, will serve as interim CEO should a replacement not be found prior to Ashby’s departure.

“Progress towards commercializing tuna aquaculture has been substantial over this period and the company has developed the Kingfish business to the stage where it is now cash flow positive,” said John Ellice-Flint, chairman of Cleanseas. “Both have been significant achievements and place the company in an excellent position to continue progress. We wish Clifford success in his future career.”

Cleanseas is a company with a long

history of innovation and excellence within the seafood industry. A result of the vision of founder and Australian seafood industry icon Hagen Stehr, Cleanseas has long been associated with premium seafood.

Hagen and son Marcus farmed the prized Southern Bluefin since the inception of this unique, sustainable ranching programme in the early 1990s.

“Cleanseas experience and understanding of the premium Japanese sashimi markets encouraged the development of a fish farming operation which could deliver the highest quality fin-fish to the most discerning markets in the world. By focussing our efforts on three indigenous local species; Yellowtail Kingfish, Mulloway and Southern Bluefin Tuna, we have been able to develop a family of fish which are not only produced by world’s best-practice methods, but which are also undeniably delicious,” the company’s website says. “Cleanseas has evolved into an integrated operation covering all aspects of fish management from water to plate. As the largest farmer of Yellowtail Kingfish and Mulloway in Australia, Cleanseas invests in its farm, its fish and its people, proudly imposing the toughest standards to deliver the highest quality.”

Cleanseas recently scooped two major awards at the 2011 South Australia Seafood

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Cleanseas FEATURE

Awards: the research and development excellence award, beating SARDI Aquatic Sciences Wildcatch Fisheries Program; and it shared the seafood business excellence award with Coorong Wild Seafood – the Judges could not split the two businesses and made them joint winners.

Cleanseas also won the leading seafood industry producer category.

To learn more visit www.cleanseas.com.au

Consolidated Tin Mines is an emerging ASX-listed tin explorer and developer, with an advanced project and substantial JORC

resource.Founder and managing director Ralph De

Lacey says its primary goal is to secure new tin supply beyond the “current producers”.

“Our projects are in the lower Herberton Tin Field in northern Queensland, once one of Australia’s premier tin producing fields, and we’re focused on discovering and developing major tin deposits at Mount Garnet, near Cairns.”

Consolidated Tin, he says, has acquired an impressive portfolio of advanced tin

exploration projects in the area, which it plans to transform into a major mining operation.

“The most advanced project within the Mount Garnet Project is our Gillian deposit ,” says De Lacey.

The Mount Garnet Tin Project , he adds, is made up of three key deposits: Gillian, Pinnacles and Windermere.

“Our goal is to confirm an initial JORC resource base of 8 to 10 million tonnes of ore from those deposits, to feed a centralised mill and process around one million tonnes per annum to produce around 5,000 tonnes of tin per year,” De Lacey explains.

Consolidated Tin has conducted extensive exploration programs at Mount Garnet and


top tinm i n eConsolidated Tin Mines is engaged in tin exploration and development in Queensland. It is focused on discovering and developing tin deposits at its Mount Garnet project and its vision is to develop a major Australian tin mine, says managing director Ralph De Lacey. By Ian Armitage

A u s t r A l i A ’ s n e x t

has a total current JORC resource of 7. 4 million tonnes at 0.60 percent tin.

“That’s right,” says De Lacey. “And that includes a JORC measured resource of 1.2 million tonnes at 0.82 percent at Gillian.”

Currently, drilling designed to update the project’s resource base is ongoing, and drilling is also underway at new project area’s.

“We are progressing pre-feasibility study work at Mount Garnet, which will play a key role in our future mine development plans,” De Lacey comments.

Consolidated Tin remains on track for production in Queensland in 2013, he adds.

“We are on course for that. Indications are that tin prices will remain positive . I certainly have not seen any negative indication on tin prices. There is a

Consolidated Tin Mines FEATURE


supply/demand shortfall for sure. “Price is always a challenge; Tin is a

good price at the moment and the future of tin looks good with new uses for tin being developed constantly.

“Prices might come down a little or go a lot higher but I’m confident, whatever happens, we will make it work.”

The tin price was sitting at US$5,000/t when Consolidated Tin started taking up areas of the tin field at Mount Garnet.

“Tin’s rise as a metal has certainly coincided with our rise,” De Lacey says. “The price rise over the last 18 months has been driven by a global increase in the sale of electronic goods and legislation removing lead from solder, where tin is the major substitute.

“Tin’s performance has certainly helped us become one of Australia’s leading tin exploration and development companies.”

Like most Queensland miners, Consolidated Tin’s process was slowed by the heavy wet season experienced last summer, however the project at Mount Garnet is now at full operation – and De Lacey expects any lost time to be made up throughout the rest of this year.

“It did put us back,” he says.

36



Consolidated Tin commenced its 2011 drill campaign in April with a 3,500 metre, 65 hole reverse circulation program at the Windermere deposit. Further drilling is currently underway at Windermere, and elsewhere. The outlook remains positive.

While Gillian and Windermere are the company’s most advanced projects at Mount Garnet it has not limited its programme of work exclusively to them, De Lacey stresses.

“We’re drilling at Pinnacles,” he says. “And we are also planning to undertake a regional drilling programme at other nearby projects held by the company in order to expose potential mineralised zones.

.“We see our company as one that has genuine credentials and is moving towards being a production company and it will be a major tin producer. I see us as being a leader in the field.”

Consolidated Tin recently announced that it has secured a major cornerstone investor for the Mount Garnet Tin project.

Hong Kong based investment company Snow Peak International Investment Limited has taken an initial placement of A$1.6 million into Consolidated Tin, as the first tranche of a proposed long-term investment designed to see the project through to production.

The initial placement is for 20 million shares at A$0.08c per share.

Proceeds from the issue will be used to advance the development at Mount Garnet and provide working capital, De Lacey says.

SEMF PTy LTdProject approvals are managed by an experienced multi-disciplinary team, with the Project Manager and specialist sub-consultants located in the project home State bringing the necessary local knowledge of environmental and engineering conditions and the State based regulatory framework. The significant advantage we can offer is that the bulk of the project team is located in Tasmania, where we have a large and experienced, committed and highly stable professional workforce, which has been involved in such processes for many years and in all States. The decision to live and work in Tasmania means we have a team which is stable and extremely cost competitive.

“We are delighted to welcome Snow Peak as a strong partner and look forward to a mutually beneficial relationship to take the Mount Garnet Tin project through feasibility studies and into production, to unlock the real value in the project for our shareholders.”

Looking forward, Consolidated Tin will continue with its development plans to position itself as a substantial tin mining company.

“In 2000 there was very little interest in tin as a commodity, but my partner John Sainsbury and myself saw great potential in the future of the metal and accumulated the best tin projects in the lower Herberton Tin Field,” De Lacey says. “Some seven years later we transferred those projects into a

Herberton NQ main shaft 1906

37



SEMF Pty Ltd are pleased to support Consolidated Tin in their mining developments.

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To learn more visit www.consolidatedtinmines.com.au

new company: Consolidated Tin Mines. “At the time, there was potential that tin

might revive -- the price having previously crashed -- and we managed to accumulate a number of very valuable tin areas in the Herberton Tin Field.

“We had the opportunity to pick and choose the very best of what we wanted. We chose the Herberton Tin Field in Northern Queensland because it was once one of Australia’s premier tin producing fields and we had faith that the tin price would revive and, sure enough, it did. As we established Consolidated Tin Mines, we raised funds to carry out the development in 2008 we listed

on the Australian Securities Exchange. We raised four million dollars in that listing and we put every bit of that towards developing the project and taking the project to where it is today.”

The Herberton Tin Field was already well explored by other mining companies and taken to a certain point when De Lacey acquired his assets. Consolidated Tin has taken the projects on to the next level of development, with the express purpose of bringing them into a mining operation.

“We’re a small company with an enormous project at Mount Garnet,” he concludes.

R EN EWA B LE S ? M AY B E , B U T T H E K I N G S T I LL R EI G N S

King Coal or Carbon Pariah? For Jason Brewer, Executive Director of Perth-based Continental Coal, a no-contest. ”Coal is still one of

the most cost effective sources of energy and power generation. There’s massive energy demand in Asia, especially China, and coal shortages are highlighted in weekly updates out of India. The outlook for thermal coal is positive and immense.”

Continental produces thermal coal, with a project portfolio in South Africa’s major coal fields. Used in power stations worldwide to generate electricity, thermal coal’s importance is set to continue, fuelling an

Coal remains the cheapest and globally in-demand power generator says Perth-based Continental Coal executive Jason Brewer

By Colin Chinery

R

R EN EWA B LE S ? M AY B E , B U T T H E K I N G S T I LL R EI G N S

estimated 44% of global electricity in 2030.Already listed in Australia, last month

(September) Continental listed its ordinary shares on the London Stock Exchange’s Alternative Investment Market (AIM), a move CEO Don Turvey says will enlarge its international profile and engagement with additional European funds and institutional investors.

Continental Coal currently has two operating open cast coal mines, Vlakvarkfontein and Ferreira, producing two million mt per year of thermal coal for the export and domestic markets. Last month it began development of its third mine,

Penumbra. With a further nine thermal coal projects progressing towards development Continental is targeting run-of-mine production of seven million metric tons per year by 2013.

“We’ve got to this position very quickly,” says Perth-based Brewer. “It’s only eighteen months ago since we mobilised contractors to our first mine development and just this month we’ve announced the same for our third.” With strictly limited risk capital available in a South African market built up to support the Anglos, De Beers, and BHP Billiton, Continental has had to look elsewhere for asset growth investment equal

Continental Coal FEATURE



to its ambitions.“The Australian market

has supported us very well and has a strong track record of providing risk capital for junior exploration companies. But when it gets to a company that’s in operation – and certainly in the case of those developing assets off-shore – inevitably that support becomes less likely.

“If you are in Australia and looking to invest in coal, the big institutions will look first at the Hunter Valley and Bowen Basin, less so off-shore and in jurisdictions with a perception of higher sovereign risk. But look at the London market and it’s a whole quantum shift in terms of the amount of capital that is available for mining companies active in Africa. The next step for Continental - once we have completed the first phase of organic growth - has to be dependent on the support of the London market. That’s what’s needed. And nowhere are the risks inherent in South Africa and in mining better understood than in London which has been instrumental in supporting South Africa’s mining industry over the past 100 years.”

Brewer acknowledges a place for renewables, but says coal remains the cheapest and most efficient form of power generation. “It was only twelve months ago that uranium was being pushed dramatically, and now we see governments pulling back from their nuclear programmes.

“There will always be a role for renewable, but coal is a very established and cost effective form of power generation for many developing economies, and any impact other forms of power generation might have on it is well offset by the tremendous growth

in coal demand. As a coal producer I’m certainly not concerned by renewables. There’s tremendous demand for coal-based power generation in developing economies, and that demand is not going to subside.”

Continental began mining at Vlakvarkfontein, a shallow, open cast operation, in May 2010 and will continue for at least the next fifteen years, says Jason Brewer.” We are producing at a rate in excess of 1.2 million tons - and at times on an annualised basis as much as 1.8 million tons. For the first two months in

this financial year – July and August – we had record sales of thermal coal from the mine generating R12.5 million of free cash flow.

“We took over mining operations at Ferreira, our second mine, last November, replacing the contractor, stopping operations in one pit and began developing a new one.” Here too record quarterly production and sales to the export market; 600,000 tons of an export thermal coal sold through the Richards Bay coal terminal. “This will continue for at least another 12-18 months, and we are just finalising the opportunity to extend the mine further through the acquisition of adjacent resources which would take that out for another one or two years. It’s a small operation but generating good positive cash flow to support our other activities.”

Ground breaking at the third mine, Penumbra, an underground operation located just 3km from the Ferreira mine, started last month, with Brewer anticipating production start-up in the second quarter of next year, a fifteen to twenty year life and

Coal is still one of the most cost effective

sources of energy and power generation...

The outlook for thermal coal is

positive and immense

Trollope Mining Services is a Level 4 BEE rated company which is 30% Black owned. It was established in 1975 by Peter and John Trollope and provides the services of opencast mining, crushing & screening, mining and rehabilitation services while operating in the Civil and Mining Industries.

Traditionally the business has predominantly operated in the coal sector however we are currently in coal, platinum, andalusite and gold and our strategic intent is to diversify into other mineral sectors and grow our geographical footprint into Africa.

The company is a privately owned entity which operates on good sound corporate practices. Our focus is customer orientated and performing at the highest levels of production and safety. We pride ourselves on the quality of workmanship on our operations through good training and upliftments of our staff in the field to maintain our reputation in the industry. We therefore put a lot of effort into maintaining our fleet to ensure high levels of availability with little or no reliance on our suppliers. We are therefore very much self-sufficient.

Our core philosophy is “Business in about people” and not just plant and equipment. We therefore invest a lot of time and money in our employees and communities. This is done through various mechanisms from external and internal to learner ships, SED programs and charity fund raising functions. We currently employ just over 1000 people in the company

Telephone: +27 11 281 6000 Fax: +27 11 281 6017Email: [email protected]

www.tmsgroup.co.za

TMS.indd 1 27/09/11 8:41 PM



another 600,000 tons of export coal. “After that we’ve got the De Wittekrans, a combined underground and open cast mine. We’ve just completed the bankable feasibility study, and you should see some production coming on in mid-2013. And that’s going to produce 3.6 million tons a year of run-of-mine coal.”

Looking beyond South Africa, an exploration programme in Botswana began last month, with a shallow coal exploration target of 2.5 billion tons. Tenders have been submitted for early stage properties throughout East Africa, and Continental is also looking at hot spot Mozambique, and Tanzania, as well as consolidating and expanding its footprint in South Africa.

“We’ve got a very, very strong management team in South Africa, major executives from major coal mining companies who are really driving the business, executives who have been used to operating and managing single mines producing ten to 30 million tons a year and now finding themselves involved in a company producing a bit over two million tons.

“But they are not here just to operate mines like that; they are here to grow a business. It’s about growth. And we’ve got an operating cash flow and depth funding behind us that allows us to deliver on that growth. The Company has concluded strategic off-take and funding agreements with

fraser alexander

EDF Trading for its export thermal coal production and recently signed a joint development agreement with KORES, Korea’s state mining and Exploration Company.”

Bullish for coal and Continental? “Yes, absolutely”

To learn more visit www.conticoal.com

faMP offers Mineral Processing services on either a build, own, operate and maintain (BOOM ) or operate and maintain (O&M) basis to the Coal and Metals industries.

fraser alexander Mineral Processing, is a division of the fraser alexander Group and wholly owned by royal Bafokeng Holdings.

300 ton per hour DM plant and Spirals at Continental Coal’s Mashala Colliery

In 2009 Fraser Alexander Mineral Processing was awarded a 5 year BOOM contract for the processing of the ROM at Continental Coal’s Mashala Colliery. Processing is done in a Dense Medium section: Drum and Cyclone and a Spiral Plant.

Fraser Alexander (Pty) Ltd Phone: +27(0)11 929 3600 Fax: +27(0)11 397 4607 Email: [email protected] www.fraseralexander.co.za

innovative performance

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MiNERAL PRocESSiNg

Inspectorate, through it’s various laboratories offers a range of

analytical testing services to the South African mining industry.

Through our Rustenburg: Johannesburg and Middelburg

laboratories we cover full geochemical exploration testing

including PGM; Base Metals; Metals and Ores and Coal as

well as the analysis of water and environmental samples.

Inspectorate SA, backed by Inspectorate Global offers a

comprehensive pit to port service including on-site mine

laboratories scope to the mine’s particular requirements.

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Empired is one of those rare gems – and it is proof that in business you can take on the big boys and WIN.

The Perth IT company’s managing director Russell Baskerville says that big thinking in a small business stops you “from ignoring potential markets” and allows you to “try those cool ideas you might think your business is too small to attempt”.

The publicly-listed company, started by a handful of Perth people in 1999, has used this philosophy and taken the battle to the multinationals in both managed services and Cloud Computing, that ever expanding part of cyberspace where companies have IT services hosted on the internet, rather than in their own buildings.

“We are taking on, and in some cases, beating the big guys in their own game,” Baskerville says.

Last month, Empired posted record

revenue of $39.71 million up 42 percent on the year before. Full year earnings before interest, tax, depreciation and amortisation (EBITDA) were $1.28 million, an increase of 132 percent.

Baskerville was delighted with the results.

“Both the operational and financial performance delivered during the 2011 financial year was fantastic,” he says

“Coming off the back of such a difficult 2010 and a patchy 2011 financial year, this performance not only vindicates our strategy and the underlying strength of our business model, but strategically positions us for considerable revenue and earnings growth during the current financial year.

“We are confident that the investments we have made will ensure a sustainable growth profile with clear strategic focus on growth opportunities in 2012.”

Empired, he says, has invested to improve


From humble beginnings, Empired has grown an empire! Australasia Business Outlook talks to Empired’s chief

executive officer and managing director Russell Baskerville, who has big plans for the company.

By Ian Armitage

b i gv i s i o nS m A l l B u S I n E S S

its sales focus and depth across all areas of the business.

“That investment has delivered two key benefits and drivers to value for the 2012 financial year. Firstly the level of run rate business is at the company’s highest since inception. Average monthly revenue increased 79 percent in the last quarter of the 2011 financial year when compared with the last quarter of the 2010 financial year. Secondly Empired’s sales pipeline is stronger than that ever experienced in the company’s history providing confidence in our ability to sustain this growth and continual performance improvement.”

Baskerville says the investment has resulted in significant growth in Empired’s client base, with new clients secured across Western Australia and Victoria.

These clients are typically high growth medium sized organisations or well established large enterprise clients within the resources sector and State government.

“Our client base is growing all the time and it provides an outstanding growth opportunity,” Baskerville says.

Rather impressively Empired has managed to extend its reach in the Victorian market, with revenue growth in Victoria of 98 percent.

“The sheer magnitude of that market continues to present a great growth

opportunity to us. We are very pleased that we have managed to achieve significant growth.

“We are confident that over the medium term this market will experience significant investment in the IT sector and that we are strategically placed to capitalise on the growth opportunity.”

Empired has also secured a number of major multi-year contracts with large Government and corporate organisations, while a number of its largest strategic clients have expanded the managed services they receive.

Empired FEATURE



Empired FEATURE

Baskerville says this is a testament to the high quality and value that clients see in Empired’s services.

“We have a genuine competitive position in the market and we have shown an ability to win major contracts against large national and international competitors.”

Empired has recognised early a fundamental shift in market trends and alternate consumption models for IT services within the Australian IT sector.

This has led to the development of Empired’s cloud services offering “FlexScale.” which enables a new approach to IT by offering organisations a flexible new range of options for how IT services are designed, delivered and managed.

“What it means is that IT services can be packaged into consumable IT products,” Baskerville says. “These products are offered through Cloud Computing in the form of online service catalogues, in much the same way as using a shopping cart.

“We expect that this innovation will provide a strong competitive advantage when tendering on managed services contracts

and provide long term opportunity.“We are very excited by this considerable

market opportunity and we are confident in attaining a leadership position in this rapid growth and high margin market.”

The area of Cloud Computing was poised for rapid growth, Baskerville stresses.

“We’re basically selling them space on a shared computing utility for the use of their systems. They pay on a usage basis so they can scale up and down, as they need to.

“Typically it’s a journey where they take a few services into the Cloud and gradually move more. Today we’re seeing people

“Both the operational and financial

performance delivered during the 2011

financial year was fantastic

Empired FEATURE

putting their research and development into the Cloud, their back-up and disaster recovery systems, and more and more their core production systems.”

Empired is headquartered in the Perth CBD where it employs 175 people - another 40 are based in Victoria.

It is a remarkable growth story considering Empired started out as an IT services provider with six staff targeting medium-sized organisations employing between 500 and 5000 people.

“Before we came along there were very few options for clients who often had to resort to large multinationals and pay significant premiums for the service. We thought we could do it much better.

“We are all about understanding their

business, engaging with them, and providing a service over and above what they were getting.

“And we have grown significantly as a result.”

Two of Empired’s marquee contracts are with Main Roads and St Barbara Mines, while it also has deals with various state government agencies both in WA and Victoria, as well as many companies in the burgeoning resources sector.

“Our flexible service delivery approach and can do attitude has enabled us to secure clients that range from medium size entities through to large enterprise accounts with services delivered across Australia, South East Asia and beyond,” Baskerville concludes.

SenSe-IT, established in 2007, are well known in the Perth market by candidates and clients for our consistent high standards, successful placements, market knowledge, active involvement in the Perth IT Community and for delivering a “great recruitment experience”, every time. This very much differentiates us from our competitors in the Perth market.

SenSe-IT is proud to be the IT Recruitment

Partner of Choice for empired

Contact Details:Phone: 08 9481 8111 email: [email protected]: www.sense-it.com.au

To learn more visit www.empired.com

Coal explorer Endocoal aims to be the Bowen Basin’s next emerging coal producer. CEO Tim Hedley says it is “well on

track” to achieving that, confirming the company has begun a bankable feasibility study at METEOR DOWNS SOUTH.

By Ian Armitage

E n d o c o a lp U S H I N g f O R W A R D W I T H M E T E O R D O W N S S O U T H

www.australasiaoutlook.com48

Endocoal is an ASX-listed Australian coal exploration and development company, focused solely on the Bowen Basin in

Central Queensland. With 11 tenements across

approximately 5,200km2, it has one of the largest landholdings in the region and, as such, is looking to establish itself as the Bowen Basin’s next emerging coal producer.

“Endocoal is a public company focused on the exploration and development of coal tenements in Queensland’s premier coal producing region -- the Bowen Basin -- which contains the most prospective coal resources in Australia,” says CEO Tim Hedley, who talked to Australasia Outlook from his office in Brisbane where the exploration team and project development is based (the firm’s corporate office is in Sydney).

“How was Endocoal formed? Well, simply a group of tenements were brought to the table and Endocoal was listed in 2010. The company then commenced a concerted exploration program exploring for coal in target areas identified by the geology team.

“We are currently targeting three types of coal: thermal coal for power generation, PCI coal as a coking coal replacement for steel making, as well as coking coal.”

Endocoal is actively exploring and there have been early discoveries and success in the thermal coal area at Orion Downs south of Emerald, between Springsure and Rolleston.

“We are currently on a path to develop an export-quality thermal coal mine at our flagship Orion Downs tenement, positioned close to existing infrastructure networks, to deliver coal to export markets,” Hedley says. “We also have additional tenements in the northern Bowen Basin region, which will be subject to further drilling and exploration. The current priority is the

Rockwood tenement, where we have recently announced a 51.6 million tonnes JORC Resource in an area that is prospective for PCI-style coal Further north, the Talwood andPretoria Hill tenements are prospective for coking coal and we look forward to commencing drilling in these areas in the near future. We are involved in a Joint Venture with Carabella Resources for the exploration at Pretoria Hill.”

Endocoal appointed Hedley, a mining engineer by background, as CEO in April.

He has over 35 years experience in coal mining, both underground and open-cut, primarily with BHP in Newcastle, Illawarra and the Bowen Basin regions.

“As one of the largest coal tenement holders in the Bowen Basin, I truly believe that Endocoal is well positioned to become a multi-mine and multiproduct company in the medium term and so I am really excited by this challenge,” Hedley says. “We’ve just started a feasibility study looking at the Meteor Downs South open-cut mine operation at Orion Downs, which will be our first operating production area.

“We are targeting 1.5Mtpa of direct-ship thermal coal from Meteor Downs South with potential for another one million tonnes from the nearby Inderi underground prospect.

“The objective is to have a mine up and running at Orion Downs by late 2013.”

To carry out the bankable feasibility study at the Meteor Downs South open-cut project Endocoal has formed the ‘Meteor Downs South Project Team’.

According to Hedley, the bankable feasibility study will cover open-cut mine operations, haulage roads, coal crushing and handling, and train-loading infrastructure.

“It started in August,” he explains. “Subject to satisfactory resolution of land access arrangements with landowners we hope to have finished by mid-December.” An Environmental Management Plan is also

Endocoal FEATURE



Company name FEATURE

being prepared.He says mining plans will target coal

production of not less than 1.5Mtpa, for a proposed eight to ten year project life. “Meteor Downs South will provide direct-ship thermal coal for export through Gladstone port to the Asian market,” Hedley says.

The open-cut mine will be based on the recently announced 15.4Mt of JORC Resource, with 13.4Mt already at ‘Measured’ status.

At Meteor Downs South the seam averages 7.63m, with sections up to 9.5m in thickness. There is 13m of overburden at the likely point-of-entry to the open-cut and the average strip ratio is expected to be 5.5:1 across the whole deposit.

“We think Meteor Downs South will deliver very competitive, low mining unit costs utilising an optimised single excavator/truck fleet,” says Hedley.

“The study will firm-up the operating cost outcome for a high productivity open-cut. The focus will be on delivering the lowest capital cost per annual production tonne outcome available. Above all else, delivering safety-in-operations will be the key priority.”

A bankable feasibility study for the Inderi

underground bord-and-pillar mine will likely follow in Q1 2012, he says.

“This really does mark the next stage of creating significant value for Endocoal shareholders. Having the Meteor Downs South deposit drilled out to JORC Measured status provides us with a great platform from which to launch the bankable feasibility study.

“We have engaged a highly regarded team of mining industry experts to ensure we deliver the best mining layout, optimised equipment selection and most efficient infrastructure arrangements.

“To stress, Meteor Downs South has the potential to be a highly productive, low operating cost mine, with relatively low upfront capital costs, delivering at least 1.5Mtpa of direct-ship thermal coal for export.”

On 1 August 2011 Endocoal announced the initial JORC Resource statement for Rockwood at 56.1 million tonnes while also upgrading the Meteor Downs South and Inderi resources to 36.0 million tonnes.

Endocoal recently started drilling at the Rockwood tenement, intersecting coal seams up to 5.6 meters in apparent thickness.

The exploration program is ongoing with plans in place to expand the exploration footprint considerably over the coming months.

Hedley confirmed that the company was planning exploration programs at other tenements including Central Bowen Basin tenements, Essex, Nebo and Springton Duaringa.

“That’s correct,” he says.Endocoal is a relatively small company

with only eight full-time staff in the exploration and support team.

For the future Hedley is focused on getting a mine “up and running” and intends to be a near term producer.

“We want to develop a portfolio of coal


Endocoal FEATURE

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resources and to take them through to production as soon as possible,” he explains.

Hedley is very optimistic about the future, citing the fact that Endocoal has already had early success in exploration at Orion Downs and Rockwood and is looking to build on that success at other locations across the Bowen Basin region.

“There are plenty of other companies out there looking for coal but I would like to think Endocoal will be the next new coal producer in the Bowen Basin.”

To learn more visit www.endocoal.com.au

52

The need for cleaner industries is now more prevalent than ever says Environmental Clean Technologies’ Adam Giles.

By Ian Armitage

Environment a lC l E A n T E C h n o l o G I E s

ECT FEATURE


Environment a lI n T E R v I E w w I T h A d A m G I l E s

Environmental Clean Technologies Limited (ECT) is engaged in commercialising and selling technologies that have, says its

mandate, “potential within the energy and resources sector, capable of delivering environmental, commercial and energy security benefits”.

“We’re about ‘game-changing’ stuff,” says ECT’s operations manager Adam Giles. “Our mission statement is to reduce carbon emissions and environmental damage through the investment and licensing of commercially practical, environmentally cleaner technologies. On a practical basis, this entails the commercialisation of our Coldry brown coal dewatering process and our Matmor iron process, which is low emission, uses cheap brown coal and cheap low grade iron ore.”

Coldry is an economic method for dewatering lignite and sub-bituminous coals, creating energy rich, black coal equivalent pellets for local consumption or transport to export markets, he says.

“The Coldry process is offered to the owners of brown coal assets, brown coal power plants, black coal power plants, coal traders and coal chemical plants.”

It’s important to understand that Coldry is not ‘clean’ coal, but it is ‘cleaner’ than as-mined brown coal due to CO2 emissions reductions, Giles adds. This is very important when facing the dual challenge of mitigating CO2 emissions and meeting the growing energy needs in emerging markets that simply can’t afford renewables on the scale being adopted in developed economies.

“The Coldry process is a coal upgrading technology that we developed here in Victoria to specifically beneficiate low-rank brown coal and sub-bituminous coal by removing natural high moisture content; harden and densify the coal; raise the calorific value of the coal up to more than 5900 kcal/kg; and


ECT FEATURE

transform the coal into a stable, exportable black coal equivalent product for use by black coal fired power generators to produce electricity. The process is a commercial method to achieve large scale beneficiation of low-rank coal without a need for government subsidy.”

Giles stresses it is not an answer to global warming. “We do not claim to be the answer to global warming, but we do make available a technology that will allow brown coal to be used in a much more efficient way well into the future,” he says. “This is economically important for States like Victoria and for developing and emerging nations who cant necessarily afford low emission power generation such as nuclear, wind, solar and the like.”

The process is gaining attention. “In May, we announced that we had signed

a Coal Supply Agreement with China Datang Corporation,” says Giles. “The agreement is for a significant test sample lot and it is the precursor to a commercial supply agreement of some two million tonnes per year.

“That sample lot will be delivered in coming months for validation testing in a live boiler unit.”

Giles views this as a “significant step forward in commercialising Coldry”, not simply from a process point of view, but from a usage point of view within high-end power generation equipment.

“China Datang, with an annual coal consumption of over 200 million tonnes in 2010, is an ideal partner,” he says. “We have moved our pilot plant operations to a 24 hour basis to supply this Coldry, providing the opportunity to enhance our continuous production operational experience and adding further to the data set to be used in the upcoming detailed engineering works for our Victoria Coldry project.

“Our global strategy involves building strong relationships with brown coal resource owners and black coal consumers

in order to drive the uptake of the Coldry technology in strategic markets, like China.”

This is an exciting time for ECT.“There is a huge brown coal resource in

Victoria – the single largest in the world that we are aware of. We are looking to build our first commercial start up -- 2 million tonnes per annum plant -- and our design for tender is about to get underway for that and we hope to have it deployed and commissioned in 2014. The plan is then to expand to 20 million tonnes per annum as extra rail and port facilities come on line.

“That’ll be export focused, destined for the Asian market.”

The Matmor iron process is having similar success.

“Any new technology takes a lot of time, money and human effort to commercialise and we are still working on Matmor,” says Giles. “Iron making is a mature, capital intensive industry that will act to protect its position. We aim to be a technology provider to existing steel works looking to expand capacity, replace plant, leverage low-grade brown coal and iron ore reserves and process iron-rich waste streams such as mill scale or nickel tailings. We’ve had considerable interest and encouragement from several parties, eager to exploit value added applications for brown coal reserves.

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“Certainly, there is still a fair bit of development left to go with Matmor. Whereas we are, with Coldry, ready to deploy very soon, for Matmor we are looking to develop the pilot plant over the next 18-24 months. The key to Matmor is that it replaces metallurgical grade coal that is very expensive. The other thing Matmor can do to is that it can take waste iron oxide streams such as mill scale, which is waste out of secondary steel manufacture, or inputs like low grade iron ores, which are often stranded because of their low iron content and are therefore not suitable for export, and create a high quality iron product at very low cost. As far as we are aware we are the only process in the world that uses brown coal as a reductant and fuel source in the primary production of iron. We believe that the base economics of our process are extremely strong. It can be used on low grade iron ore assets that otherwise would not be economically viable to develop or to recover iron from waste such as mill scale, thus turning a waste management cost into a new revenue stream.”

To learn more visit www.ectltd.com

Giles says this is a very tough industry. Trying to do “something good” for the environment and make it commercial is “challenging”.

“What next? The first deal is always the most important and our company is a vehicle for commercialising these two technologies,” Giles says. “So, the main game for us where Coldry is concerned is getting our 2 million tonne plant built here in Victoria and from there it acts as a demonstration to interested parties, which are looking to see our first commercial deployment before they can consider adopting the technology.

“On the Matmor side, we have a number of players in the commodities sector that have seen a lot of potential in it. We have a few more years of development to go, to get to the point of commercial deployment.”

ECT FEATURE

Matmor


Australia’s Freedom Foods is the leading branded manufacturer of foods free from key allergens such as gluten and nuts. The

company is based in Taren Point, Australia, and, as of December 5, 2003, became a subsidiary of Freedom Foods Group Limited (FNP), a diversified food company, which operates in the health and wellness sector in Australia and New Zealand,

FNP, through the Freedom Foods business, offers free from breakfast cereals, nutritional snack bars, biscuits, and soy

and rice beverages. The company also sells branded Alaskan salmon products under the Paramount brand and Atlantic herring sardines under the Brunswick brand, as well as supplying retailers with private label sardines in New Zealand. In addition, it is a leading contract manufacturer through Pactum Australia of UHT dairy, soy, rice milk and other valued added beverages for retail supermarkets and other branded manufacturers. .

The FNP group markets its products under the Freedom Foods, a2 milk,

Honest, nutritious &





www.australasiaoutlook.com56

Freedom Foods FEATURE

So Natural, Australia’s Own, Paramount, and Brunswick brand

names.“The company was formerly known

as Freedom Nutritional Products Limited and changed its name to Freedom Foods Group Limited in

December 2010,” says Rory MacLeod, Freedom Foods Group Limited’s executive

director, who spoke with our researcher. “Freedom Foods is a leading brand in

the “free from” market segment, which comprises food and beverage products

manufactured free from key allergens such gluten, wheat, nuts and dairy, while also maintaining a superior nutritional profile,” Freedom Foods Group Limited’s website says. “The market for “free from” products continues to expand in Australia and internationally reflecting the rising prevalence of food allergies and intolerances and the increasing consumer demand for health conscious products that eliminate potentially unhealthy ingredients.

“Since acquisition by FNP in 2003, the business has been transformed with growth

FREEFREEFREE

www.australasiaoutlook.com 57

Freedom Foods’ philosophy is simple - everyone can “benefit from delicious food that is free from the stuff

you don’t need so that your body can work better”. By Ian Armitage



in sales and profitability. In recent years, however, Freedom Foods ability to meet the growing demand for “free from” food and beverages has been limited by the requirement for strict manufacturing and quality control processes and a lack of available quality manufacturing capacity in the Australian market.”

To meet this demand and improve financial returns, in 2008 FNP management acquired a 12,000sqm food grade manufacturing site at Leeton in regional NSW and undertook a major capital equipment program.

The site today has a “integrated scale manufacturing capability” for a broad range of cereals, snacks and baked products “free from” key allergens such as gluten, nuts and dairy.

“This investment represents a significant transformation of the Freedom Foods business model and provides an opportunity for growth in sales and profitability for the future,” FNP’s website says. “The capital investment project has been implemented to provide maximum flexibility to produce a range of products at lower cost, with capacity for growth in product range and volume. Newly developed quality systems and “free from” processes from raw material to finished product will enable the business to guarantee to its consumers “free from” compliance and build competitive advantage relative to other players in a fragmented market.

“The Leeton site is one of only two Australian owned broad capability cereal manufacturing operations in Australia, with

equivalent other operations owned by major multinational food groups.”

MILKY OPPORTUNITYFreedom Foods Group recently

announced that exercised an option to take a further 18.7 million fully paid ordinary shares in Auckland-based dairy company A2 Corporation Ltd. The option exercise resulted in FNP becoming the largest single shareholder in A2 Corporation with a total stake of 26.4 percent, including partly paid ordinary shares on issue.

A2 Corp has said it will commission its own processing plant in southwest Sydney next January to meet a growing demand for A2 milk in Australia.

The new $A7.5 million factory will process 10 million litres of milk a year, some of it additional to 20 million litres of milk already supplied by contractors.

A2 Corp last year gave ASX-listed Freedom a 25 percent stake after its

INVITAInvita imports, markets and distributes food and life science ingredients, focusing its activities on the food, beverage, pharmaceutical and nutraceutical industries.

Invita has built its reputation on supplying quality ingredients, being creative & innovative, providing application & technical support and being a customer focused company. This focus has enabled the company to grow successfully and enhance its position as an important supplier to the industry.

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shareholders approved a deal to buy up the remaining 50 percent stake in Australia’s A2 Dairy Products Pty Ltd that they did not already own.

The deal gave A2 Corp exclusive rights for the production and sale of A2 milk products in Australia and Japan.

MacLeod told our researcher: “Freedom

Foods is a diversified food company operating within the health and wellness sector.

“We have consumer brands with leading or growing market shares in their categories, including Freedom Foods, a2 milk, Australia’s Own, Paramount and Brunswick and a growing business in UHT contract manufacture in Pactum Australia.”

To learn more visit www.ffgll.com.au


60

Peter McNeil, Chairman and Managing Director of Frontier Resources Ltd, talks about a great 2011 and the firm’s future.By Ian Armitage

They say the apple doesn’t fall far from the tree and I ended up following in my father’s footsteps as geology offers a good balance between the field and office


With a history in Papua New Guinea involving three generations of family members, Frontier

Resources Managing Director and Chairman Peter McNeil is an expert on the country, with vast operating experience. His son Alex is a fixed wing pilot in the country and his wife Paige is MD of recently ASX listed Quintessential Resources Ltd, which is active in the PNG Highlands. McNeil’s father Bob is also well known in PNG’s mining scene, and only recently announced his retirement as the Chairman of Toronto-listed New Guinea Gold, which runs the Sinivit gold mine.

“They say the apple doesn’t fall far from the tree and I ended up following in my father’s footsteps as geology offers a good balance between the field and office.” McNeil says. “I’ve been leading Frontier since 2001 with a focus on exploring for and developing mineral deposits in highly mineralised areas in Papua New Guinea and Tasmania.

“The business has come a long way; we listed as a company called TasGold, based on a suite of projects in Tasmania and we changed our name when the PNG projects were returned from a Canadian JV partner in 2006.”

Frontier’s tagline is rather apt, ‘Exploring new frontiers’. “The potential in PNG is huge,” McNeil says. “Andewa is our main project and we own it 100 percent “It is a large and cohesive gold and copper

mineralised system that has excellent “World Class Deposit” potential.”

Frontier controls the entire related region for mineralisation through an exploration licence application, including Mount Schrader and major potentially mineralised crustal level structures.

“The core from the initial drilling demonstrated that our geophysical, geochemical and geological anomaly modelling and identification is correct and the project has the potential to host a very large and highly mineralised gold, copper deposit. Inspection of the core consolidated my technical opinion relating to this possibility and Andewa’s associated large total tonnage potential due to the large area of known gold in soil anomalism.

“I look forward to receiving the drill assays,” McNeil says. “The Frontier team is continuing to achieve very favourable results on all fronts.”

Frontier undertook a major 3D-IP geophysical program over a 21km2 grid at Andewa in 2010 and collected in excess of 5,000 soil and rock samples.

“The 3D-IP survey was a remarkable success,” says McNeil. “It indicated very large sulphide systems from on-surface to more than 800 metres deep and 2.4km2 of gold, molybdenum, copper, arsenic, antimony and geochemical anomalies.

“We are drilling Andewa now and to mid-September 1,602 metres of the 10,000 metre


t h e F r o n t i e r

Frontier Resources FeAtUre


Frontier Resources FEATURE

program diamond drilling program have been completed in four holes.

“We are seeing chalcopyrite, pyrite and local chalcocite and molybdenite mineralisation in the holes,” he adds.

Frontier has an alliance with world-class copper producer Ok Tedi Mining.

“They are a major producer of copper concentrate for the world smelting market,” says McNeil. “OTML have the opportunity to earn between 58 percent and 80.1 percent depending on which projects they are. Frontier has to dilute its equity if the government exercises its right to take up to 30 percent of the project when the mining lease is granted on the first Joint Venture

(JV), which is Bulago. But the second JV, Likuruanga, is non-dilutable, so we can’t end up with less than 19.9 percent. To explain further, there are five projects, and Ok Tedi have an obligation to spend US$12 million on each project, which is a total of US$60 million on the five projects over a maximum of six years to earn-in. They have just started drilling now at Likuruanga and will mobilise to Bulago when weather allows. They’re planning on conducting 13,000 metres of drilling in the coming year on three projects.

“We also have a very exciting prospect at Moina in Tasmania,” McNeil continues. “The potential for the discovery of a major gold and/or polymetallic mineralised system is very high in the Moina area and that this project warrants and will receive a major exploration effort over the next year.

“Over the next six months, exploration will consist of an extensive 3D-IP survey, following on from the success of a similar survey at Andewa.

“The goal is to identify major sulphide systems that could host gold and other metals that are known and also thought to exist in the area.

“Geochemical soil sampling will be undertaken, as it was very successful in defining new regional mineralisation and associated trends earlier this year,” he says.

Frontier’s recent geochemical surveys

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and drilling at the Moina project, along with historical regional prospecting, has demonstrated excellent potential for disseminated and vein hosted tin-tungsten-molybdenum deposits, silver-gold-zinc-lead, higher-grade gold and bismuth, and World Class Intrusive Related disseminated and high grade gold. In addition, Rare Earth soil anomalies are evident.

“It is a very interesting find,” McNeil explains. “And we are starting to evaluate it systematically”.

He says drilling is also continuing and will upgrade and extend the resources at the modest Stormont and Narrawa gold and polymetallic Deposits. Recent drill results included 17.6 metre grading 10.80 g/t gold

To learn more visit www.frontierresources.com

Frontier Resources FEATURE

(from surface) and 15 metre of 7.67 g/t gold (from three metre).

Frontier has allocated a budget of approximately $1.2 million for this project to the end of the first quarter 2012, with a subsequent $0.8 million for escalated drilling in the second and third quarters of 2012.

“2011 is an excellent time to be a mineral explorer because commodity prices are high and there is a lot of demand; it is shaping up to be an excellent year for Frontier. The Company has a fantastic and highly prospective project (and perhaps deposit) in the 100 percent owned Andewa Project, but five aces in the sleave are the projects joint ventured to Ok Tedi Mining, where they will spend up to $60 million to earn in.” McNeil concludes.

64

G r e e nl i v i n g

The award-winning Pixel is a groundbreaking eco-building. Developed and built by Grocon, Australia’s largest privately

owned developer, the building offers a glimpse of what low-carbon, future-focused architecture can offer.

By Jane McCallion

G r e e n Founded in the 1950s by Luigi Grollo, Melbourne-based Grocon is the largest privately owned development and construction firm

in Australia. The company is now headed by Luigi’s grandson Daniel and has made a name for itself through its commitment to innovation and quality. Grocon is primarily an Australian business. It has also provided construction systems to projects in Dubai and Mumbai.

In the latter half of the 2000s, Grocon acquired the Carlton Brewery site in Melbourne City from RMIT University with a view to redeveloping it. The project as a whole, when finished, will be a mixed-use microcosm of the city, featuring Educational buildings of the University, apartments, retail units, restored historic buildings and commercial office buildings, as well as green spaces and car parks.

The first project to be completed on the site is the ground breaking Pixel. This office space is an unimposing building, save for its striking exterior, standing only four storeys high on a plot measuring 250m2. Yet it is probably Grocon’s most ambitious and innovative building ever. Not only is it Australia’s first carbon neutral commercial building, it also uses several technologies that have never been used in Australia before.

Overseeing the whole Carlton Brewery Project is General Manager David Waldren. As he explains, this experimental building came about partly due to the restrictions of the plot it occupies. “205 Queensbury Street – Pixel’s official address – is a modest space, surrounded on three sides by roads and other buildings. With these parameters in mind, we considered it was best suited to being a small office block. Having made this decision, we thought ‘why not make it our site office?’ The idea that we could use it as an experimental building, a prototype, simply

Grocon FEATURE


l i v i n G


Grocon FEATURE

followed on from that.”The result of this

experiment is one of the most ecologically sound buildings in the world. From power generation to heating and insulation, from lighting to air purity, everything has been built with a low-carbon future in mind.

When viewed from above, Pixel really is a green building thanks to its green roof – a garden made of local grasses. This serves two purposes – firstly it provides natural insulation. Secondly, it aids a rainwater capture system, which collects water that falls on the building and transfers it to a subterranean tank. From there, it is treated to a standard where it can be used in the building’s toilets, basins, showers and sinks.

Of particular note are three world-first technologies used in the building: a new type of concrete, vertical axis wind turbines and an anaerobic digester. The type of concrete used in the construction of Pixel, known as Pixelcrete, was developed by Grocon to have 45 percent less embedded carbon than standard material of the same strength. “This is a claim that we have had independently audited to show that this product we have developed, and which is now being used elsewhere, has half the global warming potential of traditional concrete used in the same type of application,” says Waldren.

The wind turbines, which are situated on the roof, are used in conjunction with state-of-the-art photovoltaic panels to meet the majority of Pixel’s energy needs. “These are

not the first ever vertical axis wind turbines in the world. “However, the ones we are using are the first of their kind, designed especially for Pixel.”

The company wanted to install super-efficient turbines that were optimised for use in an urban setting.

“We approached an engineer in Bendingo, Victoria, who has some expertise in the design of next generation wind turbines. We worked together with him and a local manufacturer to find a highly efficient wind-turbine solution. What we have come up with are the most energy efficient wind turbines in the world for this urban setting and which are far above those that are currently

commercially available.”Finally, Grocon have installed an

anaerobic digestion system into the building. “Effectively, the sewerage waste water from the building is collected into a tank where it is liquidised and the methane gas is removed,” Waldren explains. “The gas is then used as a fuel source by burning it to heat the domestic hot water in the building.”

While these three solutions are new designs and innovations, the building uses a lot of existing technologies that had not previously been introduced into Australia. “All the rest of the new-to-Australia systems we sourced from Europe. There is a tendency to look to America for new designs and technological breakthroughs. However, when it comes to environmentally sustainable developments, the Europeans are the world leaders. With the low-carbon laws that will come into effect there in 2020, you find ideas in common use that are

Pixel shows what can be

done with a new construction –

that it is possible to create a

self-contained, carbon neutral

building

Julian McCarthy Landscapes Pty Ltd commenced 18yrs ago.

Specialises in landscape works for developers / builders (commercial / residential) & landscape architects.

Works include excavation, concrete, paving, irrigation, retaining walls, planting & maintenance.

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Melb.Uni had specified all planting / soil structure for Pixel project with strong emphisis with locally sourced plant material.

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Current / recent projects include Tooronga Village (L.U Simon Builders), Clara Apts (Probuild Constructions), A place to live (ICON Constructions), The Garden House Apts (L.U Simon Builders).

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Grocon FEATURE

unheard of outside that continent.” Examples of this interhemispheric acquisition

include the building’s vacuum toilet system, which was brought in from Norway, or the naturally gas fired absorption cooler, which came from Italy.

The construction of Pixel required the building of a number of new relationships and some strong bonds of trust. “All the equipment we brought in from Europe was from suppliers we had never worked with before,” says Waldren. “So there was a lot of effort put in by our procurements team to ensure that we chose the right people to work with and had a good relationship with them. At the end of the day, if you bring in a piece of equipment from Italy and it doesn’t work, there’s no one to call out to come and repair it.”

There was also a strengthening of existing bonds. “We worked with a number of subcontractors who we had completed projects with before. With this build though, the relationship was a bit different, particularly

in terms of the burden of risk – with such an innovative and experimental project, it was only fair that the burden of risk was shared between us, not left solely to them.”

So does Waldren believe the Pixel and buildings like it are the future of construction in Australia? “Absolutely. We have to look at the way we use our resources and think about how to manage them in a sustainable way. Pixel shows what can be done with a new construction – that it is possible to create a self-contained, carbon neutral building. On the other hand, we also have refurbishment projects going on with existing and historic buildings. While carbon neutrality may not be possible, serious improvements in efficiencies are and we are proving that. This isn’t just the way forward for Grocon; it’s the future of the whole Australian construction industry. And the trend in this direction has already started.”

For over 30 years, Marshall Day Acoustics has been providing innovative acoustic design services to a wide range of clients

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BEST BARNot only has Best bar helped Grocon in its quest for carbon neutrality at Pixel through the timely supply of recycled Reinforcing Steel but it has also offered a level of service to Grocon that has impressed. Best Bar’s quick reaction time, its responsiveness to unforseen requirements and its attention to customer satisfaction has impressed Grocon Project management and staff alike.

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E: [email protected] W: www.bestbar.com.au

70

c oa lf o r A f r i c A n g r o w t h

a f r i ca n

Australian firm intrA Energy plans to invest $236 million in tanzania’s first privately funded coal mine and a coal-fired power plant to reduce the nation’s reliance on hydropower.

Executive chairperson graeme robertson tells Australasia Business outlook more.

By ian Armitage

Africa has been the next big thing for a long time. Some sceptics say it will continue to be just that for many years to come.

Yet, investment in Africa is growing. And with African markets outperforming their more developed counterparts, it looks like an increasingly attractive investment option.

The continent is being democratified – Ghana is a great example – and good governance and good governments have been installed.

Africa is beginning to boom.“Africa has vast potential,” says INTRA

Energy’s executive chairperson Graeme Robertson, who stressed that the improved political stability of various African governments, the region’s vast population and a growing middle class has seen many set their sights on the continent.

“This presents opportunity for us too,” he adds. “There is ever-increasing energy demand across the continent and, fortunately or unfortunately, depending on your point of view, the growth in power supply has not been sufficient.”

According to Robertson, Australia’s INTRA Energy Corporation plans to invest a whopping US$236 million in Tanzania’s first privately funded coal mine and a coal-fired power plant to reduce the nation’s reliance on hydropower.

Robertson says mining has already started, with the first consignment of coal expected in September.

“We have about 15,000t currently on the stockpile and we are starting to move coal down to the lake, with the first consignment expected in September.

“We project that the mine will expand its output to 500,000 t/y by 2013, with a long-term maximum output capacity of five-million tons a year.”

INTRA Energy’s local unit in Tanzania, responsible for the Mbalawala project, is

Tancoal Energy and it has already spent in the region of US$23 million on exploration and initial development costs of the Mbalawala mine, in the south-west of the country, Robertson says. This investment -- as part of a long-term plan -- will increase by around US$93 million to increase the mining to a rate of up to five million tons a year.

“The first shipments of coal will commence in September,” he stresses. “After that, we plan to invest an additional US$120 million in a coal-fired power plant near the mine and we have identified several possible sites for power stations near Mbalawala for 120megawatts.”

INTRA is trying to “fast-track” this station with two 60megawatts units to be installed by end 2013, he says.

“The cost of that is approximately US$1 million for each megawatt or US$120 million for the initial 120megawatts at Mbalawala.”

INTRA is also considering construction of a 400megawatts power plant in the southern Tanzanian town of Mbeya and another 400 megawatts power station in the commercial

INTRA Energy FEATURE


There is ever-increasing energy demand across

the continent and, fortunately or

unfortunately, depending on your point of view, the growth in power

supply has not been sufficient

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capital, Dar es Salaam, between 2013/4 and 2017/8.

“Why would we consider that? Well, Tanzania is east Africa’s second largest economy and it has a chronic power shortage. It is prohibiting growth,” Robertson says.

He says Tanzania plans to spend almost US$800 million by the end of next year (2012) on emergency power projects aimed at ending chronic energy shortages.

He also says the country wants to switch to thermal power sources such as coal.

“It sense,” Robertson explains. “Hydropower is weather dependent and it currently accounts for 55 percent of Tanzania’s electricity generation. 2011 has been a difficult year because of low water levels at hydropower dams - Tanzania depends heavily on hydropower for energy and experiences frequent power shortages during dry seasons.

“Also, there has been a national shortfall of 300 megawatts, which came after the hydro problems and a deficit of natural

gas supply. The Tanzania Electric Supply Company (TANESCO) has been unable to cope and has had to import coal at a considerable cost from South Africa.”

The International Monetary Fund has, in response, cut its 2011 growth forecast for Tanzania, saying frequent power outages would hurt output.

INTRA owns 70 percent of the shares in Tancoal Energy, while the Tanzanian government holds the remaining stake through the state-run National

Development Corporation (NDC).The first stage of the mine development

targets initial production of 10,000 t/m, rising to 30,000 t/m in 2012, and stabilising at 500,000 t/y, the year after.

“We’ve received strong interest from factories wanting to generate their own electricity with coal-fired generation because of the unreliability or lack of availability of electricity,” Robertson says. “We’re also looking at feeding the national grid.”

We’re also looking at

feeding the national grid





The Mbalawala mine is projected to substitute coal imports from South Africa.

Tanzania imports 250,000 t/y from South Africa. The Tanzanian mine has a mineable reserve of 50 million tons of coal, Robertson says.

“Our exports commence this year to Malawi and we believe it is our role to support neighbouring countries with

exports to Mombasa, Kenya and possibly Mauritius,” he adds.

INTRA has recently confirmed the acquisition of coal leases in the Songwe-Kiwira Coalfield, lying to the north of Lake Nyasa in southwest Tanzania. It has acquired a 70 percent interest in the Songwe-Kabulo Mining Licence SML235 and three surrounding Prospecting Licences and will hold its interest through the recently

incorporated company, Tanzacoal East Africa Mining Limited.

“We are considering several operating scenarios, which will

supplement production from Mbalawala,” Robertson concludes.

His focus is “African coal for African growth”.

To learn more visit www.intraenergycorp.com.au



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76

SteelG O I N G s t r O N G

Formed in 1969 by Erasmo Mosole, fabrication and construction specialist Pacific Industrial Company continues to win major contracts 40 years on says his son Marco Mosole, Managing Director. By Ian Armitage

PIC COVER FEATURE


Western Australian fabrication and construction specialist Pacific Industrial Company (PIC) is over 40 years old

and continues to supply key components to major resource projects across the region.

Founded in 1969 by Erasmo Mosole, who was later joined by his sons, Marco and Sandro, PIC has supplied many major resource projects over the years, working with clients predominantly involved in the mining, resource and industrial sectors.

“PIC is involved in all aspects of steel fabrication and construction from shop fabricated items through to major

construction projects requiring engineering, procurement, fabrication, installation, commissioning and related electrical, instrumentation and civil works,” says Marco Mosole, Managing Director, speaking to Australasia Business Outlook.

According to Mosole, PIC started off in a tiny 500 square metre fabrication facility; today, that facility is over 30,000 square metres – and it is getting bigger still.

“Interestingly, we have the original facility, which has been expanded to about 4,500 square metres,” he laughs. “In all seriousness, our primary focus is the fabrication and construction of heavy


PIC COVER FEATURE

engineered steelwork and equipment for the resource and oil and gas sectors in Australia, and as such, we continue to grow.

“We are on a growth path, responding to the increasing demand for satisfying larger projects and more complex projects as presented by clients. This has required the business to invest more in plant and equipment and in the training of its staff, as well as the introduction of additional staff,” Mosole adds.

He says there are lots of opportunities for companies like PIC - enormous opportunities in fact. “I say that because of all the new developments to be undertaken in Western Australia. The greatest part that will be in the mining and oil and gas sectors – that’s where the biggest project opportunities are. Our strategy is to pursue and continue to value add, for the more complex projects that are available to us, creating a niche market for opportunities to supply and install the equipment that we fabricate.

“We value add through the process of assisting with engineering, with transportation and installation activities, and secondary subcontract activities as required.

“Projects are becoming larger and more complex so we have to invest in the business to ensure we meet that requirement.

“We are continuing with our growth strategy. We want to increase our capability and capacity in terms of our manufacturing and production; that’ll be done through the incorporation of technology, additional equipment and increased workshop capacity and automation.”

Mosole is very passionate about promoting the capabilities of local manufacturing.

“Australian manufacturers have the knowledge, skills and expertise to fabricate and supply products for large projects to a world-class standard. By working in conjunction with each other, companies do not have to look offshore,” he says.

“In terms of our work, we do everything from basic structural fabrication, such as the frameworks of buildings; we do plate work including chutes and hoppers, tankage, vessels and piping. In essence we are a Structural, Mechanical and Piping (SMP) Contractor.”

The market has changed a lot since the 1970s, and in

order to remain competitive PIC has invested in ways to improve its fabrication processes – this will continue.

“Australia has some of the highest paid skilled workers in the world, so in order to increase our capabilities they must find new ways to streamline,” says Mosole. “One way of doing that this through automation.”

PIC gets a lot of work from the mining sector and has placed an emphasis on the oil and gas industry.

It has also done a lot of government infrastructure and heavy commercial work in recent years.

“We’ve done everything from fabricating steel for high rise buildings, shopping centres and structures of that nature to oil and gas and mining. We are involved in all aspects of steel fabrication and construction, and are able to provide clients with services straight through from shop floor fabrication items through to construction,” Mosole says.

PIC is currently involved in building City Square, a 47-storey office skyscraper under

We value add through

the process of assisting with

engineering, with transportation and installation activities, and

secondary subcontract activities as

required

1300 00 2273


PIC COVER FEATURE

construction in Perth.When complete it will be

BHP Billiton’s new regional office.

“We’re very proud to be involved,” says Mosole. “We are working with our client, property developer Brookfield Multiplex. We’ve had a longstanding relationship with them and it is great to continue it on this landmark project for Perth.”

It is quite apt that the steel framed 47-storey skyscraper will be home to BHP.

Located at 125 St Georges Terrance, construction started in April 2008, Mosole says, and is expected to be complete in 2012.

The project is estimated to cost around A$700 million.

“What have the challenges been? Well, there have been some challenges in meeting the logistical demands of delivering steelwork in a Just-in-Time basis to the city centre for installation,” Mosole says. “And there have been challenges too in some of the engineering connections that come with high stress joints in a high rise building. But it is nothing we can’t handle.

“Pacific Industrial Company is committed to providing quality manufacturing and installation expertise for all clients,” he continues. “We


PIC COVER FEATURE

combine fast, efficient service and delivery with performance to the most exacting standards.”

Looking to the future, Mosole is confident the company will continue to grow. One stumbling block, however, could be the Federal Government’s carbon tax, which is due to start in July next year, and, say many, will hit businesses like PIC hard.

The tax will increase the cost of doing business, discourage new investment and jeopardise the international competitiveness of firms, opponents say.

“We are a 40 year established business; we’re highly respected and reputable in the

industry in executing work safely, on-time and within budget for a vast array of clients and have enjoyed repeated work with all of our major customers over many years. I remain confident of future success,” Mosole concludes.

LEADERS IN GALVANIZING

Hartway Galvanizers has recognised that total project life costs are key to delivering the largest resource infrastructure investments in the world. Hartway has made significant improvements to local capacity to efficiently feed these projects.

Hartway Galvanizers is a WA-owned and operated business. It has been in operation for 25 years and has developed a geographical footprint from Albany to Port Hedland and Perth to Kalgoorlie.

The investment in a second new plant in Kwinana, WA’s industry heartland, makes Hartway one of the largest galvanizers in Australia, with the cumulative capacity of both plants increased to 54,000 tonnes of steel per annum.

Improvements in supply chain value are rapidly becoming a key area of performance for all project managers.

The new yard at Naval Base is able to store 52 cradles, amounting to 800 tonnes of storage. The facility drives economies of scale with regard to dispatch and creates a buffer for fabrication to continue in the absence of site receipts.

Hartway has also allocated significant areas of its yard to pre-assembly and loading for large projects, adding value to the steel coating process and invoking savings in logistics.

See our website for design considerations, recent projects and contact details.

HArTWAy CANNING VAleBath size: 12.6m long x 1.4m wide x 2.7m deepSpeciality: centrifuge plant for threaded fastenersAddress: 10 Sherman St, Canning vale, WA 6155Tel: (08) 9455 1713

HArTWAy NAVAl BASeBath size: 12.6m long x 1.4m wide x 3m deepSpeciality: with the deepest bath and 5 acres of pre-assembly area, this plant specialises in large structural projects.Address: 46 Hope Valley rd, Naval Base, WA 6165Tel: (08) 9410 1055

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To learn more visit www.pacind.com.au


The rapid growth of Africa’s mining industry is to continue into the future,

says Mark Calderwood, managing director and CEO of Perseus Mining.

By Ian Armitage

g o l d e n

P e r s e u s ’

o p p o r t u n i t y

Perseus Mining FEATURE


G old’s meteoric rise has been well documented. The metal reached a price of US$1786.54 per ounce in early August and it

is expected to rise further still, with the gold market feeding off Eurozone uncertainty and, to a certain degree, off ongoing fears of slowing in the US.

Gold is the quintessential hedge when there are worries about the economy and this represents a great opportunity for gold producing regions.

From 2005 to the end of 2010 there were approximately 15 new gold mines in West Africa alone, averaging 200,000 ounces per year.

Perth-based Perseus Mining is amongst those benefiting from the commodity’s soaring rise and is well aware of the obvious opportunity that lies in gold production. Its lead project is the Central Ashanti Gold Project (CAGP), formerly known as Ayanfuri, in Ghana, where it is working towards being in production soon.

The CAGP comprises a group of large gold deposits located in the Ashanti gold belt.

“It represents a big opportunity for us,” managing director and CEO, Mark Calderwood, tells us. “A major milestone was achieved on August 9, 2011 when the SAG mill commenced processing ore and first gold production is expected within a week, in line with expectations of first gold in the third quarter of 2011.

“It was a tremendous effort by all involved to bring this substantial project to fruition within 14 months of starting site works.

“The construction and operations teams put in a fantastic effort towards completing the project on schedule.”

Commissioning the process facility to name plate capacity and optimisation of gold recoveries is expected within three months.

84

“The mining ramp-up is progressing, and is on schedule for an average mining rate of 1,100,000 m3 per month. Approximately 4,200,000 m3 of material has been mined to date, including about 700,000 tonnes of ore,” Calderwood says.

ASX-listed Perseus has forged a reputation as one of West Africa’s most successful gold explorers. It is focused on under-explored gold belts in West Africa.

“We are a miner and our first gold sale will be this quarter,” Calderwood adds. “We have two major projects at different stages of evaluation and development.”The company plans to produce at the initial rate of

220,000 ounces of gold in year one in Ghana and wants to increase this to about 280,000 ounces per annum by 2013.


The construction

and operations

teams put in a fantastic

effort towards

completing the project on schedule

Mineralised waste being discharged to stockpile


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“The beauty of gold doré is that it can be sent to any refinery in the world,” Calderwood, who spent 11 years in Ghana before moving back to Perth to head up Perseus, continues.

As well as developments in Ghana, Perseus is also planning the development of its Tengrela Gold Project in Côte d’Ivoire, with production targeted for late 2012 or earlier. “We are tendering the design - we have tendered the SAG for that one – and we are also about to lodge the EIS,” Calderwood says. “We are continuing our strategy of rapidly increasing our resource and reserve base.”

Tengrela has the potential to become a significant contributor in the company’s goal to develop into a 450,000 ounce per year gold producer by 2013.

GOLDEN OPPORTUNITYIn addition to its projects in Ghana and Côte d’Ivoire, Perseus retains a 23.9 percent stake in Manas Resources Limited, which it spun off in 2008 as a focused Kyrgyz Republic gold explorer and developer.

Perseus also has a 19 percent stake in, as well as a strategic alliance with, Burey

Gold Limited, a listed exploration company focussed on Guinea.

Calderwood has been

managing director and CEO at Perseus since it listed in 2004 and he is a member of the Australasian Institute of Mining and Metallurgy.

He served as Managing Director of Afminex’s West African operations and has extensive experience in the West African region as well as a network of contacts throughout the region.

Recent years indicate a rapid growth in the African mining industry that is likely to continue well into the future as more markets open up and new resource companies enter the market. Perseus will play its own part in it.

“We are on track to start production with CAGP and we are also planning the development of Tengrela. Tengrela has the potential to become a significant contributor to our goal to develop into a 500,000-ounce per year gold producer,” Calderwood says.“West Africa is pretty early on in the discovery curve, exploration curve in terms of maturity, and there are a number of discoveries in the pipeline, given the rate of exploration that is going on. We will look to add further projects to our portfolio, aiming to get our production levels up.

“We are an aggressive explorer and we have a lot

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of rigs – about 12 rigs at the moment - and are doing a lot of drilling. We do over 300,000 metres of drilling a year.

“We are looking for robust open-pit ore bodies, which are quick solid operations that have quick payback and relatively low cost. We are looking at mines that produce 150,000 ounces per annum – that is our minimum target for new projects,” Calderwood concludes.

To learn more visit www.perseusmining.com

PESTECH.indd 1 27/09/11 8:13 PM

88

Australasia Outlook talks to Lorry Hughes, CEO of Perth-based South Boulder Mines, who tells us that his main focus is to

getting to potash production in Eritrea.By Ian Armitage

w o r l d ’ ss h a l l o w e s t

T H E

P O T A S H d E P O S I T

South Boulder Mines Ltd (South Boulder) is aiming to jump the pack to become a major potash producer. The company has the world’s shallowest potash deposit and it expects to start production at the world’s first open-pit potash mine by 2016 and possibly sooner, with

start-up costs expected to be half the average for a typical potash mine. Managing director Lorry Hughes says South Boulder’s Colluli potash

project in Eritrea could be delivered for between US$500 million and US$700 million.

“This is a real gem,” he says. “On our current progress, operating costs should be among the lowest ten percent of all the global potash producers.

“What we have at the Colluli Potash Project is the world’s shallowest potash deposit, and it is accessible as low as 16 metres below surface.

“There is nothing else like it in the world.”According to Hughes there is currently huge interest in the potash sector,

with players such as BHP Billiton, Brazil’s Vale and Canada’s Potash Corp looking to capitalise on the market’s potential.

South Boulder Mines Ltd has something they don’t though.“The Colluli Potash Project would fit comfortably into any resource giant’s

portfolio; this is a Tier 1 asset,” Hughes says. “It’s great for a junior company to advance toward a multi-billion dollar producer in a relatively short space of time and it is seldom that a company like South Boulder gets the chance to control such a potentially large producing asset in any commodity.

“We are developing this from discovery through construction and production; we have the team the can deliver production for many decades to come.”

Hughes says global consumption of potash, used in fertiliser for food production, is expected to surge about 45 percent in the 20 years to 2030.

`This demand is there and is underpinned by rising world populations, changing diets as incomes grow, constraints on arable land, government policies to enhance crop yields, and programs encouraging things like the use of biofuels.”

Since spiking in 2008, the average price for potash has been on a growth curve for the past two years and continues to trend upwards, he adds.

“We continue to deliver a string of high grade potash hits from the Colluli Potash Project in Eritrea. We recently confirmed Area B as a significant addition to the Colluli Potash Project, with the results continuing to support the project Exploration Target of 1.25 to 1.75 billion tonnes at 18-20 percent potassium chloride (KCl).

“The continuous zones containing sylvinite, carnallite / kieserite and kainitite mineralisation have been identified in 18 of 22 holes drilled at Area B to date.

“Boosting the potential of the project even further is that the holes are open in most directions.”

The Colluli current JORC Resource is 548 million tonnes at 18.6 percent KCl, for total contained potash of 102 million tonnes, he says.

“We’re very excited and are expecting to confirm the robust economics of the project with the release of an engineering scoping study in October,”

South Boulder Mines FEATURE



South Boulder Mines FEATURE

Hughes explains.South Boulder Mines was originally listed

on the Australian Stock Exchange in 2003, with its ground pack¬age in the Duketon Greenstone Belt in Western Australia and in 2009 acquired the Eritrean Project.

Today, South Boulder has shareholders all over the world and a lot of exciting developments to report. The world really is watching this dynamic company.

“South Boulder’s gold and nickel prospects are all located within the under-explored Duketon Greenstone Belt,” Hughes says. “The Duketon Belt is located 120 kilometres north of Laverton in Western Australia and is considered highly prospective for gold, nickel sulphide and base metal mineralisation.

“From the early 1990s most of the Duketon Project was held by Normandy Mining Limited and Newmont Mining Corporation. Widespread reconnaissance was sporadically conducted but the majority of the project remains under-explored. New mines and discoveries are occurring regularly in the belt now, due to a better understanding of the geology of the area and targeted exploration.

“Our key Duketon gold prospects are Moolart West, Thomson’s Bore, Terminator and The Garden Well area: our three Duketon nickel prospects are the Bulge C2, the Bulge

Rosie and the Bulge Extended prospects.” Within the Duketon Gold Project area,

South Boulder entered a farm-out joint venture agreement with Independence Group NL, whereby Independence can earn a 70 percent interest in the nickel rights on JV tenements held by South Boulder in the Duketon Project, by the completion of a bankable feasibility study within five years of the grant of the relevant tenement.

Hughes says that the Duketon Nickel JV has had recent success at The Rosie and C2 Nickel sulphide prospects, where drilling has defined intercepts of 5.20 meters at 9.13 percent nickel, 1.09 percent copper, 0.21 percent cobalt and 7.09g/t platinum group elements (PGEs) at Rosie and 50 meters at 0.92 percent nickel including 37 meters at 1.05 percent nickel at C2.

“The deposits are approximately two kilometres apart and the mineralisation at both prospects is considered open in most directions,” he says. “A mining lease was granted over the Rosie and C2 deposits in November 2010. A resource definition and exploration drilling program and scoping study into an open-pit mine at C2 and an underground mine at Rosie was under way as of July 2011.”

The South Boulder Mines Ltd story is remarkable. A sixth sense for holding the Duketon package, and the foresight to enter Eritrea, has com¬bined to create a strong and potentially extremely rewarding portfolio, Hughes concludes.

“What at future we have,” he says. “As a general strategy, we are looking to split the company, creating a new one – one that is dedicated to potash. The effect of that is to create the best value for all South Boulder shareholders. That is part of the strategy and that will come in the next year or two.”

To learn more visit www.southbouldermines.com.au

STB Team assesing drill core from Colluli

92

Jason Stirbinskis, managing director of Phillips River Mining NL, talks to Australasia Business Outlook about “shaking the market perception” that this Perth-based company is a small nickel producer. In fact, it is far more.By Ian Armitage

Listed on the Australian Stock Exchange, Phillips River Mining NL (PRM) is a West Australian-based resources company focused

on developing its 100 percent owned Phillips River Project, located near Ravensthorpe in southern Western Australia.

Managing director Jason Stirbinskis says that with a “highly prospective, untapped location”, the company is well placed to realise returns for shareholders.

A rich inventory of gold, silver and base metals, are currently the target of exploration and evaluation activities.

“We’ve already proven our ability as a producer in the region, having successfully mined the RAV 8 nickel deposit in the Ravensthorpe area until the reserve was exhausted in 2007,” he says. “Now we are going to the next level.”

As part of this PRM, formerly Tectonic Resources NL, went through a name change.

Stirbinskis says it was necessary because of the market perception that the company is still a small nickel producer.

“We changed the name to Phillips River in August and we did that to reflect the direction of the company and to align

Phillips river mining FEATURE


p o T E n T i A lp o T E n T i A lp o T E n T i A l


Phillips River Mining FEATURE

ourselves with our flagship project, the Phillips River project.

“Our primary goal now is to develop that mineral rich project. Having completed the definitive feasibility study (DFS) earlier this year, we are currently targeting development in 2012 and production in 2013.”

Located 20 kilometres southeast of Ravensthorpe, the Phillips River project includes two mining areas: Trilogy, a large polymetallic deposit with copper, gold, silver lead, zinc, metals; and Kundip, primarily gold and copper.

“Trilogy and Kundip projects form the Phillips River project,” Stirbinskis, who joined the firm in February, says “A one million

ton per annum processing facility to be established at Trilogy will generate around $1billion in revenue over an operating life of 10 years.

“Our recent focus has been on progressing debt and offtake arrangements and securing government approvals. These are progressing well and it is time to start building our team and securing our EPC contractor for the Trilogy processing facility.”

In addition to the Phillips River project, PRM holds a highly prospective tenement portfolio of around 2500km2 within the region, containing numerous targets of potential Trilogy and Kundip style mineralisation.

“We have made a number of strategic

We’ve already proven our ability as a producer in the region,

having successfully mined the

RAV 8 nickel deposit in the Ravensthorpe

area

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tenement acquisitions to further strengthen our strategic regional position,” Stirbinskis says. “We now hold a substantial portfolio of both copper/gold and base metal targets within the region ranging from early stage, which have achieved encouraging exploration results to date, to advanced prospects with JORC compliant Resource, which were not included in the feasibility study.”

PRM recently announced new exploration Aircore drilling results from its Gift South Prospect, located within the Kundip area.

According to Stirbinskis the fact that it occurs in near surface unconsolidated sands suggests that, “mining costs will be low”.

“If the mineralisation proves to respond well to gravity separation, as we expect, then we are looking at a potentially very economically attractive supplement to our Phillips River Project, especially with today’s gold price,” he says.

The mineralisation is located within existing Kundip mining leases and is interpreted as alluvial in nature.

“The prospect will undergo Resource Estimation and high level metallurgical test work and the results used for conceptual mining studies. The mineralisation is expected to grow the current

Kundip Resource which stand at 708,000 oz of contained gold,” Stirbinskis says.

“It is very exciting. This is really just cream on the cake. We have the Phillips River project going well – and at least $1 billion of revenue based on February prices. Plus, we have all the other targets that are coming through with fantastic results. Gift South is just one. The other one that was really incredible was Queen Sheba. That is looking very exciting as well.”

PRM recently announced the upgraded Resource Estimate for the Queen Sheba deposit, located only two kilometres from the proposed Trilogy mine and processing plant. It takes PRM’s gold inventory to 0.93Moz.

Stirbinskis says: “This is a great result as it fits ideally into the larger Phillips River Project strategy. Queen Sheba is located close to the planned processing plant at our Trilogy project, within the current mining lease and on our freehold farm property. Not only has recent drilling at Queen Sheba increased the resource but also it has significantly enhanced




the potential to expand the size of the resource and further extension drilling will be conducted after the end of winter.

“The polymetallic Trilogy deposit is interpreted as SedEx in style and these often occur in clusters,” he adds. “We are seeing similarities between Queen Sheba and Trilogy that suggest we may have found another SedEx. Compounding our enthusiasm for Queen Sheba is that we are observing mineralised zones which are substantially wider than Trilogy’s and our deepest drill hole actually ended in copper mineralisation.”

The Queen Sheba Resource is located within two moderately dipping parallel lodes within the Proterozoic Mount Barren Group sediments, which also host the Trilogy deposit.

Mineralisation extends from near surface to about 160 metres below surface, with

about 550 metres strike identified. The resource is open at depth, with

stronger base metal values within the fresh rock portions.

Depleted base metals values in the oxide portion are similar to Trilogy; and oxidation extends to near the base of defined mineralisation.

“Further drilling is planned,” Stirbinskis says.

Following our chat with Stirbinskis, Phillips River announced that an agreement has been reached with LN Metals for the Phillips River lead/zinc concentrate.

Stirbinskis said: “This marks a major milestone in the development of the $1 billion Phillips River Project, allowing us to focus on securing offtake agreements for the high value copper/gold concentrate. The board is delighted with the negotiations and outcome of the agreement.”

To learn more visit www.phillipsriver.com.au


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