Exploration Radio

"...The elephant in the room is that the devaluation of mining companies cannot be explained by the commodity price, instead it is dictated by the self-inflicted mistakes of a commodity boom, and the irresponsible management of these assets."

"...The elephant in the room is that most of these mining companies believe that the commodity boom will continue to bail out their lackadaisical management and operations."

"...The elephant in the room is that mining companies, in the past, maximised returns for an ever-rising gold price; optimising project resources for scale rather than payback and returns."

"...The elephant in the room is that the mining industry has made so many mistakes; mistakes in the geological modelling, mistakes in community relations, mistakes in environmental planning, mistakes in capital markets, mistakes in communicating with investors and mistakes in overpromising and promoting their business."

"...The elephant in the room is that the mining industry has lost the trust of the most serious investors, causing an exodus of capital that will not return quickly."

For a while, we have been complaining that there seems to be a continuous exodus of investors out of mining. We have laid the blame for this on a number of things: mining is a risky business and investors just do not get us; the boom and bust cycles make it difficult for these investors to stay around; and the common and ever present excuse, it is all because of the commodity price. Maybe it is time that we recognised that we as an industry have lost the trust of investors because of the failures of our recent past in returning value to shareholders. Maybe what these absent investors are asking for, is the opportunity to make real investments that have a potential to deliver long term returns and not just over-hyped stock plays.

Our guest today is Jonathan Goodman, President and CEO of Dundee Corporation, a company with a long and successful pedigree investing in the mining and resources industry. He joins us to talk about how as an industry we need to start addressing some of these “elephants in the room” before general investors start trusting us an industry again.

In 2005, Wallbridge Mining a junior exploration company based in Sudbury Canada, hired two students to help out with their summer exploration programs. One of these students was Ahmad, the host of this podcast, who only ended up working with Wallbridge for that summer before building a career through different roles and opportunities in several multi-national companies. The other was Attila Pentek, who ended up staying with the company for the next 15 years, starting as a Masters Student, to then completing his PhD with the company, to working as an exploration geologist, then a resource geologist, a mine manager, a business development geologist and now heads up their exploration department.

Our industry has plenty of examples of people that jump between jobs every 3-5 years. It is rare to find someone like Attila that has stayed with a company for such a long time. Even rarer still, is someone that has done it at the start of their career with a junior explorer. Junior companies are not usually renowned for having established programs that develop and nuture graduates. Maybe the reason that Attila stayed with Wallbridge for so long has something to do with the culture that the company has created, where loyalty is rewarded by opportunity. At some point, all of us have faced these questions: when is it time to leave? Is it better to switch jobs to chase opportunities? Or stay and show loyalty where the reward is opportunities provided?

Our guest today is Attila Pentek, the Vice President Exploration for Wallbridge Mining and we talk to him about why he took the career road less travelled.