Australia’s biggest mining conference starts on Monday with the return to Kalgoorlie of the annual Diggers & Dealers forum – bringing with it a plethora of miners and explorers vying with each other for media and investor interest.
As Western Australia’s unofficial gold mining capital, Kalgoorlie is a secluded and popular place for the annual Diggers & Dealers event that sees company executives, bankers and stockbrokers descend to drink copious amounts of alcohol, eat, gossip and discuss deals.
There will be opportunities for news gathering potential from being in the Goldfields Arts Centre and its auditorium, or in the adjoining marquee filled with company booths, or the pubs, for which Kalgoorlie is infamous.
This year, a record number of delegates (2,620 at last count) are expected to return to the forum and shake-off COVID pandemic blues.
What they will likely experience is a slick and professionally run event designed to create a hothouse atmosphere in what can be a surprisingly cold town.
This year will involve more than 70 presentations over three days from a smorgasbord of explorers and miners – from Australian and overseas.
So, like anyone with an interest in Australian mining, especially the small end of the industry, it is necessary to pre-select companies, which might generate a worthwhile story in the same way a private investor needs to pre-select a company with investment potential.
Day one, Monday 1 August:
After the opening formalities the first presentation of the forum is from Australia’s leading gold miner Newcrest (ASX: NCM), which recently revealed in its June quarter report that it had achieved its FY2022 production guidance of 1.9 million ounces of gold at a lower than expected cost.
That’s a huge achievement in an environment of COVID-19 challenges, supply chain disruptions, surging inflation and costs.
The three stocks I’ve pre-selected for following on the first day of the conference are:
Genesis is on the hunt for deals after bagging Dacian Gold and is possibly on the lookout for a merger with St Barbara (ASX: SBM) as part of a grand plan to consolidate the Leonora goldfield north of Kalgoorlie.
Over the past week, perhaps in harmony with a modest uptick in the gold price, Genesis has risen by 6% to $1.30, valuing the company at around $377 million, roughly half of St Barbara’s $758 million but with a talented and aggressive management team keen to grow.
The second stock on my first day watchlist is De Grey Mining (ASX: DEG), which owns the world-class Mallina gold project near Port Hedland.
De Grey is moving closer to the next steps which will take it from the status of explorer to developer to producer.
If all goes to plan, the company will produce 430,000oz of gold over a minimum 10-years at an all-in sustaining cost of A$1,224/oz, with a capital cost payback expected in two years from a mine generating a 50% post-tax return.
The third stock on my Monday list is Core Lithium (ASX: CXO), which is developing the Finniss lithium project in the Northern Territory.
Core has the advantage of a sales deal with Tesla, the world electric vehicle (EV) leader.
Site works are well advanced with the company confident it will ship first lithium from Darwin by the end of the year. Recent drilling has helped Core extend the initial life of the project from 10 to 12 years.
Day two, Tuesday 2 August:
Like Genesis, Develop Global (ASX: DVP) is a comeback corporate vehicle for a particularly successful mine developer in Bill Beament – the man who turned Northern Star into a global gold star.
This time around, Beament is developing a business with two core interests: underground mining services, and future-facing metal production with a focus on copper and zinc through the Woodlawn mine in NSW and the Sulphur Springs project in WA.
Some investors seem to believe that events are accelerating at Develop, with the stock rising by 11% over the last week – clawing back ground lost in the preceding three months.
Calidus Resources (ASX: CAI) is targeting initial annual output of 90,000oz of gold a year, rising to 130,000oz at an AISC of around A$1,290/oz from its Warrawoona project in WA’s Pilbara region.
As well as its status as Australia’s newest gold producer Calidus has a stake in a potentially significant lithium exploration project and could be a key player in the widely tipped consolidation of gold assets in the Pilbara region.
After starting with the redevelopment of the rich nickel mines around Kambalda, close to Kalgoorlie, Mincor (ASX: MCR) lost its way briefly, attempting a switch to gold, but rediscovered its roots two years ago – just in time to ride a doubling of the nickel price.
Exploration on its extensive tenement position continues to expand Mincor’s base of high quality (low pollution) nickel in demand from EV battery makers.
Day three, Wednesday 3 August:
A red-hot performer until early this year Chalice Mining (ASX: CHN) remains the company most likely to develop Australia’s first palladium (with nickel) mine and potentially start a new mining province on the outskirts of Perth – environmentalists willing.
Work so far has outlined a near-surface structure containing 11Moz of 3E metals (palladium, platinum and gold), equivalent to 2Mt of nickel or 20Moz of palladium.
Exploration news flow will drive the stock, especially if government approvals are received to extend drilling into state forest.
Emerging globally significant producer of titanium minerals, Strandline Resources’ (ASX: STA) first project is Coburn on the WA coast. It is 80% complete with rare earth containing monazite ore a potential bonus.
With cash flow on the horizon from its Australian operations Strandline will then be in a position to progress its African assets, including the Fungoni and Tajiri mineral sands deposits.
Australia’s next uranium producer Boss Energy (ASX BOE) is ramping up construction work at its Honeymoon project in South Australia following last month’s final investment decision.
Annual production is expected to reach 2.45 million pounds of uranium a year over an initial 11-year mine life starting in the second half of next year at an all-in sustaining cost of US$25.60/lb – with the potential to expand.
Other day three presenters worth following include: Liontown Resources (ASX: LTR), Lunnon Metals (ASX: LM8), Peel Mining (ASX: PEX), Hastings Technology Metals (ASX: HAS), and Lynas Rare Earths (ASX: LYC).