2022 General News etc, page-31

Sabine

This is what the FY13 Annual Report stated, “NRW’s contract at Rio Tinto’s Simandou operations was terminated effective December 2012, after having been previously awarded a three year extension in November 2011. As a result, revenue at Simandou was $10 million less than expected, with 50% of total assets NRW employed on the Simandou project sold to the client.”

Losing $10m revenue in FY13 on a contract that was to expire in December 2014, suggests NWH lost more, the cancelled revenue from July 2013 until December 2014. Further, RIO acquired half the eqiupment, which left NWH with half lying idle in Guinea. The assets in Guinea as at 30 June 2014 were $5.901m. The Report states. “... remnant operations exist in Guinea West Africa, including some assets that are strategically held there for new project development and bids.” Similar words of hope appeared in later years, but no business eventuated. As at 30 June 2014 the assets in Guinea were $1.026m, and they were not reported in subsequent years. I assume the assets were depreciated to zero. Management lost its appetite for overseas adventures.

Management accepted the Simandou setback gracefully, and that must have impressed RIO. I am sure NWH would consider doing work almost anywhere if the likes of RIO asked, but they would want to avoid a repeat of what NWH suffered in Guinea. I do not hold LYL, but it does a lot of work in Africa for Australian listed companies who develop mines there. LYL insists on a large upfront deposit, and gets it, which is why LYL always seems to have large cash holdings.

There is more to consider than losing a bit of money in Africa. In South Africa the locals have a proclivity to murder people, and in respect to RIO's operations there, see https://www.mining.com/rio-tintos-richards-bay-manager-murdered-on-way-to-work/