HI FB,
Read the article,
I am glad they pointed out Nathan is tall with a close cropped beard.
- The change of mind on the contract is not much in the way of news.
- The comments about the fact that is 'not the first time related party transactions have emerged' is also not much of a story, they have disclosed related party transactions which appear to have worked fine - this is the first time we have heard of any issues. Understand though where issues can obviously arise and the more of these there are, the more opaque things can become.
- The most relevant part of the story I thought was about the affidavit - where quoted from the AFR "The affidavit then alleged a strange bombshell: “Mr Mitchell further stated that SMS would be required to remain the head contractor … on a ‘no margin’ basis as the financing arrangements for the [gold mine] provided for SMS as the contractor.”
I might be stupid but I find this a bit vague. I would like to see the context of the 'no margin basis' rather than coming in part way through - blending that sentence together seems misleading or lacking clarity?
I understand that the finance could be dependent on SMS being the contractor, but the comment implies Nathan is insisting on SMS making no margin - which doesn't make any sense - or is it just that SMS had stuffed up the contract and found themselves making no margin?
- Regarding the view that SMS thought MSV had not done a good job:
AFR - "At one stage, the affidavit alleged, blasts were fired at wrong heights causing a “shock tidal wave in the pit water reserve, resulting in loss of operation pumps and reducing productivity for an extended period”. Another time, a “worker was removing a blocked drill bit from a hammer when a pulse of high-pressure trapped air … released spraying mud and fine particles of rock onto the [driller’s] uncovered hands”.Certainly seems more impressive using words like shock tidal wave (I still have to tell my kids the difference between tidal waves and tsunamis) and while the spraying on the workers hands is unfortunate, this smells of clutching at straws from SMS to me. How long is extended period? 3 weeks, 3 days or 3 hours?
Don't get me wrong, this has all been a stuffup, but I am not sure if I have learnt much from the article.
You obviously know a lot more about the situation than me - so feel free to jump in and clarify, as I may think clearer when I wake up a bit.
Personally the news doesn't change my sentiment.
(20min delay)