Sarah-Jane Tasker, September 14, 2009 The Australian
PETER McIntyre was so close to fulfilling every junior explorer's dream, but the former Extract Resources boss has cruelly had to bow out and watch from the sidelines as his company steers its way into production at its world-class uranium mine.
Mr McIntyre, 53, is clearly disappointed he will not experience the joy of turning the company's Namibia discovery into a mine, but rather than enter into a public battle with major shareholder Kalahari Minerals, he has chosen to step aside.
The mining veteran of 30 years spent his last day as Extract managing director on Friday at the company's Perth office.
His success in transforming the company from a $4.5 million junior player into a $2.3 billion miner is certain to put him on the wish list of many companies.
Extract started out in late 2003 as a back-door listing through a gold project, and its interest in its flagship uranium mine in Namibia started with a 51 per cent stake in the licences, with AIM-listed Kalahari Minerals holding the remaining interest.
The junior's original focus was copper, but with the tenements neighbouring Rio Tinto's massive Rossing uranium mine, the junior soon decided to sell its gold assets and focus purely on uranium.
"When you are in a world-class address, there is the hope you are sitting on a world-class deposit," Mr McIntyre said.
The company's Husab uranium project, containing the Rossing South and Ida Dome deposit areas, quickly became its focus, and Mr McIntyre soon moved to pull the asset solely under the Extract banner. In that process, Kalahari secured its original 36 per cent stake in Extract.
Mr McIntyre said it was a good consolidation strategy, but it didn't stop there.
Around March 2007, Mr McIntyre moved to tidy up the junior's ownership structure.
Once a 1.5c stock, Extract had a large number of shares on issue that were often subject to the whims of day traders.
When shares rose to 9c, the company conducted a share consolidation to crunch the number of shares, making itself appealing to institutional investors.
With the company starting to take "corporate shape", Mr McIntyre's focus returned to the project site and the original plan to explore the uranium area.
But it was during this time a significant change for the company was born, when it decided to look elsewhere.
"We went from the known into the unknown into the oldest desert in the world," he said.
"No one had ever looked under the sand."
Extract focused on an area 5km south of Rio's hugely successful Rossing mine, where it had identified a good target and from the first line it hit in late 2007, the exciting feeling a junior explorer gets when it believes it's on to a good find began to be felt around the company's boardroom.
By February last year, the company had announced a major uranium discovery at the Rossing South exploration target, sending its shares on a steady climb.
"I have never won lotto before but there is a lot of luck in finding what we did and being at the right place at the right time," Mr McIntyre said.
He had taken his son on his first trip to the African project when the good news flowed in and "was prepared to start hiring him out as a lucky charm".
Rio Tinto had missed out on the expansion upside from its nearby project, having stopped short of extending its reach in the area because of the discovery it made more than 30 years ago.
Extract was fortunate enough to secure the licence next door to Rio's project, before the uranium price increased, fuelling renewed interest in the sector, and in September last year Rio bought 11 per cent of the explorer.
Although the global financial crisis was starting to bite and Rio was going through its own issues, it still increased its share to 15 per cent by December.
"It was an endorsement by Rio Tinto and stamped what we had and was telling the market they clearly endorsed the work we were doing," Mr McIntyre said.
The downturn that crippled many other miners didn't deter Extract's push.
"We continued to be aggressive on the project during that period and ploughed ahead, which was a defining moment for the company," he said.
But Mr McIntyre's key role in building the company into a $2.3bn emerging miner wasn't enough to keep his largest shareholder happy.
He refuses to dwell on the reasons for his decision to resign but Kalahari, which owns 38.7 per cent of the miner, moved in May to remove him as a director.
And it wanted another board seat while Extract's next two biggest shareholders, Rio Tinto and Polo Resources, also called for boardroom representation.
Mr McIntyre said he took the view that it would be better to step aside rather than go through the process of calling a public meeting, where investors would be asked to vote on his removal.
"It is not good for a company to go through these episodes and it is embarrassing for the company," he said.
"It was unfortunate and it is disappointing not to take the company to the next phase.
"It's not easy, but you're in a public company and you have to accept it."
His replacement has not been named but Mr McIntyre is positive the team in place will fulfil his dream of turning the discovery into a successful producing mine, with 2013 the target for first output.
He still owns a sizeable stake in the company, valued in excess of $56m at the time of his departure, bolstered by his decision last week to convert one million of his directors' incentive options into shares.
Mr McIntyre plans to take a break from work, but not surprisingly, he will continue to keep a close eye on the Extract story.
"When this great project comes into development, I hope I go to the opening ceremony and cut the ribbon," he said, adding that he had no plan to sell his shares. He believes the project could outshine Rio's mine and become the largest pure uranium deposit in the world.
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