heron mentioned in mining news article

Juniors looking up

Charlotte Dudley, Colin Jacoby --Mining News --
Thursday, 19 February 2009

AUSTRALIAN junior explorers have revealed a pragmatic optimism as the global fiscal fallout continues to put pressure on the local resources sector.

With a sea of resource up-and-comers descending on the RIU Explorers Conference in Fremantle this week, the music matched the mood with the conference opening to the tune of Irish pop group D:Ream’s mid-90s hit, “Things can only get better”.

While the musical choice prompted a few discreet sniggers from the corporate suits in attendance, discussions with small-cap companies paint a portrait of pragmatic eagerness and a continued belief in the strength of the Chinese economy.

Asked about the company’s key challenges, Fox Resources managing director Bruno Seneque said negativity, particularly the perceived negative approach of the media, was a key obstacle.

“You’ve got to take a glass half-full mentality,” he said before tipping nickel and copper prices to turn around by year-end.

Seneque backed the view of a China upswing saying it was only a matter of time before supply and demand issues would reach equilibrium.

“Then it’s on for one and all.”

Fox is hoping market conditions will allow the company to get the Radio Hill mine back in business by year-end, after it was placed on care and maintenance in mid-2008 due to low nickel prices.

Managing director of gold-focused Emmerson Resources, Rob Bills, also expressed optimism over the Asian dragon.

Bills, who joined a Northern Territory trade delegation to China in November, said the long-term approach that drove many Chinese companies was indicative of a future upturn.

While the junior boasts more than $A11 million in the bank, Bills admitted the tightening financial markets had pushed the company to take a more prudent approach to exploration.

For example Emmerson was now more selective about its drilling targets and had opened the door to possible joint ventures as a way of spreading risk.

Bass Metals managing director Mike Rosenstreich said with the recent acquisition of the Hellyer mill his company was poised to grow but conceded many other juniors were operating on survival mode.

Royal Resources chief executive officer Marcus Flis said permitting issues, particularly those relating to native title, were the biggest challenges and he welcomed the Western Australian state government’s pledge to streamline the approvals system.

As for China, the CEO was confident the impact of the Chinese government’s infrastructure package would fuel activity across all sectors of the country.

“Sure China will take a trip, take a stumble, but it will surprise us with an upswing,” he said.

Sharing the bullish outlook, Heron managing director Matthew Longworth said the downturn could present opportunities for reduced capital expenditure costs brought about by lower capital and equipment costs as well as increased availability of skilled labour.

The company is in talks over potential project acquisitions, having identified the low point of the cycle as “the time to go shopping”.

Meantime, Vertical Events managing director Stewart McDonald said there was a sense of optimism at the conference, with mining companies accepting that while times were tough, they wouldn’t last forever.

This year around 600 delegates attended the two day conference, which was around 100 delegates less than last year but comparable in numbers to the 2007 RIU Explorers Conference.