Daisy from my past posts you can see that I have been a supporter of the owner-miner model for MMI. The SAB contract is for 2 years with another 12 months to go. This contract has been terminated prematurely. With the 2 year contract we can speculate that the owner-miner transition would have been in 2020. I support this decision but is it premature given we are almost doubling production next year and have had such a turbulent one this year? Much of the equipment on site is leased by MMI but the important resource is people and if you have any links to or knowledge of the mine (even from public sources) you would be well aware of the staff turnover. We need some stability before we consider doubling production. Do we have that stability now? Hopefully we do and with the new General Manager at Bauxite Hills, who is both production and safety orientated, may have sorted the team out and future requirements without the SAB team. Maybe MMI have realised that the contractor costs are blowing out their costs and a way forward could not be reached. Maybe the expansion was too much for both parties to grow together? We dont know as MMI has given us very little information and that is the worry. This is a common pattern for MMI and after the last quarterly release what can we expect this time around? Finnis said alot of things before the realease of the last quarterly and I though that that release did not explain the performance and financials. We appear to get better analysis of production and financials from posts on HotCopper and if I was part of the MMI head office team I woulfd be shamed by this. MMI needs to be clear about what is going on and does the SAB contract termination leave us open for litigation? I personally feel that a transition to owner-miner makes more commercial sense in 2020 and fits in with the 2 year contract as planned. SAB, like MMI shareholders is one of MMI's people. In my opinion, I do not like this decision, even though I support the ransition to owner-miner, and I don't like MMI giving us the bare minimum when it comes to important change in business direction like this.
MMI Price at posting:
16.0¢ Sentiment: Hold Disclosure: Held
