The 292nd Sydney Mining Club – Leading Edge Event – 5 September 2024 – MetalsX

Summary

The speaker discusses the challenges and operations at a Tasmanian mine, emphasizing the significance of power and the impact on workers. He highlights Metal X's joint venture with Unan Tin and Green Tech, focusing on sustainable tin production. The company's strategy involves using cash flow from tin operations to invest in growth, with a recent share buyback and exploration efforts to extend the mine's life. The script also covers the potential of a green tin premium, the company's customer base, and future shareholder returns, including dividends and project investments.

Takeaways

• 📈 The speaker is optimistic about the future of tin production, highlighting a supply shortage and increasing demand due to electrification and technology advancements.
• ⚡ The recent power outage in Tasmania affected mining operations, but power has been restored, and operations are back in action.
• 🏭 Metal X owns 50% of a mine in Tasmania, with the remaining 50% owned by a joint venture involving a major tin producer, providing valuable technological insights.
• 🌿 Tasmania's mining community and government are described as friendly towards mining operations, which is beneficial for business continuity.
• 📉 The speaker mentions the impact of the gold price on the market, suggesting it's 'hiding a lot of people's sins,' and discusses the financial health of Metal X.
• 🔋 Tin is referred to as the 'forgotten battery mineral,' with the speaker advocating for its recognition as a critical mineral by the Australian government.
• 📊 Metal X's stock price is said to closely track the tin price, indicating the importance of tin market trends for shareholders.
• 🌱 The company is focusing on increasing tin production sustainably, with a recent share buyback program initiated post-results announcement.
• 🔄 Metal X is exploring ways to recover tin from tailings, considering an ultrafine grinding and flotation process, potentially increasing production at lower costs.
• 🌐 The company is looking at strategic investments to grow its portfolio, with a recent major share purchase in First Quantum, aiming to become a major listed tin producer globally.

Q & A

What challenges did the Renison mine in Tasmania face recently?

The Renison mine faced power outages, leaving 200 workers stuck at the mine site with no food or power. Operations have resumed now that power has been restored.

How does the mining industry affect local communities in Tasmania?

Many small towns around the Renison mine depend heavily on mining. If the mine shuts down, these towns face economic collapse.

What is Metal X’s ownership structure in the Renison mine?

Metal X owns 50% of the Renison mine in Tasmania, while the other 50% is owned by a joint venture between Yunnan Tin, one of the largest tin producers in the world, and a Hong Kong-based trading company called Green Tech.

What is the long-term strategy of Metal X regarding tin production?

Metal X aims to become a major tin producer by using its funds to grow sustainable tin production in the long term.

How has Metal X been performing financially in relation to the tin market?

Metal X has seen strong financial performance, driven by the rising tin prices, which have helped generate significant cash flow. The company recently recommenced a buyback program, purchasing 4.2 million shares.

Why is tin considered important despite being 'forgotten' in the battery mineral sector?

Tin plays a crucial role in the electrification process and in increasing demand for circuitry. However, despite its importance, Australia has not yet classified it as a critical mineral.

What are the major challenges in the global tin supply chain?

Global tin production faces a supply-side shortage. While some capacity is being added in the Congo, other regions such as Myanmar are struggling to maintain consistent supply, and Indonesia presents complexities in production.

What exploration efforts has Metal X undertaken to extend the life of the Renison mine?

Metal X has been focusing on near-mine exploration, including drilling in the Ringrose area, which is just 700 meters from the existing underground workings. This exploration aims to extend the mine’s life by continuously adding new reserves.

What is Metal X’s plan for processing the tailings at the Renison mine?

Metal X has developed a new plan for processing tin and copper tailings through ultrafine grinding and flotation. The new strategy involves separating the low-grade concentrate and processing it at Yunnan Tin, rather than building a new facility in Tasmania.

Why does Metal X emphasize maintaining more than one customer for their tin production?

Metal X strategically sells tin to multiple smelters, including those in Malaysia and China, to avoid over-reliance on a single buyer and to ensure flexibility in their sales agreements.