109th Sydney Mining Club Luncheon - Malcolm Richmond of Strike Resources

Mar 1^{st 2007} 12.30pm
Tattersalls Club

109th Sydney Mining Club Luncheon

Malcolm Richmond - Strike Resources

While the international iron ore industry is today characterised by a high degree of concentration, where the three major participants control a little under three quarters of the traded world supply, there are signs (doubtless initiated by sharp price rises) a new significant source of supply may well emerge by the end of the decade. This new source may well be termed "significant independent suppliers". Broadly, this grouping comprises some half a dozen start-ups producing, say, between 15mta and 30mta of ore and is scattered (at varying degrees of development) across the globe: Africa (Sundance), Australia (Fortescue and Murchison) and South America (MMX and Strike Resources).

Strike Resources (SRK) is a Perth-based newcomer with an initial target of 20mta of high grade iron ore. The company has only recently secured a strong tenement position in highly prospective territory near Cuzco on the Peruvian Altiplano. Preliminary geophysics has been completed - drilling is well under way. The mineralization and grade appear very promising, although a little unusual with the ore body to date comprising widely varying (though high grade) proportions of magnetite and hematite.

Strike management sees Peru as a particularly supportive country in which to develop a significant mine - the necessary skills and infrastructure are good, and importantly, the recent burdensome levels of consumer inflation (borne by, say, Australian mining start-ups) are by and large absent in this country.

Malcolm will also provide some views on where he sees the iron ore market heading, particularly with regard to China.

Professor Malcolm Richmond has 30 years experience with the Rio Tinto and CRA Groups in a number of positions including: Vice President, Strategy and Acquisitions, Managing Director, Research and Technology, Managing Director Development (Hamersley Iron Pty Limited) and Director of Hismelt Corporation Pty Limited. He was formerly Deputy Chairman of the Australian Mineral Industries Research Association and Vice President of the WA Chamber of Minerals and Energy. Professor Richmond also served as a Member on the Boards of a number of public and governmental bodies and other public listed companies. He is currently a Visiting Professor at the Graduate School of Management and School of Engineering, University of Western Australia.