Notes from Sunday Roast Podcast regarding Havieron funding and new Board appointments - 12 Sept 2022

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Notes from Sunday Roast Podcast regarding Havieron funding and new Board appointments - 12 Sept 2022

Interview:
https://audioboom.com/posts/8155979-mid ... ld-aim-ggp

RNS re. funding:
https://polaris.brighterir.com/public/g ... ry/xegzdjw

RNS re. appointments:
https://polaris.brighterir.com/public/g ... ry/xpn9qjr

RNS re. options:
https://polaris.brighterir.com/public/g ... ry/wvj1kvw

Further Proactive Interview:
https://youtu.be/gzqjOdy2Fl8

* Update on all the news re. funding, board appointments and options?
- Bit to unpack today in the announcements but collectively transformation across Board, get Capital, equity, strategic shareholder, being fully funded
- Talked a bit about getting through transition issues and switching from defence to offence and think this is that transition moment.

* Looking at the billionaire Andrew Forrest who’s positioned himself in there, presumably is he the owner of Wyloo metals, do you want to give us some background on some of the funders?
- Let’s start with the Equity which is Wyloo ( https://www.wyloometals.com/who-we-are/ ), our relationship is directly with the team who have been great to deal with
- As you rightly state there, Andrew Forrest (known as Twiggy) really the founder of Fortescue, Australia’s 50bn dollar iron force, that’s his kind of vehicle
- But look I don’t know the mind of Andrew but certainly the Wyloo team coming to support us is tremendous, can’t think of a better strategic shareholder to have, really enjoyed working with that team and to bring them in is a great credit to Greatland and quality of the Havieron asset
- Switching gears, also brought in capital with the debt banks, main street Tier 1 Banks with HSBC, ANZ and ING, three big names in resource funding, 7 year debt facility, great terms, 3.5% interest… you know that’s really good
- That's the cornerstone for our funding and being full funded just means we have a pathway to take this all the way to FCF and the magic of leverage it’s not being done all with equity, there’s a really meaningful leverage in that portfolio but with the cash coming in I think the debt to loan gearing ratio is really balanced, it’s a beautiful combination of funding announcements.

* Really knocked it out of the park, so the scenario is what were Newcrest playing at, why didn’t they take 5%, seems absolutely bizarre and they’re now in a situation where you’re 30% shareholder and I’m sure that wasn’t their plan?
- Don’t know the mind of Newcrest but was certainly a curve ball when they didn’t take that option
- From our perspective the value there was obvious but for Greatland shareholders this was the best possible outcome, to own 30% of our most prized asset is perfect
- My view on valuation went up 20% on fundamentals but we’re moving back from 25% to 30% ownership so a great result for us and that success of holding onto more of Havieron moved the market view on fundamental value
- That helped us raise equity, it helps us do transactions like today where we bring in high quality talent, we bring in a strategic investor and strategic bank debt
- So, all the hard work so remember it was started in December and finished in effectively August that the team did around that option process I think has been you know a really worthwhile investment and wrapped to have been able to achieve that.

* The markets haven’t been great for 6-9 months so when Newcrest threw the challenge down and said you need to get the money down for the first stage, that was a big issue for Greatland. Now you’d obviously done some preplanning for this so there’s no way on earth it would have happened as quickly as it did, so talk us through this?
- Hopefully shareholders have confidence that I tend to plan ahead and be prepared for these things you know on all accounts
- The day we got that PFS we went onto a war footing in respect of the option, described before the series of independent experts we brought in to help us prepare for that thoroughly
- Similarly in the lead to that outcome I’d prebaked a couple of funds headed by Tribeca who came in and corner stoned the equity raise to invest in our company with equity
- The curve ball of Newcrest not exercising that option was a little bit too good to be true, everyone had models that it was good buying at that price so when they didn’t exercise that option it was late nights trying to keep that equity support there which was obviously successful and being prebaked with that equity lead to a successful equity raising in a difficult market, lead to it being upsized twice from 20 to 30 to 35m dollars and still meaningfully oversubscribed so that we’re able to do a very healthy scale back
- Switch to today, started these debt discussions in January 2021, so that’s 9 months, think I had my first conversation with Mark Barnaba the incoming chair on the 1st December 2021 so it’s taken more than 12 months so all of this has been trying to take all of this, lay the foundations and that was fundamentally built around understanding the value of Havieron and protect that value through that arbitration process and then being able to be fully funded and then bringing in this board that really changes gear together with the strategic shareholder which really gives us a platform for success
- And I think the opportunities ahead of us now, not just to successfully develop Havieron and to continually unlock the value in that exploration portfolio but also to go ahead and look for inorganic opportunities is only enhanced, so it’s a pretty exciting process.

* I can see now, the market hasn’t got the value of Havieron yet, the view now that you’ve secured 30% of Havieron for the future now for the indefinite future of you like, how many ounces are JORC reported now for Havieron?
- So, 5.5 Moz today and Greatland came out with that announcement the 3rd of March then you saw Newcrest come out with the same figure in August which again I was really proud of with resource estimates within 1% of each other
- Testament to the quality of the team we’ve built here but you would expect them to be similar because we’re using the same drill data, the same methodology and we should get really similar outputs but we did that I think in a really timely manner
- Our cut-off was December, Newcrest’s was November so they’ve actually brought in a few more ounces which is great but we think… what I want to unpack in that is the cut-off to that was November
- So there’s already another 10 months of drill results and if you have a look at the last 10 months of drill results which we all know are spectacular so you’ve got to feel really confident about the ongoing trajectory of that exploration
- And particularly in that Eastern Breccia, the gap zone and recently in the latest announcement where we’ve got intercepts another 100m below the known, last previous intercept, we just keep data that tells us about the growth of this project, you know I feel really confident about the geology.

* I know you can’t give me a figure but what are we talking about, 6,7, 8,9,10 Moz in the next year or two? I know you can’t answer it but give me a chance.
- You know I can’t answer that but a good effort from you but look I think what I like to talk about is Telfer next door, 13MoZ, probably a 20 million envelope and it’s taken them about 30 years to mine 13 million punces there
- I like to think if you look at the volumetric survey of Havieron, on grade zonations you can get around a 20Moz envelope
- You know we’re 45km apart, I’d rather one day see Havieron being a similar size but you never mine those 20Moz but to have 5.5Moz already of High Grade and it’s still in its growth trajectory there is a pathway to be in that same ilk of Telfer which has been a top 5 Australian goldmine for 30-35 years.

* How many ounces at its peak did Telfer mine you know, what were they producing?
- From memory about 700,000 ounces from the open pit and underground combined and 20mtpa processing capacity, think it might even be more in its early days I think because the grades haven’t been like that for a decade or more but at its peak it’s a beast, it’s a beautiful piece of infrastructure.
 
* Will take my sun glasses off now as I said before a superstar has arrived, really think you’ve pulled an absolute blinder off it but I’m quite sure the strategic investor, even the equity people and banks are not just looking at Havieron? I look at Scallywag and potentially anything else you can invest in this area, what do you think, what’s going to happen now because you’re obviously going to be full steam ahead with other stuff now as well?
- Lovely quote from Luke at Wyloo in our announcement, talked about investing in Havieron but also the exploration optionality in the portfolio
- Think you’re right, Havieron absolutely underpins Greatland but to have the opportunity to add to that is tremendous and our strategy 1- is to deliver and expand at Havieron, 2 – invest in the drill bit and 3 – understand inorganic growth opportunities and I think with this platform and funding and with the team we’ve brought in and need to talk about the team a little more, I think it gives us a higher probability of being extremely successful in that regard.

* Maybe next time we can talk about all those other opportunities because hopefully the market starts to realise what’s actually happened and the valuation that you’re financed to mine probably one of the biggest gold mines in Australia in recent history has to now balance itself up.
- In that regard let’s talk about the debt and the directors in the moment
- The debt with HSBC, ING and ANZ is a tremendous quality product, as I described before it leverages the return for equity holders and to have in place at this point in time on the back of PFS before the FS is complete gives us a lot of confidence about being fully funded for the development of Havieron
- We are fully funded now, I should say that Wyloo funding is subject to shareholder approval so we will have a shareholder meeting presumably early October to put that to shareholders and that has the full endorsement of the board
- It’s a fantastic outcome and of course having the equity unlocks the access to the debt
- If I can, probably just worth mentioning that Board…..

* Is it Mark Banarba, Elisabeth Gaines and Jimmy Wilson, do you want to give us some background on these people and why you brought them in?
- This is just as important as the funding, each element of the announcement brings something to the table and similarly each of these directors have an overlapping skillset but bring something to the table
- Jimmy Wilson former head of iron ore at BHP, his operational pedigree is stunning, actually joining in an exec role not full time but we’re going to have him in the office and think that’s huge for the office and already had him in several times and he’s got to know the team and spend time with them
- As we do the FS having his insights on Havieron will be tremendous but also more broadly as we continue to develop the asset and look at other opportunities, as we look at exploration opportunities in the portfolio, his expertise at experience at the table are tremendous together with his corporate history at BHP
- Jimmy starts immediately today, Elisabeth has just finished up as MD at Fortescue and will join as Deputy Chair from 1st January or sooner as she kind of extracts herself from those but it’s a top ten company and she’s done an amazing job there, huge reputation and a background in private equity as well
- Formerly the CFO of Fortescue before becoming its MD so this amazing funding and strategic background and management experience which she brings to the board and to work with me and a great person to be working with, her reputation is fantastic so having her as part of the team is extraordinary
- And then again perhaps from 1st January or sooner Mark Barnaba who is Deputy Chair at Fortescue this AS $50BN hugely successful and was formerly head of resources at Macquarie Bank globally, presently sits on the reserve bank of Australia which is our BOE
- These people are not just significant in mining, they are significant in corporate Australia full stop and Mark’s background in strategic thinking and corporate strategy which they all overlap in of course is unbelievable
- So, it is a formidable board and fundamentally my view has been that if we surround ourselves with A-Grade talent and each of them are definitely that, we increase the probability of being successful
- And I think that’s what we have achieved today, we have a group here of directors which is equal to any in the country and that is an extraordinary outcome for Greatland
- We combine that with a group of tier 1 banks and their support and then I can’t think of a better strategic investor with Wyloo, what a line up we have
- And its worth me mentioning I first started talking to Mark in September 2021 so over a year ago and he’s helped, he’s helped to bring in Jimmy and Elisabeth and helped put all of this together
- So it’s a stunning outcome which I haven’t done alone, the team here have done a large part of this and the team of incoming directors have contributed to everything we’ve announced today as well together with existing board
- So team effort and what a platform we now have.

* Look forward to the billion-dollar valuation being restored to Greatland and I think with this team and the team you’ve built you’ve become a mini major in the future. I’m fairly sure of this, if all of these focuses are continued over the coming years things are going to look good for this company, I’m sure.
- To be open I’m wrapped with what we’ve been able to do today, been a huge journey for me over the last 12 months to receive the PFS to then deal with the subsequent option pricing off the back of that PFS, the success of that followed by retaining the 30%
- The success of bringing in some corner stone equity holders with the August raise and really grateful top Tribeca who corner stoned that
- And then success breeds success, that then brought the confidence to everyone to bring this team together
- The banks wanted to see that equity component then we bring in Wyloo to augment all of that then… this is good guys in a difficult market, this is good.

* Again congratulations, as we’re on eth midweek takeaway and you’ve had one of the best days of your career, what are you going to eat tonight?!
- Got an LSE London webinar at 11pm my time so I’m actually in the office
- This is the price I pay for being in Australia and London, it’s good fun but the price I pay is I work two jobs a day, I do my Ozzy job and then I switch into London mode
- So I’m going to be… might have to put a pitch in for one of the restaurants where our office is maybe, maybe there might be a counter meal at the hotel or something between engagements but it will be good so might try and get a stake or something I think
- Happy in my work, nice to have a day like this where three streams that we’ve been running all happen to converge into one announcement is good.

* Again, congratulations and we hope to speak to you soon.

Download link:
https://www.mediafire.com/file/hkp053vj ... 2.pdf/file