The Minerals Council, Austmine and related Mining Suppliers

Tuesday, November 24, 2015

The Minerals Council of Australia is the peak body in Australia representing the mining industry to government. This year, members of Austmine, which includes our company, were treated to a free invitation to attend the event. The conference had an emphasis on ‘METS’ suppliers such as ourselves. The invitation was restricted to the CEO of each Austmine member business, so it was a rare opportunity to meet with like minded people and entrepreneurs who had also started significant Australian businesses. METS stands for Mining Equipment and Technology Suppliers and includes all of the Australian businesses which have grown up in support of the mining industry in Australia and who now, like CST, export to the mining industry worldwide. I have to admit I did not know that Orica is a real Australian success story, now a huge international business supplying explosives for mining all around the world and are the largest in their field. I was pleased to meet with some of the other business leaders from businesses more on our scale like Gekko – Elizabeth Lewis-Gray, Hedweld – Ian Hedley, Mill Relining Systems – Dr John Russell, and Alminco – Jose Cabello. It was great to meet Zimi Meka, the founder and CEO of Ausenco, he has achieved so much in a short time! We all agreed that the past few years had been a very prosperous time, however we also expressed our concerns about the business prospects in the latter half of 2012. We could all see a real pause in investment at this time and were asking ourselves how we would be able to weather this storm. The whole function was one of the most worthwhile I had attended for some time. The speakers were interesting and included Tony Abbot and the official dinner was presented with a televised speech by our Prime Minister Julia Gillard. Julia reminded the room that the mineral resources of Australia belong to the people of Australia and ended her speech with the words “and this is a Labor government”. Tony Abbot assured us that the MRRT (?) and the Carbon Tax would both be repealed by his government, and yes, he seemed to have the support of the room! Julia did seem a bit defensive in her speech and while I would agree with her that the resources belong to Australians, I don’t think that gives the government the right to interfere with company profits. A royalty is a more appropriate tool to reward ownership and a company who finds a way to make a profit should be able to reap the reward. Another thought on the matter is that while Labour claim that BHP is sending huge profits overseas actually BHPB and similar resource companies pay very small dividends as little as 4% of share value but they invest billions in the local Australian economy, they invest here because of the stable political environment and the possibility of profits, so let’s encourage them. Another thought is that I would much rather have BHP spend the money than the government, I have much more confidence that the money will be well spent.