Star Investing spoke with Rob Waugh, Managing Director of Musgrave Minerals (ASX:MGV) about the company’s mining activities and its recent gold discovery at Lake Austin.
Rob thanks very much for joining us today. Would you like to start by introducing yourself.
I’m Rob Waugh, Managing Director at Musgrave Minerals, a junior resource company focused in WA.
So you walk into an elevator and there’s a stranger there and you’ve got a better minute to tell them what the company does, what do you say?
We’re a junior resource company. Our business is gold and in particular discovery and development. We just made a new discovery at Lake Austin North prospect within our Cue Gold Project in WA. We’re busy drilling at the moment to determine what size the deposit could potentially be. So it’s a really exciting time for us at Musgrave.
You’ve also got existing resources there at Cue already so this could add to add to those?
Absolutely. There’s a strong existing resource base and now the intent is really to grow that base through this new discovery to see what potential the project could hold.
What do you consider the company’s competitive advantage and what what sets you apart from the other gold explorers out there?
Really, exploration is our advantage. There are two key components in exploration. You must have ground that you think has a significant deposit within it. We think we’ve got that prime ground. We’ve got a green stone belt up at Cue that has been under explored. You also must have an excellent exploration team and we have that as well. So we’ve got a really strong team with an integrated approach with a history of that discovery success sitting behind us.
2018 was a big year for the company what some of the milestones that you’re most proud of?
There are a number of milestones in 2018 for the company that are really significant. The most recent one is the discovery at Lake Austin North. We think that discovery is significant. We’re getting thick intervals of high grade gold mineralisation, which leads us to the potential for a significant ore body under the lake system. So that’s what we’re looking for and we’ve made inroads into that discovery.
Another significant milestone has been the investment from Westgold. They are now a 12.4 percent shareholder and it’s good having a nice corporate on the books.
The other significant milestone for us is the term sheet that we’ve signed with Westgold to share mine management for the Lena and Break of Day existing resource base to work together to get a profitable near-term development up and going for those deposits.
And how does the company approach innovation. Can you give some examples of what you’ve done that is innovative in in the exploration sense?
From our perspective innovation encompasses a number of different approaches. So people look at new technology as an innovation. People will look at also a big expenditure on R&D. As a junior you don’t have some of those luxuries that are afforded to having strong and huge cash backing positions. Innovation for us is a focus on implementation and integration of data and interpretation of that data.
So innovating and interpretation to make discoveries so we’re looking at providing new data to the team, which might be cutting edge geophysics or geochemistry but not techniques that we’ve created. We’ve got them off the shelf but they are still right at the forefront of exploration and integrating that data. And then the interpretation of that data is key. It’s the integration and the interpretation that gives us a competitive advantage.
And in terms of companies within the gold sector are there any that you look to for inspiration or that you particularly admire their approach to going about business?
We would absolutely love to emulate what Sirius did with Nova nickel copper discovery in the Fraser range. That was a classic, persistent, good Geoscience approach to the initial discovery and then a really strong focus on capital raising and marketing and continuing the impetus from that discovery through to the eventual sale of the company.
A good one from the acquisition and brownfield expansion point of view is Northern Star in the gold space. That developed into a well-respected highly credentialed gold producer over a relatively short period of time. Through a very astute acquisition at the lower part of the cyclical market and then a strong focus on brownfield exploration to build the resource base and then a strong focus on production and meeting guidelines.
One that brings components together is probably one of the early years with Independence Group. That focus they had initially on acquisition in the nickel space and then the focus on brownfield exploration and then the greenfield discovery at Tropicana.
So it encompassed integration through through brownfield exploration, mining and profitable mining, and also greenfield exploration, encompassing all three components of what is important in our industry.
That’s a good selection of names from the industry in terms of the top performers there. What about sort of the industry are there any known mining companies that you look to in particular and admire their approach?
I think it’s pretty hard to go past you know a company like Apple who were on their knees a few decades ago – a strong focus on innovation new product development and obtaining a niche within a new market.
The foresight to do that and the commitment to do that and then to see obviously the reward and maintaining a very strong position in a new market. From a company that was really struggling to an extremely high performer over a couple of decades it has been a really strong sector example.
And just to finish – what are the challenges that you’re most looking forward to tackling in 2019?
The key focus for us and the biggest challenge is increasing shareholder value. It’s a bit cliche, but really it’s the integration of what we’re doing. So trying to get through to development. Also discovery at Lake Austin and elsewhere on the lake. But it’s not just the success that those key components, it’s then building on that and having a consistent share price performance.
It’s our ultimate goal over a period of time so it’s not just the discovery it’s also having that reflected in our share price and creating value for our shareholders.
This content is produced by Star Investing in commercial partnership with Musgrave Minerals. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
Don’t miss a thing, subscribe now