TRANSCRIPTION OF FINANCE NEWS NETWORK INTERVIEW WITH ROX RESOURCES (ASX:RXL) MANAGING DIRECTOR, IAN MULHOLLAND
David Taylor: Hello David Taylor reporting for the Finance News Network. Today we’re coming to you from the Esplanade Hotel in Fremantle Perth, the host of the 2011 Explorers Conference.
Joining me now is the Managing Director of Rox Resources who presented today, Mr. Ian Mulholland. Ian thank you for your time today, now just to begin with - Rox Resources, can you give us a brief introduction to your Company?
Ian Mulholland: Rox Resources is a diversified mineral explorer, our market cap is about $20 million. We have projects that cover lead and zinc, phosphate and a recently announced deal to acquire a gold and nickel project.
David Taylor: Now from very humble beginnings in 2004 when you listed, how have things progressed since then?
Ian Mulholland: Well we started life as a gold explorer with a project in Western Australia and we’ve moved through a number of projects as we’ve tried to find, you know, the ideal project that will become a mine if you like. We had some lead and zinc projects offshore, but most recently we’ve been focusing on Australia at our Myrtle Project in the Northern Territory; our Marqua Project is also in the Northern Territory and our project in Western Australia.
So we think that the growth of the company has been really good. We’ve been through a number of projects and continually looking for new projects and turning over projects that may be aren’t going to meet the requirements that we have.
David Taylor: There’s a lot of mining jargon and explorers jargon being thrown around today, cutting straight to the point, are you happy with the way that Rox Resources has developed?
Ian Mulholland: Look I think so. You know, we’re I guess feeling quite fortunate that we survived the GFC and we had great support from our shareholders. We had great support from Patersons who are our broker, who kept us funded to continue and then we knew - we had faith that the Myrtle Zinc Project potentially was a great project and was potentially going to be a company maker.
But we realised that we needed more funding for that project and it was only during 2010 when the market started to pick up, that there was interest in investing in that project that started to come forward. And we’ve been fortunate to be able to secure a major joint venture on that project which will set us in good stead for the future.
David Taylor: Has funding been an issue for you since the Global Financial Crisis and during the Global Financial Crisis?
Ian Mulholland: Well it was difficult during the GFC for sure; you know 2009 and 2010 were pretty tough, but you know at the end of 2010, we were lucky enough to get a reasonable sized placement away. So we’re now well funded, we’ve got just under $5 million in the bank with about another million to come from some options and an investment by Teck in the company.
David Taylor: Now turning back to the Myrtle Project, what was your strategic thinking behind partnering with Teck Resources?
Ian Mulholland: Right, well Teck need to invest $15 million in the project to earn a 70% interest. And of course with all exploration projects, you know its high risk money that you’re investing. We made the decision that bringing in a joint venture partner was a better way to lay off some of the risk involved in developing the project. We could have gone to our own shareholders and raised that sort of money, but it would have caused a lot of dilution.
The other thing of course that Teck brings to the table is their production expertise. They’re the second largest zinc producer in the world – a much bigger financial clout, so that if the project needs to be moved forward quickly, they can do it. And thirdly, I think the third party endorsement that a major company like Teck think that this is a good project to invest in, gives you know, our credibility an improvement.
David Taylor: Your two other main projects Marqua and Fisher, how do they combine to produce the sort of strategy and development that you want from Rox Resources moving forward?
Ian Mulholland: Sure, I mean an exploration company is always looking for opportunities - you know the more tickets you buy in the lottery, the greater chance you’ve got to win. The Marqua Phosphate Project wasn’t in particular something that I was looking for; I wasn’t looking for a phosphate project. It was an opportunity to acquire or peg some ground that had become vacant where there was a significant opportunity for phosphate mineralisation there.
The Mt. Fisher Project on the other hand was something that we carefully pursued. We were after a gold nickel or gold copper type project and this particular project is very prospective, and we’ve been actually chasing it for some time now.
David Taylor: Well it sounds like things are going exceptionally well, so what do the next six to twelve months hold for Rox?
Ian Mulholland: Well the next twelve months say, six to twelve months for Rox - you know the main share price drivers are going to be when Teck get in and start doing some work at Myrtle and they do that drilling – they’ve got to do 2000 metres of drilling this year. We expect that they’ll test those high grade targets and you know, we’re pretty confident that they’ll get some pretty good drill hits which will prove that there’s high grade mineralisation there, which is what brought them into the project.
We’ll also be starting our own exploration at Marqua once the tenements are granted and also Mt. Fisher once we’ve finalised that deal with Avoca. And we’ll be doing our own work and producing our own results as well. So shareholders are going to be getting three projects basically contributing to the wellbeing of the Company, rather than one that we had just previously.
David Taylor: Ian Mulholland, very much appreciate your time today, thank you.
Ian Mulholland: Thank you very much David.