Simon Wandke joins the board of Magnetite Mines (ASX:MGT)


by Melissa Darmawan

Magnetite Mines Limited (ASX:MGT) new board member Simon Wandke discusses his background, what he will bring to the company and the company's outlook.

Melissa Darmawan: Thanks for tuning in to Finance News. I'm Melissa Darmawan. Here to talk to us today from Magnetite Mines (ASX:MGT) is Simon Wandke. Simon, nice to meet you and welcome to the network.

Simon Wandke: Thank you, Melissa.

Melissa Darmawan: Firstly, congratulations on the appointment to the board. Can you tell us about your background and expertise in the industry?

Simon Wandke: Sure, Melissa. I've had over 40 years in the global resources sector. I've been very fortunate to have a wide experience globally. Green, brownfield projects, mainly in iron ore, manganese, coal. And during that period I've been exposed to many jurisdictions. And I think during my career, the last 11 years have probably been most pertinent to today's discussion, in the sense that I've been working for the world's largest steel company, which is vertically integrated. Which means it is in raw materials all the way through to metal. And so the interaction of day-to-day activities in the mining space, in which MGT, we're moving into as a magnetite iron ore producer, are pretty critical in terms of understanding what the customers need around quality and product

Melissa Darmawan: Simon, why did you join the board of Magnetite?

Simon Wandke: The main takeaways when I was reviewing the project was not just the high-quality team which exists, and I've had the fortunate chance this week of meeting the team. I think the other takeaway is the resource is absolutely massive. This is a very large magnetite ore body, close to surface, and it's a mining down proposition because it's actually outcropping from the earth. I think some very solid work I've seen on the PFS and studies work to date were encouraging. I also think that I'm a true believer in the high-grade strategy for raw materials, and iron ore is being pulled in that direction through a decarbonising world. And this project will match into that new world order, which is not just a dream -- it's real, it's happening. I think the other thing is the political jurisdiction here is very stable. The government is very supportive. And I love the fact that we're in a green grid. You know, something like 97 per cent renewables in South Australia is an unusually positive foundation for the project.

Melissa Darmawan: Thanks for that, Simon. Let's turn our attention to the Razorback Iron Ore Project, which I know is Magnetite's main focus. Could you tell our viewers how your expertise will bring this project into production?

Simon Wandke: Yes. I think, Melissa, going back to the earlier question, I've been very fortunate to be involved in a fully integrated raw materials through to steel company. And I've had 21 years of my career in BHP, very much an R&D, product-driven company as well, and really need to understand the product suite and the value of that product in the marketplace. So, me coming in, I know the team have done a lot of work in the space, but I do have a perspective on where steel is going and how it will need changes to the high-grade nature of products, also the types of products. And that timeframe is rushing towards us in a decarbonising world. I've obviously seen ESG matters in many developing countries and been involved in that myself, but this jurisdiction is quite mature, but nevertheless, every project has its own idiosyncracies around ESG developments. And I hope I can actually bring some value to the team and my experience. I think, the other part of my career, particularly when I was based in Indonesia, in coal, big logistics issues in moving the coal in that case, the dirt from the mines through to the ocean shipping points. And whilst this project has good logistics options, in a greenfield project there's always plenty of challenges. And I've lived the dream, so to speak, on a number of projects in dry bulks, and I've done trans shipping, I've done railing, built rails, barges, rail car purchase, been through all those hard times and many assets. And I'm hoping that will also add value to the team's thinking, as a board member. I think the biggest one, though, gets back to the raw materials design. I think that this project has a tremendous position in the high-grade raw materials space for iron ore. Magnetite is particularly special in the sense that it's an exothermic reaction and has value to the downstream processing. And I think we have more to understand and further developments to make with the project in that journey to a future-fit decarbonising world of steel consumption for raw materials like this.

Melissa Darmawan: Thanks for that, Simon. I want to talk about the iron ore price. It's well off its recent highs. What's your view on the pricing moving forward?

Simon Wandke: You probably heard before people say, "Well, I'd be a rich person if I could predict the iron ore price." I don't think we're at all interested in predicting the forecast price for iron ore, and it's volatile. I mean, I started work a hundred years ago, it feels like, and the iron price was $17, and now people worry if it goes from 125 to 116, you know, in a week. I'm not overly concerned about that. I think that the value accretion for this project is about understanding its value in use, which is what happens to it when it goes into the iron-making processes, and that may not be a blast furnace. And also particularly around what's going to happen to price premia today. There are price premia in place above the 62 index and 65 index, etc. Which… 65 index, you know, wasn't part of a conversation 10 years ago, but today it's very much alive, it's solidly traded, it has a forward curve and maturity will evolve. And I think there will be more and higher premiums for cleaner products and products that can fit into a decarbonising steel world. And MGT, Magnetite Mines, has definitely got the credentials in the ground today to participate and really gain value from an evolving and higher premia world.

Melissa Darmawan: Last question from me, what's next for Magnetite?

Simon Wandke: Clearly, the work underway post PFS and the advancement of the DFS underway now is really a focus for the team. I think all of that leads to how do we unlock the maximum value for this project? And that's what the team is absolutely focused on. And I think coming up with a sustaining operating model for how we actually optimise that value. And clearly parallel is advancing the financing options for this project. There's a lot on the plate. These projects often have many challenges. But I'm confident that the team's in place. And I always go back to the basics. You know, is the volume of material in the ground there? And the answer is yes. Can it actually be future-fit for a long-run project, as this case will be? I believe, yes. So, now it's the hard work in proving that and maximising value for shareholders in the outcome of the studies underway at the moment.

Melissa Darmawan: Simon, it was great speaking with you, and congratulations once again on your appointment.

Simon Wandke: Thanks, Melissa. Thanks for talking with us today. Thank you.


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