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for the new public companies will include London and Canada as
well as the ASX.
“As an exploration geologist interested in creating new mines
from ideas or prospects anywhere in the world, I have to follow
the money. You need support, with investors, to be able to do the
exploration, the pre-development, and the development of mines.
If money is not available to do that sort of work in Australia, we are
motivated to go where the money will go.”
Considering South Korea for instance, Mr Schultz explains,
“Government agencies have published that there is in excess of
two million ounces left in some of the old mines that we have
acquired. Government incentives, particularly no royalties and
low corporate tax rates, are a contrast to what is happening here
in Australia. Korea understands the importance of fostering
business whereas Australia believes it has lost that necessity.
There is a view in Australia that we are mining stuff that should
be left for future generations. By contrast Korea would love to
see its gold mines back in production. They would be delighted
to see their foreign reserves increasingly gold based rather than
US-dollar based.”
Mr Schultz has been in mining since the early 1960s, and in his
50-year career so far, he has worked all over, including the United
States in the 1980s and Tanzania in the 1990s. “I went to Tanzania
with a private entrepreneur group, much the same as I am now
starting things in Korea and Serbia. At the time, the government
of Tanzania really wanted foreign investment, and they knew
they had potential to be a force in gold mining. Subsequently the
country became the third largest gold producer in Africa.”
Mr Schultz is concerned with the similarities between the
socialism he observed having a negative impact on Australian
mining in the Whitlam years of the 1970s and that which is
happening today. “There is also extreme environmentalism here.
If Bob Brown has his way, the focus would be environmental
conservation and he would shut down mining wherever he could.”
“With choice, naturally my energy goes to other places
in the world at a time of re-emergence of socialism. There is a
tendency amongst Australians to be complacent about the impact
extreme conservation movements are likely to have on their
future wellbeing.”
If the political horizon changes, Mr Schultz believes he would
be more inclined to do business in Australia, pointing out that
he is still involved in the northern parts of Western Australia
and the Northern Territory through Northern Minerals.
But exploration budgets now need to be five times what they were
five years ago to meet today’s costs of complying with Australia’s
growing list of constraints such as aboriginal land rights and
environmental conservation.
“Mining is not a treasure house of abundant minerals waiting
to be plucked, as the Treasury and current politicians seem to
see it in Eastern Australia. Just how lowly they view the status
of mining was brought home to me when I filled in the Census
form recently. The question asking what business I worked in
did not include mining, or farming in the list of alternatives - the
fundamental bases of our wellbeing in this country.”
Mr Schultz believes that although Australians tend towards
being socialistic in their thinking, and socialism will continue to
emerge in different forms, it is cyclical, as is government change.
“After the Whitlam era, the subsequent Fraser era may have been
unexciting politically, but there was a resurgence of capital back
into mining and exploration, and there have indeed been several
cycles since.”
He considers many investors share his present focus outside
of Australia, and it is clear at whose doorstep Mr Schultz lays the
responsibility for Australian mining’s deteriorating international
reputation. “There has been a flood of capital out of Australia
interested in new targets in new areas of the world. In my
judgment, if the interests of my shareholders lie in my being
successful in discovering and developing minerals, Australia is not
a good place to invest. I have to be cognisant of how governments
perform, and a country governed by politicians who are advised by
bureaucrats who think that mining is a magic pudding, and do not
even recognise it as an industry of importance, is not a great place
in which to try to encourage investment.”
• Presence of numerous old gold mines
containing government documented
(non-JORC) historical resources in excess
of 2 million ounces.
• Favourable geological setting for the presence
of large and high-grade mesothermal and
epithermal gold deposits.
• Opportunity to utilize modern day mineral
exploration techniques.
• Established statutory and environmental
approvals systems reflective of current
industry standards.
• Excellent road, rail and power infrastructure.
• Established financial and legal system.
• Security of Exploration and Mining titles
guaranteed by law.
• No government mining royalties.
• Corporate tax rate of 22% (expected
to reduce to 20%).
• Excellent infrastructure.
• Low cost, educated workforce.
• Corporate tax rate of 10%.
• Democratically elected government that
is targeting entry into the EU by 2015.
• Established mining code and transparent
financial and legal systems.
• Investor friendly country with high levels
of unemployment in the project areas.
WHY SOUTH KOREA?
WHY SERBIA?
Mining is not a
treasure house of
abundant minerals
waiting to be plucked,
as the Treasury and
current politicians
seem to see it in
Eastern Australia.
MINESITE 2011
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