03 May 2016

Despite the sunny skies, bright-eyed conference goers packed into Ballroom C of the Vancouver Convention Centre for the opening Plenary Session of the CIM 2016 Convention Monday morning to hear four industry titans discuss their perspectives on navigating the commodities downturn and the future of mining.

Moderator Colin Joudrie, vice-president of business development and general manager of hydrometallurgy at Teck Resources, kicked off the session by introducing the four headliners: Phillips S. Baker, Jr., president and CEO of Hecla Mining Company; Randy Smallwood, president and CEO of Silver Wheaton; Don Lindsay, president and CEO of Teck Resources; and Jim Gowans, president and CEO of Arizona Mining. “We have an opportunity to engage and lead ourselves into the future and these are the guys that are going to do it for us,” said Joudrie.

In line with the conference theme of “Leading excellence,” Joudrie noted five leadership qualities common to all of the plenary speakers that have contributed to their success: their ability to manage diverse teams and organizations, broad and extensive experience with different companies producing diverse commodities, skill raising and managing capital, their approachability and a strong sense of personal and professional charity.

According to Lindsay, there has been evidence that markets are improving and there is an increasing optimism within the industry. “After a long period of oversupply, I believe low prices have had a significant impact on production and are pushing most markets in the balance and even deficit,” he said. “At the same time, we’re seeing steady demand.” Moving forward, Lindsay said he believes the three factors that will characterize successful companies in the future are cost discipline, their ability to adapt to a lower carbon future and sound management of community relations.

In terms of project financing, Smallwood said he sees streaming agreements as the key to capital for miners given its flexibility. “I do think this financing model will be a player for the mining industry for many years in the future,” said Smallwood.

Hecla’s Baker said he believes the way precious metals companies are valued today is all wrong. Rather than focus on net asset value and discounted cash flow analysis, “we want long-life, low-cost mines that create real value,” he said. In addition, Baker, whose 16-year tenure as Hecla CEO far outstretches the average, said he believes it is important to maintain continuity in management while developing long-term strategies.

For Gowans, innovation is critical to advancing the industry. He has seen mining adopt its share of new technologies over the years, but he said he is concerned that there may be a lack of cohesion among the many innovation-focused organizations in Canada, noting that there are eight such groups in Ontario alone. “The questions is, is that allowing us as an industry […] to be able to get the concentration of effort?” he said.