Australia relying on luck over strategy, mining veteran says

Mining veteran Jake Klein says Australia missed a huge opportunity to become a leader in the rare earths space.Best known as the founder and chairman of gold producer Evolution Mining (ASX: EVN), Klein also sat on the board of Lynas Rare Earths (ASX: LYC) for many years when it was trying to establish itself as a producer.Speaking at the Melbourne Mining Club on Wednesday, Klein pointed to China’s successful multi-decade strategy to secure raw materials.“When I reflect on Australia’s success over the last 30 years, it was largely founded on the back of some very bold reform in the ‘90s, which laid the groundwork for our economic success, which has been phenomenal,” he said.“This country has got rich because of those reforms, and because of China’s growth and their appetite for iron ore and coal.“In the ‘90s, we were match fit. We had real competitive advantages. We were the premier place for the mining industry, and it kind of feels to me that we’re a team that’s now relying on luck rather than good strategy.”The Lynas exampleKlein said even in 2004, Lynas founder Nic Curtis had a vision and an understanding of the importance of rare earths.“He spent six years trying to convince Australian capital markets and government that rare earths are really important and it was a struggle to do that,” Klein said.“He certainly couldn’t get government support during that time, and it just wasn’t considered strategic.“Malaysia, on the other hand, offered us a 10-year tax holiday. They offered us gas to the site, and a lot of infrastructure benefits, which effectively resulted in the plant being built in Malaysia.” Today, the ore from Lynas’ Mt Weld mine in Western Australia is shipped to Malaysia.Klein said Australia missed an opportunity to lead the rare earths sector 15 year ago.“All of that IP is now in Malaysia,” he said.“Australia is now talking about needing to participate in critical minerals, but we’re part of the crowd now. We could have been a leader, and it’s a huge missed opportunity, and itcomes back to this need for real strategic thinking, vision and courageous strategy if we’re going to be successful as a country.”Lynas has subsequently built a rare earths cracking facility in Kalgoorlie, WA, but it has been plagued by issues due to unreliable power. Klein noted the recent critical minerals deal between Australia and the US but suggested rare earths had become a good political soundbite for politicians.“But the actual, practical reality of building a rare earths industry is much more complicated than a headline and a grant to a company,” he said.“You’ve got to think about the knowledge and the IP. It still irks me that this is a country that has built itself off resources, and yet today, there are fewer places that are training people for university positions for the mining industry than there was a decade ago.“If you want to be a leader in the rare earth space and the critical mineral space, you need to be investing in the technology. You need to be investing in the education as well as supporting the industry and laying the framework that allows them to be successful.”The opportunityKlein slammed Australia’s short federal election cycle of three years as contributing to a loss of competitiveness.“If you think about the resource sector, the need to think and have a vision for the mines of the future in Australia, it’s going to require multi-decade reform,” he said.“It cannot be something that changes between each election cycle. I think doing the same thing that we did for the last 30 years and hoping that it will result in the same level of success over the next 30 years is a recipe for failure.” This week, the Australian government released a National AI Plan, which focused on artificial intelligence infrastructure, training and regulatory frameworks.The Minerals Council of Australia welcomed the plan but called for a “dynamic and light touch approach” to regulation.Klein said Australia should lean into AI.“Because if you think about repositioning the mining industry, it doesn’t seem like we’re going to get low power costs soon. Our labor cost is expensive, so I don’t think we should expect people to take a wage cut, but we need to make ourselves more productive and more efficient,” he said.“If you imagine a mine of the future, something that could put us into a different league and make ourselves more competitive, is [the solution] embracing AI and really using it in a different way than the mining industry is using it today?”Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com