I’ve just been through a most interesting and rewarding exercise of chatting independently, and at some length, with Randgold chief executive Mark Bristow and four of his “generals” responsible for the development of the company’s mines from the first stroke of a pen authorising exploration to the final thumbs up when “the wheels begin to turn.” Quite a journey I assure you, as you will discover if you read the company profile in this issue.
That profile is more than an interesting piece of writing. It reflects – through the mouths of the gentlemen concerned – certain lessons that one can apply to any company ………. mining or otherwise.
“In today’s mining environment you can’t sit back in head office and survive,” says Bristow.
You need to spend time with the media, your shareholders and stakeholders like governments and unions – you must develop those strong relationships to survive,” he insists.
“Exploration is our value creator,” says Paul Harbidge, Randgold’s group general manager: exploration, “that’s why we want to keep making world-class gold discoveries.”
Randgold has 55 permits which cover 15,075sq km in Senegal, Mali, Ivory Coast and the DRC, and within that ground it has 130 gold targets.
“Obviously every target is not going to be a world-class gold mine, so we have developed what we call strategic filters that help us make the decision to either advance or reject projects,” Harbidge explains.
His view on strategic filters is strongly supported by Randgold’s group general manager: evaluation, Rod Quick.
On strategic filters, he says: “This is all designed to enable us to achieve our mission of finding, building and operating profitable gold mines in Africa. We would rather target high quality assets which are going to keep us profitable, than huge assets which might produce a lot of gold, but take a really long time to pay back the capital they owe,” he states.
My team is responsible for building our mines, says group technical and capital projects executive John Steele, and we can safely say that Randgold has never been driven by ounces. “For us it’s always been low cost per ounce, profitable production, and quality always beat quantity.”
The company’s general manager, operations: central and east Africa, Willem Jacobs and his team are responsible for taking a capital project when construction is completed and converting it into an operating mine.
“Randgold is very different,” he points out. “We have a small executive team, and we pass the ball around ten times a day. Our philosophy is that none of us will ever be the ‘supremo’ in any one decision, and that, I believe, is a very special characteristic that we have as a team. We’re a close-knit management team, and we’re very different from other mining companies,” he says.
Mark Bristow enjoys pointing out that since Randgold listed on the Nasdaq in 2002, the company’s share price has risen by more than 1,000%, while most of its peers are currently below their share price on that day in 2002.
“This gives you a feel for why the market is so angry,” Bristow remarks. The remark that I would like to add is that one needs to take note of what Bristow and his team are saying. They certainly seem to be doing something right. One might even be tempted to replace that “something” with “everything!”