Interesting podcast interview with Adam Lundin, the CEO of Josemaria Resources. He discusses his family (three generations of being in the mining business), their investment approach and his outlook for the natural resources sector. Some notes are below – please note these are for personal reference only, and any mistakes are my own.

• On his family background: Lundin Group has been around for ~50 years. His grandfather started the business, with a focus on mining and oil & gas. Then his father and uncle got into the business as well. The Lundin Group is not an entity, more of an umbrella comprising 12 public companies. Group companies normally have the family as the largest shareholder and a few professionals who may overlap on some of the boards. But they all share the same vision of maximising shareholder returns and doing what is best for all stakeholders and host nations. They understand that mining is a long-term game. One example is Bluestone Resources. When they got involved they were initially looking at an underground mine. But when you look from a different lens – they could make it an open pit, pull 3x the gold out of it, increase the production profile, means more jobs and tax dollars for the host country. Some people said they could have been in production faster if you had gone with the underground mine, but they would rather take longer and get a better outcome for everyone.
• On the current generation of the family: he has 3 brothers. His brother Will is now the COO of International Petroleum Corp, based in Geneva. His eldest brother Harry is running a natural resources fund called Bromma Asset Management. His other brother Jack is at Bluestone Resources. What makes the group great is the people in the business, he and his brothers are able to come up in the business surrounded by many talented people. They are all pulling the same rope and want to achieve the same goals. He has lots of support around him, doesn’t necessarily feel the pressure of following in the footsteps of his grandfather, father etc.
• On copper & oil: they are bullish on copper, started to have that view when they saw the lack of investment going into the space. The electric vehicle story is only the cherry on the cake. He thinks a super cycle is beginning, could last 5-8 years because of the long lead time it takes to bring new production online. The family is well positioned for copper with Lundin Mining, and growth from Josemaria Resources (defined, FS stage) and Filo Mining (exploration stage). Very active in the oil business as well. Thinks oil will fade over time, but there will be a long tail where oil is going to be very important.
• Josemaria project timeline: this was not an overnight success. They had sold the Valedero deposit to Homestake back in 1999. With the same geologist, they went and staked the ground in Argentina where they are active today. Josemaria was discovered in 2004/05, Filo around the same time. 15 years later, got a FS out at Josemaria. They have a clear game plan and strategy laid out to get into production in the current copper cycle. Permits are in hand, now looking for fiscal stability from Argentina, aiming for production by end of 2025. Doesn’t think there is another junior out there that has the ability to get their deposit online this cycle.
• On potentially withholding gold & silver co-product from Josemaria: sees himself potentially doing the opposite, selling forward the precious metals. They will do about ~1m oz of silver for 19 years and ~250k oz of gold for 19 years. 30% of their revenue. Mindset has been so focused on looking to see if he can do a stream to bring in the first US$1bn of capex that he hadn’t paused to think about withholding. He thinks that commodity prices are very strong across the board, precious metals may have some room to run, but margins are still attractive at current prices. If they can finance the project without streaming off the precious metals, they will be in very good shape when they go into production.
• On working with local governments: very important that you sit down face to face (often multiple times) and get a sense of trust and what they want to achieve. Need to explain the process, the timeline it takes to get into production and come up with an appropriate government take. For them not to see a penny until you are in production is maybe too long, perhaps something you can do to help them see the benefits more than just employing local people and procuring local materials. Also important to understand the election timelines, don’t want to get in somewhere where things are going to shift another way. But their order of priority is ore body, location, making sure you have the right people who can tackle it and then you see if the host nation wants their resource in production, are they pro-business, what do they think about mining etc.
• On his approach to running a company (and how it is different from his father’s and grandfather’s approach): where their approach is the same is surrounding themselves with intelligent people and empowering them. Don’t like to micromanage at all. If there is someone better for the job, let them run with it. Can’t answer where they are different yet.
• On choosing projects to back: they like concentrated bets. Size matters, they are looking for tier 1 deposits. Don’t worry initially about where they are. Then talk to the host nation to see how they view it and what they want to do, see if it will be a good partnership. Then come up with a game plan in terms of further exploration, resource understanding and getting into production. He was on the board of Fortress Minerals. Was a shell in the Lundin Group, had about $5m in cash. Heard FDN was up for sale. Headline was 10m oz by 10g/ton. Are you going to have chance to work on another property like that in your career? Probably not. So they flew to Ecuador to get a hang of it. Came up with an agreement with Kinross to buy it. Remember going around to raise the capital, was tough as gold was getting it on the head at the end of 2014. Price was down US$100/oz the week they were trying to close the deal. Not easy, but now they are in production looking like they can do ~400k oz a year. Takes so much time to push these projects forward, you want to have an ore body that makes it worth it.
• On finding good people: thinks the younger generations are perhaps more open minded, whereas previously the mining industry had largely negative connotations. If they are given an opportunity to see what they do as a group, thinks they could get more young people interested. His brother Jack is also involved on the education side. Has given some money to University of Arizona, to upgrade facilities, provide financial support to students etc. The mining departments at universities are outdated, boring. Got to make it more attractive for younger people to study mining and pursue careers in the industry.