This was one goldfields leadership role that seemed tailor-made for Ryan.
His obligatory due diligence included matching up what he'd learned about Bardoc's cornerstone Zoroastrian deposit as general manager operations at Paddington, about 20km to the south, under a toll milling arrangement, with what he found in Bardoc's data room. Ryan spent about six years with Paddington owner Norton Gold Fields in various roles.
He was ready to take an extended break to recharge his batteries early last year when the Bardoc opportunity came along.
"I'd seen the development of the company … as GM of technical services at Paddington, managing the toll treatment arrangement that Excelsior had at Paddington. I was well aware of the issues [with milled ore grades from Zoroastrian being materially below reserve grades]. Really having a deep dive into the technical studies [done by Bardoc since it was formed from the merger of Excelsior and Spitfire Materials] gave me the confidence that … it was a serious company going into mining," Ryan said.
That was backed by Bardoc's prefeasibility study released earlier this year that indicated the Black Flag area straddling the Goldfields Highway between Kalgoorlie and Menzies could support a A$140 million, plus-seven-year operation producing 135,000ozpa at AISC of $1220/oz, and generating post-tax IRR of 27-68% on a range of USD gold price scenarios.
Ryan knows from experience timing and luck play huge roles in the success of junior miners and while he also believes "you make your own luck in this industry", Bardoc's PFS release immediately before the COVID-19 sharemarket meltdown in March was unfortunate timing and it hasn't really caught the tailwinds other gold stocks have benefitted from over the past few months. They include neighbour Ora Banda Mining which has gone from 10c to 30c in that period.
So the A$24 million slab of equity finance Bardoc has just raised to "accelerate exploration and development" came at a price the company would have hoped was more elevated, but it does tick a box Ryan has on a list of milestones he wants to achieve as Bardoc heads toward its 2022 production target.
"I think people were waiting to see the prefeasibility study, to see how the two projects [Zoroastrian and Aphrodite] came together and what a potential production scenario would look like," he said.
"I think the value proposition, especially the enterprise value per reserve ounce, is significant"
"In the next year when we're doing the construction equity raise we need to have people on board who are supportive of the project that can really back it into production. We've been going out and meeting different groups and introducing them to the Bardoc story and there seems to be a lot of interest in what we've put forward as a program and how it's all come together.
"Unfortunately, we haven't had the rerating the quality of the PFS deserves because it was released in the midst of the COVID-19 crisis. So people do see [Bardoc] as an excellent value opportunity, primarily because it has been missed due to the global market factors.
"There are basically four [gold] projects with over 0.5Moz of reserve in WA. We sit at 790,000oz of reserve, and will look to increase that as we move to DFS.
"I think the value proposition, especially the enterprise value per reserve ounce, is significant.
"A big thing for us is getting that next leg of investment. With the Excelsior shareholder base, as you can imagine with the dramas that happened during the mining campaign in 2016-17, there was quite a tired shareholder register. People had been involved in the company for 7-10 years and had probably seen significant destruction of value. But as we start transitioning into this new phase it's a completely different company with a completely different investment scenario.
"We've put together a realistic resource; we've used LUC [localised uniform conditioning] block modelling - a risk-averse style of modelling - for all our openpits. So we've got that realism in our modelling. What we say we're going to do in our PFS we do not expect to change in our DFS. In fact, all we see is upside."
Ryan said ongoing resource infill drilling on the main Aphrodite, Zorastrian and Excelsior lodes was part of $7-9 million of DFS spending that also covered further metallurgical testwork and other standard study activity. A resource update is due in September this year.
"It's more going to be a confidence update," Ryan said. "We're not talking about moving the needle significantly on the amount of contained ounces, it's more just confirming what we have in indicated resource to prove up the reserve.
"The metallurgical testwork is key. We've invested quite heavily in drilling; we've spent about $3 million on a drilling campaign at Aphrodite to really get a good handle on the variability testwork. We wanted to make sure, with the DFS, we're testing different lithologies, different weathering types, higher and lower grade components of ore zones, so we can really build out a proper metallurgical model and really get a firm handle [by October] on the quality of concentrate we'll produce at any time in the mining cycle. That will lead into our concentrate offtake discussions with potential gold offtakers."
Bardoc says it's added "tier-1 Australian and global institutions and strategic investors" to its register with the latest raising, which gives it $35 million to advance its exploration and development plans over the next 12 months. They will potentially become more important in that timeframe as Bardoc posts its DFS in the March quarter next year and then moves into finalise debt and equity financing by the end of September. It is also talking to concentrate buyers about offtake agreements for what will ultimately be 50% of Bardoc's Black Flag gold output in its initial life-of-mine plan.
"We've gone out with a request for pricing to about 25 different groups. There is significant interest in the gold concentrate space at the moment," Ryan said.
As well as the time running the 200,000ozpa Paddington mine and working with and joining the board of Norton Gold Fields, Ryan worked with consultancy Mining Plus on Norton and also Gold Fields (St Ives) projects, and held senior management positions in WA with Barrick Gold.
The WA School of Mines engineering graduate said he "tried not to advance too quickly up the ladder without first learning all the ropes", which meant rounding out his education and experience in all aspects of surface and underground mining.
"I wanted to make sure I not only had experience in operating mines, and running successful mines, but also in planning mines and doing feasibility studies," Ryan said.
"There were things I said no to along the way because they weren't on the right development path, and I thought I needed a broader understanding before I moved into that next role. I think it's about picking and choosing your moments and timing on those has been impeccable for me so far."
While led out of the gate by Evolution Mining's Jake Klein, arguably now in the veteran class as a mining leader, Ryan's youthful WASM cohort of respected mid-tier Australian gold company chiefs is making a mark on the industry in ways that have resonated with investors around the world.
It has certainly also made an impression on those heading the next line of wannabe mid-tiers.
Ryan said leaders with strong operational backgrounds, and demonstrated business acumen, had built high market valuations on "fundamentally good business practices".
"I remember the push even from a Barrick perspective in the major gold boom from 2009 to 2011, the focus was on ounces and getting your production numbers up and just producing ounces at any cost," he said.
"A lot of us that went through that saw first-hand the destruction of value, and I think a lot of people have now taken that into these roles and said, if we're going to run a company we need to make sure we run it as a business. It's about operating margins, not how much gold you're going to produce. And I think Jake has been fantastic with that at Evolution, and so has Bill [Beament] at Northern Star."
Rob Ryan is a nominee for Emerging Leader of the Year in the 2020 MNN Awards.