Geoff Stokes started Diggers n Dealers in the early 1990s with the aim of injecting life and business back into Kalgoorlie. DnD has become a resounding success that increased from the 30 to 50 people that attended those early informal sessions in the Palace Bar into an event that attracts thousands of people each year to Kalgoorlie.

RES is expected to have a significant impact on Broken Hill. Although the number of people initially enrolling for the RES started slowly, it accelerated to over 420 delegates with more registering on the opening day, and is expected to increase to over 600 people in 2012. Rex Airlines added 2 more daily flights and a DC3 was chartered too.

So what of a conference being held in the classic mining town of Broken Hill with street names like Bromide, Chloride and Sulphide. The town council actually closed off Chloride Street and erected a marquee on top of it, adjacent to the spacious Entertainment Centre for the conference. There appeared to be no shortage of cafes and accommodation in Broken Hill, and whereas Kalgoorlie has the super-pit east of the town, Broken Hill also has its super-pit area east (actually more SE) of the city centre (with a part of the town further east).

The mayor in his opening speech observed that Australia appears to have forgotten its (mining) roots, even some major companies earned dishonourable mentions having forgotten them too in refusing to fund activities in the town, or sponsor or help the conference.

The conference was opened with a didgeridoo and Aboriginal dancing, with the dinner opened by Kerry Stevenson riding on a camel (that was carefully ushered out of the dinner area), and two camel races were run (funds raised were going to the scholarship program).

The RES conference uses a different format to DnD through having a number of keynote speeches, workshops and company presentations limited to 10-minute speaking slots, with ~ 7 companies presenting in a session, one after each other. The companies that presented ranged from IPOs, to companies that had been taken over (Bemax and CBH Resources), to > $2bn companies such as Alacer Gold, and >$20bn companies like Newcrest.

The keynote speeches covered a range of topics including : how to present, to an audience, how to improve your distribution using the latest forms of media, the history of Broken Hill's mineralisation, advantages of partial hedging, as well as the mining industry and where it's going (and the threats it is facing), with iOps operational technology rooms for controlling remote world wide operations, carbon fibre deep drilling techniques, plus what is happening in world markets.

As one fund manager commented "you don't expect to find the quality of speakers like Richard Hames at conferences like this in the bush", or another from a geophysics company that only registered 4 days before the conference "after taking a look at the program I realised I had to be there", and hence drove to the conference from outside Newcastle, north of Sydney in NSW. (It's ~1400km by road from Sydney to Broken Hill, ie ~2 days' driving or ~3hrs via Dubbo by plane).

We must admit to never having heard of Professor Richard Hames, who has a string of achievements and is on a number of recognised world future committees, and who presented in the style of Niall Ferguson (at DnD 2010). Prof Hames highlighted the accelerating global stages of development in history: from 1400 to 1800 as nations, 1800 to 2000 as corporations, 2000 to 2010 as individuals, and 2010 to 2011 (so far) as communications.

Prof Hames highlighted the opportunity that Australia has, provided that it re-invents itself and adapts to the changes occurring in enterprises, energy and the environment as its part in SE Asia.

China (which Prof Hames visits on a monthly basis) is perceived as driving the world's future. On a worst case scenario, Prof Hames expected China to drive resource growth for at least the next 10 years (with an upside scenario being that of driving resource growth indefinitely). China's RMB was expected to become the new reserve currency for the world within the next 3 to 5 years as the global monetary system is revised with the banks likely to undergo significant restructuring into a simpler format.

Prof Hames thought that the technological advances that China is making in clean coal, fossil efficiencies, nuclear fuel uses, energy efficiencies and maglev trains were being overlooked (with some commentators still looking for signs of China's demise) as China creates a new middle class out of poverty. Prof Hames also thought that the US is gradually being consigned to history, while Europe may perhaps be able to continue to linger longer than 5 years in its present form, before its structural fabric crumbles.

The Commonwealth Bank (CBA) believed that the current commodity price cycle was different to previous cycles with commodity prices probably remaining strong (driven by China) and with exchange rates rising. CBA stated that the reason why most economists' forecasts have falling prices and don't change them (if anything they upgrade the fall-off point), is because eventually one day they have to be right. But as CBA showed in their charts, this commodity cycle has extended beyond any historical cycle in which the prices ultimately fell.

Ian Smith, ex MD & CEO of Newcrest, gave a description of NCM, before describing the industry with ~600 metals and minerals companies on the ASX and ~400 new junior resource company floats in the past 5 Years. There are ~$133bn projects planned of which $72bn are already in advanced stages, despite only 200 to 250 mining engineers graduating per year (or ~1200 in the next 5 years), resulting in a shortfall of 1700 engineers and 36,000 trades people by 2015, probably necessitating the retraining of mature-aged employees with relevant skills.

Ian Smith also went into some detail on Australia's new Carbon Tax (the details can be seen in the presentation on NCM's website). We have included these details plus some information from a later conference - in our column in the current copy of Paydirt's GMJ (Gold Mining Journal).

One of the most interesting and dynamic keynote speeches was from Rich Evans of Redd Interactive who showed how communications had evolved from the age of communication to messaging, to broadcasting, and now to world-wide engagement with Facebook having > 500m users including nearly 10m or ~50% of Australia's population, and Twitter with ~200m users.

Originally communication was from someone in the field to someone in the office to marketing PR, media and potential investors, whereas now it is posted on your website and can be instantly automatically shared with Facebook, Twitter, Youtube, LinkedIn and Email. Whitepages are being stopped and being replaced by a professional looking website that has a consistency of information in both quality and frequency, with links into platforms. Also clouds are forming, clustering and growing.

Rich Evans stated that "one used to say, all the roads lead to Rome", "now all the roads can lead to you, and the more places you can be found, the more opportunities you have".

And like DnD, the dealing background was buzzing on the regional activity, especially with companies that had exposure to silver, new IPOs offering silver exposure and other new IPOs yet to come up to September / October 2011.

For those planning on attending RES 2012, it was expected to be from May 21 to May 23 (with golf on the 20th) 2012 in Broken Hill. There is an abundant choice of 88 motels or hotels ranging from "A Miner's Rest" including a number of apartments and cottages to "Sue's House".

However, don't believe the weather forecast (of 27 deg to 14 deg at night), it "unseasonably" rained and was very cold (you could see your breath), so take the winter woolly jacket and woolly beanie (just in case).

Disclosure and Disclaimer : This article has been written by Keith Goode, the Managing Director of Eagle Research Advisory Pty Ltd, (an independent research company) who is a Financial Services Representative with Taylor Collison Ltd.

Figure 1. Richard Hames' Presentation at the Broken Hill Symposium Conference in May 2011

Figure2. The Opening of the Inaugural Broken Hill Conference in May 2011