Tempest Minerals: unlocking new opportunities in the ‘age of technology’

This article is a sponsored feature from Mining.com.au partner Tempest Minerals Limited. It is not financial advice. Talk to a registered financial expert before making investment decisions.

Don Smith, Managing Director of Tempest Minerals (ASX:TEM), is a self-confessed “massive tech nerd”.

When Mining.com.au connects over a Zoom call, he’s wrapping up a team meeting — the sort in which audio recording software, fancy presentation platforms, and sprawling datasets play no small part.

Based in Perth, Western Australia, Tempest holds a portfolio of precious, base, and energy metal assets across the state, as well as weighty interests in other projects in Papua New Guinea, Africa, and the US.

Those in WA include the wholly owned Yalgoo project, with its ‘highly prospective’ Messenger, Meleya, Warriedar West and Euro tenements, as well as the Range project in Mt Magnet — all of which lie 400km north-east of Perth.

Overseas, Tempest has exposure to the Tonapah lithium project in Nevada, US, through Argosy Minerals (ASX:AGY), as well as other assets in Africa via a 25-million-share stake in Premier African Minerals (LON:PREM). In Papua New Guinea, the company holds a substantial million-dollar interest in privately held Tolu Minerals, which owns the Tolukama mine and Mt Penck project, and is soon expected to list on the ASX, which Smith anticipates will deliver some healthy returns.

Indeed, technology has had some kind of a hand in every step along the way. But it’s the symbiotic confluence of those tools with good old-fashioned attention to detail — plus a sound strategy — that has helped Tempest deliver.

Beware the company commodity cult

When it listed in 2017, Tempest — then Lithium Consolidated Mineral Exploration — was a pure-play lithium company. After the lithium market suffered a tumble in late-2019, the board, Smith says, was uncomfortable in its exposure to just one commodity.

“They said, we need to diversify. And my colleague Owen (Burchell) and I had a company that we were trying to IPO at the time, and they made us an offer and we took it and we merged. Then, to my surprise, they made the offer for me to become CEO. And because we had a wider focus than just lithium, we re-branded and did all that kind of stuff. And that became Tempest.”

Even now, Smith remains sceptical of what he calls “the company commodity cult”. He prefers to focus on geology and project generation; he does not go in for the simplicity of monomania. And for good reason, too.

In his early career, he worked for the now-defunct “BHP of zinc and lead”, Pasminco. “It was the world’s biggest base metal miner,” he says.

In his early career, he worked for the now-defunct “BHP of zinc and lead”, Pasminco

“Pasminco, they actually had — I know this for a fact — they had two of the world’s largest gold deposits in their portfolio, but didn’t know it because they never assayed for gold, they only assayed for the things that they were looking for. But they missed out on these huge, huge multibillion-dollar mines because they didn’t look. In my early career, it really stuck in my mind. I’m not going to make that mistake. So, when we’re exploring, we’re always looking for everything.”

There are, of course, a number of factors that make this approach work. The first is that Tempest has a substantial landholding. Earlier this year, the company extended its footprint in the Yalgoo region by 195km-square, making it the dominant explorer in the area by acreage. Not only does it afford Tempest a larger, more diverse slice of the stuff-in-the-ground pie, but it also presents greater strategic flexibility in terms of potential earn-in agreements or divestments.

The second is that recent advancements in technology have brought some gale-force tailwinds for the mining industry. It’s afforded fresh exploration opportunities at all sorts of existing projects, but also makes breaking new, untouched ground a rare but nevertheless real possibility.

The right tools, and the right opportunity

Cutting-edge mining technologies have not so much opened new doors as much as they’ve blown them off the hinges. The proof is in the company Smith and his colleague Burchell — now also a Director at Tempest — had attempted to IPO before it merged with Lithium Consolidated.

Burchell, Smith says, was driving to work at an unrelated project one day, along a road that now dissects — “literally up the guts” — one of Tempest’s key tenements.

“He was driving up there as a shortcut and he saw some guys on the side of the road. He’s got a very good memory, and he looked in his memory and goes, ‘This is meant to be a barren area. Why are they over there digging?’”

It turns out the guys had dug a modest pit — a modest but “non-trivial” pit. And the whole wall of this pit was one big sheet of gold. It took some time, and a couple of visits, but eventually Smith and Burchell found it was an intrusive related gold system, not unlike the one De Grey Mining (ASX:DEG) would find a few years later.

“Places where people haven’t looked, that’s where the real excitement is. Because that’s where we can go in and find something new that no one’s found before, and the chances of discovery are actually higher. That’s the majority of our project in Yalgoo, particularly the Meleya area. No one’s ever been there before, because the old government geology maps were wrong. They showed it all as a granite or a particular type of rock. Whereas, we went, we saw that the data we had — the particular geophysics — didn’t match that. And we went out and looked and went, ‘Oh, this is not what’s on the map.’

Not many, if any, companies are doing stuff like we are in that (technology) realm. And that’s how I was able to go through everything really quickly and say, that doesn’t match with that, that doesn’t match with that. And this is five years ago. No one had even heard of AI and that kind of thing, but we were using early equivalents of AI at the time there.”

Fast forward 5 years, and things are much the same — field work in particular holds the same emphasis on technological support. While staff on the ground are collecting samples and mapping terrain, drones hover above like angels of analysis.

“That can create a real-time 3D model of the land you’re walking on. And then with Starlink and things like that, we can send it back to the supercomputer here and it can be creating that 3D model while we’re sleeping in the bush,” Smith says.

Tempest is also an Australian pioneer of Geotek-made BoxScan, a modular core and rock chip scanning platform designed to solve the labour-intensive process of logging and interpreting samples collected from the field.

“It’s the only publicly available unit in Australia, and it’s here in our shared facility in West Perth. It uses maybe 10 different sensors automatically. It’s a robot. You put your samples underneath in the big box, and the robot arm comes out and measures all the things that people measure in the field.”

Tempest Minerals does not do dogma

Of course, it hasn’t all been smooth sailing. Earlier this year, a preliminary deal with US-based Lithium of Nevada — under which Tempest would acquire up to a 50% stake in the Smiths Creek Nevada lithium project — fell through due to delays in progressing the agreement.

“We’re reassessing it. It hasn’t changed the strategy, which is always to create value. In our office, we have a phrase: We don’t do dogma. It’s about getting the best outcome every time. It’s not, ‘This is the way that it has to be’. We tried that strategy with Lithium of Nevada, couldn’t make it happen. That was frustrating. But we have plenty of other options that we’re exploring,” Smith says.

In our office, we have a phrase: We don’t do dogma

But delivering value means, above all, making a meaningful discovery. That’s where Smith would like Tempest to be a year from now, with a discovery in hand and on the way to project development.

“Whether it happens, that’s part of the game. We certainly think we have a great opportunity to do that. A year from now, we want to be advancing all our projects, that’s for sure.”

That Tempest’s projects sit in one of the most prolific mining regions in Australia, if not the world, is a huge advantage. If Smith does indeed have his sights set on taking the company from junior to mid-tier status, then the existing infrastructure in the area is a welcome leg-up.

The Range project near Mt Magnet, for example, is “right next door to three major companies, and there’s a mill only a few kilometres away that’s underutilised. So we’re really keen to see if we can find some gold there”.

Likewise, Tempest’s Yalgoo project is in good company, with Silver Lake’s (ASX:SLR) Deflector and Rothsay mines, Tungsten Mining’s (ASX:TGN) Mt Mulgine project, and the 8-million-tonnes-per-year Karara iron ore mine in close proximity. Karara Mining alone has invested more than $4 billion for the establishment of critical infrastructure in the region, including rail systems, power transmission lines, water pipelines, and processing facilities.

“All of us on the board have experience building major projects

“All of us on the board have experience building major projects,” Smith says. 

“Owen, I think, has built around 30 mines. I’ve built half a dozen myself. Brian Moller was, until recently, chairman of one of the biggest copper-gold developments in the world. Andrew Haythorpe, who’s also a geologist, he’s been involved with project development and mining. So we could do that. If we find something that’s worth it, we could absolutely become a mining company, no problem. 

“But if a big player nearby wanders in and says, ‘Oh, that’s a nice looking project’, and makes an offer, we might take that if it’s a good one. But the strategy is what’s best for shareholder value.”

Indeed, Tempest knows what it needs to do, but is staying flexible, agile and — I think — somewhat zen about how it’s going to do it. It’s true that in the high-pressure chamber of Very Serious Business — no matter what that business might be — a competitive edge can make all the difference. Tempest Minerals is, among other things, using everything it’s got to find that edge and sharpen it to an extremely fine point.

Write to Oliver Gray at Mining.com.au

Images: Tempest Minerals
Author Image
Written By Oliver Gray
Originally from Perth, Oliver has a keen interest long-form journalism. He has written for a number of publications and was most recently Contributing Editor of The Market Herald’s opinion section, Art of the Essay.