Tamaya rewrites the rule book
Not many mining companies move to London to save money. But that’s just what Tamaya Resources is doing as it juggles the challenges of developing a global spread of mining interests off a small financial base.Technically, Tamaya will retain its home stock exchangelisting in Australia, but relocate its head office to the inner London suburb of Wimbledon.The shift will save more than A$400,000 a year, mainly in the air fares currently being racked up shuttling managers between Tamaya’s copper interests in Chile, its gold interests in Armenia and its tungsten interests in Portugal.It’s the far-flung nature of Tamaya’s assets, and what appears to be a lack of clear focus on any single asset, that worries some outside observers. This is a company supporting far-flung aspirations on a modest market capitalisation and a share price which has fallen by 60 per cent over the past six months. But that’s history, according to Tamaya chairman, Hugh Callaghan. He believes the future will be a lot different.“We have had a number of issues with our share price,” Callaghan tells Minesite after the end of a three week hunt to pin him down for a telephone interview. “Cash costs at our copper mine in Chile have been high as we work through a low-grade ore zone. There was also the issue of a big shareholder selling down, and some rather odd trading during the margin-lending mess in Australia. Those matters are largely resolved and now we’re set to focus on expanding our copper assets in Chile”.Unravelling Tamaya is not easy, but it’s worth the effort. Even Callaghan, a lawyer with a lawyer’s love of using more words than is always necessary, acknowledges the problem. He says the immediate focus of the company is copper in Chile: “It’s not hard to see that profit margins on copper in this market are excellent”. Centrepiece of Tamaya’s assets is the Punitaqui project, which has just hit its target of processing 3,000 tonnes of ore a day, and is now heading for 4,000 tonnes a day. At 3,000 tonnes the project is yielding between 21 million pounds of copper a year, valued at more than US$100 million.Investors, however, is waiting to see Tamaya deliver on its promise. They were unimpressed with the company’s A$6.6 million profit in the 2007 calendar year, a result which Callaghan admits was dragged down by difficult operating conditions in the December quarter. “It is obviously pleasing to have been able to record a positive financial result at a time of rapid change within the business,” he says. “But the December quarter was particularly challenging”.