Q&A – Chris Hinde
Rhiannon Garth Jones talks to Chris Hinde, Director of Reports at SNL Metals and Mining, about his 40+ years of studying and analysing the industry, and the problems now facing it.
Tell me a bit about your background.
I qualified with a BSc in Mining Engineering in 1975 from Cardiff University, and stayed on for my PhD (awarded in 1978). Anglo American had given me a scholarship during my undergraduate years so, after I finished the doctorate, I spent two years working for them as an underground miner at the Western Deep Levels gold mine in South Africa. I then moved to Johannesburg and worked there for a year with mining consultancy SRK before returning to the UK to do similar work with Golder Associates, which included assignments in Malaysia and Turkey.
What about the rest of your experiences in the industry?
Apart from one year with Schroder Securities in the late 1980s, I spent 26 years at Mining Journal (ending as Editorial Director of all the group’s mining titles). This included a role in launching the Mines and Money series of conferences – initially only in London but we subsequently launched sister events in Sydney, Hong Kong and then Beijing. In March 2012, I joined mining database company IntierraRMG, which was acquired by SNL (a US-based financial database company) in January 2014. I am now responsible, among other things, for the company’s quarterly reports on the mining industry.
What has been your career highlight?
As I mentioned, I helped launch the Mines and Money conferences in 2003. Mining Journal’s only previous conference had been in 1890, so this was a relatively new direction for the company. Despite the 113-year gap (surely a candidate for the Guinness Book of Records), the return to the conference scene proved to be a huge success. The most rewarding part, and my personal highlight, was the introduction of an annual mining awards ceremony in London. I believe these awards are still the most prestigious in the industry.
How do you think your position as an analyst has changed your perspective of the industry?
Being a scientist, I consider hard facts important. Now that I am with SNL, I have source information in spades – the company’s database covers some 3,000 companies and 30,000 projects, with information being updated within hours of any stock exchange statements. I am now able to monitor trends almost as they happen. Indeed, the main difficultly is sorting the mass of information – in effect, trying to see the wood for the trees.
The main change is the ability to look at things on an industry basis, rather than get bogged down in the detail of individual projects and companies. As a result, I can appreciate that the vast bulk of the exploration and mining companies are seriously disadvantaged in the current financial climate – more than half of the industry’s listed companies have a market capitalisation of less than US$10 million, and very few liquid assets.
What are the biggest changes you have seen in the industry?
The biggest change has undoubtedly been an increased awareness of safety and the environment, and the (not unrelated) impact on the industry of social media.
In the late 1970s, when I joined the industry, accidents were commonplace, and while safety was talked about, it was rarely at the front of the mind. The same could be said for the environment. This mindset has been dramatically improved. However, there is still room for progress – for example, I believe the industry’s top people still go through the production, rather than safety departments.
What do you think about the current state of the industry, and what will pose the biggest challenge in the next 10 years?
The industry is still not effectively addressing its deep unpopularity. Distrust is probably inevitable because of the historic mistakes made and the fact that our business involves the displacement, often on a huge scale, of earth and rock. Neither the industry as a whole nor corporate executives individually have ever really grasped this fundamental problem and sought ways to alleviate it. This poor public opinion rebounds on the availability of skilled staff and the ease at receiving approval for exploration and mine development. Companies need to start acting together – perhaps with universal contributions, based on a percentage of mined revenue, to a (large) budget for educating the public, especially at school level.
What do you think is the most exciting area for exploration at the moment?
Some of the Asian countries have a history of mining but little recent exploration – often for good reasons. Myanmar would be one example, where there is encouraging geology and ancient mine workings, but little modern exploration because of the unhelpful political climate. Large parts of Africa also remain too dangerous, and the Arctic is currently too expensive. India must open up to more exploration sometime soon, and is an area to watch. Right now, corruption, scandals and environmental concerns are preventing that, with bureaucracy proving the biggest obstacle.
What is the biggest external issue affecting the mining industry right now?
Corruption is a problem in some areas but will eventually be controlled. Initiatives such as the Extractive Industries Transparency Initiative should help, but I am not particularly hopeful. I think the most effective pressure for change will continue to come, relatively slowly, from the financial community.
There is a possibility that the public perception of climate change could cause issues, but nothing major, and I don’t think climate change itself will cause great problems at the mine level. Resource nationalism, however, is a real threat to international trade and corporate planning. The industry is doing very little as a whole to tackle this issue – there is hardly any global budget for such activity.
Are there any other issues you see affecting the industry in the future that are being overlooked?
The burgeoning use of social media will have unexpected consequences for the mining industry, perhaps in the dissemination of unfavourable news. It needs addressing, and while individual companies do great things, they are relatively ineffective at the national and international levels. An industry-wide approach is needed, and there is simply not the mechanism – or budget – for such work.
Are there any areas in which the industry as a whole is making positive progress?
Organisations such as the International Council on Mining and Metals (ICMM) are doing good work on promoting better working practices, especially on safety and the environment. However, ICMM is an example of mining organisations having insufficient budget and clout to make a real difference in regions that most need change (it only has 22 mining companies as members, plus some 34 associations). What is needed is more of the same, with every metals producer making a financial contribution to the global effort.
What would your advice be to someone looking to enter the industry?
As in any industry, you need to be lucky. But (with apologies to golfer Gary Player) you can make your own luck, or at least give it a tweak. This involves researching the companies that you are applying to join (it is helpful if they are expanding) and making your application and CV specific to their likely needs. Ask yourself, ‘How can I add value to their operation?’, be it now or in the not-too-distant future.