Ron Manners’ ideas and adventures
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Photo of Ron Manners

Ron prefaced this speech, presented at the Mineral Drilling Association of Australia Symposium in Busselton, by stating: “As I haven’t been given any guidelines for this presentation, I’ve had to rely on my own imagination.” The title It just needs more drilling! refers to the standard answer he gave every time he was asked if mining could start. It’s broken into three sections — how he first got involved in mining, holes and efficiency; several threats to our economic survival and concluding comments.

How I first got involved in mining, holes and efficiency

A story in last Saturday’s The West Australian, Headstones go from old graves to allow more burials, (they can’t fit any more bodies into Karrakatta Cemetery) reminded me of an early interest in holes and efficiencies during my time at Kalgoorlie School of Mines in the late 1950s/early 1960s. By delving into my archives I managed to exhume a light-hearted thesis I published in the 1961 School of Mines Magazine Yearbook on the matter of vertical burial, subtitled ‘Why is that headstone smiling at me?’

This idea in 1961 may have been ahead of its time but now, with the crisis at the Karrakatta Cemetery, it reminds me of a quote from Victor Hugo: You can defeat an army but you can’t defeat an idea whose time has come. It seems that back in 1961 I was uneasy at the lack of efficiency exhibited at the local graveyard and I noted that in order to bury one human body (cubic displacement approximately 2 cubic yards, boxed), the authorities were shifting 11 cubic yards of earth. Also, further on the debit side, 9 cubic yards of this earth had to be replaced leaving the overall displacement efficiency at 15 per cent.

I proposed that with vertical burial, in close proximity to the surface, a displacement efficiency figure approaching 100 per cent might be obtained. My hopes for realization of this objective crashed upon discovery of a council by-law containing the clause ‘minimum depth — 6 foot below the surface’. To confirm this by-law, total depth from vertical burial would be 12-foot, thereby reducing the efficiency figure to 50 per cent and greatly increase the danger of striking oil. This would necessitate heavy concrete blasting of the ‘interned’ lest it repeatedly float to the surface.

These investigations were coming to a dead end, but were resuscitated after experimentation with some of the newer rigid plastics. These were considered to be an ideal way of preventing decomposition of the deceased. Furthermore, results from this new ‘PVC plastic people dip’ were surpassing all expectations and with recognition of the potential of this new encasing method, we approached local authorities who agreed that this new coating afforded sufficient protection against the elements, hungry canines and vandals.

This breakthrough left the path clear for obtaining maximum efficiency in the graveyard. Having gone this far, we wondered at the possibility of going beyond the ultimate goal of 100 per cent efficiency.

“Yes”, said one student to their dismay,

“Drop them down only part of the way.”

Efficiencies reached by using this plan

Would ensure its acceptance by civilized man.

Their heads an shoulders transparently cased

Set with expressions, some pleasantly faced.

Headstones of stone, there would be no more.

Epitaphs now moulded below the jaw.

In fact, it seems in reality

Headstones for ever they would be.

For tourists our town would be a must

Now somewhere to sit, up out of the dust.

Seated on heads in circles arrayed

With assorted expressions gaily displayed.

Many an hour they could send each day

Discussing the merits of those passed away.

This one it seemed died in great pain,

He’d taken Chem I and been driven insane.

The man on our righted taken Maths II,

From the look of delight he’d surely scrapped through.

Plain to see he’s an engineer,

The look on his face is so sincere.

Higher efficiencies may be made,

By using a Ramset instead of a spade.

The bodies are sorted and the tall and the slim

May be loaded in Ramset and driven straight in.

Now that you’ve heard all about our plan,

We hope you’ll all die, as soon as you can.

Now, least you feel that I was being irreverent about the dead, let me quote the well-known philosopher Woody Allen: “The difference between sex and death is that with death you can do it alone and no one is going to make fun of you.”

The only reason I mentioned the vertical burial project, devised so many years ago, was to suggest that it may have been a heroic misadventure then but now, 43 years later, it must be an idea whose time has come. The idea is not patented but as vertical holes for vertical burial could be a way of the drilling industry diversifying in times of mineral downturn, I’ll simply leave that thought with you.

Several threats to our economic survival

There are so many but I’ll only mention three today — corporate alzheimers, land access and scams (when the conman comes calling).

Corporate alzheimers

Back in the year 2000, in my role as chairman for the Australian Mining Hall of Fame, I visited the Melbourne head office of BHP (just before it became BHP-Billiton) to gain support for the Mining Hall of Fame project. They had a bundle of senior BHP people politely listening to my presentation and at the conclusion they said: “Well, we have decided not to support your project for the following reasons: BHP has never had any involvement in Kalgoorlie so we don’t identify at all with Kalgoorlie, and, this seems to be a gold-oriented project and BHP hasn’t ever had any interest in gold mining, so there’s little incentive for us to support it.”

I was fascinated by their display of ignorance on where ether company had or had not been and in my most polite and humble way pointed out:

  • The actual site of the Mining Hall of Fame was known as the BHP Hannan’s North End Mine right up until the time that BHP closed it around 1954.
  • For the next 15 years the site was WA headquarters of the Titan Manufacturing Company, a BHP-owned company which at that time was supplying all of the underground rock bolts to our mines.
  • More recently, in the late 1980s, their corporate entity BHP Gold was one of the most successful and active gold explorers and producers in this region, and the company merged with Newmont’s Australian operation to form what has become Australia’s leading gold producer — Newcrest Mining Ltd.
  • Further, if they didn’t believe my claims about BHP’s involvement in the region, they could visit the Mining Hall of Fame and view the many framed photos that we had obtained from BHP’s actual archives.

I mention this to you today to demonstrate what I’ve decided to call corporate alzheimers. Now, I wouldn’t expect everyone to have an intimate knowledge of their company’s history but they must know enough to avoid making claims that are grossly inaccurate.

Of Australia’s top 100 listed companies, 47 per cent of managing directors have been in their role for less than five years and 12 per cent have held the job for less than a year. That leaves only 41 per cent who have been in the role of managing director with that company for more than five years.

That then gives scope for corporate alzheimers and explains why so many companies have short-term memory problems and zero long-term memory, running the risk of making the same mistakes again and again. I mention this to you today only to remind you of the important responsibility you have to pass on all the wisdom that each of you have accumulated. Pass it on effectively to those who follow you and it will save you many future problems.

I do know some of you are very effective in this role but I feel strongly enough about this aspect to flag its importance.

Land access

In 1979 I purchased a block of land in Hong Kong. I have the title here, headed ‘Document of Land Ownership’ and it certifies quite clearly that “Ron Manners, the above named honourable person, is a purchaser of a square centimetre of land in the British Colony of Hong Kong entitled under this document.” It (below) was purchased from China Square Inch Land Ltd.

 

Now let me compare that with an application in Western Australia for an exploration licence, prospecting licence or a mining lease. Neither these applications nor the China Land Title give me useful access or rights. The essential difference is that when I purchased the square centimetre of Hong Kong land I knew it was a joke, simply a clever tourist gimmick and I never had any expectations of claiming the rights to my so called ‘title’, for which I paid very little.

However, with the Mineral Tenement Application, that was different. I paid good money with the expectation I could proceed to explore and produce. The scandal which confronts us now is that any of us applying for a mineral tenement would be lucky to live long enough to go through the various procedures that will give us the access, when in the past we could simply get on with our job.

I despair at the outcome (or lack of any outcome) of what is mistakenly called native title. Australian Aborigines do not have any title as a result of this and, simultaneously, the system of mining titles that previously gave good title is now severely diminished.

The Act was not well thought through and is poorly drafted. With all due respect to our High Court and Parliamentary scribes, I’m amazed how they can have had so much knowledge, but so little wisdom. Since the High Court judgements, property rights have not only been reallocated without compensation for people’s losses but, worse from an economic perspective, they have been stripped of any useful function—destroyed!

What is called native title is inalienable, and therefore cannot be sold or mortgaged. Native title is unclear as to ownership, geographic extent and rights that it confers. It is of almost no use to Aborigines and an absolute nightmare to investors who must steer clear of uncertainty.

It has cost our nation around $60 billion in lost production, lost opportunities and lost employment and gives Aborigines no rights whatsoever other than to hold projects up. When the eminent economist Hernando de Soto visited Notre Dame University last year, he pointed out that such unclear and unreliable property rights are the essence of third world status.

Scams (when the conman comes calling)

One of the greatest threats to your financial health is the existence of professional predators purporting to be financial advisors. This is not a new phenomenon but it gained credibility with the rise of socialism, with the credo that it is far easier to plunder than to produce. Like socialism, it needs a victim on which to feed and relentlessly continue to redistribute your hard earned dollars elsewhere.

In the hope that you will learn something from one of my many Heroic Misadventures, I’ll take a few moments to relate the story of…

The fabulous RockCruise

There I was, in September 1977, sitting on yet another plane. The accountant, seated alongside, mentioned to his colleague, just loud enough so I could hear: “The RockCruise project is going really well, all arrangements are well in hand and it can’t miss being a huge success. There is still room for another investor, but they will have to be quick, because there is so much interest.”

Of course I spoke up: “What is this big deal that sounds so good?” He then explained. “It’s a cruise ship promotion called RockCruise that I’m involved in back in Sydney. The investors will get all their capital back before the end of November, with the split-up of the very substantial profits early next year.”

He offered to sit down with me when we arrived at our destination and outline the whole venture, which he did. He said that the group had chartered the SS Australis and would be filling 1200 berths from Sydney, and 400 from Auckland for theRockCruise. In total, there were to be 2200 berths but 30 or 40 of these would be given away for promotional purposes. The total amount of ticket funds would be released on November 13, and the investors would get all of their capital back before the end of November.

At that stage, there would already be a profit of $100,000. On top of all this, there would be additional areas of profit, and he listed items such as alcohol sales, sponsorships from Levi Jeans and many others. Profits were also promised from rock concerts arranged in each South Pacific port, and in addition there would be the banking exchange (currency conversion of travellers’ cheques on board and when passengers get onshore).

Again, he stressed there would be a full capital refund to each investor on November 30, 1977 with the only thing beyond that point being their profits. These profits were to be calculated no later than March 30, 1978. Many other assurances were given about the guaranteed profitability, such as the fact that all Christmas cruises out of Sydney were fully booked with long waiting lists, “and we can pick up all of these people from the waiting lists”.

He also used wonderful, comforting phrases such as: “the venture is already under way and can’t go wrong”, and, “the involvement of the Chandris Shipping Line and Orbit Travel virtually guarantee this”.

Well friends, how could one resist an offer like this?

Of course a more detailed document that you could call a prospectus was subsequently supplied. It even improved on these initial assurances, together with the investor agreement, and included details of the top-flight industry experts they had signed up to attend to all the logistical arrangements. The calculations now included the spectacular concert profits, indicating a total return to the investors of 137.5 per cent over the five-month period. Not bad!

Now we were under way, the reports started flowing in and the project just got better every week. By November 14 we were advised: “Ticket sales are going really well now, over 600, nearly 700, and we still have another month to top up the ship.”

With ticket sales going like this they were already planning a RockCruise II, to cater for the overflow with another cruise a month later. All these arrangements gave us comfort to release our funds. By now additional sponsorship had come on board, in particular, Coca Cola and Faberge Babe. The latter was to be the major sponsor, with the cruise now being officially titled the Faberge Babe RockCruise.

The experts had also visited all the exotic South Sea destinations and made arrangements for the concerts, with these ticket sales also progressing well.  In fact, everything looked so good that we had no hesitation in folly victualling the ship in Port Said (none of these liners could afford food in Australia, so they collected provisions well ahead of arriving here) and we paid all the bands so they couldn’t perform elsewhere over the busy Christmas/New Year period.

I don’t think I’ve ever been involved in a project that was going so well, without even a minor complication.

Lucky Debbie, from Parramatta, then became the famous face of the Faberge Babe RockCruise competition and won a free cruise. She was on all of Sydney’s talk-back programs for 24 hours. All good news until just three days later, on November 17, when just a glimmer of a problem emerged. Chandris Lines requested an urgent meeting the next day, where they insisted on us finding a guarantor for $300,000, otherwise they would cancel the cruise.

The ticket sales were not 700, they were actually 450, and under further questioning we discovered they were not even fully paid, they were in fact “deposit paid”. The next day, the gravity of the situation struck home and I was on the train from Kalgoorlie to Perth and then the flight from Perth to Sydney. We then stalled Chandris until we could get some answers.

We needed our own expert, and a mate of mine, John Singleton, lined up his personal advisor to sit through our interrogation of the promoter and his assembled team of experts. It was becoming obvious that the promoter and his assembled experts knew less about the project than even the two non-executive investors (of which I was one).

They were still parroting all their marketing cliches but there was very little substance to them. So the two investors took on the task of selling tickets on Sydney’s street comers, with Chandris giving us a couple of weeks as the SS Australis, fully provisioned, made its way towards Sydney.

My whole family joined me in Sydney right through until mid-December, where we spent all daylight hours proudly wearing our RockCruise T-shirts and selling tickets like there was no tomorrow. During the evenings we meticulously planned the next day and phoned many metropolitan Sydney and Melbourne travel agents seeking their support (most of whom had not previously been offered tickets for sale).

These were four challenging weeks for us in Sydney, which were made even harder because of:

  • a postal union strike, preventing us getting our brochures into the hands of travel agents
  • an airline union strike, preventing interstate flights from joining the cruise in Sydney
  • the NSW coal mining union strike which plunged Sydney into darkness on the day the SS Australis berthed.

During this time, while working into the night, we assembled a checklist to confirm all the other promises which had been made by the promoter and his assembled experts. We found that very little had actually been finalised by them. There was no sponsorship money forthcoming, as all such agreements were still in draft form. The sponsors were willing but had not been followed up.

The media started to pick up the smell of death and articles of doubt appeared in the press. Probably the greatest disappointment was for us to find that, despite detailed descriptions, no venues whatsoever had actually been booked at any of the exotic South Pacific ports. When we phoned people on-site it was explained that when “our experts” visited, they realised that suitable fenced venues simply did not exist, so they converted their investigation into a holiday at our expense. We had no alternative other than to cancel the cruise and refund all the ticket money.

On the night the ship was due to sail out of Sydney, it remained berthed in a blackened-out Sydney, fully laden with provisions (there was a lot of food on board). This was a serious ship, but had nowhere to go.

Whose fault was all this?

Despite encouraging sounds about the excellent prospects of legal success and the issuing of writs, the mounting legal costs and seemingly endless legal procedure completely destroyed our faith in the court ever dispensing justice within our lifetimes. My RockCruise files were carefully hidden in my archives until 1999 when, on hearing that Renee Geyer and her band were visiting Perth, I wrote a letter to her Perth venue, suggesting that on the strength of my filling an ocean liner with food and honouring the contract with her band by payment in full, she might send me a ticket or two to her Perth concert, and even buy me a beer.

No response!

This RockCruise adventure was not only a hard-luck story, but a lesson in what traps lurk out there for simple souls like us when we are let loose in the hard cold world out there.

Concluding comments

Well, here we are at another conference. I know I’m going to get value because, talking to you over a coffee or a beer, I’ll better understand just where we are in the various economic cycles. These cycles are not often synchronized between all aspects of our industry but all cycles lead to the future and constant change — and that’s exactly where we are all going.

The American commentator, Fred Allen, once described a conference as: “…a gathering of important people who singularly can do nothing, but together can decide that nothing can be done.”

Now I want you to think for a moment about what you, as drilling professionals, actually do. Do you fully understand the importance of what you do? Are you able to explain this in simple terms to your children, to your loved ones and to the general public? We all need to be put on the spot occasionally and be forced to explain, sometimes to a hostile audience, the importance of what we do.

Someone, making fun of me writing books, recently said: “so what’s writing?” and I said: “writing is a very lonely occupation, as you sit into the early hours of the morning, staring at a blank piece of paper watching the beads of creative blood as they are squeezed from your brain to become words.”

Apart from my business interests I also run the Mannkal Economic Education Foundation and we arrange visiting lecturers and send young people away on scholarships. I was asked what this was all about and flippantly said: “oh, we have a bit of fun by sending people here and there.” My wife Jenny heard me say this and called me to one side and said: “I know how important this is to you so it deserves a better answer than the one you just gave.” Jenny was quite right.

As professional drillers you don’t just sell holes, you enable the dreams of people like me to come true. Sometimes you even shatter expectations as the drill bit searches for truth but nothing much happens until the drilling starts.

If you want to find out if an exploration company is serious, you ask “are you drilling yet?” When Denis O’Meara asked me to be chairman of DeGrey Mining, when he was putting the company together, I agreed but on one condition — that he was drilling by the day we listed on the ASX.

Your profession brings a sense of legitimacy to our little-understood mining industry so I implore you to think about your industry, write poems about it, even sing songs about it and at all times be proud of the nobility and importance of your achievements.

In conclusion, let me say that in addition to being proud of our achievements we should all remain vigilant and aware of how fragile our business is, as it’s tossed around on the turbulent economic ocean of today. Business is very much like the concept of freedom and if you substitute the word ‘business’ for the word ‘freedom’ in this quote from late President Ronald Reagan, you will see the similarity:

“Freedom is a fragile thing and is never more than one generation away from extinction. It is not ours by inheritance; it must be fought for and defended constantly by each generation, for it comes only once to a people.

“Those who have known freedom and then lost it have never known it again.”

Friends, may you run your business successfully and train well those to whom you pass the torch in life wonderful relay race.

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