In his 30 years in mining, Aura Energy Ltd (ASX:AEE, AIM:AURA)’s David Woodall has been exposed to the broad brush of commodities and jurisdictions.
This has given him a keen sense of an industry that – contrary to its fusty reputation in some quarters – sits at the cutting edge of geopolitics, technology and the energy transition.
In this article:
- Geopolitics and diverse markets
- Learnings from a long career
- A transition for the mining industry
- Decarbonising – a portfolio of solutions
- Uranium in the mix
- ESG across the board
Geopolitics and diverse markets
Aura has major uranium and polymetallic resources in Africa and Europe – vastly different jurisdictions and settings which will deliver well to their respective markets.
Woodall understands that there is a need to meet countries where they are on their energy journey.
For a country like Sweden – where Aura’s polymetallic Häggån project is based – there are fierce debates about where one of the world’s most advanced and decarbonised economies heads next.
The war in Ukraine has concentrated the national focus on energy security and the maintenance of a diversified portfolio of power solutions.
For Mauritania – where the company is working on resource expansion and production at the Tiris Project, a major greenfields uranium play – the question is more needs-based and existential.
How do developing countries most effectively monetise their natural resources in a world with growing, and changing, energy requirements?
Resources development provides Mauritania and its people with significant scope to contribute to a global, diversified energy solution.
“One thing becoming obvious and unavoidable is the forecast that the use of electricity is going to increase by about 150% between now and 2030,” he says.
“As the world becomes more developed, we need more energy – so the electrification of the world is going to continue. And the question is, well, if it's going to grow, how are you going to grow with it?
“All indications are that from 2025, we are going to need to diversify supply – and that means there's going to be a greater demand than supply for yellowcake uranium on the markets.”
Of course, the geopolitical situation plays its part in current demand opportunity, too. Aura is focusing on parts of the world that need energy security.
“What we learned from COVID-19 and the Ukraine crisis is that, while globalisation works, you can't outsource everything,” Woodall says. “Whichever country you’re talking about, there needs to be both a diversity of supply and a strong domestic supply chain.
“Europe in particular has been caught out in the past year, and that’s had its economic and inflation impacts.”
Learnings from a long career
“The general perception of mining is that it is a dinosaur industry,” he says. “But if you look at what is being done, where there's a new technology, it's adopted very quickly.
“Because the industry understands that it needs to evolve to survive, and it always has.”
Woodall was born in Kalgoorlie, ground zero for mining in Australia, and so perhaps it was a foregone conclusion that he would go into mining as his father had before him.
“When I finished high school, my choices were geology, mining, metallurgy,” he says. “When I graduated, I went to spend time with a mining magnate.”
Woodall’s first assignment was in Fiji, which sparked an interest in working abroad and in different jurisdictions and cultural settings.
“You need to learn about culture, and about different societies and how they work.”
After Fiji there were stints in Canada, the US and Africa, working with a range of commodities, from iron ore to gold, copper, nickel and rare earths.
The evolution into new technologies and the energy transition seemed organic from here.
“When it comes to new technologies, for me, it's about learning, which keeps you interested, engaged and excited,” Woodall says.
A transition for the mining industry
The necessary global energy transition mirrors the transition for the mining industry itself, which has also been through a period of rapid change and diversification.
The rush towards lithium, rare earths and uranium by traditional miners certainly encapsulates this trend – but old-school mining has also evolved.
Woodall lists off a host of innovations – in new metallurgical processes and GPS technologies, the use of self-driving trucks, virtual reality training and the embedding of ESG principles – as markers of the way the industry is adapting.
“There are certain things that we probably hold onto a little bit too long – but invariably we’ve had to innovate to survive,” he says.
Doing more with less is part of that innovative approach: “Look at the gold mining sector, which is working with mining grades significantly lower than when I first joined the industry – and yet they’re doing it profitably. That’s because they’ve evolved their technologies and processes.”
He also flags an image problem the industry has struggled to shake off. “We are criticised for what we sometimes do because mining does scar the environment – that's a reality.
“But when we finish mining, most companies rehabilitate well and do the right thing. Unfortunately, the few that don't tend to hurt the reputation of the broader industry.”
The public debate about uranium’s place in the energy mix is politically charged, which means there is seldom a clear-eyed approach to practical solutions.
Decarbonising – a portfolio of solutions
At home, Woodall walks the talk on sustainability: “My family is pretty much off the grid. When someone talks to me about being carbon efficient, I can tell them I drive an electric vehicle, I've got solar panels and a battery – we’re about 98% self-sufficient when it comes to energy.”
And while he is adamant that the whole world needs to head in this direction, he feels it’s not there yet – and needs a bridge, in the form of a portfolio of needs-specific solutions, to get there.
“I understand that while renewables are cheap and Australia is blessed from that perspective, you need diversity in the energy sector,” he says.
“It's very easy for a country like Australia to sit around and say, ‘we've got to stop doing all this’, but what about Africa? What about India? What about developing countries? Do we have a right to dictate? Or do we have an obligation to help them to achieve first-world energy security with low or zero-emissions energy sources?
“The solution for decarbonisation is one of renewable, nuclear and transitioning out of fossil fuels.”
“Whether you're left or right, I don't care,” Woodall says. “We've got to have a mature conversation, for the sake of future generations, about how to resolve this issue.
“It is resolvable – it just needs focus and commitment. Not words.
“What we do know is that if we're talking about a potential of a two-and-a-half-degree warming in the climate if nothing changes, that’s going to be significant.
“As the world becomes warmer and the seas rise, there'll be a whole lot of people in low-lying areas who have to move. We're not talking two or three million, but tens of millions of people.”
The current solution is to ensure the right blend of sources. “And if you don't have the right blend, you are not only not meeting your decarbonisation targets, but not achieving baseload power.”
Uranium in the mix
Woodall thinks the emphasis on nuclear incidents, like Three Mile Island, Chernobyl and Fukushima, has failed to place them in the context of all mining incidents and the impact of the overall process on the environment.
“Small modular reactors are extremely safe, and don’t impact the environment at all,” he says.
“If you want to get to a decarbonised world, you have to use nuclear as a percentage of the mix – it’s now around nine to 12%.
“We've got the ability to do this, as long as it doesn’t become a political football. Most Australians just get sick of the noise and just tune out after a while.
“But we see a significant opportunity for Australia as an energy producer, in the renewable space and with green hydrogen, green ammonia and nuclear.”
Woodall is confident that the company’s ESG bona fides meet strict European environmental requirements around the provenance and carbon footprint pedigree of the product.
“In Mauritania, we don't have to drill and blast, we don't have to crush and grind down material because we can free dig it. It's a low-cost operation that is easily expandable.
“This is where we see ourselves fitting into the global market as another supplier and a diversified supplier close to Europe and the US.
“We mine it, we process it – we produce the yellowcake and, in that process, you've got a system where we do the beneficiation where roughly 80% of the material goes straight back into the mined out areas.
“When mining you're not leaving holes in the Sahara, you're basically backfilling them up with mine waste and continuing on – it's a closed loop.
“And then once you ship the material and store waste, there are very strict guidelines from the IEA on the movement and storage of nuclear material.
“As you'd expect, in the Sahara water is a precious resource, and our process, recognising this, reuses a lot of water.”
ESG across the board
Along with environmental fundamentals, the social component of ESG is front of mind for Woodall.
“While the nearest communities are about 650 kilometres away, that doesn't stop us getting involved in what I would call generational benefits – so the health, education, training and development of the people within that community will be key to our engagement with our Mauritanian partners,” he says.
“We will look to people from Mauritania, from the local region, to run this operation, with minimal reliance on ex-pats.”
One of the challenges he sees is attracting a diversity of people and ideas to the industry.
“We need to get more diversity in leadership and engineering positions as we go forward. We need diverse nationalities,” he says.
“When we build management teams with diversity around the table, we get better discussions, better decisions – and more success.”
As he wraps up, Woodall recalls how he used to go to schools in Canada to educate children about the mining industry: “I would ask the students if they could see any iron ore in the room.
“And the kids would look around and say they couldn't see any.
“But then you point out the chairs they’re sitting on - they've got some steel, and that comes from iron ore.
“And it was interesting that teachers would approach me later and say, ‘we didn't understand just how important this industry is for the way we live’.”