Site Searches - Finding new quarry sites and Concrete Plant sites
Conflicts of Interest - Independant Advice
Quarry Lease Terms and Conditions
See our article on the above in our Published Articles Section
Mineral Ownership Issues
See our article on the above in "Quarry Royalties" under our Published Articles Section
Interpretation of Technical Reports
There are often EIS documents, Development Approvals, EPA Licences, Mining Licences, Geological reports, Product Testing reports and a range of other documentation that often requires interpretation for legal use or other purposes. We can provide explanations about how these documents impact on your business, and check to see if we believe your in compliance with your obligations.
Minimum Rents and Royalties
See our article on the above in "Quarry Royalties" under our Published Articles Section
Quarry Product Pricing Structure
There are many operators who do not properly reflect the full asset value of their minerals and plant, machinery and equipment, when carrying out their pricing structure. In essence there can be particular products, often the highest selling one, that can be underpriced, or involve very little margins, without the operator fully understanding the processing costs, or the mineral value for that particular product.
A Concrete Plant operator wrongly priced their concrete mixes one year, and were $8.00 a cubic metre, below the cost price. They had a record year, and sold 22,000 cubic metres of concrete, and were sure that they must have made a good profit at the end of the year, when in fact, they made a loss of $200,000, with a few bad debts as well. The bank cut their credit, and they had to sell up and because the business was failing, they luckily had enough to cover their debts after 20 years of building the business. I acted for the quarry operator who bought them, identified why the business was failing, corrected the pricing structure, and they sold 15,000 cubic metres their first year at a profit which equated to 30% of the purchase price.
We can supply you with a spreadsheet to do your pricing structure, and ensure that you have covered all of your costs. Some operators don't apply a value for the mineral, some for plant and machinery or capital costs, or development approvals, or even for future capital costs.
Quarry After Use and Land Development Potential
There are a range of opportunities for quarry after use, the most common of which can involve landfill. In or around urban locations then there are often industrial or residential use that have a higher and best use compared to the quarry value, and it can be more feasible to re develop the site at an early stage, rather than continue the quarry, which can be detrimental to the value, as sometimes additional depths prevent other future uses from occurring (there can be geotechnical and flooding and drainage issues). There can also be opportunities to lease lands and gain additional income, or obtain value added opportunities from associated industries.
Site Searches - Finding new quarry sites and Concrete Plant sites
We have a large number of geological maps which identifies the broad geology within virtually all of the major populated areas of Australia. We are familiar with the nature and types of geology that a lot of the major quarry operators extract and work, but also come across many landowners who are looking to sell lands containing unconsented mineral deposits. We can therefore quite often identify suitable opportunities. We are also aware that many LGA's hold records of old quarry extractions within their area, that have old consents, some of which are still valid today, and research for these can often provide lucrative opportunities. However the flip side is that sometimes the research can reveal very little or nothing, but where an opportunity can be found, then this can more than offset the failures.
We also do many valuations of quarries for quarry operators wishing to sell, so we often know where the opportunities are, but also have client confidentiality conflicts.
Conflicts of Interest - Independant Advice
There are many conflicts within the quarry industry that always need to be addressed. Drilling operators always want to drill more holes than an operator may need, plant saleman always want to sell a higher capacity plant than is needed, and good saleman will often achieve their objectives. This is not a criticism of those individuals or businesses, as forward thinking quarry operators, are often the ones who are most successful and often require these services. However there are times where an independant viewpoint is required, and we can assist in providing that assessment, especially where a large capital investment is involved.
Over capitalisation can significantly impact a quarries profitability, and rather than benefit economies of scale, can cause dis-economies of scale, which in turn causes obsolescence and can damage the business.
A quarry operator buys and installs a 300 tonne per hour crusher, but it was fed by a 100 tonne per hour conveyor. That company later went into liquidation. Another operator had a sand operation with a 60 tonne per hour sand plant which they upgraded to 80 tonnes with a 30 tonne per hour feed, surprisingly the plant did not produce any more than 30 tonnes per hour. So sometimes it is not the plant that
has been acquired, it is the other bottlenecks that have been created by a new item of plant, that also need to be addressed. We have inspected and valued several hundred quarry plants and have experience in a range of different configurations and designs. Let us know if we can assist you.
