“This must be the most exciting gold province in Australia today. We could find the big one here,” former mining magnate Joseph Gutnick said a decade ago.
He was talking about Western Australia’s eastern goldfields, and in Melbourne this month, Gutnick’s eldest son, Mordechai, repeated the prophecy.
“We’ve got every chance in the world of making a discovery,” Gutnick says, referring to the same ground that excited his father 10 years ago.
“We’ve raised quite a lot of money over the last two or three years and we feel we’re getting closer and closer to what they call, in the mining industry, the Holy Grail.”
The family name might have gone from the headlines, but the Gutnicks have not vanished from the mining fraternity.
Their Melbourne office is still home to four junior explorers – locally listed Great Gold Mines, Quantum Resources and Astro Diamond Mines, and North American play Golden River Resources.
And Mordechai Gutnick, or Mordi as he is known, is determined to emulate some of his father’s earlier success from his seat on the company boards. Gutnick, 28, has not taken the traditional path to a mining career.
He went to Yeshivah College in East St Kilda, one of Victoria’s top-performing high schools, before spending six years in New York and Israel studying for a rabbinical degree.
But he says his education, with its focus on Jewish law and philosophy, was good preparation for the mining industry.
“The best thing that it gives you is discipline and it gives you perspective on life,” he says.
“The mining industry is a rough place. It can take you to great highs and great lows and if you’re not properly grounded it can have an effect on you.”
Plus, he says, he has the benefit of his father’s years of experience.
“I’ve always been in his office and sitting around meetings. If I went off and got an accounting degree it wouldn’t have taught me a lot about how to do a deal, when to buy, when to sell.
”You learn how to make these judgment calls by experience, by sitting around them, by watching them, by seeing how they’re done.“
He was appointed a director of the family companies three years ago, soon after his return to Australia.
He decided to move his family – he has two sons, six and three, and a third on the way – to Perth, to be closer to the action.
He spends a lot of time liaising with investors and beating the well-worn fundraising path between Perth, the eastern states, New York and London.
He also oversees the company’s drilling programs, making sure that ”when the money is raised it is spent in the ground“.
Fortunes have fluctuated in recent years.
The Australian-listed Gutnick companies have a combined market capitalisation of about $34 million and accumulated losses of close to $150 million.
Short on cash, their share prices have taken a downward trajectory.
Only Quantum has surged, perhaps on the addition of uranium to its portfolio.
Gutnick admits it has been a rough ride.
”It wasn’t a business for eight years,“ he says, pointing to the crash in commodity prices and lack of interest in resources that led to the takeover of his father’s success story, Great Central Mines.
But he says the stable of companies he now helps oversee kept its focus, picking up ”some of the most prospective ground in Australia“.
”If you didn’t pick up that . . . in a complete depression you would have never been able to pick it up today,“ he says. ”Now it’s a business, because we’re seeing people wanting to put money into the companies. We’re seeing people wanting to joint venture. Now, at least, there’s money to drill.“
Great Gold Mines recently raised $5 million it will spend on a drilling program.
The company has ground in the eastern goldfields, near Anglo Gold Ashanti’s Sunrise Dam and Barrick’s Granny Smith gold mines.
The Gutnicks also have gold targets near Newmont’s giant Callie gold mine in the Northern Territory (under the Quantum umbrella) and diamond targets next to the Argyle and Kimberley diamond mines in Western Australia’s north (through Astro Diamond Mines).
Any of those could turn up the next big one, Gutnick says.
And he is not just chasing a few hundred thousand ounces.
”We don’t want go get into a marginal project and start hedging and all the complications that go with that,“ he says.
”We’re going for the major, multimillion-ounce discovery.“
A mining magnate in training he might be, but Gutnick remains grounded and contributes that to his faith.
Like his father, Gutnick is a rabbi, and he spends much of his spare time helping Perth’s small, but close-knit, Jewish community.
He also credits his religion with helping him to maintain that all important work-family balance.
”The Jewish Sabbath gives me time to spend with my family that I probably wouldn’t if I didn’t have that,“ he says.
While the shift to Perth has been good for business, it has sparked a conflict of sorts when it comes to Gutnick’s other great passion – football.
A long-time Carlton supporter, Gutnick developed a soft spot for Melbourne when his father became the club’s white knight, but now finds himself barracking for Fremantle.
Gutnick has first-hand experience of the boom-bust nature of the mining industry. As a child, he watched his father’s star rise. As a teen he watched it fall again.
As an adult, he is living what analysts and economists predict could be the longest-running resources boom in history.
But Gutnick says the benefits are not flowing through to mining juniors. He wants tax breaks for investors in junior explorers.
The industry is pushing for the introduction of a flow-through share scheme that would allow the tax deductions junior miners get on their exploration spending to be passed on to individual shareholders (Gutnick has seen the benefits of the scheme in Canada) – but Treasurer Peter Costello is likely to put the kybosh on that when he hands down his Budget tonight.
”I think the Canadians realise their country is built on the resource industry and there is nothing to be ashamed of,“ he says.
”Australia’s been blessed with a great economy over the last number of years and a lot of it’s been built on the mining industry but you’ve got to nurture that also,” Gutnick said.