Thread by @PraiseKek

#Uranum biography 2⃣
John Borshoff, CEO of @DeepYellowLtd
Thread 🧵 1/25

When investing in the mining sector I believe there are 2 main factors one should consider when taking decisions:

1⃣ The Asset
2⃣ The Management

In these threads, we will concentrate on the CEO.

2/25

Borshoff served in the Aussie Army during the Vietnam War, an experience that connected him with Dustin Garrow, who became a lifelong companion throughout John's #Uranium ventures. Both drew valuable lessons from their time in the war, which later influenced their careers.

3/25

John Borshoff relates the lessons he learned during his time in the Vietnam War, and how it impacted his corporate #Uranium experience:

4/25

John Borshoff obtained his Bachelor of Science in Geology from the University of Western Australia and started off his geological career in a company called International Nickel which was operating out of Australia at that time.

5/25

John Borshoff: "The oil shock happened in '70-'71, and all hell broke loose. Where was the next energy fuel?” This search for alternative energy sources piqued John's interest in #uranium as a potential solution for the world's growing energy needs.

6/25

John Borshoff then joined Canadian Superior Oil, which allowed him to work in Northern Australia and gain hands-on experience in the #uranium sector. "I joined a company called Canadian Superior Oil and worked a little bit there in about '73."

7/25

After gaining experience in the #uranium sector, John Borshoff joined Uranerz, a West German group focused on uranium exploration & production. Uranerz was a large company with an international footprint, seeking to find uranium to support Germany's nuclear program.

8/25

During his time at Uranerz, John Borshoff expanded his knowledge & skills in the field of geology and the #uranium sector. "I worked there for 15 years until 1992 and got a tremendous experience, broad international spectral across not only geology but the full gamut."

9/25

Following Uranerz's withdrawal from Australia in 1992 due to political reasons, John Borshoff founded a consulting company to continue working in the uranium sector. "When they pulled out of Australia because of political reasons, I then formed a consulting company."

10/25

He leveraged his expertise and connections to acquire valuable resources for his new venture, including Uranerz's database. "For my golden handshake, I actually swapped their database and got that in lieu of a pay-out. And that became a tremendous asset."

11/25

Rick Rule:

"Uranerz spent a billion $ on its database. when they shut down they were gonna give John his severance in cash, but he asked for the database. He had enough faith in #uranium & his own skills. Rather than taking $, he took the database and he bet on himself."

12/25

After successfully running his consulting firm, John Borshoff founded Paladin Energy Ltd in 1993. Paladin initially focused on copper-gold exploration, but John Borshoff recognized the potential in the #uranium market and convinced the board to shift the company's focus.

13/25

He believed that if the #uranium market picked up, Paladin would be well-positioned to seize the opportunity. "And if it does click, this will be a tremendous opportunity for the company." He started picking up cheap properties in Namibia and Malawi.

14/25

Borshoff's vision for Paladin was not to simply find deposits & sell them, but rather to build a company that would develop & operate mines. "We weren't dressing the bride to sell her, we were actually going to make a marriage between deposit & the company & build mines."

15/25

But having cheaply-bought assets alone would not build a mine by itself. With the sentiment in the sector at its lowest levels ever, and with only a 2 million dollar valuation, his company was in need of capital to be able to execute John Borshoff's #uranium vision.

16/25

So John Borshoff turned to Rick Rule who then worked at Sprott.

Rick: “I met this amazing man named John Borshoff, just a bundle of determination & knowledge, a wonderful human with a $2 million MC when nobody cared about uranium, instant love between John and me."

17/25

"Nobody wanted to talk to us, my play was too contrarian, based on demand. So, I teamed up with Rick Rule in 1998. He sort of backed me a little bit. In 2003 the price started to go up, Rick's support was vindicated and we then built our mine in 2005 and demand kicked in."

18/25

"When Rick first came in he bought it at $0.10 and it went down to $0.01 and then he supported it at $0.01, and then when other people started to come in, and institutions started to come in seeing that we were legitimate, price just went from $0.03 in 2003 to $10."

19/25

Paladin became a major player in the #uranium sector, thanks in large part to Borshoff's leadership & vision. The company successfully developed multiple mines & generated significant revenue. But there was a danger lurking in the shadows that was about to ruin the party.

20/25

Paladin had raised a lot of debt to finance the construction and upgrade of their mines. When Fukushima happened, the #uranium sector suddenly experienced a huge demand destruction phase with Japanese NPPs shutting down. And this started a vicious cycle.

21/25

"When Fukushima came along, there was still about 3.2 billion in debt, and we thought after Chernobyl and the experience there, that the Japanese would restart quickly, but they didn't. I did not kill the debt on time, and it became a problem"

22/25

John Borshoff resigned from Paladin and retired in 2015. But...

"I couldn't retire. I just, my whole attitude is I come from a farming background and people, 80 years old, are still planting oak trees, and for a future, for a tree they will never see in its full glory."

23/25

So John looked for a company in the sector that did not have a compromised share structure, one that allowed for greater autonomy and flexibility in decision-making. He became CEO of @DeepYellowLtd, a former exploration branch from Paladin, and he reunited his old team.

24/25

Since then, John Borshoff and his stellar team, the only team that turned an explorer into a real producer in the last cycle, have been working hard to create a multi-jurisdiction, top-tier, #uranium developer. Will he be able to repeat the Paladin story?

25/25

Has he learned from his mistakes at Paladin though?

John Borshoff:

"What I did learn is to be very wary of debt. Even though your model might be great, there are outside influences like Fukushima."