Belfast-based Tribe Technology’s planned UK initial public offering should get a boost from the company’s maiden supply deal with a mining major. Managing director Charlie King says the company is looking for a capital injection to scale its manufacturing and service operations. “We’ve got enough enquiries and contracted sales to book our production pipeline for the next five years, if we convert all of them into wins,” he says.
“There are roughly 1400 RC [reverse circulation drilling] rigs globally at the moment,” King told InvestMETS.com this week.
“Not all of those would be applicable for the technology and the power requirements we’ve got. But we’ve created a niche for ourselves in the autonomous space and we’re particularly targeting … big metreage [drilling programs] where people are chasing large amounts of volume and we can help them deliver that safer, faster [and] more efficiently.”
Tribe is building two of its unique, made-for-automation RC rigs at its Northern Ireland base, one for Anglo and the other for Major Drilling subsidiary, McKay Drilling. The McKay unit will head to Western Australia’s Pilbara region this year.
“The Pilbara is really the Mecca, the gold standard, for what’s going on globally in automation,” King said.
“We’re seeing other really mature projects elsewhere globally. But what’s now standard operating procedure in the Pilbara is really setting precedents globally. I think it’s a very exciting innovation hub. And the big players are really taking chances [and] investing in technology.”
Anglo’s rig will be delivered next year.
The mineral exploration world, and particularly the drilling community, will be watching and waiting for the rigs to go to work.
“We are over 100,000 engineering hours into it [rig design and integration with proprietary Tribe Technology Drilling System],” King said.
“We’ve done testing and validation of each individual sub-module as we’ve gone along.
“We’re still yet to drill a hole autonomously, but it won’t be that far off before we’re doing that.
“Commercial partners who are buying rigs are [pivotal] for us to make a viable business. Otherwise it’s just too working-capital intensive.”
King said he hoped to be making autonomous drilling rigs for Anglo “for many years into the future”.
“We eventually want to be producing 20 machines a year out of our current facility,” he said.
In May this year Tribe said it was raising £2 million via what it described as a pre-IPO funding round.
King said while the METS (mining equipment, technology and services) sector was not mainstream finance fare in London, the increased volume of recent M&A and investment in the space was generating greater interest.
He said the UK’s enterprise investment scheme (EIS) and venture capital trust (VCT) share plan for small AIM-listed companies were both appealing and should be looked at in other countries, particularly Australia, where Tribe has its secondary office.
“The future’s very bullish for the mineral space and the market fundamentals are very strong,” King said.
“London is a major finance centre of the world and there’s a lot of dry powder around.
“There are definitely better times we could be going to market but … we’re seeing a lot of excitement about what we’re doing. Our order book’s filling up and we need capital to grow and keep scaling the business.”