What have been the main developments at Foraco International in 2024?

Foraco International (Foraco) has transitioned from non-essential markets, such as Russia and parts of West Africa, and intentionally pivoted into more stable jurisdictions. Another major development was establishing a permanent presence in the US. We are extremely excited about the opportunities in the US as they are well aligned with Foraco’s strategy of working for tier-one customers in mature jurisdictions, where we can get long-term sustainable contracts. We also successfully deployed our new generation rotary drill (NGBF 800), which is built in our workshops in France and retrofitted with tooling and support equipment in Australia. The NGBF 800 is remote-controlled and has completely hands-free automation. It has a much smaller footprint even though the rig has significantly more capacity than competitive rigs, and it received the Australian Drilling Industry Association (ADIA) 2024 Safety Innovation of the Year award. This is a great achievement as deploying a new type of equipment into a market as sophisticated as Australia can be challenging. We are currently in the process of deploying the next three, which will bring it to a total of five rigs in that region.

Moving forward, what are Foraco’s priorities when it comes to developing new technologies?

There is no question that automation and remote-controlled drill rigs operations are priorities resulting in safer operations and a better working environment for field crews. Ever since the first remote rigs were deployed in 2015, we have continued to reap the benefit by adopting this technology which only continues to improve in terms of function and reliability. Automating certain rig functions is within reach and will improve performance further and will be widely accepted by our increasingly diversified field crews.

Do your junior and major customers approach drilling differently?

There are some differences between the way juniors and senior mining companies approach their drilling requirements, and this is largely related to the stage of exploration. Juniors are predominantly engaged in greenfield exploration and often have a limited drilling budget especially when the capital markets are challenging as they are presently. These initial, often first pass drilling programs covering a large area or target and drill holes are often designed to provide the maximum amount of geological information in terms of rock types and structure. With success, additional funds may be raised to fund a more extensive and concentrated drilling campaign.

While senior mining companies also conduct greenfield exploration, most are engaged in advanced exploration or feasibility studies. These projects are much larger in scope, requiring many rigs drilling closely controlled holes designed to define the orebody in an efficient and timely manner. As such drilling services are considered an integral part of the project and subject to stringent HSE, environmental and regulatory requirements that demand state-of-the-art equipment, operating procedures and crews.

How have inflationary pressures impacted the cost of drilling in recent years?

Inflation has impacted the cost of drilling in recent years as it has all aspects of the mining industry. The industry-wide labour shortage resulted in steep increases in labour costs, which are the biggest cost of drilling services. Similarly, rising costs of raw and finished materials drive up overall expenses, further contributing to an increase in drilling rates to offset these costs.

As inflation pressures ease, drilling costs have stabilized and are subject to market fluctuations depending on how competitive these markets are. Junior exploration activity plays a big role especially in mature regions like Canada that are well serviced by numerous service providers resulting in discounted drilling services when market conditions are tight, as they are today.

Which markets will be of particular focus for Foraco in 2025 and beyond?

Key markets for Foraco include North and South America as well as Australia. Not only are these stable and well financed jurisdictions, but they also have tremendous potential for prime commodities such as copper, nickel and gold, which are the main drivers for our business. Underpinning these commodities is the water business associated with mining activities for all commodities which is also a focus market for Foraco. This does not prevent Foraco from entering into markets as our customers require from time to time, providing it makes sense for the business and our employees.