UNEARTHING THAILANDíS TREASURES

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John Steele is the Chairman of Geothai Services, Limited. The Toronto native is a geophysicist by training; meaning he measures the physical properties of rocks for mineral, oil and gas exploration.

He originally became interested in the field while studying math, physics and chemistry at the University of Toronto. In his program of study, there were seven different streams he could choose to go into, and starting in his second year he saw a little bit of each as he gravitated toward what he wanted to major in. One of his professors, a fellow by the name of Tuzo Wilson (an eminent geophysicist who put forth the Continental Drift theory and later became the President of Erindale College) used to show pictures of all the places he had visited during his career. Heíd been everywhere. John was hooked: he wanted to be a physicist and he liked the idea of traveling and working outside.    

After obtaining a Bachelorís Degree in geophysics from the U of T, he then took a Masters Degree in the same field from the University of British Columbia. After graduating in 1968, he went to work for the mineral arm of a French oil company based in Calgary, called Aquitane. During the next ten years, he also worked for Chevron Minerals and two geophysical contractors: Geoterrex out of Ottawa and Scintrex out of Toronto.

Describing his work, John says, ďItís an in-depth professional job but itís blue collar as well because you have to go into the jungles, bushes and mountains take measurements and do the field work. A lot of people start there and evolve into office work. But I still prefer to do both.Ē

But gradually John did evolve from just being a guy in the field to upper management and beginning in 1973 he started working overseas in and today he has worked in over eighty countries.     

ďCanadian geophysical contractors were the first group of technical people that Canada exported in a serious way. Partly because you went where the mines were; you canít bring them to you,Ē John says. He actually ended up studying a field still in its infancy: using geophysical techniques to define geology as opposed to looking for mineral deposits.

Canada, by the way, leads the world when it comes to geophysics. People recognize this, but itís not common knowledge. For example, John was recently invited to go to Morocco to speak to the Moroccan Stock Exchange and the Moroccan business community because the country wants help in building up the financial side of their mining sector.

You canít always see all the rocks, but if you use geophysical techniques you can see the rocks through all the dirt on top. So in the early 80s countries were deciding to try and better idea of what kind of minerals they actually had. As a result, John ended up doing a number of different surveys around the world, including one, which spanned the entire country of Jordan.  

And the Thai government also wanted to do a mineral inventory to see what hidden treasures it had. Back then, the countryís main exports earners were tapioca and rice and the government wanted to add minerals to the list. So they borrowed US$50 million from the Asian Development Bank (at 11 ľ% interest), of which about seventy percent was targeted for geophysics. 

The ADB stipulated that the Thais needed experts to help implement the US$35 million geophysical side of the loan. Thatís where John came in as he arrived to work inside the 120-year-old Thai Department of Mineral Resources, which is part of the Ministry of Industry. This was, and still is, the biggest survey of its kind ever performed and unfortunately the least utilized. (The results hang on the walls of Johnís office at the One Pacific Place Building on Sukhumvit Rd). The project was supposed to take five years, but the survey and all the ancillary work actually ended up stretching to eight from 1984-92. (John worked on it from 84-87).

No one has ever bought the US$20 million ADB survey that Steele worked on because itís too expensive and the Thais donít want to sell it because they are scared the person who buys it will then turn around and re-sell it. The Thai government really has little experience in the use of the survey. But by charging so much they obviously discourage people from coming here and setting up exploration.

Geothai, however, did grow out of this project. John realized that the mineral resources in Thailand were completely unexploited and absolutely so by foreign groups, who had the knowledge and expertise that didnít exist here. So he thought there was a role for a company that could do the work and also manage projects for foreign groups and bring them into the country. John then set up Geothai with his Thai partner at the DMR, Amnuaychai Thienprasert. They needed to build the business but John was in no financial state to stay here, so he moved his wife and two children back to Canada, while Amnuaychai stayed here and ran Geothai.

From 87-91, John then took a consulting job in Iran, which took him go to the Persian Gulf for two weeks every two months. He was the first technical guy in Iran after the revolution and the only foreigner with his company. He was there the day the Ayatollah died and when the mullahs decreed that nine people in his workplace had to be shot for corruption, so they dragged everyone outside the company and they then shot the culprits in the back of the head while John and the rest of his co-workers were forced to stand by and watch.

Until 1994, he continued doing consulting work throughout the world, but he made a number of trips to Thailand to oversee Geothai. The company then started putting together some exploration projects with foreign companies, helping them to better understand the way things were done here.

Then a Canadian stockbroker named Yorkton Securities, who specialized in mining finance wanted to expand into Asia and bring companies here that needed financing. His company, Yorkton Securities, hired John to set up a South-East Asian office with Bangkok as it hub and Geothai being its rep office. So for five years Geothai worked with Yorkton to find and finance projects for Canadian companies that wanted to work in this part of the world.  It also looked for local companies that wanted to raise financing for their activities such as the Malaysian Mining Corporation. This lead to financial projects in Malaysia, Indonesia the Philippines and it generated exploration projects in Thailand, Burma, and Vietnam as well as some ancillary projects in Laos and Cambodia.


So what does the future hold for Geothai? ďFirst, we will expand the business of the company. Thereís a market for e-commerce and e-business, so we will become the Asian representative for a number of functional e-business software firms.    

ďSecond, the Thai government has decided to sub-contract its resource exploration. They are putting out 206 areas over seven years with a 480-day exploration period with a budget of Bt22 million per area. We will be bidding on a number of these projects and if we get them we will be actively soliciting people to come and work in the country.

ďAnd third, I am taking Geothai public in Thailand as the Stock Exchange of Thailand has created a sub-exchange called the Market for Alternative Investment (MAI.). Normally a resource-based group wouldnít get any benefit from listing with the SET but the MAI is theoretically different in that it allows venture capital firms to list. We will be the first or second group to be listed and I intend to raise venture capital money for Thai resource projects from Thais. And then I hope to list the company with the Toronto Stock Exchange.Ē 

Another project Steele is working on is diamond exploration. ďThe Thais were finding diamonds in the tin-mining areas in the south for many years.  Then in 1968, the DMR decided they wanted to find out where they came from so they called in the British Geological Survey, which was working in Burma at the time, to go to Phuket and the surrounding area and appraise the situation. This team told the Thais they had just learned from continental drift that Thailand and Australia were once linked and since they are diamonds in Northern Australia, the Thai diamonds were alluvial - the source wasnít here, and since Australia had moved away there was no point in looking for diamonds.  

ďBut in 1973, we learned that Thailand and Australia were never linked. But when I came here in 84, one of the director-generals showed me diamonds that have been found in Thailand and still said the DMRís position was the source was Australia because the British Geological Survey had told them so. We then took the existing data and did exploration actually identifying sources of where these diamonds come from. We even had some concessions but politics entered into it and they were taken away from us. So now we are in negotiations with De Beers and other companies to set up joint ventures here.Ē 

Steele is also the President of the Prospector & Development Association of Canada (PDAC), which represents all the junior (smaller) exploration mining companies in the world. Being a spokesman for this industry opens almost every door for him in the mining business to both the producing and junior companies and is a great way to promote his company and the industry here. The body also has a lot of influence e.g. it just worked with the South African Mining Minister to propose changes in that countryís new flawed mining law.

John has purposely kept a low profile in the ex-pat community preferring to integrate himself with the Thais he is working and dealing with. As a result, not many people in the Canadian community in Thailand know John Steele and thatís a shame. Heís been a credit to his company and his country and his expertise has helped Thailand evolve as a country. Heís a good example of what Canadian know-how can do when itís properly applied. 

 

Contact Info:

Tel: (662) 653-0940
Fax: (662) 653-0939
Website: www.minesthailand.com
Email: jpsteel@attglobal.net     


  FINIS

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