The mates list is one of the spookiest features of Geocaching Australia.
"How does the system know who my friends are?!?!"
Actually, it's quite simple: It's based on the number of simultaneous finds of caches by pairs of cachers. For example, if you and someone else regularly log the same caches on the same day, it assumes you are caching together and further assumes you are mates.
Despite the multi-level assumptions, it's often quite accurate!
Manually adding or removing mates:
You can manually add or remove a cacher from your mates list by visiting their cacher profile page. In the top left of the profile page next to “Profile” are two icons, the blue icon adds the cacher to your mates list and the red icon removes them from your mates list. You can also remove a mate with the same red icon while viewing your mates list found under your “My” tab.