Hookers and Blow: The Only Real Metric in the Junior Mining Industry – by Peter Clausi (InvestorIntel.com – May 3, 2017)


Peter M. Clausi is an experienced investment banker, executive and director and CEO for CBLT Inc., formerly known as Green Swan Capital.

We have suffered through at least four years of soul-sucking mining markets. The pain has shot through the juniors, the intermediates, even the mighty senior producers.Many in the industry this year have been quick /eager/ desperate to call a recovery. “It’s over!” we shout, with fingers crossed, hoping that saying it makes it true.

PDAC 2012: ah, the good ole days. Every booth in the trade show and the investor side was spending marketing money. The parties were huge. Treasuries were full. Scotch tastings, a banquet of food and 35,000 people wedged into downtown Toronto for The Mining Show. Companies were on undisciplined buying sprees, spraying capital like water from a hose. That’s what the smell of gold near $1,800 an ounce will do.

Fast forward to PDAC2014. Think Cormac McCarthy’s The Road, the great Irish potato famine, Mad Max, Fort McMurray after the fire, the dark side of the moon. That year, attendance fell to about 25,000, with empty booths artfully draped to cover up the holes.

The number through the turnstiles was likely much less than that. Parties were much smaller, guest lists more tightly controlled, marketing more focused. Value had been obliterated in those two years and mining companies were adjusting to a more limited treasury.

PDAC2016 was a time of desperate optimism. Official attendance was down to 22,000, but those 22,000 real mining people made a better group than did the 25,000 in 2014. Good projects were barely getting funded, bad projects were properly dying the death they deserved. Intermediate projects had to battle to see another day. Some companies survived on having raised a well-planned amount of money at the right time, others on pure luck.

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