The National Post is Canada’s second largest national paper.

TORONTO — For junior exploration companies, alternative financing options such as crowdfunding are starting to be taken seriously.

The halls of the Prospectors and Developers Association of Canada (PDAC) conference here are littered with companies clinging onto their last dollars and seeing no opportunity to raise money through traditional equity issues.

So it was no surprise that a big focus of the conference on Monday was digging into the alternatives. Some of them, notably crowdfunding, have real potential. But the rules remain uncertain and they raise serious concerns that even the experts acknowledged are not yet understood.

For decades, exploration companies could count on Canadian retail investors to provide capital. Now that institutional investors have almost entirely stopped funding greenfield exploration, they need to tap into retail more than ever. But under the current securities regime, they have failed to do that in recent years. Now they need to win the retail investor back.

“This is the worst bear market in decades and the retail investor has completely left the room,” said junior mining analyst John Kaiser. He added that the sector has become “inaccessible to the retail investor.”

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The National Post is Canada’s second largest national paper.

Legendary mining and oil tycoon Lukas Lundin has never been modest about his goals. So his latest targets probably shouldn’t surprise anyone, as eye-opening as they might sound.

“I want Lundin Mining up to $10-billion [market capitalization]. I want Lundin Petroleum up to $10-billion. And I want Lundin Gold [at] $5-billion,” the Swedish entrepreneur said in an interview in his office, which overlooks the city of Vancouver and the North Shore Mountains beyond.

On his bookshelf sits an unusual marble pig with a red dash up its spine. It is a gift from an investment banker that commemorates Mr. Lundin’s US$7.1-billion sale of Red Back Mining Inc. to Kinross Gold Corp. in 2010. That was probably the most one-sided deal in the history of the gold business, and Mr. Lundin, as he usually does, came out on the winning end.

Now the Lundin Group of Companies is back in the gold game. It paid US$240 million – including US$100 million from Mr. Lundin’s own family – to Kinross for the Fruta del Norte (FDN) project in Ecuador last year, creating Lundin Gold Inc. Kinross paid US$1.2 billion for FDN in 2008, but decided not to build the mine after the government imposed a punitive windfall profits tax.

FDN is one of the largest and richest undeveloped gold projects in the world. It’s capable of producing 500,000 to 600,000 ounces of gold per year at low cash costs, Mr. Lundin said. But he has to overcome the political problems in Ecuador that felled Kinross.

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The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Private-equity interest in mining companies has waned, leaving a handful of players to pick through the debris.

For two years, private equity was all the rage as the mining industry got hit hard by the plummeting commodity prices. Traditional private-equity firms were looking for distressed assets. Bankers and others tried to establish private-equity shops.

But today, many of the big funds have not made mining investments and others have simply given up.

“They thought they could be passive financial investors, raise some capital, put it in some companies. But it is very difficult to find something where you can actually make money,” said Isser Elishis, chief investment officer with Waterton Global Resource Management.

Globally, private-equity mining deals have slipped. Last year, the private pools of capital were involved in 66 deals worth $5-billion, compared with 83 transactions worth $6.7-billion in 2010, according to data compiled by Thomson Reuters.

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http://www.mineweb.com/

The oddities that come in ranking the world’s best places to explore. Strange things happen when you ask exploration company management a hypothetical question about the juiciest regions for discovery.

Every year the Fraser Institute sends out a questionnaire to mining types. Most of them are exploration management (as self-reported.) This year it sent out a little over 4,000 questionnaires and it got back responses from just over 10% of that score.

One of the topics the Fraser Institute addresses, among many, is a question of fantasy. To paraphrase: Based on what you’re familiar with, what areas hold awesome potential for discovery assuming there are no impediments to exploration, like nasty dictators, pushy anti-miners and prohibitive regulation.

The idea, the Fraser Institute says, is to poll what its respondents think are the best regions in terms of raw exploration potential.

It gets weird in two ways. It seems the potential of the world’s rocks, to the survey’s respondents, changes very rapidly, as year to year the best of rankings bounce erratically. And each year the ranking makes for odd juxtaposition.

Let’s take this year’s survey. It doesn’t start out too controversially. Yukon tops it. Alaska comes next. Nevada thereafter.

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The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Crowdfunding one solution, prospectors’ conference told

Junior miners must seek new ways to find investors — including crowdfunding — if they want to survive the current industry slump, analysts told a prospectors’ convention.

A turnaround in metals prices isn’t expected until about 2017, but “that’s an eternity for the juniors,” warned longtime analyst and industry observer John Kaiser on Monday at the Prospectors and Developers Association conference in Toronto.

“We are now in the worst bear market in decades,” noted Kaiser, who is based in San Francisco and has covered the topsy-turvy sector since 1983.

He said the ongoing bear market has been dismissed as a cyclical downturn that will eventually reverse, as it always has. For instance the five-year downturn in the mining industry after the Bre-X gold salting scandal in 1997 was followed by a ‘super cycle’ of 13 years of sky-high metals prices and record share prices.

“While true for majors (big mining companies) whose fortunes hinge on the commodity cycle, it may not be true for juniors,” he said.

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http://ca.reuters.com/

TORONTO (Reuters) – A four-year mining-industry downturn has left big gold producers hungry to buy reserves they haven’t had the money to find themselves, and impoverished small miners eager to cash out, setting up the ingredients for mergers and acquisitions revival in 2015.

Mining veterans say that scenario is likely to come into play at the industry’s largest annual event, the Prospectors and Developers Association of Canada convention in Toronto, March 1-4, where more than 20,000 participants are expected.

Many small explorers and developers, cash-strapped after years of austerity, may be looking to attract buyers at the convention.

Big gold miners, meanwhile, have been hit by weak commodity prices that have forced them to slash exploration budgets, slowing new discoveries, and contributing to a drop in in-the-ground reserves at the world’s five biggest bullion producers.

Their reserves, cumulatively, fell 11 percent to 317 million ounces in 2014, company data show. If reserves continue shrinking, production will eventually follow.

“The big mining companies still know they have to buy projects … If you don’t buy new assets you just watch your business decline,” said John Gravelle, global mining leader at consultancy PwC.

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http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Several federal departments of the Canadian government, as well as the Ontario provincial government, unveiled new measures and investments on Sunday to increase support and drive growth in the country’s besieged mining industry.

In a speech to the Prospectors & Developers Association of Canada, Finance Minister Joe Oliver announced that government proposed to extend the 15% Mineral Exploration Tax Credit (METC) for investors in flow-through shares for a further year, until March 31, 2016. The credit was scheduled to expire on March 31, 2015.

The federal tax credit programme had been referred to as the “lifeblood” of junior mineral exploration – and its extension was expected to support the mineral exploration efforts of junior exploration companies, as it had done since its introduction in October 2000. During a challenging time for the global economy, in the struggle to secure capital, it had helped keep investment flowing.

“When we strengthen this industry, we create jobs, growth and long-term prosperity from coast to coast to coast. We are doing exactly that by cutting red tape, lowering taxes and expanding free trade across the globe,” Oliver stated.

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