Copper Miners: Money for Small Projects Coming from Majors
At a copper CEO roundtable at the Vancouver Resource Investment Conference, the leaders of multiple junior copper companies talked about the trouble with raising money in the industry.
Vince Sorace of Kutcho Copper (TSXV:KC) said that amongst other things, a lot of “institutional money” is yet to make its way back into the sector since the end of the global financial crisis.
“We’ve seen a lot of the high-risk capital that typically plays in the resource space a lot more focused on cannabis … [and] … we’ve seen it for a more short period a lot more focused on the likes of cryptos.”
“Institutional money that was there traditionally to fund projects like us basically hasn’t come back since 2011 — they suffered some heavy losses and really they’re just not around. These days money is coming from basically corporates, strategics, and private equity is soaking up a lot of the money out there.”
He said that while the money still out there, “that money is hard to get, and you need a good project to get it.”
John Black, who is a director at Chakana Copper (TSXV:PERU) and the CEO of Regulus Resources (TSXV:REG), said the same thing.
“We see retail investors and retail money through traditional sources like private placements quite difficult to raise. It’s been very difficult for companies to get money out there right now.
“However, what’s replaced that are essentially funds, large funds, or strategic investors. In many cases a mining company or a large significant shareholder is backing it.”
Junior miners set up to develop projects and then be acquired rejoice though.