slide1 l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Exploration, Investment and Development for Miners, Financiers and Investors Canada as a source of investment for Afric PowerPoint Presentation
Download Presentation
Exploration, Investment and Development for Miners, Financiers and Investors Canada as a source of investment for Afric

Loading in 2 Seconds...

play fullscreen
1 / 38

Exploration, Investment and Development for Miners, Financiers and Investors Canada as a source of investment for Afric - PowerPoint PPT Presentation


  • 241 Views
  • Uploaded on

Exploration, Investment and Development for Miners, Financiers and Investors Canada as a source of investment for African mining Africa Mining Congress 2010. Bruce Shapiro President, MineAfrica Inc. President, Canada-South Africa Chamber of Business www.mineafrica.com

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Exploration, Investment and Development for Miners, Financiers and Investors Canada as a source of investment for Afric' - nam


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

Exploration, Investment and Development for Miners, Financiers and InvestorsCanada as a source of investment for African miningAfrica Mining Congress 2010

Bruce Shapiro

President, MineAfrica Inc.

President, Canada-South Africa Chamber of Business

www.mineafrica.com

www.canadasachamber.com

why should africa s mines turn to canada
Why should Africa’s mines turn to Canada?

1. Toronto is the mining finance capital of the world

Canada is a global leader in the mining industry and Toronto is the

world's most active centre for mining equity finance. Over the past five

years, issuers listed on both the Toronto Stock Exchange (TSX) and the

TSX Venture Exchange have led all international exchanges in mining

equity financings.

Over 10,000 transactions;

  • 80% of all mining financings in number (US$136.9 billion).
  • 36% of total equity capital raised globally.
  • 27% compound annual growth rate in number of listings.
  • Record $22.2 billion in 2009 alone.
importance of toronto
Importance of Toronto

To emphasize the importance of Toronto as a source

of mining equity, its main competition in terms of

number of listings is;

  • ASX at 9%.
  • LSE-AIM at 8.5%.
  • US markets combined at 0.35%.
number of new mining listings 2005 2009
Number of New Mining Listings 2005-2009

YearTSX/TSXV LSE/AIM ASX NYSEAmex NYSE HKEx JSE

2009 104 4 22 1 1 1 0

2008 138 29 9 5 3 3 2

2007 186 142 33 13 3 n/a 4

2006 112 70 55 14 6 n/a 10

2005 86 53 67 17 3 n/a 6

The table shows a consistent increase in the number of new

listings on the TSX and TSX-V from 86 in 2005 to 104 by last

year. On the other hand, listings on the competing exchanges

have been going down.

top 10 caps on tsx
Top 10 Caps on TSX

Market Capitalization in 2009

tsx tsxv and africa
TSX/TSXV and Africa

Toronto is the top exchange for mining in Africa;

  • 169 mining companies listed in 2009 out of about 300 non African based comanies.
  • 681 mining properties as of 2009.
  • $2.6 billion in equity capital raised out of 68 financings.
  • Projects in 44 African countries.
top 10 financings into africa in 2009
Top 10 Financings into Africa in 2009
  • Paladin Energy - uranium in Namibia $400m
  • First Quantum – copper, diamonds in DRC,

Mauritania, Zambia $345m

  • IAMGOLD - gold in Burkina Faso $345m
  • Katanga Mining - copper in DRC $282m
  • Anvil Mining - copper in DRC $200m
  • Equinox Minerals - copper in Zambia $184m
  • Red Back Mining -gold in Ghana, Mauritania $165m
  • Banro Corp - gold in DRC $117m
  • Centamin Egypt - gold in Egypt $98m
  • Mantra Resources - uranium in Tanzania

Mozambique $52m

2 expected canadian mining growth to boost foreign investment
2. Expected Canadian mining growth to boost foreign investment

Like in most other jurisdictions, the Canadian

mining sector suffered losses during the recent

financial crisis.

Canada Mining Report 2010;

  • Canadian mining shrank 10% year-on-year.
  • Predictions of 7.4% annual growth for next 4 years.
  • Investment outflows to foreign development expected.
3 leader in csr in the mining sector
3. Leader in CSR in the mining sector

Canadian miners are working with the federal government on

a Corporate Social Responsibility Strategy to help developing

countries reduce poverty and build their economies through

responsible development of their natural resources.

Canada’s CSR Strategy for the International Extractive

Industry in Developing Countries sets out government's

expectations on;

  • Social responsibility.
  • Environmental stewardship.
  • Health and safety.

Canada's mining industry has its own independent CSR program,

Towards Sustainable Mining, which involves consultations, public

reporting and third party verification.

how different jurisdictions can access canadian finance
How different jurisdictions can access Canadian finance

1. Listing on the TSX and TSX-Vor CNSX

Stock listing is a proven way to;

  • Raise capital, particularly for junior miners.
  • Attract long-term investment.
  • Draw expert advice in project finance and management.
listing costs
Listing Costs

TSX TSX-Venture

Listing Fees $10,000-$200,000 $7,500-$40,000

Accounting/Auditing Fees $75,000-$100,000 $25,000-$100,000

Legal Fees $400,000-$750,000 $75,000+

Underwriters’ commission 4-6% Up to 12%

Other fees to consider include:

Securities Commission fees, Transfer agency fees, Investor relations costs,

Geological or engineering reports, Printing and translation costs, Valuation reports and Director and Officer liability insurance

Listing Timetable and Costs

Details of an approximate time table and the various costs involved can be found in the white paper in the binder

canadian national stock exchange cnsx
Canadian National Stock Exchange – CNSX
  • CNSX has created a unique exchange to trade listed securities that is designed to meet the needs and characteristics of public companies and their investors. CNSX matches enhanced disclosure and streamlined issuer regulation with leading edge technology. Combined with comprehensive regulatory oversight CNSX provides an efficient new stock exchange that fosters integrity, transparency and liquidity for trading securities.
  • The costs of listing on this exchange are much lower than the TSX or TSX-V and the listing requirements are considerably easier to comply with. However the issuer will have to have its own pool of investors to take advantage of this option.
  • It is possible to move from the CNSX to the TSX or TSX-V at a later stage if there is benefit in this.
2 partnering with canadian investors
2. Partnering with Canadian Investors

Joint ventures and strategic alliances;

  • Canadian industry completed 442 deals worth $10.2 billion in 2009.
  • Advantage in providing risk-sharing.
  • Canadian knowledge of technical, financing, legal & regulatory landscape.
  • Contacts for political, financial & professional purposes.
  • Access to Canadian Financing institutions such as Export Development Corporation.
3 participating in promotional events
3. Participating in promotional events

PDAC’s annual exhibition - largest mining

convention of its kind;

  • Among top networking platforms for investors, financiers, developers and brokers.
  • Junior miners particularly enhance their chances of being noticed.
  • PDAC 2010 drew a record 22,000 delegates and 1,000 exhibitors in trade show.
4 participating in african focused promotional events held in canada
4. Participating in African focused promotional events held in Canada

Canada-South Africa Chamber of Business &

MineAfrica;

  • Host largest North American African focused annual mining breakfast and seminar during PDAC - record 340 attended.
  • MineAfrica rents out space at its booths to African juniors, service providers and governments.
  • Hosts seminars in Canada and London, UK that are dedicated to mining in Africa.
  • MineAfrica hosts similar seminars which include Africa but are not Africa specific, through its new international division, On The Ground Group.
5 participating in non african focused promotional events held in canada
5. Participating in Non-African focused promotional events held in Canada
  • There are many opportunities to promote your mining project in Canada but other than the Canada-South Africa Chamber of Business and MineAfrica events, none of these opportunities focus exclusively on Africa.
africa s mining sector competing against global leaders
Africa’s mining sector: competing against global leaders

1. Advantages – Abundant resources

International Development Research Centre rates Africa as

new frontier for innovation

  • Resevoir of young talent.
  • Growing market for cutting-edge technologies.
  • Source of fresh ideas.

And Africa has the geology

africa s mining sector competing against global leaders20
Africa’s mining sector: competing against global leaders

The Fraser Institute recently released its annual mining survey

comparing all mining regions in various categories including policy

potential, which is the main area of concern for investors when it

comes to opportunities in Africa. The table in the following slide shows

the policy potential for 10 of Africa’s mining jurisdictions. The Fraser

Institute scored them on a progression scale from 2006/2007 to

2009/2010.

It also ranked them out of the total of similar

jurisdictions measured over the same period. You will notice that there

are African jurisdictions that are in the top third, such as Botswana and

Burkina Faso and yet there are others that are in the bottom five, e.g.

DRC and Zimbabwe.

categories assessed for policy potential
Categories assessed for policy potential
  • Policy formulation
  • Administration, interpretation and enforcement of regulations
  • Environmental concerns
  • policy inconsistencies
  • Concern on native/aboriginal land claims
  • Taxation regimes
  • Availability of infrastructure
  • Socioeconomic agreements
  • Community development conditions
  • Political stability
  • Labor regulations and agreements
  • Geological data bases
  • Security
policy potential index
Policy Potential Index

Score Rank

2009/ 2008/ 2007/ 2006/ 2009/2008/ 2007/ 2006/

2010 2009 2008 20072010 2009 2008 2007

  • Botswana 66.5 64.9 74.3 47.3 21/7218/71 11/68 38/65
  • Mali 58.2 53.6 24.7 41.4 27/7233/71 58/68 42/65
  • Ghana 53.3 51.3 63.1 45.3 34/72 35/71 23/68 40/65
  • Burkina Faso 49.6 45.1 45.5 34.5 36/7242/71 38/68 46/65
  • Namibia 49.2 52.5 51.4 * 37/7234/71 33/68 *
  • Tanzania 44.9 41.8 35.0 41.3 44/7248/71 49/68 43/65
  • Zambia 36.5 44.4 49.8 31.0 52/72 44/71 34/68 50/65
  • South Africa 26.2 40.4 34.6 29.0 61/72 49/71 50/68 53/65
  • DRC (Congo) 18.9 24.1 34.4 17.4 68/72 63/71 51/68 57/65
  • Zimbabwe 14.7 19.1 2.9 2.9 69/72 65/71 67 /68 65/65

The table above ranks the 10 sampled African countries for the 13 policy areas covered

by the Fraser Institutein order of their standing out of 72 major mining jurisdictions

surveyed by the Fraser Institute worldwide. The higher the ranking, the higher the

country’s potential to attract new mining investment on the basis of policy.

access to canadian finance boosted south america s mining secto r
Access to Canadian finance boosted South America’s mining sector
  • Increasing investment concentration
  • 256 (169) Canadian mining companies in South America
  • 1,015 (681) Canadian mining properties.
  • $3.0B ($2.6B) in equity capital raised in 2009 – from 125 (68)financings.

African figures in brackets

top 10 financings for south american projects in 2009
Top 10 Financings for South American Projects in 2009
  • Mirabela Nickel - nickel, copper in Brazil $267m
  • Silver Standard Resources - gold, silver in

Argentina $170m

  • Kinross Gold - gold in Chile & Ecuador $516m
  • Medoro Resources - gold in Colombia $102m
  • Andean Resources - gold in Argentina $90m
  • Jaguar Mining - gold in Brazil $86m
  • Rusoro Mining - gold, copper in Venezuela

& Chile $80m

  • Quadra Mining - gold, copper in Chile $78m
  • Colossus Minerals - gold, platinum in Brazil $72m
  • MBAC Fertilizer - phosphate, potash in Brazil $57m
policy potential index26
Policy Potential Index

Score Rank

2009/ 2008/ 2007/ 2006/ 2009/ 2008/ 2007/ 2006/

2010 2009 2008 2007 2010 2009 2008 2007

  • Chile 79.1 79.9 82.0 64.1 7/72 7/71 6/68 27/65
  • Mexico 58.1 57.7 63.0 64.1 28/72 28/71 24/68 28/65
  • Peru 47.7 56.6 54.1 30.1 39/72 30/71 28/68 52/65
  • Brazil 46.1 47.1 45.0 51.2 40/72 39/71 39/68 36/65
  • Colombia 40.6 43.0 26.3 24.6 48/72 46/71 56/68 55/65
  • Panama 31.2 42.4 6.1 * 56/72 47/71 65/68 *
  • Argentina 28.4 33.0 40.3 40.9 59/72 56/71 43/68 44/65
  • Guatemala 21.9 5.1 * * 64/72 69/71 * *
  • Honduras 20.4 11.8 0.0 * 65/72 68/71 68/68 *
  • Bolivia 20.1 16.5 7.0 9.2 66/72 66/71 64/68 63/65
  • Ecuador 10.5 4.1 4.9 30.1 71/72 70/71 66/68 51/65
  • Venezuela 6.9 3.7 20.3 4.8 72/72 71/71 59/68 64/65

Just like in the case of Africa, the table above ranks the 10 sampled South American countries in order of

their standing out of 72 major mining jurisdictions surveyed by the Fraser Institute worldwide. The

higher the ranking, the higher the country’s potential to attract new mining investment on the basis of

13 policy categories previously stated.

comparison of african south american policy potential indexes
Comparison of African & South American Policy Potential Indexes

Score Rank

2009/ 2008/ 2007/ 2006/ 2009/ 2008/ 2007/ 2006/

2010 2009 2008 2007 2010 2009 2008 2007

  • Chile 79.1 79.9 82.0 64.1 7/72 7/71 6/68 27/65
  • Botswana 66.5 64.9 74.3 47.3 21/72 18/71 11/68 38/65
  • Mali 58.2 53.6 24.7 41.4 27/72 33/71 58/68 42/65
  • Mexico 58.1 57.7 63.0 64.1 28/72 28/71 24/68 28/65
  • Ghana 53.3 51.3 63.1 45.3 34/72 35/71 23/68 40/65
  • Burkina Faso 49.6 45.1 45.5 34.5 36/72 42/71 38/68 46/65
  • Namibia 49.2 52.5 51.4 * 37/72 34/71 33/68 *
  • Peru 47.7 56.6 54.1 30.1 39/72 30/71 28/68 52/65
  • Brazil 46.1 47.1 45.0 51.2 40/72 39/71 39/68 36/65
  • Tanzania 44.9 41.8 35.0 41.3 44/72 48/71 49/68 43/65
  • Colombia 40.6 43.0 26.3 24.6 48/72 46/71 56/68 55/65
  • Zambia 36.5 44.4 49.8 31.0 52/72 44/71 34/68 50/65
  • Panama 31.2 42.4 6.1 * 56/72 47/71 65/68 *
  • Argentina 28.4 33.0 40.3 40.9 59/72 56/71 43/68 44/65
  • South Africa 26.2 40.4 34.6 29.0 61/72 49/71 50/68 53/65
  • Guatemala 21.9 5.1 * * 64/72 69/71 * *
  • Honduras 20.4 11.8 0.0 * 65/72 68/71 68/68 *
  • Bolivia 20.1 16. 7.0 9.2 66/72 66/71 64/68 63/65
  • DRC (Congo) 18.9 24.1 34.4 17.4 68/72 63/71 51/68 57/65
  • Zimbabwe 14.7 19.1 2.9 2.9 69/72 65/71 67 /68 65/65
  • Ecuador 10.5 4.1 4.9 30.1 71/72 70/71 66/68 51/65
  • Venezuela 6.9 3.7 20.3 4.8 72/72 71/71 59/68 64/65
comparison of africa and south america
Comparison of Africa and South America

The policy potential index tables show that on

average, African countries fare better than South

American countries.

  • Only Chile ranks 7th out of 72 jurisdictions
  • Most other South American countries rank towards tail end of scale.
  • Ecuador and Venezuela are actually ranked 71st and 72nd respectively.
  • Majority of African countries rank in mid-table.
comparison table canada
Comparison tableCanada

Africa South America

Canadian Companies 169 256

Mining Properties 6811015

Financings in 2009 68125

Capital Raised in 2009 $2.6B $3.0B

several reasons why canadian investors favour south america
Several reasons why Canadian investors favour South America

1. History

  • Major Canadian investment to South America began in 1980s.
  • Canadian investment to Africa ballooned only after 2000.

2. Policy

  • Many South American gov’t’s have similar policies to Canada.
  • Africa behind in mineral policy changes.

3. Capacity for Risk

  • Canada is a resource based economy and Canadian investors accept a greater risk profile than other western countires

4. Geology

  • The two regions have almost similar geological attributes.

5. Other

  • Less important considerations include proximity and different time zones both of which impact on communication and travel costs.
sources and thanks to
Sources and Thanks to:
  • Innocent Madawo (Researcher)
  • Canada-South Africa Chamber of Business
  • MineAfrica Inc.
  • The Fraser Institute
  • National Resources Canada
  • Canada Mining Report – 2010
  • The Vancouver Sun
  • TMX
  • Canadian Securities Law
  • International Development and Research Centre
  • Intierra Resource Intelligence
useful websites
Useful Websites
  • imadawo@yahoo.com
  • http://www.mineafrica.com/
  • http://www.canadasachamber.com/
  • www.fraserinstitute.org
  • http://www.nrc-cnrc.gc.ca/eng/index.html
  • http://www.reportsandreports.com/market-reports/canada-mining-report-2010/
  • http://www.vancouversun.com/business/Will+mining+suffer+Bill+becomes/3072115/story.html
  • http://www.tmx.com/en/listings/listing_with_us/faq/index.html
  • http://www.canadiansecuritieslaw.com/2010/04/articles/mergers-acquisitions/mining-ma-opportunities-and-trends/
  • http://www.mineafrica.com/miningseminar/mineafricapdac2010report.htm
  • http://www.idrc.ca/AfricaNewFrontier/
  • http://www.fraserinstitute.org/commerce.web/product_files/miningsurvey2009-2010.pdf
  • http://www.fraserinstitute.org/commerce.web/product_files/miningsurvey2009-2010.pdf
  • http://www.nrc-cnrc.gc.ca/eng/index.html
  • intierra.com
for more information

For More Information

Bruce Shapiro

President, MineAfrica Inc.

President, Canada-South Africa Chamber of Business

Toronto, Ontario, Canada

bruce@mineafrica.com

www.mineafrica.com

www.canadasachamber.com