First Mining Finance: On Building A Mineral Bank
Investment Executive Steve Todoruk chats with First Mining Finances’ President Patrick Donnelly for the next interview in our Sprott’s Thoughts Natural Resource Symposium Platinum Sponsor series. First Mining Finance, like all the companies we have interviewed, offers investors a unique method by which to participate in the natural resource space.
Referring to itself as a “mineral bank,” First Mining Finance accumulates development-stage gold assets, and circumvents the exploration and construction risk inherent in most junior miners.
Patrick Donnelly runs First Mining Finance as President, along with Keith Neumeyer, the current Chairman of the Board. Keith Neumeyer founded First Quantum Minerals and First Majestic Silver (the latter currently has a market cap of about $2.0 billion).
Patrick Donnelly is an exploration geologist by background, but has many years of financial, investing and operational experience through his work as an analyst with a Canadian securities firm and later as the Vice President of copper development companies in Alaska and South Africa.
During the interview, Steve Todoruk explains why the junior exploration model that has been prevalent for many years is now broken. The typical junior resource company has a history of continuously tapping the markets to raise capital. Most never find a deposit of economic value, and shareholders are left with hundreds of millions of shares outstanding and assets which amount to nothing in value.
The result has caused the market to severely downgrade all junior mining companies. As Patrick explains, “We see a very severe protracted bear market with respect to mining equities and as a result, we’re seeing historically low valuations of junior mining companies.”
It is those low valuations that First Mining Finance seeks to take advantage of, by purchasing distressed junior mining companies with undervalued gold development assets. They will also seek viable development partners, anticipating an opportunity to sell the assets, holding on to a residual royalty or ownership percentage.
Using this methodology, First Mining Finance, has acquired several million ounces of gold across the various projects, and anticipates having nearly 20 million ounces in their portfolio in the near future. The current market cap is about US $273 million.
Steve’s interview with Patrick Donnelly is a must listen.
To listen to the audio link: CLICK HERE
For more information on the Sprott Vancouver Natural Resource Symposium, please click here or contact your Sprott broker.
About the 2016 Sprott Natural Resource Symposium in Vancouver:
How can you maximize your profits from the long awaited precious metals and natural resources bull market? One time tested way is by listening to respected experts in the industry at the 2016 Sprott Natural Resource Symposium in Vancouver, Canada, July 26-29. Our clients have consistently rated this conference as the finest investment conference they attend.
Join experts including Jim Rickards, John Embry, Doug Casey and Steve Sjuggerud. Join the “living legends” of mining, men who built billion dollar businesses, and are doing it again: Ross Beaty (who took Lumina Copper from $.50 to $140 in seven years); Robert Quartermain (who took Silver Standard from $.72 to $45in ten years); Rob McEwen; and Robert Friedland.
Meet and listen to fifteen of the most influential precious metals and natural resource oriented newsletter editors in the world. Meet over 50 public company exhibitors, who are allowed to exhibit because they are owned in Sprott managed accounts.
In the early stages of a resource bull market, can you afford not to go to the finest junior resource investing conference in the world?
For more information, please follow this link: Sprott Natural Resource Symposium
This information is for information purposes only and is not intended to be an offer or solicitation for the sale of any financial product or service or a recommendation or determination by Sprott Global Resource Investments Ltd. that any investment strategy is suitable for a specific investor. Investors should seek financial advice regarding the suitability of any investment strategy based on the objectives of the investor, financial situation, investment horizon, and their particular needs. This information is not intended to provide financial, tax, legal, accounting or other professional advice since such advice always requires consideration of individual circumstances. The products discussed herein are not insured by the FDIC or any other governmental agency, are subject to risks, including a possible loss of the principal amount invested.
Generally, natural resources investments are more volatile on a daily basis and have higher headline risk than other sectors as they tend to be more sensitive to economic data, political and regulatory events as well as underlying commodity prices. Natural resource investments are influenced by the price of underlying commodities like oil, gas, metals, coal, etc.; several of which trade on various exchanges and have price fluctuations based on short-term dynamics partly driven by demand/supply and nowadays also by investment flows. Natural resource investments tend to react more sensitively to global events and economic data than other sectors, whether it is a natural disaster like an earthquake, political upheaval in the Middle East or release of employment data in the U.S. Low priced securities can be very risky and may result in the loss of part or all of your investment. Because of significant volatility, large dealer spreads and very limited market liquidity, typically you will not be able to sell a low priced security immediately back to the dealer at the same price it sold the stock to you. In some cases, the stock may fall quickly in value. Investing in foreign markets may entail greater risks than those normally associated with domestic markets, such as political, currency, economic and market risks. You should carefully consider whether trading in low priced and international securities is suitable for you in light of your circumstances and financial resources. Past performance is no guarantee of future returns. Sprott Global, entities that it controls, family, friends, employees, associates, and others may hold positions in the securities it recommends to clients, and may sell the same at any time.
Friday, February 3, 2017
2017 Outlook - Sprott Asset Management USA, Inc.
Saturday, January 14, 2017
2016 in Review
Friday, December 30, 2016
Sprott Asset Management - December 2016 Strategy Report
Wednesday, December 14, 2016
Precious Metals Market Commentary
Tuesday, December 6, 2016
The Next Bull Market Move Interview - Rick Rule from London
Monday, November 28, 2016
November 2016 - Strategy Report
Wednesday, November 16, 2016
Manager Insights from the Sprott Gold Team
Monday, November 14, 2016
A Snapshot of How Trump's Election Affected Gold Commodities and Major Markets Last Week
Thursday, November 10, 2016
Post-Election Commentary from Sprott
Friday, October 28, 2016
Sprott Precious Metals Watch - October 2016
Wednesday, October 26, 2016
Corrections, Patterns, and Positioning