Project Generators: Exploration & Investment
Mineral exploration is an inherently capital-intensive and risky business. Despite the large number of junior explorers there is only the very occasional spectacular discovery, meaning the odds of success are stacked against individual resource investors. This geological risk can then be compounded by the ‘all eggs in one basket’ approach that many typical juniors employ whereby shareholders are offered exposure to only one or two flagship projects that focus on a single commodity within the same jurisdiction.
Project Generators, however, offer an alternative: a large portfolio of projects that is diversified by commodity and country, helping to insulate the company against political and economic risks, with joint venture partners being sought to fund the more advanced and expensive phases of exploration. In addition, a continually-fed pipeline of new projects forces the company to quickly assess and dispassionately relinquish unprospective ground, allowing it to focus on only those with the greatest potential, therefore increasing the chance of making an economic discovery.
This presentation will introduce the concept of ‘Project Generators’, providing an overview of the business model and attractiveness for investment, as well as outlining how they conduct their exploration programmes and what to look out for when considering investing …!