Mining firm eyes Mongolian cash
Junior mining companies must go where the money is when searching for capital.
But Mongolia?
Halifax-based Erdene Resource Development Corp. Wednesday announced that it intends to raise up to $2 million through a private equity placement with Mongolian investors.
“We really do believe that we’re being welcomed as a guest in that country,” said Peter Akerley, Erdene’s president and CEO. “We want to do everything we can to ensure that the communities that welcome us have some benefit from our presence.”
Erdene isn’t new to the Mongolian steppes. Since 2009 it has been exploring for copper, gold and molybdenum in prospects in southwestern Mongolia near the Chinese border.
The local company has plenty of company. The development of Mongolia’s vast, but virtually untapped, mineral resources has triggered an economic boom in the country, which is sandwiched between China and Russia.
Fully one-third of Mongolia’s three million inhabitants are still nomads. Even so, the International Monetary Fund foresees double-digit annual growth for the country for years to come. Gross Domestic Product per capita — currently a mere $2,000 — is expected to quadruple by 2018.
“There’s a growing group of high net-worth individuals in Mongolia,” said Akerley. “They are also extremely knowledgeable about mining and are hungry to have a chance to participate in the boom.”
Akerley expects that 20 to 25 Mongolian investors will share the Erdene issue. Through a local brokerage house, Mongolia International Capital Corp., the company is issuing up to five million common shares at a price of 40 cents each.
Wednesday, Erdene’s shares were trading at around 41 cents apiece on the TSX.
Akerley said that his company plans to use the money for more exploratory drilling on its Mongolian properties.
Earlier this week, the company recorded a loss of $1.3 million in the third quarter of 2011, up from a loss of $834,437 for the same period in 2010.
Erdene holds a 25 per cent stake in Xstrata Coal Canada Ltd.’s plan to develop the Donkin coal field in Cape Breton.
(jdemont@herald.ca)
But Mongolia?
Halifax-based Erdene Resource Development Corp. Wednesday announced that it intends to raise up to $2 million through a private equity placement with Mongolian investors.
“We really do believe that we’re being welcomed as a guest in that country,” said Peter Akerley, Erdene’s president and CEO. “We want to do everything we can to ensure that the communities that welcome us have some benefit from our presence.”
Erdene isn’t new to the Mongolian steppes. Since 2009 it has been exploring for copper, gold and molybdenum in prospects in southwestern Mongolia near the Chinese border.
The local company has plenty of company. The development of Mongolia’s vast, but virtually untapped, mineral resources has triggered an economic boom in the country, which is sandwiched between China and Russia.
Fully one-third of Mongolia’s three million inhabitants are still nomads. Even so, the International Monetary Fund foresees double-digit annual growth for the country for years to come. Gross Domestic Product per capita — currently a mere $2,000 — is expected to quadruple by 2018.
“There’s a growing group of high net-worth individuals in Mongolia,” said Akerley. “They are also extremely knowledgeable about mining and are hungry to have a chance to participate in the boom.”
Akerley expects that 20 to 25 Mongolian investors will share the Erdene issue. Through a local brokerage house, Mongolia International Capital Corp., the company is issuing up to five million common shares at a price of 40 cents each.
Wednesday, Erdene’s shares were trading at around 41 cents apiece on the TSX.
Akerley said that his company plans to use the money for more exploratory drilling on its Mongolian properties.
Earlier this week, the company recorded a loss of $1.3 million in the third quarter of 2011, up from a loss of $834,437 for the same period in 2010.
Erdene holds a 25 per cent stake in Xstrata Coal Canada Ltd.’s plan to develop the Donkin coal field in Cape Breton.
(jdemont@herald.ca)
Comments
Post a Comment