MINERS worldwide will be watching PeruvianPresident Ollanta Humala in coming days to see how he handles a veryhot mining potato.
Bigminers are warning Lima that Peru risks losing something like $US50billion ($49bn) in proposed mining and oil investment if the governmentdoesn't back Newmont Mining after demonstrations against its $US4.8bnConga gold and copper project forced work there to stop.
As withcoal-seam gas in our eastern states, Conga is all about undergroundwater along with rivers. The locals believe this water will be pollutedby the mine waste.
The country's image may also suffer fromGlencore's announcement that it is pulling out of its planned $US475million acquisition of a copper project in Peru after failednegotiations. The mine is expected to produce a vital 100,000 tonnes ayear of copper.
Peruis the world's second-largest producer of copper and silver and alsoexports large quantities of gold, zinc, tin, iron ore and molybdenum.
Anotherreason to watch Peru is that China is close to being its largestinvestor and trading partner, most of the activity involving oil andminerals.
No surprise then that a large Chinese investment firm,Junefield Holdings, is to take 16.8 per cent of Latin Resources (LRS) aswell as having the right to earn 70 per cent of two iron ore projects.LRS also has a large heavy minerals project in Peru that has significantpotential for rare earths, including the prized neodymium.
Theother news of the week came from Laconia Resources (LCR), a hithertopoor performer with unspectacular West Australian projects. The companyhit 26c soon after listing in late 2009, but its shares dived within twomonths of that and recently hit a low of 3.7c.
That price hasmanaged to get back to all of 5c on news of its acquiring an advancedgold-silver project in Peru. It already has a completed feasibilitystudy and Laconia is aiming at production within 18 months. The projectis being backed into Laconia by Gulf Mines of Peru, which attempted tofloat on the ASX earlier in the year. The latter company stands to endup with 56.5 million shares in Laconia in addition to the 82 million nowon issue.
We had news from one of the bigger Peruvian players,Metminco (MNC), which has just raised another $US40m, seen by thecompany as a good result in present market conditions. This tops up thewar chest for the 2012 work at the Los Calatos copper-molybdenumdiscovery in southern Peru and also ground in Chile.
Forgotten prospects
WE'REtold by someone who attended a number of junior resource company annualmeetings in recent weeks that attendance was well down, a sign of lackof interest in this part of the market.
When it comes to the smallexplorers, these meetings are usually attended only by those who needreassuring their investment has been wise one. They certainly don't goto hear the address from the chair, which is in most cases a recital(and a very dull one at that) of drill holes combined with whistling inthe wind about the company's prospects.
But, occasionally, you do find a few scraps of news or a reminder of a long-forgotten story.
TakeOutback Metals (OUM). Since listing in September 2008, the stock hasfailed to regain its 20c face value. It now sits at an all-time low of0.6c and recent roadshows have failed to raise a cent, so executivechairman Graham Chrisp told the annual meeting he is lending the company$500,000.
Last month, it was announced that a Chinese state-ownedcompany, Midon Land Resources, was negotiating to take a 78 per centinterest in OUM, including the chairman's majority stake. Chrisp saidthe talks were continuing and other international companies were alsointerested in the junior.
So what's the big attraction? In theNorthern Territory, the company has ground prospective for copper, tin,silver, uranium, coal and rare earths.
On Friday, PancontinentalOil & Gas (PCL) announced a $15m placement. The company plans todrill its Mbawa prospect offshore of Kenya. At the annual meeting twodays earlier, chairman David Kennedy was very enthusiastic about theproject, noting that virtually all Kenyan acreage had been taken up andthat Pancon's neighbours included several majors such as Shell andTotal, while the operator at Mbawa is Houston-based Apache Corp.
Overat the Platsearch (PTS) annual meeting, chairman Pat Elliott clearlyfelt he was beating his head against a brick wall, pointing out that thecompany's investments and cash were worth 12c a share, that there were22 projects in joint venture for base metals, gold, silver, uranium andiron ore, yet the share price was stuck at 10.5c.
Platsearch'sholdings include 48.3 per cent of Eastern Iron (EFE), 14.6 per cent ofSilver City Minerals (SCI) and 25.7 per cent of Thomson Resources (TMZ).All the companies have a very heavy weighting on NSW exploration, astate that has rarely fired investors' imagination.
And still theycome. Artist & Entertainment Group (AEM), which on Friday traded at0.4c, seeks to find a better future in resources.
Chairman RossHill had hoped to tell the annual meeting that two projects -- oil andgas in Indonesia and coal in Thailand -- were in the bag, but globalvolatility had caused delays. News in the "coming weeks", he hopes.
Mongolian failure
A REMINDER that not even magic words like "Mongolia" guarantee success.
Havingearlier this year dropped the non-magical word "diamonds" from itsname, Blina Minerals (BDI) took on a copper-gold project in the northAsian country now regarded as an exploration hotspot.
Then "sophisticated and professional" investors pumped in $663,000 at 0.9c a share.
Theywere in the money until Friday when BDI broke the bad news that areview of assays from Mongolia were such that the deposit was shelved.The shares fell 45.45 per cent to 0.6c, but those who took the placementalso got free options exercisable at 2c. Now they will be hoping theshare price beats that by the expiry date of October 2013.
brombyr@theaustralian.com.au