LIBERTY METALS & Mining Holdings continues to take stakes in emerging gold and metals producers.
This one has
Karma.
The unit of the large insurer,
Liberty Mutual, came across my screen about a year ago, when it gave
Red Eagle Mining in Colombia (
RD in Canada) $8 million in exchange for a net smelter royalty and 19.9 percent of RD. That was in October 2012 in Medellin. A very similar arrangement took place Thursday with True Gold's Karma gold development in West Afrique.
Says Red Eagle's
Ian Slater, "They have been quite active." Liberty Metals and/or its Liberty Mutual Group Asset Management in Boston (and New York City) also has backed coal mine developer Black Eagle, another Ian Slater company, in Alberta, Canada.
The only other person in traditional media who is covering the frisky Boston investor is young Kip Keen, who writes for Mineweb from Halifax, Nova Scotia, Canada.
As an insurer, Liberty Mutual has more than $120 billion of assets and about $37 billion of consolidated revenues (as of December 2012). It is probably one of the 100 largest corporations in the world by sales.
Insurance companies are always having to put their prodigious monies to work; the mining and metals facet of Liberty might amount to a sliver of its asset management pie.
From what I can find, the overall investment arm in one citing manages about $75 billion of discretionary and non-discretionary assets, most of that money for insurance companies. See:
https://investment-advisors.findthebest.com/l/35740/LIBERTY-MUTUAL-GROUP-ASSET-MANAGEMENT-INC.
Liberty has one of its longest standing investments in
Platinum Group Metals, a later-stage mine developer in Republic of South Africa. (I own shares of Platinum Group Metals, PLG in USA and
PTM in Canada. I also am a long-time investor in PGM's neighbour on the Platsreef/Flatreef,
Ivanplats.) The number on the Platinum Group Metals stake is 19.9 percent of PLG. (Once you go over 20 percent on a Canada-traded equity, rules and regulations multiply.)
Platinum Group's Mike Jones just said that his company named Liberty Metals' chief executive,
Diana Walters, to its board.
Diana Walters earned a Master's degree in energy and mineral resources at the University of Texas (Austin) in 1986. At age 50, she has been an analyst, an investment banker and an asset manager, mostly in resources.
A few hours ago, Liberty Metals and Mark O'Dea's
True Gold Mining, a Burkina Faso mine developer, said the insurance unit would give True Gold (
TGM in Canada) $23.4 million via a private placement of True Gold common shares and the sale of a 2% net smelter return royalty in True Gold's
Karma Gold Project. True Gold's shares were rising about 10 percent in Canada after the Liberty bell rang Thursday morning.
Other Liberty Metals stakes include British Columbia gold mine developer Pretium (
PVG in USA) and Ram River Coal.
Ms. Walters will address small mining company representatives at the Precious Metals Summit in Colorado this coming September. Joe Wickwire of Fidelity Investments and others also will speak in Beaver Creek.
See:
https://www.precioussummit.com/event/2013-summit-colorado/?section=home.
TCR takeaway: When junior miners show high grades of ore (gold, tin, platinum, coal, iron ore, etc), and demonstrate a finite timeline to production, Ms. Walters and her team appear ready to drop in for a visit. I'd have to say diamonds are next on their list of stakes.
ZODIAC EXPLORATION: I talked this morning with
Peter Haverson, the Briton who now runs Zodiac Exploration (
ZEX in Canada). Peter lives up on a hill above Calgary and directs the oil explorer's California operations. The shares are selling for 5 cents with three times their average 10-day volume today Thursday. (Perhaps a follow-on from a Zodiac tour as potential investors and bankers perform their Sherlock & Moriarty diligence in and around Kettleman City and drill-points south.)
Mr. Haverson and another Zodiac member, financier
Sam Charanek, who also lives on the Calgary hill, this week are giving me some of the background I wanted to understand just why California's Monterey shale and other oil/gas formations have lagged Texas, Canada, Montana, Oklahoma and elsewhere in the
USA TODAY headline news. The one word that helps is:
Secrecy. On the part of large operators in the San Joaquin Basin -- or roughly the Los Angeles Basin to the Sacramento Delta. (
Occidental, first and foremost.)
Mr. Haverson, a long-time mechanical engineer in the petroleum biz (Africa, Asia, Canada and California), calls this characteristic "the California mafia, and these professionals are ruthless in the measures they take to keep their tight holes really tight." See:
tight hole in any oil dictionary for two-year and sometimes greater "holds" on assay data from large companies.
I will be reporting more on central California's basins. I likely will buy Zodiac shares before seeing its third drilling attempt in the basin, within 20 minutes or so of
Rango Energy's vertical rig at
Kettleman Middle Dome. Zodiac has run through about $40 million in some say misguided attempts to prove-up energy resources, only to see them consigned to the science-experiment file. Its third rig is a venture with
Aera Energy, a consortium that is ultra-active in California.
Rango is
RAGO in the USA. I have plenty of exposure to Rango shares and its link to INNEX of Texas and
Hangtown Energy of Nevada via my consulting link with
Torrey Hills Capital, a California investor outreach firm that represents metals, energy and other resources and early-stage developers. Still, aside from the professional connection, I slowly am coming to the belief that a basket of small central California energy exploration companies (unlike Texas and elsewhere, few junior energy companies are operating in secretive California) is a high-risk and even higher-reward strategy if oil continues to march higher in price this summer and autumn.
The last time I had so much fun driving across the 100-plus-degree prairies of the San Joaquin Basin, which features the finest Denny's restaurant(s) (
read: archetype mediocrity), along with an occasional In 'n Out Burger as relief against the culinary wastescape of Interstate-5, was more than 10 years ago near Bakersfield, in pursuit of an Ivanhoe Energy that itself had Oxy-Pete ambitions.
As
TCR family member and our beloved Nevada geologist and Concordia Resources CEO
Edward Flood tells me from his home in Monaco the other day. Mr. Flood was an early member of the related Ivanhoe Mines team that discovered copper and gold in Mongolia. He says, and I insert this to emphasize the risk italics that come with the basin, "Thom, not sure if you remember Ivanhoe Energy's exploration effort in the Bakersfield area several years ago. There was a blowout of a gas well that appeared to identify a huge gas reservoir at some 20,000 feet in a structure about six miles north of town. (
IE in Canada and
IVAN in USA) spent well over $20 million drilling what turned out to be a dry hole even though all indications were positive."
Thank you, Ed.
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