While there are plenty of minerals in the ground in Northwestern Ontario, it’s hard to get the money to find them right now.
It’s estimated that up to 35 per cent of junior exploration companies have less than $200,000 in their treasuries. That’s a drop in the bucket for companies to discover deposits that could be tomorrow’s literal and metaphorical gold mines.
“They really drive the (mining) sector all over the world,” Thunder Bay Community Economic Development Corporation mining expert John Mason said. “Many of them are hurting.”
Although metal prices are still high, stock prices for the companies that find those metals have dropped as much as 90 per cent in the past 18 months.
Ontario Prospector Association executive director Garry Clark said it’s not just specific to companies exploring Northwestern Ontario but part of a global malaise.
That said, there were still around 110 booths and up to 600 people at the Northwestern Ontario Prospectors Association’s Mines and Minerals Symposium at the Vallhalla Inn Tuesday.
“Everyone is kind of protecting their money and they’re worried what’s going to happen with their cash,” Clark said. “So they’re not investing as much in junior mining.”
Laurian Mineral Exploration has been making massive precious metal discoveries at its Ishkoday property near Beardmore. CEO Cynthia Le Sueur-Aquin said the industry goes through cycles and that right now exploration companies are suffering. It’s a ripple effect from global problems like the U.S. mortgage crisis to the current Cyprus bailout talks.
“You’ll see a lot of projects that will come to a grinding halt, some companies will probably fall off the radar, we’ve seen that a lot in our industry,” she said.
But Le Sueur-Aquin sees reasons for optimism later this year as investors start to make come back to juniors that have been hit hard.
“It’s slow but I do definitely see an improvement,” she said. “I do think that in time this will sort itself out.”
Clark agrees.
“We’re not down and out we’re going to keep going forward,” he said.
