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BDO Australia

Key insights and trends from the 2024 121 Mining Investment Conference in Cape Town  

The 121 Mining Investment Conference is a premier meeting forum between mining companies and investors in major cities, including London, New York, Las Vegas, and Singapore, with the first of the global series for 2024 kicking off in Cape Town on 5 and 6 February. In attendance was BDO’s Global Head of Natural Resources, Sherif Andrawes, who was joined by BDO experts from around the world, including Bert Lopes, Servaas Kranhold and Jacques Barradas (BDO in South Africa) and Matt Crane, Fiona Davis, Jill MacRae and Peter Acloque (BDO in United Kingdom).  

The conference connects more than 650 investors with more than 110 junior mining production, development, and exploration companies. With speakers from mining leaders such as Triple Flag Precious Metals and Rio Tinto and institutional funds such as The Connect Africa Network and Commodity Discovery Fund, the 121 Conference focuses on investment capital, with industry experts sharing market intelligence and investment ideas.  

Uncovering the current trends in the minerals and mining sector  

  • There is minimal capital available in Canada, which may explain the significant presence of Canadian companies at the conference. The ASX presents an ideal alternative for these companies. As detailed in the September 2023 Explorer Quarterly Cash Update, the financial health of Australian-listed explorers continues to remain resilient, with sector activity thriving.   
  • Uranium is experiencing a resurgence in popularity. The commodity’s rise has been anticipated for some time, driven by the evolving clean energy transition movement and legislative changes in the European Union approving nuclear energy as climate-friendly. This trend has had a flow-on effect in Australian capital markets, as we reported in the June 2022 Explorer Quarterly Cash Update. While today’s prices appear high, there is a reasonable expectation that they will increase further.   
  • Rare earth magnets are of sustained importance, as is the transition to the green economy and the rise of lithium, nickel, and cobalt in the energy transition market. A historical overview of commodity performance in the Australian resources sector is featured in our Explorer Quarterly Commodity Update: Spotlight on commodity trends, where we observe how a company’s commodity focus can impact fund raising and how the data can inform the future of Australian exploration funding.   
  • While funding early-stage exploration in the current economic market is challenging, when global interest rates fall, there is an optimistic outlook that investors will reallocate funds back into the sector. When the market demonstrates signs of improvement and funds begin to flow, those exploring for commodities aligned with climate change will be well positioned, however geological advantages alone are insufficient. Investors will be strongly compelled by companies that operate with deeply embedded Environmental, Social and Governance (ESG) practices from the outset.  
  • The availability of funds is limited in most of the world’s capital markets, most notably in Canada and the UK when we are talking about traditional mining jurisdictions. Australia is a bright spot, even if only to a limited extent. Still is proving increasingly popular as an alternative destination for funding by Canadian listed exploration companies.  
  • Sustainability remains a critical topic and should be at the core of every company’s strategy. All companies must keep sustainability at the top of their agenda, regardless of business size.   
    • Small and mid-tier explorers must prioritise their sustainability reporting as it becomes essential for capital raising.   
    • Sustainability reporting is becoming more pertinent than ever, as organisations face increasing pressure from stakeholders to be transparent in various sustainability matters. It poses an opportunity and threat for companies wanting to attract investors and talent and raise finance. Today, sustainability is an increasingly critical component in a business’s social license to operate.  
    • A comprehensive sustainability strategy goes beyond an organisation’s carbon footprint and climate impact. It employs an integrated approach to consider holistic ESG issues such as water, nature, Indigenous rights, culture, and community engagement. The benefits of a clear and comprehensive strategy include a positive impact on financial performance, risk mitigation, strengthening an organisation’s corporate reputation, employee value proposition, and future preparedness.  

The 121 Mining Investment Conference proved instrumental in highlighting the wider trends and opportunities within the industry. With a key focus on transparent sustainability and emphasis on holistic ESG considerations, the conference underscored the evolving landscape of mining investment.   

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