Raising capital: Australia’s mining sector could turn to crowdfunding
"The lack of equ...
The well has run dry for mining companies when it comes to raising capital—especially Australia’s junior exploration sector.
"The lack of equity finance continues to be the most significant business constraint for mineral exploration and mining companies," said Simon Bennison, chief executive of the Association of Mining and Exploration companies, representing many of Australia's smaller miners.
• Related content: VIDEO] Is crowdsourcing the next chapter in innovation?
However, that could be changing in coming months as the growing phenomenon of crowd-funding -- soliciting small amounts of money from a large number of people in order to fund a project or venture -- could very soon become a viable option for companies in Australia.
“The mining industry is really prehistoric in the way we do business,” said George Salamis, chairman of Integra Gold Corp, which launched its own crowdsourcing initiative earlier this year.
A pair of mining executives, Cameron McLean and Joe Treacy, are planning to introduce crowdfunding in the mining sector, launching their own website Mineral Intelligence in order to assist junior exploration companies source seed capital. The site will allow anyone to list their for-sale mining projects free of charge in the hope of connecting with subscriber companies that will pay $5000 per year to access the database.
• Related content: Gold Fields launches innovation challenge, offers $10k for new algorithm
"Traditionally, this has been the domain of a select few industry insiders, geologists, mining entrepreneurs and prospectors with the knowledge and industry connections required to get in the ground floor of new mining ventures," Market Intelligence's Managing Director Cameron McLean said.
“With crowd-funding, if someone has got $500 and wants to get in at the ground floor of a mining asset, they can,” he said.
“Typically, it’s only been open to people who with a nod and a wink and a handshake who knew that an asset had IPO potential and could get in at 7c or 8c in the knowledge it would IPO at 20c. Crowd-funding can open up the market completely.”
Crowd-funding is worth about $5 billion worldwide but the practice to raise equity is currently prohibited in Australia under the nation’s Corporations Act, however, McLean is hopeful that those restrictions will ease under the Turnbull government.
Time will only tell.
Rio Tinto and Alcoa begin construction with ELYSIS tech
Eliminating all direct greenhouse gases from aluminium smelting has taken a major step forward with the start of construction on the first commercial-scale prototype cells of ELYSIS’ inert anode technology, at Rio Tinto’s Alma smelter in Saguenay-Lac-Saint-Jean, Quebec.
ELYSIS has the potential to reduce the carbon footprint of aluminium production
ELYSIS is a joint venture company led by Rio Tinto and Alcoa that is developing a new breakthrough technology, known as inert anode, that eliminates all direct greenhouse gases (GHGs) from the traditional smelting process and instead produces oxygen.
The technology has the potential to transform the aluminium industry, with a significant reduction in its carbon footprint.
The inert anode prototype cells will operate on a commercial scale typical for large modern aluminium smelters, using an electrical current of 450 kiloamperes (kA).
The Honourable Francois-Philippe Champagne, Minister of Innovation, Science and Industry joined representatives from ELYSIS, Rio Tinto and Alcoa to mark the start of construction and announce a further CAD $20mn financial contribution from the Government of Canada to support the project.
The federal government's financial support will enable the creation of a unique commercial size inert anode technology showroom for future customers and will help develop the supply chain by involving local and regional equipment manufacturers and suppliers in the project.
ELYSIS is working to complete the technology demonstration by 2024 followed by the commercialization activities.
ELYSIS technology at a glance:
- The ELYSIS technology addresses the global trend towards producing low carbon footprint products, from mobile phones to cars, planes and building materials.
- The new process will reduce operating costs ofaluminiumsmelters while increasing production capacity. It could be used in both new and existing aluminium smelters.
- In Canada alone, the ELYSIS technology has the potential to reduce GHG emissions by 7 million tons, the equivalent of removing 1.8 million cars from the roads.
- ELYSIS will also sell next-generation anode and cathode materials, which will last more than 30 times longer than traditional components.
Alcoa and Rio Tinto will continue to support the ELYSIS development program alongside the Governments of Canada and Quebec.
ELYSIS is working closely with Alcoa's Technical Center, where the zero-carbon smelting technology was invented, and the Rio Tinto technology design team in France.
Alcoa's Technical Center supports ELYSIS in the manufacture of proprietary materials for the new anodes and cathodes that are essential to the ELYSIS process. The Rio Tinto technology team in France is creating commercial scale designs for the ELYSIS technology.
Vincent Christ, CEO, ELYSIS commented: “This is a great day for ELYSIS. It means that we are becoming the first technology company in the world to build commercial-size inert anode cells. While we refine the technology in our R&D Centre, we start the construction of our prototype cells. This shows our confidence in our process and in the know-how of our team. The combination of ELYSIS' zero CO2 technology and Quebec's renewable energy will be great competitive advantage for the future. I would like to thank the government for its support and all the partners for their commitment.”
Samir Cairae, Rio Tinto Aluminium managing director Atlantic Operations and ELYSIS board member added: “Today marks a real step towards the future of the aluminium industry, by progressing this breakthrough technology to cut carbon emissions. Rio Tinto is committed to supporting its ongoing development here in Quebec where we already use clean hydropower to deliver some of the world’s lowest carbon aluminium. Combining this technology with renewable hydropower holds the promise of zero carbon aluminium smelting.”