The annual Northwestern Ontario Minerals and Mines symposium brought together prospectors, junior exploration outfits and major mining companies at the Valhalla Inn on Tuesday.
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Bear markets in the mining sector are bad news for the prospectors trying to make the next big discovery.
But despite its challenges, some optimism remains.
Garry Clark, executive director of the Ontario Prospector's Association, says it’s the explorers seeking new deposits that feel some of the heaviest effects of down markets.
“The prospectors really feel the snap on the end of the whip,” Clark said at the Northwestern Ontario Minerals and Mines symposium, which was being held at the Valhalla Inn Tuesday.
“Part of that ... is because there is nobody to put money in the ground. The junior companies step back and they may go look in other jurisdictions or preserve capital and not go out and spend on new projects.”
That doesn't make failure a certainty. Some companies, like Transition Metals Corp., have still been able to find success.
President and CEO Scott McLean admits Transition Metals has been feeling the crunch, but added that some companies have been able to remain on track by using alternative business models such as project generation.
“It’s one of the worst downturns we’ve seen in a while, 2013 in particular,” McLean said. “We’re a little different than the traditional junior that relies on funding markets to issue equity and look to bring partners in that have the wherewithal to help support projects.”
Transition Metals has been working in platinum exploration in this area for the past five years.
They believe they may have hit it big last November with a discovery at Sunday Lake, which is located 25 kilometres north of Thunder Bay.
He cautioned that the project is still in its infancy and is a long way from developing a mine and extracting product from the ground.
Nevertheless, Clark says it is cases of success that will attract investors back and spur the market toward profitable levels.
“When you look at the markets the junior companies have been able to raise a bit of money lately and that means some of the investors are coming back into the market and buying shares,” he said. “Some of the stocks have been going up and that’s what keeps everyone happy and moving forward.”
The big question left for prospectors and junior companies is exactly when the market will take that step forward.
McLean anticipates a turnaround may occur in the near future.
“We’re certainly encouraged that the bull market will return, it’s just determining exactly when that’s going to happen,” McLean said.
“We were feeling there was a bit of a financing window that opened up where companies were able to attract some investments into their companies. I’m cautious that may slow down through the summer months but encouraged that once we get into the fall and into 2015 things will become more robust.”
The two-day symposium, which has been held annually since 1996, features close to 90 exhibitors and is bringing together prospectors, junior exploration outfits and major companies along with contractors and suppliers.
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