Plenty of Asia Upside as Commodity Downturn Eases

A resurgence in international precious, base and battery metals exploration and development investment activity has given a leading international mining consulting firm good reasons to celebrate the five-year anniversary of its Hong Kong office. SRK Consulting’s Hong Kong general manager and principal geologist, Dr. Gavin Chan, said the global firm is increasingly optimistic about prospects in the region as the mining industry continues to emerge from a protracted downturn.

As China’s $12 trillion economy matures and spurs new demand for a wide range of commodities, the global mining industry is seeing renewed investment, and stronger pricing signals. Chan said new exploration and development opportunities are emerging in China and other Asian countries.

“Hong Kong was chosen to service both the Chinese and international finance sectors, Hong Kong-listed companies and state-owned enterprises,” Chan reflected on the opening of SRK’s seventh office in Asia, and 50th globally. “With Hong Kong regarded as the first stop for Chinese outbound capital and a springboard to world markets, it is one of the world’s leading financial hubs.

“The first five years haven’t been all smooth sailing as major corrections of commodity prices resulted in a sharp decline of fundraising activities through equity and debt markets, and less mining activity in recent years.”

Chan said SRK Hong Kong is seeing increased activity around technical due diligence, public reporting for capital raisings, mergers and acquisitions (M&A), and initial public offerings (IPOs). “We are seeing requests for these services in a number of countries across a range of commodities, including gold, copper, iron ore and coal, as well as battery minerals,” he said.

While gold remains the dominant commodity, there is also activity in the battery minerals space, including lithium, cobalt, nickel and graphite. Recent work includes a resource estimation and valuation of a gold project located in northwest China; sampling support and resource estimation of a leadzinc project in inner Mongolia, and a polymetallic (mainly tin and tungsten) also in Mongolia; and a resource estimation of a lithium hard rock project (lepidolite) in China. The company has also been involved with an underground gold feasibility study in Indonesia, as well as several lithium review projects for Chinese clients.

As featured in Womp 2018 Vol 04 -