"My advice to any company planning to raise capital is to do it on a basis that that minimizes the extent to which the company will then be dependent on ups and downs in the markets."

Denis Frawley


March 24, 2023

How have macro events impacted the evolution of junior miners operating in Ontario today?

Financings are lower than they were in 2021, but 2021 was unusually strong on a historical basis. The Ukraine war and global inflation has had a strong negative influence on investor sentiment in 2022. However, in Ontario there is still a widespread understanding of the need for critical minerals to support the energy transition. The pipeline of projects to support that transition is being built, and the revitalization of a “cold war” like geopolitical order is forcing manufacturing companies to look at alternative pathways to secure future supplies. Consequently, manufacturers are now having direct discussions with exploration companies and not necessarily relying on mining companies to be their intermediaries to supplies.

How does the nature of your work change when there are not as many financings occurring?

There is more strategic positioning going on. For example, clients are looking at how they can use their capital in smart ways, they are considering structures or relationships that can be put in place to make it possible to continue advancing the exploration or development of projects, and they are evaluating their spending priorities. We see our clients working hard to find the right partners to help spread the risk on those projects.

Do you anticipate more M&A opportunities will arise as we progress through this phase of interest rate increases?

The companies that weather this period and continue to have capital are going to have the leverage to acquire projects they want to bolt onto their portfolios. I believe that companies know that if they hold multiple projects that are well aligned with the needs of the energy transition, they will enjoy a huge advantage.

What advice can you offer to juniors looking to IPO or raise capital in this market?

An IPO is not a great idea for a private company. My advice to any company planning to raise capital is to do it on a basis that that minimizes the extent to which the company will then be dependent on ups and downs in the markets. A company can execute on its exploration plan and show great results, but for juniors it’s never certain that markets will react when you need or want them to react. As much as possible, a company should take a longer-term view. 

Where do you hope to see progress on the policy front with respect to mining?

If the government can spend more money on infrastructure, it opens things up and drives down the cost of exploration and mine development. Furthermore, infrastructure spending has an-add on permanent benefit for nearby communities. A second policy priority would be for the government to do all it can to facilitate discussions and alignment between the ultimate end-users of the commodities or minerals being targeted in exploration, and the exploration companies conducting that exploration. If there is alignment between OEMs/manufacturers and exploration companies, and if the users make commitments to purchasing production early on or offer funding, it sends a strong signal to investors.  It also sends a signal to nearby communities that successful exploration will result in longer-term benefits. If the requisite investments are not made towards building a battery material supply chain in Canada, these commodities will be sourced somewhere else, the manufacturing activity will embed itself in a different market, and once implanted in another country Ontario and Canada will never get those industries back.

What do you see as OLF’s value proposition for juniors?

Our value proposition for our existing and future clients is that we are smaller firm that is cost competitive while being able to draw on close to 20 years of experience in the sector. Exploration companies almost always have very lean management teams and, when executing transactions, whether they are financings, strategic arrangements or acquisitions, they need deep support.  We have always provided that support to our clients.  We do it at a cost where the people from our firm providing that support have, and are drawing upon, years of experience, as compared to our larger competitors where a company is likely to be working with less experienced advisors at a cost that is generally higher than what we charge.


"There are hundreds of firms out there offering very specific services, and this will ultimately lead to more consolidation within the industry."
"Rather than merely facilitating tech transfers, we aspire to lead the innovation charge for our clients."
"Since the establishment of our facility in the US, we have felt the appreciation of the market in being able to have a local partner, especially in light of many companies trying to localize their supply chains."
"Afreximbank has demonstrated its relevance, evidenced by the tremendous growth in its interventions on the continent and balance sheet in recent years."


Chile Mining 2024 Pre-Release

The Chilean mining renaissance has begun. In 2024, the country is set to experience its first increase in copper production since 2018, driven by Codelco’s production surge and Teck Resources’ Quebrada Blanca II coming online. This year also saw the first major regulatory update since 1983 with amendments to Law No. 21,420, which modernized the mining framework. The government has shown strong support for the industry by committing to reduce permit processing times by a third and proposing 20 actionable measures to streamline processes. Additionally, Chile classified its 69 saline environments, leaving 31 open for private development and initiating a request for information process in April to rapidly advance these areas.



"We plan to double our copper production by the end of the decade. There remains significant upside potential in the gold industry, and the copper operations are strategic and additive to that."