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MINING | JOSEMARIA RESOURCES
JOSEMARIA RESOURCES The latest large scale resource project to be delivered by the Lundin Group
The Lundin Group was founded by Swedish oil and mining entrepeneur Adolf H. Lundin over 40 years ago and is today comprised of 13 publicly traded companies dotted around the global resources sector. In the beginning, the Group was driven forward by Adolf’s passion for natural resources and his desire to supply the world with key commodities. In order to do this, he quickly learned that you need to find large, high quality resources and bring them into production wherever they are to be found in the world and no matter how unfavourable the jurisdiction might appear to be.
“The Lundin Group modus
the business, the Lundin Group
operandi is to find tier 1 assets
has production out of Norway,
that benefit local communities.
Canada, Nigeria, France,
We’re not scared to go to any
Malaysia and Iraqi Kurdistan.
jurisdiction, as long as the local country wants to do it
“In Argentina, we’ve had ups
together. This belief has taken
and downs but my father went
us across the world,” says
there in the early 90s and
Adolf’s grandson and current
found success and we never
president and CEO of Josemaria
left. Overall, it’s a Group where
Resources, Adam Lundin.
a lot of people came together
A truly global resources group
who were passionate about making the world a better place and doing that through
The poster child of the
the extraction of natural
Group’s success in the mining
resources.”
sector is Lundin Gold, after it brought into production the
The Lundin Group’s early
multi-million ounce Fruta del
success in Argentina goes back
Norte gold mine in Ecuador
to the discovery of the Veladero
– a jurisdiction that precious
gold deposit in San Juan
few Western companies had
Province. The project was soon
explored in prior to Lundin’s
acquired by Homestake Mining
discovery.
after fighting off a hostile bid by Barrick, who ultimately bought
Elsewhere, the Lundin
Homestake to get their hands
Group has been involved in
on the prized deposit. Veladero
developing one of the largest
has remained one of the largest
copper-cobalt mines in the
gold mines in the world over
Democratic Republic of Congo
the last two decades.
through Lundin Mining, which
ADOLF H. LUNDIN, LUNDIN GROUP FOUNDER
currently operates mines in
On the back of this divestment,
Brazil, the US, Portugal, Chile
the same Lundin Group
and Sweden. On the oil side of
exploration team decided to
MINING | JOSEMARIA RESOURCES
stake some ground on the Chile-Argentina border, not far from the Veladero deposit, at the turn of the century. The subsequent exploration campaigns yielded three grassroots discoveries – one being the Josemaría coppergold deposit in 2004. The three discoveries are in the same land package and are located within 15 km of each other, but have since been spun into three separate companies within the Lundin Group. “Josemaría is currently the most defined project. We feel we’ve found the boundary of the resource, so the view now is to get something into production and maybe we can later tie in the other two deposits to form a district that will allow us to be mining here for 50+ years,” says Lundin.
Faith in Argentina In years gone by, international mining companies have been wary of investing in
LUKAS AND ADAM LUNDIN WITH ARGENTINA PRESIDENT ALBERTO
MINING | JOSEMARIA RESOURCES
an emerging market like Argentina, especially while some of its provinces receive low rankings for attractiveness as a mining jurisdiction. However, it has never been the remit of the Lundin Group to be put off by warnings of this nature. As we have already learned, if a project is large and of a high quality, the group will commit to its development. In the case of San Juan Province, where Josemaría is located in the shade of the resplendent Andes mountains snaking through Northern Argentina, mining is entrenched in the political and economic fibres of the region. “San Juan is where we made the Veladero discovery, so it has producing mines and they understand mining and how it can help benefit the local economy. Before Veladero came into production, San Juan was one of the top five FERNÁNDEZ (MIDDLE), JAN 2020
poorest provinces in Argentina
and now it’s one of the top five
At the federal level, Lundin
wealthiest, because of those
and his father Lukas managed
royalties and benefits attached
to arrange a meeting with
to the Veladero mine.”
President Alberto Fernández during a visit to Buenos Aires
In addition, Josemaria’s
in mid-January. “To be able
experience working with the
to meet the president at short
different layers of government
notice and get in front of key
in Argentina thus far has been
government officials shows
overwhelmingly positive.
their willingness and their
On the provincial level, the
want to get mining going.
company has been in close contact with the minister of
“This is their resource. We
mines for San Juan Province,
are happy to help put it into
who was recently appointed
production but they will be
federal minister of mines,
biggest benefiters, followed
reporting directly to the
by our shareholders,” Lundin
president.
asserts.
J OS E M A R I A RES O U R C ES
Entering a new era
AT A G L A N C E
Following the publishing of a robust pre-feasibility study (PFS) at the end of 2018, Josemaria made the decision to plough on with the bankable and full feasibility studies. And so, last year became a
STOCK TICKER
TSX:JOSE, OMX:JOSE
MARKET CAPITALISATION
US$87.2 million (as of April 2, 2020)
j
transformational year in the development of the company and the project. The company’s name was changed from NGEx Resources
MINING | JOSEMARIA RESOURCES
MINING | JOSEMARIA RESOURCES
(the original entity that made the three discoveries) to Josemaria Resources and Adam was brought in to head up the refreshed organisation, along with several other additions to the board and management team. “We strengthened the board by bringing in Paul Conibear, the previous Lundin Mining CEO. We have Ashley Heppenstall, who is former Lundin Petroleum CEO. We also brought in Ron Hochstein who’s currently running Lundin Gold.” Adam’s father Lukas is also on the board of directors alongside Jack – Adam’s brother and Lukas’ son. Alongside the familial connections, the board retained the services of renowned geoscientist Wojtek Wodzicki - who made the initial Josemaría discovery. “I think it’s important to keep that continuity,” Lundin adds. Christina Batruch rounds off Josemaria’s experienced board
Spotlight on
Adam Lundin
Adam Lundin was appointed president and CEO of Josemaria Resources in September 2019, succeeding Dr. Wojtek Wodzicki, who had been at the helm of the company for over 10 years. Adam is the grandson of Adolf Lundin, the man who founded the Lundin Group over forty years ago. Following in the footsteps of his grandfather and father, Adam chose a career in natural resources and has accumulated several years of experience in capital markets and public company management across the sector. Working across the Lundin Group, Adam is also CEO and a director of Filo Mining Corp and a director of NGEx Minerals and Africa Energy Corp.
“We have big camaraderie in the Lundin Group. All the companies are independent from one another, but we learn from each other and we’re always there to support each other”- Adam Lundin, Josemaria Resources president and CEO
team and is responsible for
Going back to the 2018 PFS,
helping guide the company’s
Lundin was pleased with
sustainability strategy.
the anticipated economic metrics for the Josemaría
On the management side,
project, particularly the capital
Ian Gibbs was brought in as
expenditure (capex) estimate
chief financial officer owing
of US$2.75 billion. This may
to his previous project finance
seem like a large figure in
experience from the oil side
comparison to Josemaria’s
of the Lundin Group and
market cap, but this is a large
with Lundin Gold. With an
scale project that requires
extensive history across global
large scale investment.
engineering companies, Arndt Brettschneider, VP Projects,
Furthermore, Josemaría’s
was also recruited to lead the
production profile is also
feasibility study.
attractive. The operation will
MINING | JOSEMARIA RESOURCES
produce 125,000 tonnes per
Lundin Mining agreed when it
field programme that included
annum of its main commodity
bought the Candelaria mine in
condemnation, geotechnical
copper over a 20-year mine
Chile, as a way of financing the
and water drilling.
life, along with 230,000 ounces
capex for Josemaría.”
of gold and 790,000 ounces of silver per annum over the same period.
Ploughing ahead in 2020
Josemaria is blessed with a supply of groundwater just 1.5 km away from the project – a
The first quarter of 2020
considerable benefit given that
“The gold production is
has been about polishing
just across the border, Chilean
significant and accounts for
elements of the PFS ahead of
authorities insist on miners
around 25% of our revenue
the publish of a full feasibility
building desalination plants
of the mine life. That gives us
study and building towards
for their water supply.
flexibility when it comes to
applying for environmental
project finance. Maybe we will
and social permits. The
After proving its main source
look to the streaming deal that
company conducted a large
of water supply, the company
was about to test another basin
times. We’ve collected a lot of
Josemaria has also been
as a future supply source until
our baseline studies, so we’ll
monitoring the local
Argentina was placed in full
be in a good position to apply
environment in tandem with
lockdown to quell the spread
for permits in Q4.”
BGC Engineering over the last
of COVID-19 (coronavirus), so the work was cut short.
five years, specifically focusing On the social side, Josemaria
on minimising any potential
has engaged with the Lundin
impact on a glacier around
“The original plan before
Foundation and started to run
seven km away in the Andes.
COVID-19 was to finish the
social programmes within
feasibility and publish it in
the community. One aim is
Q3. I think it’s better to start
to eventually assist water
guiding the market towards
treatment facilities in the local
A standout company and project
the second half of the year,
city of San Juan.
The Lundin Group is bullish
just to give us some flexibility
about copper and a believer
as we adapt to these changing
in the forthcoming electrical
MINING | JOSEMARIA RESOURCES
revolution as the world looks
of experience in different
Despite the global
to shift away from fossil fuels,
geographical contexts and
resources sector facing an
and Josemaría is a large scale
economic cycles.
unprecedented squeeze from
mine that is going to stand
the coronavirus pandemic,
out in an environment where
“Lundin Gold was one of
Lundin is quietly confident
not many copper projects of
the first projects we built by
that Josemaria can emerge
an appropriate scale for the
ourselves and we are hoping
stronger. “Downturns is when
projected demand increase are
Josemaria is the next one.
we benefit the most as a
coming to market.
We have big camaraderie in
Group. We can push projects
the Lundin Group. All the
forward and retain key talent
Josemaria the company also
companies are independent
where other companies are
stands out in the junior space,
from one another, but we
sitting idle.”
as its part of a much larger
learn from each other and
family of natural resource
we’re always there to support
companies with decades
each other,” Lundin exclaims.
Published by Anderson Murray Media Ltd
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