Former top executives from Australia-based resources investor Taurus on Tuesday launched a firm that could provide up to $500 million per project for multiple projects in strategic metals worldwide, to help fill a funding gap for junior miners.
Benwerrin Investment Partners aims to bolster the supply of metals such as copper seen in huge demand for the energy transition, data centres and defence, at a time when the U.S. and its allies are hunting for alternative sources to dominant producer China.
“The ‘why now?’ is that there’s a market that’s crying out for capital. There’s a staggering number of projects that need to be built across a very diverse group of commodities,” Managing Partner Martin Boland told Reuters.
He could not disclose how much the firm would have available to invest, due to U.S. regulations around fund-raising, but said it would target junior to mid-tier miners.
“Given the retreat of traditional capital providers to the space, private capital is going to need to fill the void in a meaningful way,” he said.
Growing interest
Governments and other institutions, such as the International Finance Corporation, are increasingly looking to work with specialist resources investors to help develop risky mining projects.
Last week, New York-based Orion Resource Partners, among the world’s largest mining-focused investment firms, said it would receive $1.8 billion from the U.S. and Abu Dhabi governments to support global mining and refining projects.
Orion co-founder Doug Silver, an early architect of a type of mine finance called streaming, will work as an adviser to Benwerrin.
The firm is evaluating opportunities starting at the low end of the tens of millions of dollars and ranging up to half a billion dollars, Boland said.
It will invest in developers of base metals, such as copper, precious metals, bulks and some industrial metals, but not in metals processing or frontier locations, such as West Africa.
“Africa is still very investable for us, but probably a bit more selectively than what it was, say, five years ago,” he said.
Critical minerals such as rare earths will not be a focus given the execution risk attached to these often highly technical projects, Boland said.
Benwerrin, named for an Aboriginal word meaning “long hill”, will offer capital principally for buyout activity and brownfield projects, which are sites with existing mining infrastructure, as loans or in return for a royalty or stream.
Streaming and royalty contracts provide funding in exchange for a portion of production or revenue. They have become a popular source of capital for North American gold miners, led by the success of $37 billion company Franco-Nevada FNV.TO.
Boland, previously an investment banker at Barclays, is one of three to join Benwerrin from Taurus.
The team will include 14 sector specialists, including in sustainability, in Perth, Melbourne, Vancouver, Toronto and Denver.
Boland said mining has been attracting investors who seek exposure to inflation-linked gains from real assets, and accept that a range of metals will be needed, not just those specific to certain battery technologies.
“The energy transition, the AI demand profile, the need for defence – it’s really making people understand the role of mined commodities.”
Reuters
