Fireside chat with Ross Beaty & Marin Katusa at the 2020 Vancouver Resource Investment Conference.
Ross Beaty is one of the most legendary figures in mining. Beaty is the Chairman of Pan American Silver, the Chairman of Equinox Gold and the Founder of the Lumina Group. He's built and sold over a dozen public companies and created many billions of dollars for his shareholders.
In this video, Ross shares his viewpoints on several different investments and gives some great insight into the markets.
Where is Ross Beatty at with Copper?
Beaty: Copper is a good metal to hold for the long term - energy and transition metal + digital metal, Copper is the 2nd best conductor metal after silver.
China consumes half the worlds supply of Copper. Supply and demand is strong. Very bullish on copper. This view is partly based on the Electric Vehicle (EV) revolution.
Short term Copper 2020 should do very well. Everything electrical needs copper & renewable energy needs more copper now than anything before it. A more electrical world needs more copper.
Solaris Copper: Ross is getting involved. Solaris Copper is spinoff from Equinox Gold. 30% owned. Dan Earl CEO of Solaris. Solaris is going public sometime this year. Ecuador, Chile, and Peru copper mines. David Lowell is the mastermind behind the projects at Solaris.
What about lithium? The demand side is very strong(bullish). Amazing storage and discharging capacity for electricity. There will be a huge growth in batteries for cars and in stores. Nickel, Cobalt, Manganese are prime metals for batteries. Hue amounts of supply. Long term the price of lithium is going to go down because supply is high and scaling will make production much cheaper.
Beaty on Iron Ore: Bearish - Long term shift away from steel consuming projects. Infrastructure is built for the most part. Not a huge need for Iron Ore as there was massive growth in the last 15 years. Prices have done well because Brazil shut down a massive Iron Ore mine in 2019. Once these mines come back online the supply will be robust and the price will fall.
Beaty on Green Energy: Cost of Capital? Clean Energy - Wind, Hydro, Solar Power - Green Energy has a predictable revenue due to very predictable costs and few variables. 2-4% margins for 40 years. Favors Scale and low cost of capital. Great for Pension funds. Market is looking for predictable low cost, low returns to hedge against portfolio risk.
Beatty Index: What it consists of: Lumina Gold - Pan America Silver - Equinox Gold - Innergex - Luminex : These are his direct involvements.
Lumia Gold has a gold deposit in Ecuador (purchased for $3 million cash) - The mine has 17 million low grade gold ounces - company owns much of the surrounding land.
Targeting large mining - 400k ounces a year for 25 years - low grade relative to annual production - Luminex aims to produce gold for $900 and oz and sell them for $1600 and oz.
$1.35 - 1.55 stock price in 2020 as a prediction for Lumina Gold.
Equinox Gold - Where is the price going? (added LeaGold this year) The mission is to build a massive purely gold company and scale it fast. Investors favor diversity and liquidity - Strong Board - Mines in Brazil, Southern California, Mexico (via LeaGold)
Equinox Gold is projecting to be a million ounce Gold producer in the next few year -Which will make them the 15th largest gold production company in the world - Amazing liquidity on the Nasdaq - Ross is very confident in a secular gold bull market continuing.
Where does Ross see silver going in 2020? Silver could take a hit relative to gold in a market correction.
Investors are curious if Lumia gold might be bought by Equinox Gold? The probability of this is low due to the conflicts of interest.
What is the exit strategy for Luminex Gold - Luminex is Diversified with 8/9 different projects- 100% based in Ecuador - The plan is to build this asset and then sell it.
Will $15 dollar warrants be trading "In The Money" on Equinox Gold this year? Beaty "That is our plan"
What to do if you’re 40 - 50 years old just getting started in the Gold business? Beaty suggests to go big quickly and buy the larger gold ETFs and stocks. Since the market is tough on junior miners the money wont trickle down to them until large cap stocks make big gains.
If Ross Beaty was only allowed to invest in 3 people in the Gold industry, who would they be?
*Richard Warke - Augusta Group
*Lukas Lundin - Lundin Gold
*Mark O’Dea - Liberty Gold
*Nolan Watson - Sandstorm Gold
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