Mining and Metals
Mining and Metals
As commodity prices take an unfortunate nosedive to their lowest figures on record, mining companies are finding it increasingly difficult to acclimatise. The situation is exacerbated further due to a host of unresolved challenges facing the industry —from plummeting demand and dwindling grades to increased stakeholder expectations and a lack of financing.
With the outlook for the sector looking increasingly volatile, the global mining and metals industry needs to dig its collective heels in and look to maintain a strong and flexible balance sheet while preparing for future growth. The industry is also facing up to escalating challenges of access to capital, dealing with increased transparency, maintaining license to operate and cyber security.
BTG Global Advisory has a strong background in the mining sector across the globe through a network of skilled and experienced partners who come together to help mining and metals companies meet the issues of today and anticipate those of tomorrow by developing solutions to meet these challenges.
Specialist Experience
Despite the challenges within the sector, our global team of professionals are on hand to help you succeed — a team comprising deep technical experience in providing transactional and advisory services to the mining and metals sector. Ultimately it enables us to help you meet your goals and compete more effectively. Services we offer include:
- Restructuring and business development strategies
- Outsourcing analysis
- Strategic M&A review and options
- Property and asset valuations
- Corporate simplification
- Performance enhancement
- Data and intelligence leakage and tracing
- Security Risk Support
Risk Management
The scarcity of raw materials forces mining and other natural resource operators to venture into geo-politically high-risk environments. Our partners support such operators in the extractive industries with effective planning, security controls and risk management services.
We work with mining companies, their investors and government agencies to identify and manage the risks facing their interests.
Our Approach
Effective identification and management of various levels of risk is a core requirement of natural resources based business. Institutional investors, financiers, shareholders, insurers and re-insurers increasingly demand transparent and comprehensive governance over issues such as corporate social responsibility, conflict zone operations and integrated risk management.
We understand these demands and assist our clients in delivering effective and proportionate security programmes that complement the core business activity and ease insurance, investor and regulatory concerns.
Our senior management and security support teams have assisted mining operations in the development of seamless security infrastructures, product security and revenue assurance. Our specialist teams have provided valuable support in the development of holistic security initiatives for exploration operations and more specifically to mines where theft of product has become apparent.
In these circumstances, using our security support teams to stabilise and manage security operations whilst concluding the roll-out of improvement strategies, has proved invaluable to our clients.
Related Case Studies
Mining and Metals
Exploration Due Diligence
The exploration arm of an international operator entered into a joint venture with their local partners in sub- Saharan Africa. Our Partners undertook an enhanced due diligence on the local companies, their directors and their overall business profiles. This work, whilst satisfying the Foreign Corrupt Practices Act and similar regulatory and compliance demands, provided assurance to institutional lenders and political risk insurers in advance of a major long-term capital project.
Mining and Metals
Product Vulnerability Assessment
Following reports of product loss from a mine, ourPartners conducted a product vulnerability assessment and identified a significant number of liabilities in the recovery, storage and transportation of product. The assessment highlighted key weaknesses in the security resource, systems, policies and procedures.
The company had reportedly suffered loss from internal and external criminal elements and, under the existing operating infrastructure, it was felt unlikely that further losses could be prevented.
A Security Support team was deployed for a period of six months to stabilise the security operation whilst an agreed improvement strategy was developed and implemented.
During this period, we assumed overall management of the security operation whilst vulnerabilities were addressed and a platform for effective security operations was put in place.
Following implementation of the new security strategy, the client has reported a significant improvement in the recovery of product.
Mining and Metals
Security Planning
Following the decision of a South African government to contract out the management of a state owned mine, officials identified an urgent need to address reported large-scale theft of product and a requirement to develop controls to assure government royalties through increased transparency of recovery and reporting processes.
We were engaged to develop and implement a security programme to reduce the large-scale organised theft of product. Applying a proven mine security concept was instrumental in identifying numerous risks to the mining operation. Structured control mechanisms reduced the level of criminal activity and provided accountability throughout the recovery process.
This improvement programme addressed the fundamental risks that threatened the longevity of the mining operation
Mining and Metals
Chrome and Platinum Mine
Umnotho weSizwe Resources (Pty) Ltd (“UWR”), based in South Africa, owns and operates a chrome and platinum group metals mine with proven reserves of 20 million tons of premium grade chrome.
UWR began developing the mine in 2010 and started production in April 2011. However operational challenges as well as poor commodity prices led the shareholder to place the company into Business Rescue during February 2013, in terms of Section 131 of Chapter 6 of the Companies Act.
A refinance agreement was put in place to settle all pre-commencement claims and fund the ongoing running of the mine whilst the business rescue plan was implemented. Operational changes to the mine were implemented including, as well as finding a new investor and restructuring the existing bank debt.
The mine has now changed name and is currently operational and profitable and contributing to the local economy in a meaningful manner.
Our Other Industry Experience