[miningmx.com] — PETMIN’S investment in the Liberian iron ore project owned by AIM-listed Hummingbird Resources links the two major business endeavours embarked on by Ian Cockerill since he left Anglo American.
Cockerill is executive chairman of Petmin and non-executive chairman of Hummingbird, the largest holder of mineral exploration licences in the eastern part of Liberia.
Hummingbird has been exploring this region – a largely unexplored area of Birimian age geology – for the past four years, focusing on gold and iron ore.
Cockerill was forced out of his position as CEO of Anglo Coal in a management cull carried out by Anglo CEO Cynthia Carroll in October 2009. Carroll had previously handpicked him for the job in April 2008, when he moved from his previous position as CEO of Gold Fields.
Cockerill told Miningmx at the 2010 Mining Indaba that he had been appointed “chairman designate’ of Hummingbird – a business founded in 2005 by the Betts family of the UK.
He said at the time: “I have long been a close friend of the Betts family and have been advising them over the past eight or so years.
“We have now formalised the relationship. I have become a non-executive director of Hummingbird and, if we find something worthwhile in Liberia, I will help them float the company through an initial public offering.’
Hummingbird started trading on AIM in December following a share placing at 167p which raised ₤25.5m.
Cockerill had also been a non-executive director of Petmin since October 2007, and he was appointed executive chairman in July last year.
Petmin has now agreed to provide up to $2m to explore the Mount Ginka licence area in Liberia for iron ore.
According to Petmin CEO Jan du Preez, “the Mount Ginka JV with Hummingbird represents an early stage, cost effective entry into a potentially prospective venture.
“It is further progress on our stated intention of diversifying both our product mix and expanding our global footprint.’
Petmin chief operating officer Bradley Doig said: “it has always been part of Petmin’s long-term strategy to look for a new magnetite project.
“Ian identified the opportunity, but the deal has not been done merely because he is on our board and that of Hummingbird.
“This was very much an arm’s length transaction, observing all the required corporate governance rules. Ian recused himself from all discussions on the offer and the decision by the board.’
Cockerill said: “I played the introductory role but then I completely withdrew myself from all negotiations because, obviously, I had to.
“I think this is a very good deal for both companies. Petmin will piggy-back on Hummingbird’s established presence in the country, while Hummingbird will be able to focus on its gold exploration efforts.
“For Petmin, this is a very cost effective way of getting exposure to a potential iron ore project, because it’s being done on an earn-in basis.’
The Mount Ginka licence will be transferred to a separate company – Iron Bird Resources – which is a wholly-owned subsidiary of Hummingbird.
Petmin will take a 15% stake in Iron Bird for $0.5m, which will used on initial exploration work and to demonstrate whether a commercially saleable magnetite concentrate can be produced from Mount Ginka.
If that is successful Petmin will invest a further $1.5m, taking its stake in Iron Bird to 50%. That money will be used on further exploration work to assess the scale of the resource.
After that, any further development of the project will be on a 50/50 basis between the two companies.
