Karbine

Karbine has been providing engineering design, development and operating services to the global resources industry for 5 years, with clients including BHP, Anglo, and Kinross.  Its founders and directors are engineers embedded in the industry, not speculators.

In 2013, Karbine established its own operating gold mine in Papua New Guinea, exiting that investment in 2015.  Its focus is now primarily on the abundant opportunities in Australia.

 

The Gold Divergence & Opportunity

The Mining & Resources industry is in crisis.  Commodity prices have collapsed, asset and company valuations have collapsed, and access to new sources of debt and equity are near non-existent.

Yet Karbine strongly believes there has been no better time in a generation to secure, develop and operate gold mines:

  • At c.AUD1600/oz, gold is close to its 2011 high of $1800/oz, supported by both strong Indo-Chinese demand for jewelry, and as a hedge for uncertain economic times
  • Yet the market caps of ASX-listed gold companies have collapsed, dragged down in the general Mining & Resources malaise, providing a pipeline of distressed assets at basement prices
  • Operating costs are falling, with lower diesel prices and wages, and rising labour availability.

 

Karbine’s Active – Not Speculative – Strategy

As the Mining & Resources crisis has unfolded, there has been a stampede of investors headed for the door. 

A small number of vulture plays have emerged, mostly backed by international capital.  But these appear to be “buy and hold” plays, speculating that a future up-swing in the commodities cycle will increase the value of their assets many-fold.

Karbine doesn’t like gambling.  We are pursuing a “buy low and operate efficiently” strategy, using our strong capabilities to produce gold bars with high investment returns.  Any future uplift in the value of our underlying assets will be a bonus to this primary focus.

 

Karbine’s Core Capabilities for Success

Karbine’s success is underpinned by three core and critical capabilities:

  • The deep experience to look beyond the views of the directors and receivers of gold players to diligently identify the most attractive distressed and undervalued assets
  • The ability to optimize CAPEX through both design expertise and an established supply chain of low-cost mining equipment from China
  • The ability to optimize OPEX efficiencies through deep operational experience and private, low overhead structures.

Investment Memorandum

For further information, sophisticated investors should contact Rob Foster at Karbine.