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Lara Exploration Is Positioning Itself As A
Go-To Company For Investors Who Want Access To Mineral Rights And Deposits
In Brazil And Peru
Mining
Gold and Base Metals
(LRA-TSXV)
Lara Exploration Ltd.
Suite 300, 570 Granville Street
Vancouver, BC Canada V6C 3P1
Phone: 604-669-8777
Miles Thompson
President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
Published – February 22, 2008
BIO:
Miles Thompson
President and CEO
Mr. Thompson was the original founder of Laras' Brazilian business and has
been involved in mineral exploration in Brazil and South America for twenty
years as a project generator, consultant and manager for both large and
small companies. Mr. Thompson worked as a contractor to Lac Minerals and
then Barrick between 1993 and 1996 and then worked with MRDI (now AMEC) on
the privatization of CVRD in 1996. From 1997-1998 he was the Brazil
representative for Newcrest and in 1999 became the Brazil representative for
Gold Fields. In the same period, he provided property deals that established
three Canadian-listed junior companies in Brazil. Mr. Thompson joined Gold
Fields as an employee in 2000 initially as Senior Geologist then later
Manager Business Development, in which role he initiated the acquisitions of
the Cerro Corona copper-gold deposit in Peru and the Bolivar Gold assets in
Venezuela. Based in Johannesburg (2004) and Oxford (2005) he worked on joint
ventures and acquisitions in Africa, Canada, Russia, Eastern Europe and
Central Asia. Mr. Thompson is a geology graduate of the University of
Bristol (UK).
Company Profile:
Lara
Exploration (TSX-V: LRA) is a South American exploration company with a
portfolio of mineral projects in Brazil and Peru. The Company uses its funds
to generate prospects and/or make acquisitions and then seeks JV
partnerships to fund drilling and development. Since 2006 Lara has thus
built a highly prospective property portfolio, while preserving its treasury
and capital structure. Lara has ~$5m in treasury and ~20m shares
outstanding; large shareholders include Management, Rick Rule and Lukas
Lundin.
Peru projects
include the Lara Copper Deposit (inferred resource of 18.6Mt @ 0.53% copper)
and the Mantaro Phosphate Deposit (funded through an Option Agreement with
Sprott Resource Corp). In Brazil the Company has a nickel exploration
program funded through a JV with Teck Cominco in the Araguaia Belt and a
gold exploration at Campos Verdes, funded through a JV with CCT Capital.
Lara’s generative pipeline includes various iron and copper targets in the
Carajás District; tin-bearing granites, a small gold deposit and two
diamondiferous kimberlites in Rondônia State.
CEOCFO:
Mr. Thompson, what is your vision for Lara Exploration?
Mr.
Thompson: “We are building
a portfolio of exploration, mining and royalty assets in South America
primarily in Brazil although we do look at other things, we have some
projects in Peru. We see ourselves as the pipeline for investors and mining
companies who want to access mineral rights and deposits in those
countries.”
CEOCFO:
What do you like about Brazil?
Mr.
Thompson: “I think it is
fast growing, stable and an attractive economy in which to invest. From a
geological point of view, it is a large country and well endowed, it is like
going to Canada or Australia fifty or a hundred years ago in terms of the
amount of money that is being spent per square kilometer. There is so much
more opportunity there.”
CEOCFO:
What do you look for in a project or property?
Mr.
Thompson: “We are looking
for things where we can attract investment from other companies and other
investors to share the risk with us. Therefore, we do direct our efforts a
little bit to what the investors and the market is looking for. From our
point of view internally we are focused on quality, evidence of
mineralization within a geological environment where there is room to grow
into a world-class deposit and we are looking for a sort of grade that would
make it attractive through any cycle.”
CEOCFO:
What current projects do you have in operation?
Mr.
Thompson: “We are
currently working on four deposits, of which there is the Lara copper
deposit in Peru which is a near surface oxide resource. We also have the
Mantaro Phosphate Deposit in Peru, which is a resource that we recently
acquired on behalf of Sprott Resource Corp. We are still in the early stage
of evaluating that, but it is a very large and attractive phosphate deposit
for use in fertilizers. We then have a nickel discovery in Brazil which is
in a joint venture with Teck Cominco, and we have a small iron ore deposit
which we recently optioned.”
CEOCFO:
What knowledge do you have that allows you to find successful projects?
Mr.
Thompson: “We have
something that you just cannot go out and buy. We have all been working in
South America for a long time. I have been there since the mid-1980’s, and
my vice president has been there since the mid-1970’s. We also have a team
of very senior Brazilian and Peruvian geologists that work with us and
collectively we have pretty much been everywhere seen everything. That is a
bit of an exaggeration, but what we have is just a lot of experience in
these countries and I think that is what gives us the edge.”
CEOCFO:
Is there a deliberate focus to be working with a variety of different
metals?
Mr.
Thompson: “We are looking
for quality projects. All of us have been specialized in different areas in
the past. A lot of my experience has been in gold and it is always
frustrating as a geologist when you walk across something, which is of no
interest whatsoever to the company that pays you, but which has
mineralization, and you know it has some value. We have taken the approach
that if it has some value we want to take a look at it and if it is
something we don’t understand well, we will joint venture to someone who
does or we will bring in the expertise in the form of contractors and
consultants to help us. That allows us to capitalize on a wide variety of
opportunities, which we wouldn’t be able to do if we were focused on a
single commodity.”
CEOCFO:
What is the financial picture of the company?
Mr.
Thompson: “It is pretty
solid. We are having a series of warrants exercised at the moment, so I am
not sure what the precise cash position is, but it is in excess of $5
million. We spend money at the rate of ~$2 million a year so we are
comfortable for the coming years and we hope to achieve some small cash flow
from the iron ore project we are working on. We are in a reasonable
comfortable position for the kind of company we are.”
CEOCFO:
What do you see ahead for the next two or three years?
Mr.
Thompson: “I think we will
add value to the existing projects we are working on. We have several quite
exciting things in the pipeline in terms of new acquisitions or areas of
mineralization that we believe are going to turn into discoveries. We also
with the relationship with Sprott Resource Corp on the phosphate deposit in
Peru and having the Lundin family as large shareholders, we have access to
groups with a lot more funding than we have. Therefore, we are looking at
perhaps larger projects than we would have done in recent years, in addition
to our ongoing generative exploration. This tougher market will probably
also turn up some good opportunities for us.”
CEOCFO:
There are a lot of exploration companies out there, why should investors
pick Lara out of the crowd?
Mr. Thompson: “We have a lot of
positive points and a lot of expertise as well as a good project portfolio.
We have very few shares out; we are a tightly structured company that is
well-funded. We also have the stamp of approval in the sense that some very
smart investors follow what we do closely. We have Rick Rule and his group
from Global Resource Investments in California who are large shareholders.
The Lundin family are also large shareholders and we do business with the
likes of Sprott Resources. Therefore, people who have a long experience of
investing in the resource sector, have selected us as a vehicle for Brazil
particularly and I think that takes a lot of the risk out for investors that
are not able to make their own technical evaluation. We are able to attract
companies like Teck Cominco, as joint venture partners, which is another
level of due diligence that the investor does not need to do. Therefore, we
are a lower risk company than many and we have the stamp of approval from a
lot of people that really understand this business.”
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