Extreme Opportunity: A Management Play

July 3rd, 2007

If you’re a resource investor, you know quality management is crucial to a company’s success.  Often a small start-up resource company is given money.  From that point, an entire company is built exactly upon the foundation the management team lays.  At the beginning there are only two assets, money and people and both must perform extremely well or failure is inevitable.  The management team must make the most important decisions like where to purchase property and where and how to drill on that property.  Success in the mining industry takes time, hard work, a good management team and plenty of access to capital.  Finding the right mix is often very hard, which is why most exploration resource companies fail.

So what is this Nabloid rambling on about? Management. A resource company CAN’T succeed without a good team.  There are just too many ways to screw up and lose a bunch of money.  But with the right management team, an investment can achieve the x,xxx%+ range!  So, I went in search of a tiny resource exploration company with a market cap of less than $30 million with a great management team. 

Lucky for you, I found one! I can’t find a single other tiny resource company with such successful management (if you know of any others, let me know!).  Two industry veterans, both with multi-billion dollar mining company success stories, joined forces to start their THIRD multi-billion dollar company (Well, it isn’t a multi-billion dollar company yet, but that is their goal).  These two industry veterans are responsible for founding Bema Gold Corporation and Eldorado Gold Corporation; both are valued at more than $1 billion.  

Michael Beley and Richard Barclay are the co-founders of Adriana Resources Inc., the new company they hope becomes their third billion dollar success. 

Adriana Resources Inc. is listed under the symbol ADI on the TSX Venture.  It’s market cap sits at just under $30 million with its current share price of $1.01.  The Company is well financed and seems to hold private placements on a regular basis (these guys have no trouble raising money!).  After listening to some interviews that Michael Beley and Richard Barclay have done, it is clear, these guys are brilliant.  They understand that survival is all about cash flow; which is why they have a mix of projects; some that will help get cash flow quickly so they are able to continue drilling on their world class company building projects. 

Adriana Resources has four properties:

• MIE Property: This is a potential world-class Copper, Nickel, Platinum project located in Northern Canada.  It is in a very unique geological area with large lava deposits.  It is geologically similar to two other world class Copper Nickel projects that have deposits valued at over a trillion dollars; Bushveld, South Africa and Noril’sk-Talnakh, Russia.  Currently no high grade occurrences at this property have been found, but drilling and exploration programs are in progress.
• Lac Otelnuk Project:  This property is a potential multi-billion dollar Iron property in Quebec.  Drilling and exploration is underway.
• Mustavaara Project: This is a potential short term project that may begin generating cash flows relatively soon.  It is a vanadium rich property located in Finland that at one time supplied 10% of the world’s supply of vanadium!  Feasibility studies are currently underway to consider putting this old mine back into operation.
• Bear Valley Project: This is a uranium project located in Nunavut and covers a massive area of land.  This particular project is a joint venture UNOR Inc. under the UNAD Uranium Join Venture.  The land package contains over 58,320 acres with several uranium anomalies discovered.  More work is needed on this property as well.

Adriana Resources is currently in an early stage.  This may be an opportunity to get in on the ground floor of a potential multi-billion dollar mining company. 

Entry Filed under: Mining, Investing