Erin Ventures Inc. is a Canadian-based international metal and mineral exploration mining company listed on the TSX Venture Exchange (ticker symbol EV) (US Listing: ERVFF). The Company has come to our attention due, in part, to the exceptional opportunity afforded shareholders as EV.V has regained ownership of the Piskanja Boron deposit in Serbia, the 3rd largest boron deposit in the world and is in talks with potential strategic partners of size that will be able to facilitate an end market for the Boron and advance the project to fruition. EV.V also has several gold projects of significance, two with near term cash flow potential. Mining MarketWatch Journal provides insight into each of Erin Ventures' properties below:
1) Piskanja Boron Deposit, Serbia - 100% owned
3rd Largest Boron Deposit in The World
Figure 2. Piskanja Boron Deposit Erin Ventures' license covers ~3 square kilometers containing an ancient lakebed whereby the Boron was deposited through volcanic activity and it is believed there should be boron throughout -- so far EV.V has explored only ~4% of that basin yet has already established the 3rd largest deposit in the world.
On August 31, 2010 Erin Ventures Inc. reported that it has been granted an exploration license for the Piskanja Boron deposit in Serbia, by the Serbian Ministry of Mining and Energy. The license covers an area of approximately 3 square kilometres, and includes the entire known historical mineralized area along with a substantial amount of previously unexplored ground. This development signals the return of the entire license area previously held by Erin Ventures.
Background: Erin Ventures entered into a joint venture (JV) agreement with the Serbian government over a decade ago, they were the first company to do a deal with the new government after the Bosnian war and entered into a 50/50 JV with the Serb government at that time through an electric utility agency that was working on a coal seam when they hit Boron. Erin Ventures advanced the the project for several years encountering significant successes in the process building tonnage to the point where the deposit sat with (now considered historic non NI 43-101 compliant) tonnage of ~7.5 million tonnes grading 39% B203 (Boron). Fast forward to 5 years ago, the Company woke up one morning to find the Serb government had given the property to Rio Tinto. Erin Ventures launched a law suite seeking damages against the Serb government. In Q1 2008 a new Serbian government got into power, the government that is in power now, one very focused on joining the EU as one of their main mandates and establishing a responsible business friendly (including mining friendly) climate. Erin Ventures addressed its position with the new government and within a short period of time EV.V was asked if the Company was interested in the return of the Boron property as settlement. EV.V indicated that they would and have been working on that settlement ever since and the August 31, 2010 release entitled "Erin Granted License for Serbian Boron Property" is part of those efforts. The government also provided the Volujski Kljuc alluvial gold project to EV.V as compensation for damages in the settlement.
Region & Infrastructure
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The Piskanja deposit is located in a historical mining region that has good infrastructure for mining including roads, rail, electric power, experienced miners, support services, etc., ~250 km south of Belgrade, Serbia by good paved roads.
Things have changed a lot in Serbia and it is now considered a stable business friendly republic. As for the government that Erin Ventures lost this property under, there is not one of them still in power anywhere within government. There has been a lot of forward progress and numerous business have signaled the country open for business, some noteworthy names to set up shop include Microsoft, Rio Tinto, US Steel, Fiat, Bell, Italian Telephone, RCI, IBM, and a whole host of others. Its also beneficial to note that the Prime Minister of Serbia went to school with one of the directors of Erin Ventures and at one point the Minister of Mining had been a student of and an employee of one of the Erin Ventures directors.
Importance of Boron and Uses
Figure 4. Raw boron
Boron is one of the most important industrial mineral there is; just about all aspects of manufacturing rely in some way on boron. According to the US Geological Society (USGS) the estimated distribution pattern for boron compounds consumed in the United States in 2009 was glass and ceramics, 76%; soaps, detergents, and bleaches, 5%; agriculture, 4%; enamels and glazes, 3%; and other, 12%. One of larger product growth sectors of the market for boron is in demand for pink fiberglass insulation stemming from accelerated energy costs and the other is in high tech applications; the heat shield on the space shuttle craft is entirely boron, stealth technology (the aircraft that can’t be seen on radar) is entirely made of boron composite, through to specialty sports equipment such as boron shafted golf clubs. A new market application is lithium batteries, especially with respect to electric vehicles; several manufacturers are utilizing boron within their lithium batteries (when you use boron in a lithium battery it reduces the weight, it reduces the heat generated by the battery, allows it to hold charge longer, and allows it to be more easily recycled).
The Market
Demand: The latest USGS observations note that borate consumption in China was projected to increase, driven in large part by demand from its domestic ceramic and glass industries. As a direct result, Chinese imports were expected to increase over the next several years. Europe and emerging markets are requiring higher building standards, which directly correlates to higher consumption of borates for insulation fiberglass. Continued investment in new refineries and technologies and the continued rise in demand should fuel growth in world production over the next several years.
Supply: The market is 80% controlled by two entities; 1) Rio Tinto with US Borax in California, they have about 40% of the world market and 2) the Turkish government has the other 40%. The Boron market is essentially an oligopoly and highly lucrative for entities with clean high grade economical deposits. Information on margins and economics are closely guarded trade secrets; for example, if you look at Rio Tinto’s information they never disclose what their production numbers are or what their grades are however Mining MarketWatch Journal believes (from talking with people that have sat through meetings at Rio Tinto) they are looking at ~15% of their income coming from their Boron division alone. The Turks are known for frequent interruptions plus some quality and arsenic problems. World production of boron minerals reached an estimated 4.5 million metric tons in 2009 (source USGS).
Price: Market prices reflect the relative scarcity of borates with prices averaging: US$280/t for colemanite concentrate (40-42 percent B2O3); US$500/t for ulexite (40 percent B2O3); US$550/t for boric acid; and US$50/kg for anhydrous borax.
Erin Ventures' World Class Boron Deposit - Size, the Potential, and the Advantages
The Piskanja boron deposit is the third largest in the world as it sits now; Erin Ventures had proven up (now considered historical non NI 43