Editorial: Kent, Munk shared debt regrets

At The Northern Miner, we like to think of ourselves as more than reporters of the latest news and commentaries about Canadian mining and mineral exploration.

As an institution dating back to 1915 and as co-founder of the Canadian Mining Hall of Fame, we also have a unique position in business media as chroniclers of the rich history of the Canadian mining industry and its colourful characters.

In that spirit, we are presenting on our Northern Miner Podcast in August a three-part interview series by senior staff writer Trish Saywell carried out on the sidelines of the Prospectors & Developers Association of Canada convention in Toronto in March 2018 with legendary mining executive Margaret “Peggy” Kent, who let us know “there are a few of us still left around the industry who have seen it all and done it all.”

Kent rose to Canada-wide prominence in the early 1990s as Peggy Witte in her role as CEO of gold miner Royal Oak Mines, which grew to become a major producer, with mines spanning the country.

A downturn in gold and copper prices humbled the debt-laden company, eventually forcing it into a painful receivership in the mid-1990s — but not before the company gained mainstream notoriety for environmental issues and labour problems at its Giant gold mine in Yellowknife, N.W.T., which culminated in a striking miner murdering replacement workers using explosives underground.

Now in her 60s, as she sat down with us to share what wisdom she had gained over the years as a top-level mining professional, Kent readily admits that even today, “some people love me and some people hate me.”

Within Canadian business circles, Kent was particularly prominent during Royal Oak’s outsider bid for LAC Minerals — which was ultimately acquired by Peter Munk’s Barrick Gold, in a purchase that was a major stepping stone to Barrick becoming the world’s biggest gold miner.

Kent told Saywell during the interview that Peter Munk — then in his final days — was the mining entrepreneur she most admired.

After Munk’s death in late March, in our own retelling of his remarkable life, the biggest regret in his career was Barrick taking on too much debt, particularly in its acquisition of Equinox Minerals in 2011 that left the company overexposed when gold and copper prices dived only a few years later.

“I always seemed to be, for a long time, in the wrong place at the wrong time,” Kent said of her own brushes with mining’s fickle nature. “When I was young I was very feisty. I wanted to be the contrarian.

“As you get older, you realize that there are metals cycles. Everyone is in euphoria at the top of the metals cycle. But at the top of the metals cycle isn’t the time to finance a project, or to put a project into production.”

She said having to file Royal Oak through the insolvency process “gave me a whole new perspective on life. I was no longer a naive mining professional, like I see a lot of them still are out there. My world came crashing down.”

Emphasizing that all her various companies’ decisions were approved by their boards, she did concede she “took too much risk … I’d been burned. You wake up and you don’t have a friend in the world. You don’t have anyone who will come in and save you.”

She recalled other mining and financial executives she had considered friends who withdrew from her and refused to help, and instead sat back waiting for Royal Oak’s demise to pick up assets on the cheap.

Today, as chairman of junior grassroots explorer Stratabound Minerals, Kent is content to be out of the production game and instead involved in a relatively simple gold promotion in the Yukon named Golden Culvert. It’s much smaller scale than her previous feats, but could bring substantially better financial leverage to her closest supporters if the property indeed proves to host a substantial gold deposit.

“At my age, I can’t be the road warrior I used to be, on the road two weeks out of every month, pounding the pavement to sell the stock. My strength right now is in the development field, it’s not in the production field.”

— Listen to the three-part podcast series at www.northernminer.com/podcast.