PDAC: Toronto stock exchanges sign MOU with Brazilian Mining Association

The Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) have signed a memorandum of understanding (MOU) with the Brazilian Mining Association (IBRAM) that seeks to increase investment in the Brazilian mining sector over the coming years.

The signing of the MOU, which coincided with the Prospectors and Developers Association of Canada convention, is expected to open up opportunities for expanding geological research, which is vital to increasing Brazilian mineral production, exploration and the development of Brazilian mining projects as well as jointly identifying opportunities to boost the investment attractiveness of the Brazilian mining sector.

“We are excited about raising Brazil’s profile in the Canadian mining investment community and Canadian capital markets,” Wilson Brumer, president of IBRAM’s board of directors and signatory of the agreement told The Northern Miner. “We recognized that medium-sized and smaller mining companies in Brazil require our support in attracting investment, so our goal is to help countries like Canada to recognize the tremendous potential that exists for investing in Brazil’s mining sector.”

A private, not-for-profit organization, IBRAM has 130 members representing companies and institutions that work in the mining industry, including employer organizations, mineral engineering, environmental and geology companies, equipment manufacturers, technology centers and investment banks.

It aims to increase the sector’s national and international competitiveness by helping companies to establish a presence in the Brazilian minerals sector, as well as seeking to promote sustainable development practices and the use of better safety and occupational health practices in Brazilian mining.

IBRAM is expected to play a vital role in implementing actions considered in the MOU, which include initiatives to increase the number of Brazilian mining companies on the Exchanges and identifying attractive projects and investment opportunities in the Brazilian minerals sector.

The value of investments in the Brazilian mining sector is projected to be US$32.5 billion in 2020-2024, an increase of 18% compared to the forecast for 2019-2023, according to a February announcement from IBRAM, with the rise driven by investments in green and brownfield projects and operational safety.

Less than a third of Brazil’s 8.5 million sq. km has adequate geological research currently being undertaken, with mines occupying only around 0.6% of the country, IBRAM says, and the organization believes there is “enormous potential for new investments and the discovery of future world-class deposits.”

IBRAM and the Exchanges are now developing a joint agenda to promote Brazilian mining, such as investor conferences aimed at attracting investment from Canadian companies.

“From our perspective, we’ve seen a great deal of activity out of Brazil, and some exciting companies are emerging,” Robert Peterman, vice president, global business development of TSX and TSXV, and co-signatory to the agreement, said in an interview. “Therefore, we decided to establish a full-time presence in Brazil and to be part of the ecosystem in South America. The agreement is a perfect example of the collaborative work that is happening on the ground to move the sector forward collectively.”

There are currently 35 companies on the two exchanges with over 100 properties in Brazil, and Peterman believes that they will be an essential partner and source of capital for Brazilian mining companies.

The agreement will help to connect Canadian expertise in financing with Brazilian knowledge in mining to try to create more opportunities for growth.

“From my perspective, the number one thing is education — working together to find ways to help the Brazilian mining companies to think of the Canadian financing ecosystem as a pathway for growing their businesses,” Peterman said.

Peterman recognizes that there already exists a culture of mining in Brazil and a lot of expertise on the ground, and he believes that Canada has unique experience on the regulatory side through the national instrument 43-101 and the regulatory infrastructure that governs companies on the TSX and TSXV that it can bring to Brazilian mining companies.

“We are not here just to sign an agreement,” IBRAM’s Brumer said. “We now need to develop an action plan to accelerate investment in the sector by leveraging the experience that Canada brings, especially given the huge companies that are listed on the Exchanges. We are trying to create a new environment for investment in the Brazilian minerals and mining sector.”