Strategies
Distinct Strategies, Diversified Platform
Active Private Equity Investors
Diversified Platform of Mining-Specific Strategies
Our investment management teams are organized around distinct investment strategies aimed at providing capital throughout the development, capital structure, and risk/reward spectrum.
Private equity for the energy transition
RCF Private Equity
The RCF Private Equity strategy seeks to achieve significant returns from investments in the mining industry. It is founded on the belief that the world is undergoing a paradigm shift in the demand for metals and minerals. The RCF Private Equity strategy seeks a leading role in advancing projects to cash flow through a focus on late-stage assets in strong mining jurisdictions.
Martin Valdes
Partner, Head of Private Equity
Capturing opportunities across the mining sector
RCF Opportunities
The RCF Opportunities strategy rests on the belief that meeting the planet’s surging demand for metals, driven by technological innovation, changing demographics, and global electrification and decarbonization objectives, relies on new discoveries and project advancement. To offset the natural risks of early-stage exploration, the RCF Opportunities Strategy pursues a diversified and relatively unconstrained approach that seeks to lower volatility, flatten the j-curve, and generate realizations during and after the investment period.
Russ Cranswick
Partner, Head of Opportunities
Aiming to make mining safer, better, and more efficient
RCF Innovation
The RCF Innovation Strategy is a growth private equity investor focused exclusively on the mining innovation sector. The energy transition, ESG requirements, and the declining quality and remoteness of mineral reserves are forcing the mining industry to transform itself. The RCF Innovation Strategy seeks to establish equity positions with significant control and influence to enable successful scale up and position innovative firms for high-value exits. Innovation is vital to mining and we believe this niche sector has a large and fast-growing revenue potential. The Strategy generally invests in a balanced portfolio of 10-15 growth equity deals across APAC, North America, and Europe.
Andrew Jessett
Head of Innovation
Aiming for superior returns
Investing Across all Phases of Mining
Exploration
Timeframe: 1-3 years
fund strategies: RCF opportunities, RCF innovation
Exploration begins once a mineralized region is targeted. The mineral exploration phase involves the search for and discovery of mineral deposits through prospecting and advanced exploration activities. Geologists look for mineral deposits over wide areas using geological mapping, remote sensing, and geochemical and geophysical surveys. When areas of potential are found specialists drill and sample rocks (to test for and analyze the concentration/proportion of minerals or metals of interest). The exploration phase involves the most risk, but technical proficiency, responsible stakeholder engagement, and capital markets experience can help improve the odds of success.
Discovery
Timeframe: Subset of Exploration
fund strategies: RCF opportunities, RCF innovation
Discovery is a moment in time when exploration yields success. A discovery happens when drilling intercepts potentially economic mineralization (at this early stage this is often established by benchmarking against similar but more advanced deposits). Discovery is followed by more advanced exploration to define the size, geometry, and grade of mineralization. These characteristics help determine the potential economics of a project, while understanding the type and origin of mineralization help drive additional exploration success. At this stage, exploration drilling to provide representative samples ramps up, while still supported by other techniques such as geochemical and geophysical surveys.
Resource Definition
Timeframe: 1-3 years
fund strategies: RCF opportunities, RCF innovation
After a discovery has occurred and there is evidence that a location may contain potentially mineable mineralization, the resource definition phase is meant to delineate and quantify the mineral deposit with greater accuracy. It aims to convert the "discovery" into a "resource". More detailed drilling and extensive sampling is completed along with advanced geostatistical modeling. This phase culminates with an estimate of tonnage and grade referred to as a resource statement or Mineral Resource which is used to make a go/no-go decision as to whether to advance to a Preliminary Economic Assessment (PEA), or scoping study.
Scoping
Timeframe: 1-2 years | Accuracy: +/-50%
fund strategies: RCF opportunities, RCF innovation
Once a promising deposit has been explored, discovered, and a resource statement completed, the scoping phase evaluates the potential economic viability of the project. A Preliminary Economic Assessment (PEA) study, also called a scoping or order of magnitude study, uses basic data with minimal engineering involvement to estimate mine size, equipment, workforce, processing, and ESG requirements. Preliminary metallurgical testing is also conducted to ascertain potential recoveries of the targeted commodities. If the PEA is favorable, a Pre-feasibility Study is conducted to explore implementation options and evaluate economic potential with a greater level of certainty.
Pre-Feasibility
Timeframe: 1-3 years | Accuracy: +/-25%
fund strategies: RCF opportunities, RCF innovation
When the scoping phase results justify further investigation and investment, it is followed by the longer, costlier, and more detailed feasibility phase which begins with a pre-feasibility study (PFS). The PFS is conducted to assess engineering requirements, implementation options for extracting and processing minerals, and related capital and operating costs within 25% accuracy. It is a critical step towards identifying areas that require further investigation. This is the earliest that a Mineral Reserve can be defined and is an important step in the overall mining opportunity assessment. The next step is a feasibility study and these stages can overlap.
Feasibility
Timeframe: 1-3 years | Accuracy: +/-15%
fund strategies: RCF private equity, RCF innovation
Once the PFS is completed and an economically viable option is found and selected, a Feasibility Study is conducted to provide a more comprehensive technical and economic evaluation of the project to within 10% accuracy. The study includes defined resources and reserves, extensive metallurgical testing (and pilot testing where necessary), and ESG considerations, and sets out the plans for the mine. If a decision is made to move forward, pre-construction begins. The team creates a detailed plan to construct a working mine and starts to hire contractors for front-end engineering and design (FEED). The permitting process also starts in this phase, or earlier, and can take years to complete.
Financing
Timeframe: 3 months - 1 year
fund strategies: RCF Private Equity
Once a feasibility study has been completed and released, which demonstrates the technical and economic viability of a mining project, the financing stage begins. Financing a mining project will involve numerous parties, including strategic partners, offtakers, streaming groups, equity and credit providers. Experienced mining investors will conduct extensive due diligence on all aspects of the project in order to validate the development plan set out in the feasibility study, and to examine all potential risks and opportunities of the project. There are a variety of funding solutions available to companies including, debt, equity and royalty and streamlined instruments.
Construction
Timeframe: 1-3 years
fund strategies: RCF private equity, RCF innovation
Once economic viability is established and financing is in place, detailed engineering and construction begins: building the infrastructure and facilities needed to extract, process, and transport mined minerals. If the site is in a remote location - which is not uncommon - the process typically starts with roadbuilding, which enables processing plants, worker housing, and equipment to be brought in. Just as important, a company must recruit and establish a strong management team with the right skillsets and hire a large workforce ready for operations. Significant planning and efforts are be made to minimize environmental and community impacts. As this phase ends, there's a commissioning process that involves testing equipment, water systems, and performance testing to transition from construction to operations, along with a training transfer from the construction to operations group.
Construction of a new and technologically sophisticated mine has the potential to bring socioeconomic benefits to a region. RG Gold, a portfolio company in RCF VII, shown in the video above, has built a gold processing facility in Kazakhstan that RCF helped deliver on budget and on time. Learn more about RG Gold’s Grand Opening in 2022.
Operating
Timeframe: 10-27 years
fund strategies: RCF private equity, RCF innovation
Many years after ore has been discovered, the mine begins extracting and processing minerals - and generating revenue. Mine operations involve cycles of drilling, blasting, loading, and hauling ore to a processing plant where it is treated to extract minerals; waste material (tailings) are disposed of in designated areas. This phase starts with a ramping up process which can take several years of intensive effort, with new skillsets brought in to reflect the transition away from construction. Strong leadership and well-structured organizational processes are needed to bring the mine to the desired output level; at that point the focus shifts to steady-state operating performance and a focus on optimizing efficiency, removing bottlenecks, and for some minerals, building new markets. Further exploration efforts are made to identify replenishment for what has been extracted, or if possible, expand the reserve. The mine's operating life ends when the deposits are depleted, or it becomes uneconomical to continue.
Closure
Timeframe: 1-5 years
fund strategies: RCF innovation
Although it may extend over decades, mining is a temporary use of land. Closure planning must be prioritized at an early stage of mine development to ensure an overall positive legacy. It is a fully integrated, dynamic, and iterative process that takes into account environmental, social, and economic considerations. Strategic closure planning and cost estimation is integrated into operational activities, based on defined principles, objectives, and a post-closure vision. The goal is to restore mined land back to a state that can support a range of post-mining uses, from biodiversity habitat to economic diversification.
