African Minerals - Re: AMI Stream Log - “He admired Frank Timis as...

“He admired Frank Timis as courageous and clever at marketing” Dan McCrum | Aug 06 2014 185 | Comment | Share It seems like a good time to dust off the 2010 thoughts of the US ambassador in Sierra Leone on African Minerals, preserved for posterity in the Wikileaks batch of diplomatic cables. (H/T to the FT’s Christopher Thompson). They tell a story that might have been: Oluniyi Robbin-Coker, an economic advisor to Koroma, told Ambassador Cheshes January 27 that African Minerals’ activities were, “of course, speculation.” He noted that the company’s share value in London had jumped twenty-fold over the year 2009 (from 20 pence to 405 pence), although the company had no track record for taking a large mine to full production. He admired Frank Timis as courageous and clever at marketing. Everything African Minerals had done in Sierra Leone to date was based on an exploration (versus mining) contract. Robbin-Coker said that there was a widespread perception, “to which there is some reality,” that Sierra Leone’s mineral assets were in the hands of exploration companies. He anticipated that Timis, having raised large sums of money and made a vast profit on the stock market in 2009, would now “cash out” in favor of a “reliable mining company.” In fact, Robbin-Coker said that he was actively looking for a top-notch company to buy out Timis and asked if DCM knew of any interested American “big boys.” Instead Mr Timis is still there as chairman at African Minerals, which is hoping to refinance its debt before cash runs out. He has survived an internal investigation this year into claims, neither proven nor unproven by the hired sleuths at G3, that he personally benefited from a $50m payment he authorised without board approval to a Cypriot company. (No approval was necessary, said the company in its report on the affair. Mr Timis declined to comment.) The Ambassador also chanced to hear from David Keili, Sierra Leonean Managing Director for London Mining Ltd, and chipped in twopence (in bold): He said that iron-ore reserves in Tonkolili were indeed on the order of billions of tons, as Delco had known many decades ago and as a reputable surveying company had confirmed for African Minerals, but no mining company had heretofore believed that the ore was of sufficiently pure quality to be worth mining, on top of the huge infrastructure costs. The idea that such infrastructure could be put in place in a mere year or two was, Keili believed, not credible. (Note: Post concurs with this assessment.) During a road trip to Lunsar January 28, DCM observed the dilapidated state of what had once been a vast mining community (replete with a golf course and separate clubs for senior, intermediate, and junior officials). The rail tracks have been largely pulled up. An official from London Mines who guided DCM through the ghost town said that the railcars, railroad, and port at Pepel had — amazingly — remained in useable condition until the previous two years, when African Minerals had taken control of them; he said that the rails, railcars, and port infrastructure had now all been dismantled, cut up, and sold for scrap.