NEW YORK Mining companies
either failed to recognize or ignored the risks associated with
developing projects and are now paying the penalty, Cowen
Securities LLC analyst Adam Graf said.
"Miners are being punished for
making acquisitions or aggressively executing project
pipelines, then falling victim to a number of risks," he said,
noting that the political, permitting, financing or dilution,
and execution risks are the main factors facing investors and
those looking to make acquisitions.
"Were in a risk-off
environment nowinvestors are shunning any hint of risk,"
Graf said at the Society for Mining, Metallurgy and
Explorations mining finance conference in New York.
Junior miners and pre-producers
have the greatest capability to offer value and leverage
through time, he said.
But this gives these firms
exposure to the highest risks, including access to financing,