Brexit could prove to be a golden opportunity for Ireland's miners
As Brexit sent many scurrying from currencies there was one area that was deemed as a safe haven. And Conroy Gold is enjoying a knock-on benefit, its chairman tells Michael Cogley
The negatives of Britain's shock decision to leave the EU have been well documented. Some commentators have found it difficult to see any upside from Brexit with a potential UK recession being mooted. As share prices in Ireland and the UK plummeted following the vote, there was one place investors highlighted as a safe haven. It was gold.
Swathes of UK gold companies reported major increases in transactions after June 23 as Britons sought refuge from what seemed an open-ended plunge in the value of sterling.
However it isn't just companies selling gold that are benefiting from the uplift in demand: Irish exploration firm Conroy Gold and Natural Resources has began to feel a welcome knock-on effect.
Conroy chairman Professor Richard Conroy said that despite a lack of saleable gold, the economic situation has a major impact on his business.
"When we're doing our economics on a potential gold mine, it becomes very important and it's also important in various other ways, in that the major and intermediate companies obviously have a greater interest in doing a joint venture and that's to our advantage for the actual development of a mine when the emphasis is on gold.
"There are a number of elements which impinge on us but we can't directly sell the gold because we haven't as yet produced any," Mr Conroy said.
"If you're a major gold company you will be all the more anxious to do a deal with a much smaller company such as ourselves, which has the potential to discover a large quantity of gold."
The increase in demand for gold comes off the back of strong year for the company. Early last year Conroy slapped a potential value of €150m on Ireland's first commercial gold mine, at Clontibret in Monaghan.
That valuation, Mr Conroy says, is still holding through more than a year on and actually tips it to rise in value rather than dip due to the increase in the price of gold.
In the year to date so far gold has experienced a big surge, rising from $1,078 (€978) per ounce in January to $1,331 per ounce in July.
While its value has fluctuated, dropping from a 2011 high of $1,864, Conroy's chairman still maintains it's a smart move to have some of your wealth made up of an investment in gold.
"It makes absolute sense for people to have a percentage in gold, certainly the Central Banks are indicating that. For the last number of years they have been steadily building up their reserves of gold.
"Central banks have been scarcely selling any gold at all over the last number of years. They feel that is advisable to do," he said. On Monday Conroy announced it had found four new gold zones on its Glenish target in Monaghan. The discovery was made in a 150 metre-wide structural corridor in the western part of the Glenish gold target.
The new zones were found partly in thanks to a capital raise the company completed in December.
Conroy Gold raised over half a million euros at the time for the further development of gold mines through a share placing and debt conversion.
That capital is still sufficient to keep the firm going as Mr Conroy ruled out the possibility of another capital raise in the not too distant future. "We've been fortunate to raise funds to keep out exploration going and very fortunately we've gotten the results as we've gone along but it's a very prolonged process."
Year-on-year the company continued to reduce its net loss down to €315,314, however making a profit doesn't seem to be a pressing concern just yet.
"Curiously not (intentions to bring down net loss), it may seem a contradiction but if you're running an exploration company your cash flow is outward not inward. Now we try to run a tight ship and watch all our expenses because we go as far as possible to see money going into the ground to make discoveries.
"We've been involved in the exploration business for many years and it takes a long time. For quite a long time people found it difficult in seeing Ireland as a major international base metals country.
"Now, if you go out to the big mining conferences in Toronto they'll immediately say 'Ireland - oh yes of course a zinc province'. But they don't think of it as yet of gold and we're hoping that gradually that message will get across."
Mr Conroy has previously spent time in medicine and politics before taking on the Irish mining scene, something he finds there is a peculiar lack of awareness about.
"It's remarkable the contrast in Finland, they're very conscious of their mining industry, they encourage it in every way that they can, they are very upmarket, they're very good environmentally and technically.
"Whereas here in Ireland we don't even know about it. In fairness to people here, those involved in the Geological Survey here and in the Geological Survey in Northern Ireland, they are enormously helpful. They have very high quality people. But when you go beyond that circle of people it's surprising how little is known about mining."
The former senator said Ireland as a country is missing a trick in not capitalising on gold mining, saying it has genuine potential for job growth.
Ireland doesn't seem to be a hard sell either compared to the more familiar destinations for mining.
"People imagine that a mine out in Africa or somewhere in the Australian outback would be financially more attractive but there's more to it than that.
"As well as the actual financial situation, which in Ireland is quite attractive, not because of the tax, but because you have a good infrastructure, you have a good power supply, you're not flying expats out to Liberia or wherever it is.
"Ireland has many attractions and it's also considered as politically stable."
Conroy looked at gold in the nineties and believed it was vastly undervalued. As a result the company is now looking at potential benefits from its early investment.
However, Mr Conroy said it has been a "long hard process".
The company remains comparatively "tiny" to other larger gold companies, employing just ten.
A return on investment is hoped for fairly rapidly but the Conroy founder said the company is open to a joint venture with larger companies as it looks to exploit its gold targets dotted across Ireland.
In the meantime the company has seen a near 60pc increase in its share price since Britain shocked the world with its decision to leave the European Union.