No boundaries to the opportunities for Chaarat Gold
“…We can operate in these jurisdictions. Chaarat can develop good projects and we will be rewarded…”
Structure, process and operating discipline is how the new Chief Executive of Chaarat Gold envisions the company will protect and create value.
His mantra isn’t a pure theoretical philosophy because after twenty years of working with larger enterprises in the mining sector, Michael Fraser has realistic and scalable ambitions for the company that has established itself as a consolidation play in the FSU or the Former Soviet Union.
He’s gone back to the drawing board in terms of how Chaarat Gold is positioning itself. Sacrosanct are the company’s core projects – the ‘cash cow’ Kapan operating mine in Armenia, and the as yet undeveloped Tulkubash open pit heap leach project and Kyzyltash sulphide ore body in Kyrgyzstan.
However, and it’s a big however, Fraser doesn’t want to limit the business to the Former Soviet Union. Not because of Russia’s invasion of Ukraine, but because of the quality of the management team. “We’ve got a lot of global experience in the business. We will not be afraid of acquisitions outside the FSU.”
What is going on in the FSU now isn’t being ignored with investors questioning political stability and how it impacts Chaarat. Fraser says that both Armenia and Kyrgyzstan, like Ukraine remain sovereign and he is not concerned about legacy Russian influence. He is not being dismissive. He knows the Kyrgyz government is very keen to see the development of the gold sector and “westerners” are welcomed as development partners.
Fraser is fastidious about capital allocation. He is mindful about inflation and how it impacts capex and how it also influences the execution of project finance. While one mentor encouraged a “being able to walk and shoot a gun at the same time” approach to a multiple-project enterprise, Fraser is also adopting a go slow on the allocation of shareholder capital because “Ultimately you don’t want to destroy value for the pursuit of outcomes.”
Listen to Michael talk to Sarah Lowther about his leadership philosophy, the priorities of the existing portfolio, realistic timelines and consolidation outside the former Soviet Union.
Chaarat has implemented several social programmes and hosted various events for the Kapan community as captured in this video.
Read the company’s corporate presentation
Access our indepth article on Chaarat
Follow the company on Twitter @ChaaratG
The author was remunerated but does not hold shares in the company