Successful mining investors are Jacks (or Jills) of all trades. They moonlight as virtual amateur geologists, and they are well-versed in the macroeconomic trends impacting their price forecasts for the metals mined.
But they must also keep a close eye on geopolitics to avoid undue exposure to potential disruption or even loss of key projects or operations. In Cote d'Ivoire, for example, an acute political crisis has erupted into violence and chaos since President Laurent Gbagbo refused to step down after losing in a national election last year. After voting in support of United Nations sanctions against the former President, France's Ambassador to the UN, Gerard Araud, noted that "the situation is worsening by the hour". He also noted recently that the nation is now "very close to a civil war".
In addition to the tragic human consequences of the resulting unrest, the suitability of Cote d'Ivoire as a viable jurisdiction in which foreign corporations can safely conduct mining operations hangs in the balance. Australian gold major Newcrest Mining announced the closing of its Bonikro mine this week, and has left behind only a small security detail after evacuating all expatriate employees.
Meanwhile, clear across the Southern Atlantic, Kinross Gold
Assessing jurisdictions for mining investment purposes is by nature a qualitative and often subjective exercise, and there are multiple facets to the issue. Canada is about as stable as they come geopolitically, but the government's denial of Taseko Mines'
These are complex issues, to be sure, but they nonetheless command the attention of every investor with exposure to mining stocks. For stocks with superior profiles as they relate to jurisdiction, I do enjoy focusing my exposure upon operations in Canada. Agnico-Eagle Mines
Fool contributor Christopher Barker can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He tweets. He owns shares of Agnico-Eagle Mines, Kinross Gold, Osisko Mining, Taseko Mines, and Teck Resources. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has an extraordinarily stable disclosure policy.