Friedland Mines Mongolia for Love, Money
Date: 14-Jun-04
Country: CANADA
Author: Steve James
And some of the leaders of that isolated Asian country evidently like him too.
After all, the billionaire mining entrepreneur not only is planning on developing a major copper and gold project there through his company Ivanhoe Mines Ltd, but he helped bail out Mongolia from its $11.4 billion debt to Russia.
"Last December 11, I get an amazing call from the Mongolian prime minister saying that '(Russian President Vladimir) Putin will be naming a new prime minister and Russia is changing so we have an opportunity to buy all our debt from Russia,"' Friedland told the Reuters Mining Summit in Toronto this week.
Ivanhoe closed a C$150 million (US$115 million) sale of equity the following week and bought Mongolian treasury bills worth US$50 million to help the country buy back its Russian debt for just 2 percent of its outstanding level.
"Now Mongolia sits with no debt," Friedland said.
That's how Friedland talked of his current project - a huge gold and copper discovery in Mongolia. His appearance at the summit was also typical Friedland - arriving in Toronto from London where he had been a keynote speaker at a minerals conference. After talking extemporaneously for an hour with journalists, he was jetting to Melbourne, Australia.
Friedland, who also said he is off to Chile later this month, says he literally lives on his own aircraft.
The larger-than-life founder and chairman of Ivanhoe Mines speaks with intensity and passion about just about anything he does. On Mongolia, for example, he says he has "a very deep and long-term commitment to Mongolia - we really love the place, we really love the people."
He also talks of "Islamic terrorism" and America's "poorly managed" response to it, warning that it means parts of the Muslim world are now cut off for mining exploration by Western companies because of security fears.
At the end of this month, the mining world will learn whether Friedland's inner peace with the Mongolian Buddhists is equaled by his legendary golden touch in business.
The Oyu Tolgoi project in the south Gobi desert is currently in audit, and at the end of the month Ivanhoe will release an updated proven-and-probable reserve estimate for the open pit part of the Mongolian project.
Friedland, best known for the discovery by one of his companies of the massive Voisey's Bay nickel deposit in Canada in the early 1990s, said he expects by the end of the year a full feasibility study for the open-pit portion of the project, from which banks assess whether it is worth financing.
About to turn 54, the Woodstock-generation Friedland is a colorful character in an industry with its fair share of mavericks, loners and eccentrics.
As a teenager he was arrested on charges of selling LSD to an undercover cop, and in the 1970s he embarked on a tree farm business in Oregon with Apple Computer founder Steve Jobs.
Friedland talks matter-of-factly about stumbling onto gold in the course of the tree business - an event that started him on his mining career.
In 1996, Voisey's Bay was sold to Inco Ltd. for C$4.3 billion and Friedland made about $500 million from the transaction.
Besides being involved in the two potentially biggest mining discoveries in the last two decades, forming an energy company and working in off-the-beaten-track places like Burma and the Central Asian republics, Friedland has seen some less buoyant moments too.
He formed a company called Galactic Resources Ltd. to develop a gold mine in Summitville, Colorado, using a new cyanide-based technology.
But federal environmental inspectors later found acidic runoff from toxic materials, and the cost of complying with environmental standards drove Galactic into bankruptcy. Friedland ended up paying $20.7 million to help clean up the area, although he later recovered much of the money from other responsible parties.
