Segun Lawson was born and raised in Nigeria, sent to boarding school in the UK and graduated in geology at Imperial College London. Along the way, he found himself wondering why there were no large-scale mining projects in Nigeria.
The country was once the world’s leading tin producer, boasting several London-listed gold companies too. But that was before the Second World War and in recent decades metals mining has dwindled to virtually nothing as oil and gas became the dominant local industries.
With his geological background, reinforced by a stint in the City and a masters in business administration, Lawson became convinced that mining in Nigeria was an opportunity not to be missed.
He spent some time investigating potential ideas, ended up with a project in Senegal close to several big gold-producing mines and, in 2011, came across a Canadian entrepreneur with a Toronto-listed shell firm.
Lawson acquired the firm and, at the age of 32, became chief executive of Thor Explorations, a business with a Senegalese mine site and not much else.
Mettle: Segun Lawson has beaten obstacles to make his Nigerian mine work
Thor has come a long way since then. Today, it is listed in London, with a highly profitable gold mine in Nigeria and several more exciting projects in the pipeline. The share price is 17.5p and should rise as the company expands and production increases.
Early years were tough. In 2014, Lawson almost gave up entirely after financial markets closed their doors to junior mining firms and Thor’s Senegalese site was forced into hibernation.
It was then that he discovered Segilola, an early stage gold mine just 75 miles from the Nigerian capital, Lagos.
Results from Segilola were promising. There was plenty of gold on site and it was high-grade too. But a legal wrangle had erupted between previous owners, and sale negotiations were protracted. When Lawson finally acquired the scheme in 2016, he assumed Thor’s fortunes were about to change, swiftly moving from an exploration firm to a commercial enterprise.
He reckoned without the Nigeria factor. Investors fretted about bribery, corruption, security and political interference.
Segilola was also the first commercial mine project in the country for decades and no one wanted to take the plunge and support it. Lawson persevered, however, and ultimately succeeded, backed initially by family and friends, then African financiers and a Hong Kong-based mine specialist, and finally some big UK investors.
Construction started in early 2020, Thor was listed on the London Stock Exchange’s junior AIM market in June 2021 and gold production began just a few weeks later.
Last year, the group delivered 98,000 ounces of gold, sales totalled $165 million (£130 million) and net profit exceeded $25 million.
The first few months of 2023 were tricky, as Thor encountered an area of large boulders and lower-grade ore. But the second half of the year is likely to be much smoother, annual production should hit 95,000 ounces and turnover of more than $176 million is expected, with robust profits alongside.
Production should ramp up next year, with brokers predicting a near 20 per cent increase in turnover to $210 million. Costs are likely to come down in 2024 too so profit is expected to rise materially.
At the same time, Lawson is working hard to expand the Segilola mine and explore neighbouring areas, where early signs suggest more gold can be unearthed.
The group recently acquired a large lithium site in south-west Nigeria too, well connected to Lagos. Small-scale miners have been operating in the area for years, but Lawson intends to develop a substantial, high-grade commercial mine, taking advantage of persistent demand for the metal, which is a crucial component of rechargeable batteries.
Now that Thor is profitable, the business is making progress with its Senegalese mine too, a site that could produce more than 100,000 ounces of gold a year over time.
Lawson last month spent about £1 million of his own money acquiring 6.6 million shares in Thor, taking his holding to 4.45 per cent of the company.
His family own another 15 per cent, a sure sign of confidence in Thor’s future. Their combined holding also inclines Lawson to think carefully about dividends, so payouts should be on the cards as soon as practicable.
Thor takes its wider responsibilities seriously too, minimising harmful emissions and bolstering local employment, from school leavers turned laboratory assistants to female lorry drivers, whose safety record far outweighs that of their male counterparts.
Midas verdict: Nigeria fills many investors with doubt, but Lawson has developed a safe and profitable gold mine just hours from Lagos, staffed by locals and backed by government. Prospects are bright, as Thor works on its main gold mine and expands into new areas. And at a time of economic uncertainty and sticky inflation, gold prices, currently more than $1,900 an ounce, should remain firm. At 17.5p, Thor is a find for the adventurous investor.
Traded on: AIM Ticker: THX Contact: thorexpl.com or 001 778 658 6391
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