IronRidge Resources (LON:IRR) said it may look to diversify away from iron ore as a way of hedging against the commodity cycle.
The firm is in the process of exploring for iron in Gabon, but noted that with commodity prices low, it may need “some level of diversification”.
“The prudent management of IronRidge’s working capital has left it reasonably well placed to take advantage of complementary opportunities as they arise,” Nicholas Mather, chairman, said.
The iron ore price has dropped 70% since 2013, and the junior explorer said the challenges in the market may mean it looks to “complement its existing project portfolio”.
The company reported it made a loss of a little over £2mln for 2015 and as at June 30 had £14.9mln in cash.
IronRidge listed on AIM in February, raising around £9.7mln, for exploration in the Tchibanga and Tchibanga North licence areas in south-west of Gabon.
It hired well-known mining consultants SRK, which is providing “a bespoke service, which combines its exploration expertise and in-country knowledge with renowned global experience and resources.”
Following the London listing, South African iron ore, chrome and manganese specialist Assore (JSE:ASR) holds 30% of Iron Ridge’s shares, while the global Japanese trading conglomerate Sumitomo (TYO:8053) holds 12%.