Variscan seems to be attracting some interest in France, albeit...

Variscan seems to be attracting some interest in France, albeit for the wrong reasons.

One French news site last week reported that an arson attack destroyed a workshop near the Couflens project in southern France. And a second local French news site reported just a few days ago on a protest group in Brittany, who have been lobbying the French Minister of Economy and Finance to repeal the Variscan Breton mining permits.

One local politician quoted in the article, Thierry Burlot, seems convinced that there will be no mining in Brittany, although Burlot also comments that the case against Variscan has been bogged down over the issue of compensation for the company in the case of repeal.

While he was serving as Minister of the Economy a few years ago, the current French President, Emmanuel Macron, was behind a push to resurrect the French mining industry, so if the protest movement is successful in its effort to revoke Variscan's licenses without compensation, it would be a rather curious development.

None of this is good news of course, though I can't help but suspect that all of this is already factored into the share price. Even if their licenses are revoked, provided the company receives fair compensation, you would have to assume that there is a good chance this would likely be worth more than the current market cap.  

While it is tempting to blame the anti-mining culture in France for the problems the company is facing, my opinion is that the company strategy in France has been wrong-headed from the start.

It seems to me that they have approached the task of exploring for minerals in France with a mindset that would be more suitable for a remote area such as Western Australia or Siberia. But there is really no comparison between these regions: the population of France is more than 100 times that of WA. There are people everywhere in France, and so any mining company operating there will inevitably end up treading on a large number of toes.

On top of that, France doesn't have a mining culture, and as such the French are generally ignorant about the industry. People naturally tend to fear the unknown, and so these protest shouldn't really be a surprise.

Instead of scrambling to acquire as many French exploration licenses as they could get their hands on, perhaps the Variscan management should have focused more on educating the locals about the benefits of the projects, thereby winning over hearts and minds.