In the Beginning

Sprott Inc.’s founder, Eric Sprott, is well known among financial circles for his successes in the investment sector. He is also known among Aboriginal circles for his support of First Nations peoples.

Hands

In 2007, Sprott Resource Corp. (SCP:TSX) was founded by the now President of Sprott Inc. (SII:TSX) Kevin Bambrough. In an effort to explore avenues to build natural resource companies in partnership with First Nations, Kevin Bambrough reached out to National Chief Phil Fontaine.  Upon learning of Eric and Kevin’s interest and respect for First Nations peoples, Phil introduced his long-time friend and a former Grand Chief of the Federation of Saskatchewan First Nations, Blaine Favel.

Blaine and Kevin fostered the concept of a start-up company to implement their collective vision—which Blaine named "One Earth Resources". Initially they expected to be exploring avenues for developing natural resources—such as potash, oil and gas—on First Nations lands in Western Canada. As they began meeting with community leaders and touring First Nations lands in Saskatchewan, Kevin’s curiosity was piqued by the vast areas of farm lands under First Nations ownership. Surprisingly, there seemed to be an obvious disconnect as First Nations experienced high unemployment yet they were not farming their own lands. On Kevin’s reflection, "I had a positive view on agriculture and the status quo for First Nations made no sense. The First Nations typically had been entering into short-term leases that resulted in little to no employment or investment. We also found that the land was often poorly cared for and regularly discovered lease rates to be at less than fair market values."

Blaine began contacting First Nation leaders to gauge their interest in partnering with the Sprott Resource Corp on a farming venture. Working together, SRC and the First Nations would have the land, labour pool, business skills and financial ability to quickly build the largest farming company in Canada, if not the world.  The initial response by First Nations leaders to Blaine’s enquiry was resoundingly positive.  In fact the interest was so high that calls just started rolling in from all First Nations who learned of the concept and expressed their desire to participate.  This turned out to be the beginning of "One Earth Farms".

But first is was necessary to develop a detailed business case to determine if the concept for a large corporate farm connected to lands owned by First Nations could become a viable reality. Working with a small team of agri-business professionals, Larry Ruud (former agri-business partner with the national accounting firm of Meyers Norris Penny) and Fred Siemens (former President and CEO of the Winnipeg Commodity Exchange) the business case grew into a business plan that matured into a formal proposal, which was presented to the executive of Sprott Resource Corp. in December 2008. Decision makers at Sprott Resource Corp. recognized the potential for this farming initiative and agreed to make an initial investment of $27.5 million to launch the venture. This led to the establishment of One Earth Farms (OEF) in 2009. OEF became tenants on three First Nations reserves, farming 13,000 acres in the spring of 2009. A pilot scale cattle ranching operation was also initiated on one of those reserves in 2009, the White Buffalo Ranch on Thunderchild First Nation.

OEF started with four full-time employees in 2009, with farming operations undertaken by custom operators. By its second year of operations, and after its first full calendar year, OEF had 110 employees, 40 full time and about 70 seasonal. Farming operations were undertaken in 2010 using OEF’s own equipment, and cattle operations were founded upon a herd of more than 1,700 cows and bulls. The expansion in 2010 was partially funded through a $15M strategic capital raise in December 2009. Based on the success and strong reputation earned during that first year of operations, OEF successfully negotiated with leaders from an additional seven First Nations in 2010 to expand to 60,000 acres of cropland and 23,000 acres of pastureland. 2010 saw new types of operations as well as 10,000 acres of custom farm management. The total number of acres under management by 2010 was 93,000.

In February 2011, Sprott Resource Corp. contributed a further $30-million investment to help OEF become the largest operating crop and cattle farm in Canada.

The 2011 plan for OEF includes a goal to lease and seed approximately 150,000 acres of cultivated farmland and to lease about 100,000 acres of pasture to support an increase the size of its cattle herd to about 22,000 head. The implementation of the 2011 plan was supported by a private placement in March 2011 of $35 million.

Significant events

  • December 2008: Presentation of One Earth Farms (OEF) business proposal to Sprott Resource Corp. (SRC).
  • March 2009: SRC invests $27.5 million to provide seed capital for 2009 farming operations.
  • December 2009: SRC raises additional $15 million through investments by strategic partners with OEF.
  • December 2009: Ag Growth International (AGI) purchases 2 million shares in OEF as a part of the strategic capital raise; AGI to supply grain handling, storage and conditioning solutions for OEF projects.
  • December 2009: OEF signs a corporate agreement with Case New Holland (CNH) as a key farming equipment supplier.
  • December 2009: Launch of OEF Cattle LP, with acquisition of 2 ranches in Northwest Saskatchewan.
  • April 2010: OEF expands operations into Southern Alberta with the beginning of seeding on the Blood Tribe lands near Lethbridge, Alberta.
  • April 2010: OEF head count exceeds 100 full- and part-time employees.
  • May 2010: OEF enters into a contract to provide a complete custom farming solution for a large farming initiative in Saskatchewan.

October 2010: OEF and the Inroads to Agriculture Institute (IAI) announce a $5.1 million partnership between the Governments of Canada and Saskatchewan, OEF and other