Scipion hedge fund seeks small-cap African miners

* Hedge fund wants to provide finance to junior firms

* Seeks annual returns of over 50 percent

LONDON, Nov 4 (Reuters) - Hedge fund manager Scipion Capital is launching a fund this week to invest in junior mining companies exposed to Africa and provide finance to build mines.

Scipion expects the fund, which opened on Nov. 1 with $15 million of seeded capital, to make annual returns of over 50 percent.

"Taking an equity stake in these companies, and providing the funding for their projects, allows us to give high returns to our investors as the share price goes up," fund manager Nicholas Clavel said on Wednesday.

"The junior mining companies that did secure financing have achieved returns in excess of 100 percent this year, so the potential is there for all to see."

Last year, Ernst & Young's Mining Eye index, comprising the top 20 mining firms listed on London's AIM market, fell 75 percent, but so far this year it has nearly tripled. Scipion's fund will target companies listed in Sydney, Toronto and London with a market value up to about $200 million.

The fund, with a minimum investment of $500,000, wants to appeal to pension funds, endowments, wealth managers, sovereign wealth funds and other investors.