Mineral exploration is holding strong but remains in a holding pattern, according to the Association of Mining and Exploration Companies (AMEC).
Commenting on the June 2024 quarterly data on mineral exploration expenditure released by the Australian Bureau of Statistics (ABS) yesterday, association CEO Warren Pearce says while the numbers are encouraging, there are signs for caution with clouds over the horizon compared to this time in 2023.
Australian exploration expenditure reached $1.015 billion for Q2 2024, an increase of 11.6% on the March quarter ($909.6 million). However, it was 6.9% lower than the previous corresponding period.
Annual minerals expenditure nationwide for the financial year ending 30 June was a record $4.2 billion, an increase of 1.6% on FY23.
Expenditure on greenfield exploration to discover new deposits increased by 9.4% to $303.3 million, while brownfield exploration was 12.6% higher to $712 million from the previous quarter.
Metres drilled for greenfield exploration rose this past quarter by 33.8% to 656.7km and brownfield metres drilled increased by 29.5% to 1,934.7km. Annually, greenfields and brownfields exploration metres drilled fell 14.2% and 10% respectively with a softer second half through lower than historic March and June quarters.
“There are positive signs, but there remains plenty of work to be done. The industry and investors need certainty moving forward, to build on the last quarter and finish the year strongly,” says AMEC’s Pearce.
“There are positive signs, but there remains plenty of work to be done”
“Annual expenditure on greenfields exploration remains subdued and stalled at around $1.3 billion. Over a five-year period from FY20, greenfields expenditure has fallen more than 50%.
“This is very concerning, because if we want to find new mines, we need greenfields mineral exploration investment and effort to lift.”
Western Australia led the nation, with an overall increase across all mineral categories.
Queensland recorded an overall 10.2% increase in total exploration expenditure to $139.9 million, largely driven by strong exploration expenditure in base metals as well as silver, lead, zinc.
This correlates with the ability to get out on the ground after the wet season. However, with year-on-year expenditure down by almost 6%, there are real concerns facing the Queensland industry.
“Member companies are telling us they are baring the full brunt of risks in exploration at the moment,” says Pearce.
Expenditure in Victoria this quarter rose by 15.6%, with Tasmania jumping by 14.7%. Victoria and Tasmania are still challenging jurisdictions for exploration activity, with sluggish approval timeframes causing most concern for industry.
Meanwhile, New South Wales had a slight fall of 1.1% in expenditure, with all mineral commodities slipping in this regard although the exception was copper which was up by 10.7%.
Nickel expenditure rebounded strongly this quarter, up 24.2% ($10.3 million) to $52.9 million, however it remains well below historic averages (and down on June 2023 figures of $73 million).
Pearce adds that with a state election and wet season concluding, the Northern Territory saw a 52% jump in base metals expenditure and a total expenditure of $47.8 million, an increase of 16.9% on the March quarter.”
“Mineral exploration is holding strong but remains in a holding pattern. The greenfield mineral exploration figures are a real concern, and we need to do more to get onto ground to find the mines of the future,” he adds.
Write to Adam Orlando at Mining.com.au
Images: Ardea
