The current state-of-play for exploration in Australia

Webcast Presentation at the AIG E-Forum on Mineral Exploration, Perth, June 2020


As a lead-into the Forum I was asked to give a very quick 10 minute overview of the current situation for mineral exploration in Australia and the possible impact of COVID-19.

Key observations were that:

  • Based on hard data from the ABS exploration expenditures in Australia fell by 20% (as measured in AUD-terms) in Q1 2020 over the preceding quarter.  This was due to (perfectly normal) consequences of hot-weather and holidays in Australia – and nothing to do with COVID-19.  Over the last 30 years average Q1 spend is down by 21%.   This is usually reversed in Q2 – with expenditures typically up by 27% over Q1.
  • The adverse effect of travel restrictions and lock-downs associated with COVID-19 will only be felt from Q2 onwards.
  • Nearly half of all discoveries made in the last decade were associated with iron ore and coal.  Due to reduced expenditures exploring for these commodities this is likely to be less going forward.  
  • Over the same period gold and base metal discoveries flat-lined at ~8 deposits per annum.  Expenditures on gold and base metal exploration are currently at a near all-time high – suggesting a more positive outlook.
  • Since the year 2000 Junior Companies accounted for 71% of all discoveries in Australia.
  • However, uncertainty associated with the impact of COVID-19 has made it more difficult for Junior Companies to raise fresh capital.  If continued, this is likely to put pressure on their expenditures (and the level of field work activities) going forward.