Keynote Presentation to the “Exploration NSW” Webinar organised by GSNSW, Sydney, September 2020
Back in 2015, the Geological Survey of New South Wales commissioned MinEx Consulting to assess the role and importance of junior exploration companies for the future of the mining industry in that State.
In the intervening five years the World has changed greatly. On this basis the GSNSW asked me to reassess the current performance and health of the Junior Sector in NSW.
The key findings are:
- Between 2010 and 2019 NSW’s share of Australia’s expenditures on non-bulk mineral exploration rose from 5.2% to 10.7%
- Over the last four years total exploration expenditures in NSW grew by 120% (in real terms) reaching A$321m in FY2020 – an all-time high
- Over the last decade, 157 significant mineral discoveries were made in Australia – ten (ie 6%) of these were in NSW. This is in-line with NSW’s share of total expenditures (7.6%) over the same period.
- To date, many of the discoveries are modest in-size and value … and this has adversely impacted on the calculated “bang-per-buck” for NSW (of $0.21 versus national average of $0.66 per Dollar spent on exploration). MinEx notes that the value is likely to be revised upwards pending positive results on recent discoveries.
- The two biggest recent discoveries are Dalwhinnie (Au) in 2018 and Boda (Cu-Au) in 2019 – with the latter delivering a drill result of 502m @ 0.48 g/t Au + 0.2% Cu starting from 211 m depth. A Maiden Resource for Boda is due to be published later this year.
- Not surprisingly, several companies are actively exploring targets nearby (in the Lachlan Fold Belt). Recent drilling has delivered encouraging results.
- Over the last decade 70% of the NSW’s discoveries were made by Junior Explorers. Clearly, the future of the local mining sector is dependent on their continued vitality.
- A detailed analysis of the ASX Quarterly Reports published by NSW-based junior explorers shows that they were able to grow their cash reserves in 2019 and that (as at June 2020) COVID-19 has had only a modest impact on exploration expenditures.
In summary, the short-term outlook for exploration in NSW is positive