Further Exploration Spending Decreases Expected

SNL Metals & Mining reported that exploration spending in the top 10 mineral exploration countries in 2013 totaled $7.8 billion for all stages of gold, base metals, platinum group metals and uranium exploration. Examining data drawn from its annual Corporate Exploration Strategies study, SNL commented that it is evident that exploration spending in countries with the highest levels of junior activity, such as Australia, Canada, and the United States, resulted in far more reported significant drill results than in countries with weaker junior sectors or reporting regimes.

More than 55% of the 351 reported projects that recorded at least one significant drill result were located in the countries with the top three budgets—Australia had 90 projects, Canada had 76 and the United States had 29. The remainder was divided among 51 other countries.

Primary gold projects were the most active, followed distantly by copper, nickel, uranium, zinc-lead and platinum group metals. Late-stage assets drew the most attention: 196 reserves development- and feasibility-stage projects had significant results, while only 90 early-stage projects and 65 preproduction-stage and producing assets were included in the study.

Market uncertainty continues to weigh heavily on the industry entering 2014. Without renewed investor interest in the coming months, the majority of junior companies and many small producers will have little choice but to further restrict exploration efforts throughout the year, SNL said. As a result, SNL Metals & Mining expects the number of reported significant drill results to decline in 2014, particularly in countries with a strong junior mining presence, such as Canada and Australia.

As featured in Womp 2014 Vol 02 - www.womp-int.com