The latest exploration figures from the Australian Bureau of Statistics (ABS) show some positive signs for greenfields mineral exploration, according to the Association of Mining and Exploration Companies (AMEC).
“In what is traditionally a negative quarter for mineral exploration, the December 2015 quarter resulted in an increase in metres drilled driven by exploration on new deposits,” said AMEC chief executive officer Simon Bennison. AMEC is the peak national industry representative body for mineral exploration and mining companies within Australia.
“Compared with the September 2015 quarter, greenfields metres drilled is up 30% in the December 2015 quarter while expenditure is down 8%. The cost of exploration is coming down as would be expected in the current market conditions.
“The increase in greenfields mineral exploration indicates that the Federal Government’s Exploration Development Incentive (EDI), which was effective from July 1, 2015, is having a positive impact on greenfields mineral exploration as intended.
“AMEC has been working with the Australian Taxation Office, Treasury and the Department of Industry and Science to review the operation of the EDI to make it more effective for explorers and investors.
“Territory and state exploration incentive schemes have also been crucial in encouraging mineral exploration. They are highly regarded by the industry and have demonstrated significant economic returns to the jurisdictions,” said Simon Bennison.
The ABS figures show that the trend estimate for total mineral exploration expenditure rose 2.7% ($9.7 million) to $364.1 million in the December quarter. The largest contributor to the rise in the trend estimate this quarter was Western Australia, which was up by 3.1%, or $6.5 million.
The seasonally adjusted estimate for mineral exploration expenditure fell 1.4% to $365.3 million in the December quarter 2015. The largest contributor to the fall was Western Australia, which was down 2.1%, or $4.6 million.
In original terms, mineral exploration expenditure fell 3.0% to $382 million in the December quarter 2015. Exploration on areas of new deposits fell 7.8% and expenditure on areas of existing deposits fell 1.1%. In original terms, the largest decrease by minerals sought came from expenditure on iron ore, which was down 9.4%. Another large decrease came from expenditure on uranium, which was down 30.5%.
The trend estimate for metres drilled rose 3.7% in the December quarter, which was 1.1% higher than the December quarter 2014 estimate. The seasonally adjusted estimate for metres drilled rose 9.0% in the December quarter 2015. In original terms, metres drilled rose 6.9%. Drilling in areas of new deposits rose 29.6% and drilling in areas of existing deposits rose 0.6%.