In the Australian Government’s latest federal budget, peak mining bodies have welcomed the $100 million allocation towards greenfields exploration, but many industry stakeholders say more is needed.
With fewer exploration activities occurring in Australia and a difficult economic environment for junior mining companies to access financing for exploration and project development, Australia’s known resources are rapidly depleting.
A number of Australia’s larger producing mines are now winding up and they are not being replaced.
The Australian Government has created the Exploring for the Future program in an attempt to stimulate greenfields exploration in the country again.
Exploring for the Future
As part of the program, the $100 million budget allocation will be given to Geoscience Australia. Using the funding, Geoscience Australia will gather data to boost discovery rates.
Association of Mining and Exploration Companies (AMEC) national policy manager Graham Short said the organisation would like to see the Australian Government make additional annual commitment to the Exploration Development Incentive (EDI).
He said this will further stimulate investment in Australian mineral explorers and enable these companies to give their shareholders extra tax incentives.
“The production of pre-competitive data by Geoscience Australia, the state and territory geological surveys and the EDI are inextricably linked if we are to improve exploration outcomes and provide new mines for future generations,” Short said.
Infrastructure investment needed
One stumbling block for junior miners is the lack of available infrastructure in remote areas where resource-rich deposits have been discovered.
The lacking infrastructure makes it cost prohibitive for small explorers to develop these projects. The Association of Mining and Exploration Companies has called on the Australian Government to expand its $50 billion infrastructure plan to include regional infrastructure that could release stranded mineral projects such as Strandline Resources’ Coburn heavy mineral sands project in Western Australia. This project has undergone extensive exploration including a definitive feasibility study and optimisation revisions. An offtake agreement for its ore was even signed in 2012. However, due to the financing environment and current ore prices, the project has been uable to source the necessary funding for infrastructure and project development. The project has remained at a standstill awaiting an investment partner.