Finally some good (really, really good) news from the mineral exploration sector. Spending was up 26% in 2003 compared with 2002. That is the first rise in the figure since it peaked in 1997, according to the METALS ECONOMICS GROUP of Halifax.
"Worldwide nonferrous exploration spending steadily increased through the early 1990s to a crest of $5.2 billion (all figures in US dollars) in 1997, before falling for five straight years to a 10-year low of $1.9 billion in 2002an overall decline of more than 63%," the group says in a press release. It analyzed 917 companies' exploration budgets (using a $100,000 cutoff). The 2003 figure reached $2.19 billion, which covers about 90% of worldwide expenditures. If the additional 10% were included, 2003 exploration expenditures total about $2.4 billion.
Two-point-four billion! A 26% increase! Forgive me for getting so excited, but it is both exhilarating and a relief that exploration is no longer shrinking, and that has me grinning ear-to-ear.
The mineral industry needs a strong and optimistic exploration sector if there are to be new mining opportunities. The growth in money budgeted for unearthing new deposits is very important. Without an economic deposit, no mine will be built. Remember that it can take five, 10 or more years from the original discovery to put a new mine into production. The industry needs to find new reserves now if it is to remain strong. Today's discoveries are the underpinnings that will carry the industry through the first half of the 21st century.
Here is a quick look at where the money is going: Latin America, $517.9 million, up 23.6%; Canada, $471.4 million, up 21.5%; Africa, $374.2 million, up 17.1%; Australia, $339.3 million, up 15.5%; United States, $153.4 million, up 7%; the Pacific and Southeast Asia, $92.7 million, up 4.2%; and finally the rest of the world, $244.4 million, up 11.1%.
Metals Economics has made this year's complete 647-page, two-volume study available both on the Internet and in print for US$11,000. Or you can read its press releases on the subject going back to 1996 for free at www.metalseconomics.com.