Queensland’s exploration scorecard is reflecting a difficult year for the state’s explorers with minerals exploration falling 31 per cent to $732 million for 2012-13.
Released this week, the Queensland Exploration Council’s scorecard lists the continued drop of market capitalisations and heightened capital scarcity as significant factors affecting explorers.
“This is not just a Queensland trend, but a problem being felt right across Australia, and indeed globally,” the QEC said.
Access to equity capital was listed as a significant problem with companies exploring in Queensland announcing $63 million in capital raisings in 2012-13, down 76 per cent in comparison to 2011-12.
Nationally, the amount of raisings was down 60 per cent in 2012-13 from $853 million to $342 million, the report indicates.
About one third has been wiped off the market capitalisation of Queensland’s juniors over the past 12 months, a figure which jumps to 81 per cent over the past two years.
The scorecard which aims to record the progress of Queensland’s exploration sector, indicates the outlook for the state’s exploration sector remains uncertain.
“Despite the strength of the global fundamentals likely to drive resources demand well into the future, investors remain wary given continued uncertainty in the global economy, softening prices, and high costs which continue to plague domestic operations,” The QEC said.
Sentiment amongst Queensland’s explorers has also dipped, with respondents indicating the state is rating more negatively on factors like government assistance, permitting processes, environmental regulations.
The Queensland Resources Council said these findings are despite a raft of recently implemented government initiatives including the reduction of red tape around approvals processes.
“These are issues that the QRC will raise with government as a matter of priority,” the QRC said.
“Encouragingly, the government has committed to work with the QRC and industry to deliver necessary reforms to support the exploration sector.”
Coal exploration was lower in 2012-13 as companies contend with over supply and price falls, copper was also down.
In contrast gold exploration activities increased over the same period.
On the flip side, the state has experienced a surge in old and gas activity with petroleum exploration up 40 per cent to $655 million.
“This was on account of continued expenditure on coal seam gas and significant additional spend on shale gas exploration, especially in the Cooper Basin,” the QEC said.