Why Australia’s miners have currently stopped exploring

Mark Creasy, Australia’s most successful mining prospector who discovered the Jundee gold mine, Bronzewing deposit, and the most recent Nova-Bollinger nickel deposit, is pretty much disappointed with what’s happening in Australia’s mining scene. In one of his interviews, he warned upstarts that the excessive regulations for exploration are not really healthy for the future of mining.

“I started this business back in 1968, and when you do something for that long you get used to the harness. But I’m rapidly losing enthusiasm,” said Creasy in an interview with The Australian Business Review. “The reason for that is I spend my entire life filling out bloody forms and trying to fulfil the requirements of government. The headwinds you get from the regulatory environment we’re in, they’re just too great.”

In Creasy’s prime, it only takes around six weeks to apply for a permit. Now, the application for exploration usually takes 7 to 10 years.

The mining industry in Australia and other parts of the world are facing a serious decline not only because it takes an awful lot of time to apply for an exploration permit but also because the process is expensive. And when a miner is finally able to explore, it would need pay a lot of money for the ores’ extraction and purification. BullionVault states that the process of extracting and purifying is extremely expensive because they involve huge rocks that bear very little amount of metal. That, the time it takes to apply for a permit, and the declining prices of precious metals such as gold and silver are what keep miners from booming.

Mark Bennett, chief of market for the Australian-based exploration firm Sirius Resources, admits that the current conditions for exploration is bad, with activity almost non-existent and juniors who do not have a lot of financial backing constantly struggling to make ends meet.

“Right now there isn’t money,” Bennett said. “Everyone has really shut up shop or is teetering on the edge of being insolvent.  There is just no exploration happening anymore.”

While the fluctuating price of gold and increasing operating costs for exploration are inevitable, perhaps what governments around the world can do to help the mining industry is to curb the amount of time needed to apply for a permit. Mining is a hazardous industry but it shouldn’t take a decade to supply a permit.

Image provided by www.mining-technology.com

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July 26, 2017, 12:29 PM AEST