Queensland’s Mineral Exploration Spending Dives
The latest exploration statistics from the Australian Bureau of Statistics simply confirm that exploration in Queensland is “on its knees”.
For the 4th year running, the annual spending on exploration for minerals in Queensland has declined.
Just 4 years ago, Queensland was investing almost AU$250-M each Quarter in mineral exploration. In the June Quarter of Y 2016, that figure has fallen to just AU$43-M.
It’s a similar story for petroleum exploration which has fallen from well over AU$100-M each quarter 4 years ago to only AU$24-M in the June 2016 Quarter.
In the last year alone, mineral exploration spending has dropped almost 50%, from AU$67-M in June Quarter 2015.
At the same time, onshore exploration drilling for Nat Gas in Queensland is at its lowest level in almost 12 years.
Nevertheless, Nat Gas exploration in Queensland in June Quarter 2016, at AU$24.5-M, dwarfed the miserable performance in NSW (AU$0.7-M) and Victoria ($NIL). Again when it comes to East Coast Nat Gas supply, Queensland is doing the heavy lifting.
While it is usual for private exploration spending levels to be low in times of low commodity prices, this downturn is different. For the 1st time ever, Queensland has no new publicly funded geo-science work in the field.
One of the tragedies of the last budget was that there was no allocation made to the Geological Survey of Queensland (GSQ). With only base funding to fund salaries, GSQ lacks the funds to undertake critical drilling initiatives and surveying that underpin resource discoveries.
Usually in a downturn, when costs are low, GSQ play a vital role to help to keep rigs on the ground and geologists busy. A downturn is a good time to collect public data on Queensland’s geology.
There is a real risk that just as Queensland starts to see some Green Shoots in commodity prices, the State’s exploration industry is hemorrhaging core capabilities.
The Queensland Government urgently needs to find some funding for the Geological Survey. Just over two weeks ago at the COAG Energy Council meeting, our State Ministers, except Victoria, endorsed a gas supply strategy but without Queensland’s consideration and commitment to growing our exploration industry, it is difficult to see how that strategy can meet its targets.
At the national level there are a range of initiatives aimed at exploration growth that Queensland isn’t involved in, including the National Minerals Exploration Strategy. The Queensland government needs to get serious about supporting the exploration sector and ensure Queensland is part of these Key national projects, such as UNCOVER and National geo-science research initiative.
While the Queensland Government’s 50% concession on work programs and annual exploration program have been welcome initiatives, there’s no replacement for investing in the pre-competitive geo-scientific industry that can kick-start new resource projects and find new resources for all Queenslander’s.
The Queensland Exploration Council is about to issue the annual sentiment survey for explorers which forms the backbone of the annual exploration scorecard. Explorers will be able to have their say on the support for exploration in Queensland.
QRC calls on the Queensland Government to fund an emergency package for the Geological Survey of Queensland.
Latest posts by Paul Ebeling (see all)
- Key Stock Indexes, Crude, Gold & Silver Markets Briefing - January 17, 2017
- Commentary: Paul Ebeling on Wall Street - January 17, 2017
- Wall Street’s Top Analysts Upgrades, Downgrades & Initiations - January 17, 2017