2017 a year of gains by the
mining exploration sector

By Nick Wright | February 02, 2018

S&P Global Market Intelligence’s quarterly Industry Monitor reviews activities and trends in the mining industry's exploration and development sector.
Here's some highlights of the Q4 report:

The health of the mining industry's exploration sector improved markedly in the December 2017 quarter. S&P Global Market Intelligence's Pipeline Activity Index, or PAI, jumped to 87 from 77 in the September quarter, reaching the highest quarterly PAI since the March quarter of 2013, which saw 92, when the recent downturn was just beginning. In line with our predictions for the year, the S&P Global Market Intelligence Indexed Metals Price steadily improved, rising from 111 in the March 2017 quarter to 119 in the December 2017 quarter, its highest value since the September 2014 quarter.

Globally, the number of projects reporting drill results rose 14% quarter over quarter, to 567 projects from 496. Minor base metals increased the most, tripling to 18 from six in the previous quarter, 14 of them for battery metal cobalt. Nickel and zinc-lead announcements followed with increases of 50% and 35%, respectively. Gold announcements rose 10% to 334, and copper remained flat at 54. Drill activity at specialty metals projects is worthy of note, since 32 of the 59 specialty metals announcements in the December 2017 quarter were for another battery metal, lithium.

The total number of drillholes rose 9% quarter over quarter to 11,688, with minor base metals doubling and nickel rising 49%. Zinc-lead and copper increased 30% and 28%, respectively, while gold and silver numbers remained stable.

Announcements of significant (>US$2 million) gold and base/other metals financings jumped to 164 from 125 in the previous quarter. Their total value eased upward to US$1.51 billion from US$1.46 billion in the September 2017 quarter. Although the number of gold-focused financings rose to 91 from 66, their value dropped to US$682 million from US$1.07 billion the quarter before. Base metals financings increased in number to 73 from 59 in the September 2017 quarter, and their value more than doubled to US$824 million from US$395 million.

Initial resource announcements remained relatively stable, slipping to 12 from 13 previously. Nine of the new resources were at primary gold projects, the largest of which was at ASX-listed Perseus Mining Ltd.'s Yaoure gold project in Ivory Coast, where indicated resources contain 1.9 million ounces of gold. Additional inferred resources contain 1.5 Moz. The largest initial base metals resource was from Toronto-listed Aston Bay Holdings Ltd.'s namesake Aston Bay copper project in Nunavut, Canada, where inferred resources at the Seal zinc deposit contain 103,000 tonnes of zinc and 1.5 Moz of silver.

The number of positive project milestones dipped to 16 at year-end from 19 in the previous quarter. However, no negative milestones were announced in the last three months. The decline iwas mostly among projects starting construction of new mines or expansion projects, which were down to four from nine in the September 2017 quarter. Projects entering feasibility also dipped, to one from three previously. However, new mine or expansion startups jumped to 11 from seven previously, which is the highest quarterly count for the year.

Monitor the mining exploration sector with expert insights and deep asset data on mining companies.


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