Mining Exploration Insights

Exploration index rises for 2nd consecutive month

By: Robert Anders | June 17, 2020

The following analysis is an extract of S&P Global Market Intelligence monthly Industry Monitor, which reviews exploration activity and development in the mining industry. The full report and data files are made available to our Metals & Mining subscribers onlyHere are the highlights from our latest issue:


Sharp increases in significant financings and initial resources in May were slightly offset by a decrease in significant drill results — the number of positive project milestones was unchanged — as S&P Global Market Intelligence's Pipeline Activity Index, or PAI, rose to 80 from 67 in April. The gold PAI jumped to 128 from 104, while the base metals PAI increased to 44 from 38 over the same period.

After rebounding briefly in April, global drilling activity fell in May, with the total number of distinct projects reporting drill results dropping to 156 from 195 in the previous month. Reported drilling decreased sharply for gold and was also down for copper, nickel, zinc-lead and specialty commodities projects. Drilling was up for platinum group metals, silver and minor base metals projects.

The number of initial resource announcements increased for a second consecutive month in May, doubling from four to eight. Six of the new resources were for gold projects and two were for base/other metals.

Metals prices improved for a second consecutive month in May, as S&P Global Market Intelligence's Exploration Price Index rose to 136 from 132. The indexed price rose for seven — gold, silver, platinum, copper, nickel, zinc and molybdenum — of the eight constituents of the index and was unchanged for cobalt.

The number of financings by junior and intermediate companies was up sharply in May, to 186 from 107 in April, following two months of decline, and the US$801 million raised was more than double the US$375.6 million garnered in the previous month. 
The total number of significant gold and base metals financings, which is used in the calculation of the PAI, was also up sharply in May, rising to 55 from 19 in April. Gold financings tripled, to 33 from 11, while base/other metals financings were up almost threefold, from eight to 22.

Positive project milestone activity was unchanged for a third consecutive month in May at four. All four milestones were at gold projects entering feasibility. There were no negative milestones.

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Equities continue to recover

With disruptions to mining operations now appearing to be less severe than some had initially feared, mining equities recovered for a second consecutive month in May, as S&P Global Market Intelligence's aggregate market value of the industry's listed companies, based on 2,323 firms, rose 7% month over month to US$1.33 trillion. The aggregate market cap of the industry's top 100 companies was also up 7% in May at US$1.12 trillion. The number of tracked mining companies remains at a 10-year low, declining steadily from a high of 2,921 companies in March 2012.


The Pipeline Activity Index, or PAI, measures the level and direction of overall activity in the commodity supply pipeline by incorporating significant drill results, initial resource announcements, significant financings and positive project development milestones into a single comparable index.

The Exploration Price Index, or EPI, measures the relative change in precious and base metals prices, weighted by the percentage of overall exploration spending for each metal as a proxy of its relative importance to the industry at a given time.

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