Supporting explorers in resourcing the future

Kim Wainwright, Chair, Queensland Exploration Council

The Queensland exploration industry has had an incredible year. It hasn’t been without its challenges, yet the sentiment amongst our membership is infectiously positive.

We know the resources sector is cyclical and exploration in particular tends to be the barometer of the health of the broader resources industry. So, what is the barometer saying right now?

At the end of every year, the Queensland Exploration Council publishes its Exploration Scorecard, measuring and comparing explorer member sentiment, which includes drillers, in a range of areas such as policy, government support and access to capital. In some areas, we compare our findings with other Australian jurisdictions which always brings up interesting results. The 2021 Exploration Scorecard is launched in the first week of December and will be the 11th consecutive edition.

Let’s start with the challenges, which are thankfully far outweighed by the positives of this past year. Most of them come back to COVID-19 related issues and are not unique to the exploration sector. Our members have experienced staffing issues, particularly around moving staff across state borders. More broadly, there is also a shortage of skilled workers, exacerbated by border issues but also due to no overseas workers coming into Queensland or Australia.

Having said this, the support from the State Government to the exploration sector, in the form of rental fees waived and exploration program variations, has been a lifeline for many explorers. The good news is that over a third of our explorer members have indicated they expect to increase their exploration activity spending by more than 25% in 2022.

It's clear the resources sector has a leading role to play in the state’s economic recovery from COVID-19 and the exploration industry is central to this recovery. The aptly-themed 2021 Exploration Scorecard “Resourcing the Future” highlights that, despite the challenges presented over the past 18 months, Queensland exploration companies are full steam ahead fulfilling their work programs and in many cases doing more activity than expected in their work programs. It’s no surprise drill rigs are hard to secure and our labs are busy months in advance analysing results.

The latest data from the Australian Drilling Industry Association reveals an increase in exploration rigs working across the country from 621 to 755 which is now a utilisation rate of 85% (2011 saw utilisation rates of 90%).

There are three factors driving this – a perfect trifecta:

1) Access to capital

For the first time in the Scorecard’s 11-year history, Queensland explorers have shown positive sentiment towards access to investment capital. This is an outstanding result and shows explorers have the confidence that their projects will be backed by the investment required in their search for Queensland’s next big discovery. This wave of investment is centered on critical minerals.

In its recent World Economic Outlook, the International Monetary Fund highlighted nickel, copper, lithium and cobalt as key commodities essential to the global energy transition, predicting a surge in demand and price. It’s no surprise that Queensland’s thriving prospectivity means these commodities, among others, such as vanadium, rare earths and graphite, are all here ready to be unearthed.

2) Access to data

The release of precompetitive geoscience data by the Geological Survey of Queensland continues to be ranked as one of the top three government initiatives providing benefits to exploration companies in 2020-21. Last year saw the first implementation of the Geoscience Data Modernisation Project which will provide further open access to pre-competitive geoscience data.

With the first new releases of data under this project earlier this year, it’s no surprise we are now witnessing an increase in the amount of mineral acreage being taken up in the state.

Despite the challenges presented over the past 18 months, Queensland exploration companies are full steam ahead fulfilling their work programs and in many cases doing more activity than expected.

3) Accessing our ESG advantage

Not only is Queensland positioned to become a major global supplier of these critical minerals, new economy minerals and key energy resources, the opportunity to excel in the areas of environmental, social and governance (ESG) has never been more integral or achievable for Queensland explorers.

A world focused on delivering prosperity alongside environmental, social and governance outcomes will prioritise commodities from jurisdictions like Queensland, which has a strong record of environmental performance, on safety, on emissions reductions and where the supply chain is transparent. The global trend of car manufacturers investing in their supply chain to ensure that their battery materials and their metals are all produced under the highest ethical standards certainly favours our explorers.

At a recent internal strategic planning session held by the QEC, the Leadership Team recognised small exploration companies may need assistance in understanding and communicating their ESG credentials. As a result, this year the QEC introduced an Explorer’s ESG Working Group to its work stream. Watch this space as QEC looks to deliver a useful tool for its members to navigate ESG. Tracking back to the original purpose of the first Exploration Scorecard, the QEC’s vision in 2010 was for Queensland to become “Australia’s minerals and energy exploration leader by 2020”. What a wonderful vision for the industry and now, through the Scorecard’s 11-year history, we can see improvement in key areas of operation for explorers.

The trends for Queensland show a distinct improvement in sentiment towards exploration permit processes, land available for exploration, cultural heritage regulations and conduct and compensation agreements. For 2022 QEC has a heavy work program to match our members’ level of activity.

In July 2021, I participated in my first QEC Strategic Planning session. Our session was informed by a survey of our members and consultation with our Management Committee, and we were able to define QEC’s key priorities for the next two years.

It all came down to supporting explorers and I am pleased to announce QEC’s new vision: Supporting explorers on their pathway to production. Being a membership organisation, our priority will always be to support our members first, however, the type of support we aim to provide in 2022 will become much broader.

Our goal is to support and serve the wider exploration community for the greater good of the Queensland exploration industry. We look forward to delivering on this vision and supporting Queensland explorers.