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Explorers post another 6% spending increase for 2018, expect slight decrease this year

by Greg Klein | March 13, 2019

If last year was a time of mixed messages for mineral exploration, maybe it’s best to let money do the talking—money in the form of project spending within Canada. Preliminary numbers from Natural Resources Canada give 2018 the highest amount in five years. Projections for 2019 show a slight drop but remain well above the lull experienced in 2015 and 2016.

Explorers post another 6% spending increase for 2018, expect slight decrease this year

The data comes from info supplied by companies for exploration and deposit appraisal. That includes field work, engineering, economics, feasibility studies, environmental work and associated general expenses but not efforts to extend known reserves. The 2018 total came to $2.32 billion, a 6.1% rise over the previous year and about the same percentage increase as 2017 over 2016. Companies expect to spend $2.16 billion in 2019, slightly below the last two years but still above the 2014 to 2016 figures.

Ontario contradicted its startling fall in Fraser Institute rankings, coming in first for spending. Edging out its eastern neighbour, Ontario reaped 25.1% of national spending, compared with 21.5% for Quebec, which finished first last year. The key category of the Fraser Institute study, the Investment Attractiveness Index, placed Ontario 20th, a steep drop from the previous year’s seventh place, while Quebec rose from sixth to fourth. Yet Quebec’s spending fell 13.2% from its 2017 total as Ontario’s climbed 8%.

Following Quebec for 2018 spending were British Columbia (15.9%), Saskatchewan (10.7%) and Yukon (8%).

Although relatively modest, Nova Scotia’s 2018 total of $36.5 million more than doubled the previous year’s amount. Saskatchewan’s 2018 spending increased by 29.2% over the previous year and B.C. rose 22.1%.

Precious metals attracted by far the most money, with 61.3% of the country-wide total. Base metals came in a distant second at 15.6%.

Ontario’s precious metals projects attracted $450 million last year, followed by Quebec ($335 million), B.C. ($233.2 million) and Yukon ($160.6 million). Saskatchewan, although in fourth place for spending at $247.1 million, showed the greatest diversity of exploration spending: uranium (65.9%), diamonds (10.7%), base metals (6.1%), precious metals (5.3%) and other stuff (11.8%).

Adding mine complex development to exploration and deposit appraisal, the numbers climb dramatically. The Canada-wide total for 2018 came to $14.81 billion, up from $13.56 billion in 2017 and expected to hit $15.35 billion this year.

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