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Near record spent on mineral exploration in 2021

High commodity prices driving increased mining, exploration spending
'It’s pretty clear that British Columbian continues to attract large investment dollars for both exploration and for established mines' -- Gordon Clarke, BC Geological Survey

Mineral exploration in B.C. hit “new heights” in 2021, with a near-record $660 million spent, according to the BC Geological Survey.

More than half of that spending was in advanced exploration by mining companies flush with cash from high commodity prices. The record was 2012, when $680 million was spent on mineral exploration in B.C.

The estimated production value from mining output in in B.C. in 2021 is estimated at $7.3 billion, a $5.3 billion increase over 2020.

“It’s been a very impressive year,” Gordon Clarke, director of the mineral development office of the BC Geological Survey, said Monday morning at the annual Association of Mineral Exploration (AME) Roundup conference. “Mining and exploration programs, they reached new heights in 2021.

“Exploration programs continue to produce excellent results. And with all the new resource estimates, advanced exploration adds to British Columbia’s mineral inventory.

“And from the deals that have been going on in the last few years -- the acquisitions -- it’s pretty clear that British Columbian continues to attract large investment dollars for both exploration and for established mines.”

Notable acquisitions in 2021 included Newcrest Mining (TSX:NCM) recent $3.5 billion offer to buy the Brucejack mine.

High commodity prices have given mining companies the cash to increase their advanced exploration activities.

“Sometimes more advanced exploration is carried out because money’s available,” Clarke said.  “Money’s available, so people are working on increasing resource estimates and doing more drilling.”

Metallurgical coal prices in particular have been strong. In January 2021, steelmaking coal prices were US$140 per tonne, Clarke said, hit US$408 in December, 2021, and currently sits at about $350 million per tonne.

While most of the exploration has been focused on B.C.'s traditional commodities -- copper, gold and metallurgical coal -- there has also been some notable exploration spending in nickel and rare earths. The latter is the Defense Metals (TSX-V:DEFN) Wicheeda project. Meanwhile, FPX Nickel Corp. (TSX-V:FPX) has been drilling at its Decar Nickel District near Fort St. James.

The results suggest there is potential for "a new stand-alone deposit," Clarke said of the Decar nickel project.

This year's annual Roundup conference at the Vancouver Convention Centre is being held in-person this year. Last year’s conference was held virtually, due to the pandemic. The conference runs through Thursday.

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