Exploration stutters as junior miners feel the pinch

Along with the Arctic, sub- Saharan Africa remains the most under-explored and highly prospective mineralised region on earth. But the current economic environment does not bode well for exploration – especially as junior miners, the biggest explorers on the continent, feel the pinch of the current economic environment. “The role of the junior miners in Africa is very important and is going to be even more important in years to come,” says Paul Runge, managing director of Africa Project Access. “They are primarily responsible for exploration on the continent but are under pressure at present.” With commodity prices having taken significant drops, junior miners in particular are finding operational costs escalating, leaving very little in the pot for exploration. “Bigger mining houses are no longer investing in exploration and if the junior miners are not able to do it then it begs the question who is?” said Runge. But commentators believe the long-term demand for minerals will inevitably be upward as population growth continues globally, driving demand for resources. “This will be entrenched by increased urbanisation and a growing middleclass in China, India and Africa,” according to our source. Already, over a third of Africa’s 1 billion inhabitants live in urban areas and that proportion is expected to rise to 50% by 2030. Africa’s total urban population is expected to exceed that of China and India by 2050.