16 June 2009 - ABS shows exploration spending patchy in March quarter

Strong spending on uranium exploration in the Northern Territory and Western Australia is helping offset spending reductions in other parts of Australia, the latest exploration figures from the Australian Bureau of Statistics suggest.

The data for three quarters of 2008-09 show uranium exploration spending in the Northern Territory is almost at the level reached for the whole year in 2007-08 ($43.4 million in the September, December and March quarters this year compared with final year expenditure of $48.7 million in 2007-08).

Much of this spending is attributable to the continuing drilling work by ERA Ltd to prove up its additional uranium resources near the existing pit at the Ranger mine in the NT.

In Western Australia, exploration spending totalled $18.7 million by the end of the third quarter, well on the way to matching last year’s total of $26.8 million.

This reflects continuing strong interest in uranium prospects in WA, where the State Government has decided to permit uranium mining and where as many as five uranium projects are being developed as potential mines.

In South Australia, with the completion of BHP Billiton’s drilling program for the Olympic Dam expansion, the economic conditions appear to have dampened exploration activity, with $10.7 million spent in the March quarter to give a running total of $50.9 million, less than half the last full-year total.

And in Queensland, where the Government continues to prohibit uranium mining, exploration spending was also weaker, with $4.5 million spent during the March quarter to reach a three-quarter total of $23.3 million, against a 2007-08 total of $38.1 million.

Australia-wide, the uranium industry has spent $136.3 million on exploration so far this financial year. This is more than was spent in full-year 2006-07.

The Australian Uranium Association said the level of exploration spending remained encouraging.

“We saw some softening trends becoming apparent in the previous quarter, but the activity in this latest period has remained a little stronger than we might have thought,” said AUA Executive Director, Mr Michael Angwin.

Uranium Exploration: Australia 2003/04 to Q3 2008/09 *

$millions

Queensland

Western Australia

Northern Territory

South Australia

AUSTRALIA

03/04

0.2

0.2

4.8

5.3

10.5

04/05

0.4

0.3

6.9

13.1 (est)

20.7

05/06

4.6

2.2

19.1

30.3

56.1

06/07

9.0 (est)

11.2 (est)

30.1

63.8

114.1

07/08

38.1

26.8 (est)

48.7

118

231.5

08/09 (Sep, Dec, Mar qtrs)

23.3 (est)

18.7(est)

43.4

50.9

136.3

*Exploration in Tasmania is negligible. Exploration is banned in NSW and Victoria

Source: ABS 8412.0