Commodity price woes cause small activity dip
With the recent dip in commodity prices, exploration activity has fallen since last year, but not by much, according to the executive director of the Ontario Prospectors Association.
“In 2011, there was $1 billion for exploration and development spent in the province,” said Garry Clark. “This year they estimate it’s just over $900 million. We’ve gone down a bit, but it’s still very vibrant and employing a lot of people around the North.”
Members of the association gathered in Sudbury Nov. 6-7 for the Ontario Exploration and Geoscience Symposium, listening to speakers and browsing the booths at a trade fair at the Steelworkers Hall.
Despite the commodity price woes, Clark said his members are telling him they’re optimistic about the province’s exploration potential. Most of the time, when exploration companies are out in the field, they’re looking for gold, he said.
“It’s the one that is probably the most romantic, the most attractive and the highest in price,” Clark said. “There’s a lot of gold exploration and a lot of companies that are moving towards production across the province.”
This includes Detour Gold’s Detour Lake Mine project and Queenston Mining’s Kirkland Lake Gold project, he said.
But there’s also still a lot of interest in the Ring of Fire area, Clark said.
“Once there’s access provided to the Ring of Fire, and there’s infrastructure, you’re going to see a lot more exploration, and most likely a lot more discoveries,” he said.
“It won’t just be with chromite, but likely with copper/nickel, platinum group metals as well as copper/zinc.”
Delio Tortosa, president of the Sault and District Prospectors’ Association, was one of those answering questions at a booth at the symposium’s trade fair.
With the drop in commodity prices, it makes it more difficult for junior exploration companies to get financing for their projects, he said.
“What ends up happening is you’ve got a lot of people that want a piece of that little pie, so there’s more competition for the dollars,” Tortosa said.
But he said he’s not too concerned, as most people believe the globe is still in the midst of a “commodity super-cycle” driven by the demands of emerging economies such as China and India.
Gold and copper prices are also still fairly high, “so there’s still going to be demands for good prospects,” he said.
Tortosa wore two hats at the symposium. He’s also a consultant for Superior Copper Corporation, which is exploring property north of Sault Ste. Marie, near Batchewana Bay.
“There’s an old deposit that was mined back in the late 60s and early 70s, when copper prices were quite buoyant,” he said. “The mines shut down simply because the price of copper went down very quickly, and a lot of ore was left in the mine.”
As for his members with the Sault and District Prospectors’ Association, Tortosa said there’s also a lot of gold exploration activity in the Wawa area.