EXPLORATION in South Africa’s mining sector sank to a near 20-year ebb in 2020, said BusinessLive citing data published by S&P Global Market Intelligence.
South Africa’s share of global budgeted exploration spend dropped 20% from $97.4m (R1.4bn) in 2019 to $77.4m in 2020 — its lowest level since 2002, said BusinessLive.
In 2002, when the Mineral and Petroleum Resources Development Act was passed, exploration spending was $68m.
Paul Miller, director of AmaranthCX, said the data demonstrated that investors remained sceptical of the latest Mining Charter. The charter had been “rushed” by mines and energy minister, Gwede Mantashe, said Miller.
“This suggests a more fundamental reform of South Africa’s mining investment policy is required,” he said.
Exploration spending in South Africa in 2020 accounted for just 0.95% of the global total which Miller described as “… a devastating statistic for what was once the greatest mining country on earth”.
There has been a 7.8% decline in overall exploration spending in Africa to just more than $1bn in 2020, accounting for 12.4% of global exploration spend.
South Africa’s share of African exploration spend continues to decline and is now at a two-decade low of 7.66%. As a result, South Africa has now dropped into sixth position on the continent, behind the Democratic Republic of the Congo, Ivory Coast, Burkina Faso, Mali, and Ghana, said BusinessLive.
“For there to be any improvement to South Africa’s current dismal exploration performance, a far deeper legislative and regulatory reform programme, coupled with material improvements in administrative efficiency is required,” Miller said.