‘Concerning’ fall in run-up of new mine prospects as program of work applications dwindle and markets cool

There has been a slowdown in the number of new exploration ticket applications in WA as commodity markets cool and the State Government battles to clear a backlog in understaffed approvals departments. Hansard records show applications lodged for programme of work permits — a crucial first step for explorers to start drilling — fell by 31 per cent between 2021 and 2023. “In 2021–22, there were 3386; in 2022–23, 3015; in 2023–24, 2328; and in the year to date, 914,” Minister Sue Ellery advised on behalf of cabinet colleague and Mines Minister David Michael in Parliament earlier this month. A confluence of softer commodity markets, under-resourced government departments and more rigorous approvals regimes have been blamed for the decline. Australian exploration spending hit a two-year low at the start of 2024, according to data compiled by BDO, with the advisory firm observing a broader slowdown in capital inflows to explorers amid general market uncertainty. Chamber of Minerals and Energy chief executive Rebecca Tomkinson said exploration and prospecting was a “vital first step” in building a pipeline of future resources projects for WA, and the fall in applications was concerning. “Australian projects are facing a commodity market downturn and escalating input costs. At the same time, the Federal regulatory and policy environment has become far more uncertain, which increases project risk, making it harder for projects to compete for finite international capital,” she said. “This is impacting business sentiment and our attractiveness as an investment destination and may be dampening the appetite for resources exploration in WA.” Opposition environment minister Neil Thomson — who had asked for the application figures — is also concerned by the numbers, and questioned where the State’s future prosperity would come from if exploration was curtailed. Speeding up approvals processes for major projects has been a big focus for the State Government in recent years after considerable pressure from the mining industry. Program of work applications are managed by the Department of Energy, Mines, Industry Regulation and Safety, which has pledged to finalise 80 per cent of applications within 15 business days. A recent report assessment by DEMIRS found it was falling short of that target during the year, with only 53 per cent finalised within the targeted timeframe. Staffing has been a big issue, with DEMIRS saying the timeframes reflected a combination of “resourcing constraints, staff turnover and training and the need to balance workloads across teams and across the approvals and compliance portfolios”. Mr Michael said a busy period between between 2020 and 2023 had seen an “increased number of applications”. He suggested that submissions were returning to normal rates, and that the department had been picking up the pace. “As of September 2024, DEMIRS has completed 89 per cent of PoW applications within the target timeframe of 15 business days, up from 80 per cent in August 2024,” he said. “These results required substantial resourcing to reduce the backlog of applications awaiting assessment.” He also noted the mining industry “will always be subject to cyclical commodity price fluctuations and other market forces beyond its control”. “However, I remain confident WA’s mining industry will continue to thrive in the longer term, supplying responsibly-sourced, quality products that are critical to the world’s manufacturing activities and energy transition,” he said.