Australian prospectors looking primarily for gold, lithium and critical minerals secured $2.84 billion in funding in the June quarter amid renewed investor appetite for minerals, particularly those that will power the energy transition, advisor BDO said on Tuesday.
Conditions have improved for explorers after they had moved into cash preservation mode early in the year, given global economic uncertainty stemming from China’s slow post-Covid ramp up. Secured funds grew 111% from A$1.35 billion in the March quarter.
As one of the world’s major mineral hotspots, Australia’s exploration sector is closely watched as a barometer of trends in future metals supply.
“The current quarter appeared to unveil a reset in investor sentiment, marked by the increase in financing, investment and exploration spending,” BDO said in a report. That appears to have been helped along by a pause in global interest rate rises.
Gold miner Genesis Minerals led the fundraising, completing a A$466.47 million ($300 million) capital raising after its purchase of gold assets from St Barbara.
In lithium, Sayona Mining and Liontown Resources also secured major inflows.
Sayona issued A$197 million in equity securities and took other measures as it develops a hub in Canada’s major lithium region in Quebec. Liontown raised A$118.75 million of debt as it readies to start production from its northern Australian operations next year.
BDO sees a “relatively strong” pipeline of prospective IPOs for the remainder of the year, including interest from Canadian companies looking to list in Australia.
Given strong commodity prices and relatively weak capital markets, many explorers are looking to advance their projects via consolidation, it added.
Mergers in the gold sector are backed by the uncertain state of financial markets and the ongoing record level of gold purchases by central banks to bolster their foreign exchange reserves, it said.
Central banks bought the most gold in the first half since at least 2000, the World Gold Council said last month.
($1 = 1.5540 Australian dollars)
(By Melanie Burton; Editing by David Holmes)
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