Precious Metals Continue to Dominate 1983 Exploration

Weak demand for metals and consequent low metal prices resulted in continuation of the depressed state of US mineral exploration activity through 1983. Data collected by Resources for the Future Inc. and The Pennsylvania State University for a cooperative study on mineral exploration activity indicate that US exploration in 1983 fell by as much as 25% from 1982 levels. Precious metals remained the focus of most exploration efforts, as gold and silver prices remained attractive compared to base metals. Reports of 1983 domestic exploration and development activities in several industry journals indicates that about 85% to 90% of those projects were directed primarily at gold and silver. Gold exploration included work by several companies on Carlin- type disseminated gold deposits in Nevada, geological prospecting and drilling in the Wenatchee Gold Belt in Washington, and interest in lode and placer gold properties in California, especially by several small Canadian firms. Precious metals exploration projects were also reported in Alaska, Arizona, Colorado, Montana, New Mexico, Oregon, South Dakota, and Utah. There was also tome precious metal exploration activity in the eastern US. Development continued at the Ropes gold mine near Ishpeming, MI, and companies explored historic gold-producing areas in the Southeast. Some exploration for nonprecious metals took place last year. Stratabound copper-silver deposits were examined in western Montana, and US Borax continued exploring molybdenum resources in the Misty Fjords area in Alaska. Work on these projects during 1983 may have been stimulated by time limits on the availability of certain federal lands for exploration more than by projected improvements in metal markets. During 1983, several papers were published on mineral exploration strategies and the future of US exploration. David Watson of Raymond Kaiser Engineers, in a paper presented at the 1983 AMC Mining Convention, forecast increased exploration activity for gold and silver because of world economic conditions. He added that antimony, manganese, chromium, graphite, mercury, tantalum, tin, and barite are also likely targets based on their limited domestic reserve availability. He cited concern over reported subsidized mineral production by foreign producers and US regulatory and land-planning policies as retarding mineral exploration activity. Douglas Cook of Freeport Exploration Co., at the same meeting, presented a paper that showed that a 1950-75 period of vigorous exploration has been followed by a period where acquisition has replaced exploration as the predominant means of acquiring new mineral properties. At a December IIASA conference on "The Economics of Mineral Exploration," in Vienna, Austria, A. Rose and R. Eggert of The Pennsylvania State University pointed out that recent exploration decisions tend to rely more on evaluating production costs and comparing them with existing deposits, rather than on return of