The worst thing that could have happened to Australia in the latest Fraser Institute global rankings was to do well.

For those unaware, all our various states actually did do very well indeed. We think we are good!

Strictly Boardroom can’t quite understand that outcome – the rest of the planet must be doing really badly if exploration in Australia is viewed as such a favourable environment for mineral explorers to operate.

With thanks to an anonymous source, Strictly Boardroom thought the anecdote below on the difficulties of actually doing exploration in Australia from a company perspective is illustrative.

The example is sanitised but the message is still clear.

Strictly Boardroom’s anonymous source advises as follows:

“I remember attending the annual general meeting of a large diversified international mining company a couple of years back and I was lucky enough to be able to have a cup of tea with the CEO and ask a few questions as a small-time shareholder.

The key thing discussed was that I noted nearly 90% of profit for the year in question came from Australia yet there was no mention of Australia in the review of the company’s exploration program.

I asked why, especially in light of the very strong statement about the company’s preference for stable, first world jurisdictions.

I thought the answer was well informed, direct and disturbing for a longtime proponent of Australian mineral exploration.

He said the trouble with Australia was as follows:

“The prospectively is fine but when geologists get a good idea or identify a good target in Australia, by the time we have processed the native title, heritage, environmental, stakeholder liaison, the property holder access compensation agreements, ground water and any other compliance approvals it has taken a couple of years.

“Those same geologists have by then forgotten why they wanted to go there in the first place.

“So we like other jurisdictions where we can just do a deal with the landholder and get on with our work in a timely way.”

In a nutshell, sure, we make all our money in Australia (based on resources discovered many decades ago) but land access risk is too high for us now – Australia is yesterday.

Other parts of the world are tomorrow.

All the high quality and easily obtained data provided by the various state surveys is irrelevant if actually undertaking exploration is so convoluted, complex, time consuming and costly.

It’s like going to the races and saying I would like $100 to win on horse 4 in race 6 and the bookmaker looking you and up and down and saying: “Sorry, your clothes are not pressed and your shoes are not shined, please go to the laundry and fashion service provider down the road and get cleaned up first, its only $50, then I can think about taking your bet”

The number one hurdle to Australia’s competition for the world exploration dollar is land access and operational compliance – and the erosion of the spending power that exploration dollar has to be spent on it.

Sobering stuff: we can of course look for the positives here and actually choose to do something about this.

Strictly Boardroom would advise jurisdictions to measure and to benchmark the absolute parameters of conducting exploration, not just relative perception measures.

The aim then is to improve the metrics over time.

What should we measure exactly?

Start with time-based measurements such as land access time and time to tenement approval.

Indeed, some early work is already being championed here by several Australian states as it is a focus of attention.

Next the more difficult cost-based measurements, such as access cost (inclusive of heritage, environmental, legal etcetera) need to be far more transparent.

We’ll get there – but it is clear there is still a long road ahead.

Good hunting.

Allan Trench is a professor at Curtin Graduate School of Business and Research professor (value and risk) at the Centre for Exploration Targeting, University of Western Australia, a non-executive director of several resource sector companies and the Perth representative for CRU Consulting, a division of independent metals and mining advisory CRU Group (allan.trench@crugroup.com).