Minotaur Exploration managing director Andrew Woskett has suggested a national resources development fund to be paid for by a levy on established and profitable mining operations.

Speaking at a South Australian Chamber of Mines and Energy function in Adelaide today, Woskett said junior exploration companies were the backbone of Australia’s mining future but at present were struggling for investor recognition and starved for working capital.

“There is nothing more serious right now confronting those in the junior space of the equities market than the complete absence of risk capital available for explorers and small cap project developers,” Woskett said.

“The consequences of capital starvation to the overall wellbeing of our so-called booming resources sector is intensely serious and with negative global equities sentiment as it is, we need to be more unconventional in resolving how we alleviate this funding gap.

“A national resources development fund can fill that gap.”

Minotaur founded the Prominent Hill discovery in SA’s Gawler Craton region, now being operated by OZ Minerals.

The suggestion comes at a time when financial woes in Europe and the US are making investors nervous and leaving many juniors with reduced capital, which Woskett suggests will leave many companies facing the prospect of extinction or merger, despite the quality of their exploration tenements and prospectively.

“The fundamental outcome, without a national resources development fund, is that new mine development in Australia – boom or no boom – will not eventuate without continuing greenfields exploration investment,” he said.

Woskett also sought to dispel the notion that all of Australia’s resource companies were experiencing the mining boom.

“The mining boom is anything but a boom as the valuations of small to mid-cap resource stocks are being trashed by declining share volumes and prices against a softening growth outlook from China and continuing uncertainty in Europe,” he said.

“There is a preoccupation with the hype and sentiment of a mining boom despite the reality being that the benefit of this so called “boom” is pretty much confined to those well-funded, operating producers in the bulks of iron ore and coal.”

Woskett welcomed the recent decision by Australian resources ministers meeting in Darwin to develop a national strategy to address greenfields exploration.

“We need a fresh solution to break the discovery drought so that Australian explorers can continue to do vigorously what they do best; generate the resource growth opportunities that Australia needs to maintain the sector’s contribution to our social and economic wealth.”