Subject. Economic mechanisms that ensure the reproduction of the mineral resource base through the functional specialization of market participants: junior exploration companies and vertically integrated mining holdings (majors). Objectives. A comprehensive assessment of the effectiveness of the junior sector in international practice, a quantitative comparison of existing partnership formats (M&A transactions, option agreements, joint ventures), as well as the diagnosis of institutional constraints constraining the development of this mechanism in the Russian jurisdiction in the context of the task of sustainable growth of mineral reserves. Methods. The study is based on a systematic analysis of the value chain in subsurface use. The empirical basis was made up of comparative data on exploration activities from the reports of S&P Global Market Intelligence and MinEx Consulting (2018-2023). To assess the investment attractiveness of projects, risk-adjusted net present value (rNPV) modeling was applied with the integration of probabilistic coefficients of geological success. Results. It has been empirically confirmed that junior companies, accumulating no more than 15% of industry exploration costs, generate up to 70% of significant geological discoveries. Their specific cost-effectiveness for resource discovery exceeds that of the majors by 30-40%. The dominance of option agreements (Farm-in) in the structure of transactions (55%) has been established, due to their flexibility and the possibility of phased risk allocation. The author's modification of the rNPV formula made it possible to formalize an approach to optimizing partnership conditions. Among the key barriers in the Russian Federation are the fiscal burden at the pre-production stage, the lack of liquidity for venture geological assets in the financial market, and excessive regulatory requirements for subsurface users. Conclusions. The long-term sustainability of the reproduction of the mineral resource base is directly determined by the development of the institute of junior companies that assume primary geological risks. To implement this model in Russian economic practice, it is proposed to introduce a mechanism for tax deductions for exploration costs, differentiate licensing requirements for exploration stages, and create specialized exchange-traded instruments. The implementation of these measures can reduce the transaction costs of the search and stimulate the influx of private venture capital into the exploration sector.
Keywords: junior companies, majors, mineral resource base
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