Canadian spending on mineral exploration should continue its upward trend in 1995 and beyond, confirming the recovery from a 25-year low hit in 1992, a Canadian government mining official said.

Strong economic fundamentals and two exciting mine discoveries are credited with the upswing in exploration spending, considered a key signal to the future health of the mining industry."I think it will continue," Keith Brewer, director-general of mines at Natural Resources Canada, said in an interview. "It's both the economic turnaround and the renewed excitement in Canada. It all adds up to a promising outlook."

Canada expects the amount of money spent exploring for new mines to reach between 655 million Canadian dollars (US$489 million) and C$670 million this year, he said.

That is well below the 1988 peak of C$1.2 billion, but an encouraging recovery from the C$385 million spent in 1992.

Mr. Brewer said Canada's efforts to restrain inflation, interest rates and its budget deficit contributed as much to the exploration turnaround as two major discoveries.

Dia Met Minerals Ltd.'s diamond discovery in the Northwest Territories fueled a staking rush across the Arctic and the Prairie provinces in 1993.

That was followed last year by Diamond Fields Resources Inc.'s spectacular Voisey Bay nickel-copper-cobalt discovery in Labrador, which led to another rush in Canada's Atlantic provinces.

Diamond fever helped to push spending 24 percent higher in 1993 to C$477 million, Mr. Brewer said. Voisey Bay confirmed the exploration upswing in 1994, when spending increased to C$630 million.

Mr. Brewer said final figures for 1995 will not be available until next year.

"It's sort of respectable but it's still not as high as people would like," he said. "The industry would like to have higher figures to replace reserves."

But he declined to speculate on how long the spending improvements will continue. Although the outlook is positive, Mr. Brewer said a lot depends on the general economic outlook.

Canadian exploration spending improved in 1993 as the world economy started to recover from the economic recession of 1991-92, he said. Canada's mine exploration spending has also benefited from higher metal prices.

"When prices are high, mining companies have confidence, more cash flow and expectations are high," Mr. Brewer said.