Ajay Paliwal, mining and metals corporate finance leader at E&Y said the first six months of 2004 was the "boom time" for the mining sector. In that time, 14 companies joined AIM, raising more than £115 million compared to 18 companies in the whole of 2003 raising £50 million.

However, Paliwal added that the bullish market in mining stocks, driven principally by an upswing in commodity prices, has now fallen back as those same prices have dropped off.

"The markets are still interested in mining companies that are coming to IPO," Paliwal said. "But we do foresee more steady and sustainable pricing of these new issues, more in line with other sectors. Activity that has dipped in the last couple of months will return in the autumn as mining companies with a good track record, established leadership and a credible asset portfolio succeed in raising funds."