Australian news, and some related international items

Toro economic report – uncovering the uranium industry bull

20 May 13,  West Australia’s first planned uranium mine has been put under the spotlight and found lacking in a detailed new economic bull-uncertain-uraniumanalysis.

The viability of Toro Energy’s Wiluna uranium proposal has been examined by the independent economic consultancy Economists at Large in a report jointly commissioned by the Anti-Nuclear Alliance of WA and the office of WA Senator Scott Ludlam.

“It is time for Toro to come clean on the full costs of the Wiluna project”, said ANAWA member Mia Pepper. “Toro’s mine closure plans and costs require particular attention as the project’s viability rests on these.”

“In 2013 ERA – the operator of the Ranger uranium mine in Kakadu – estimated closure costs at $640 million. Even if you half that and half that again for this small low grade project, mine closure estimates are still around $150 million – we are yet to hear full details from Toro about this cost.”

The report outlines that for Toro to achieve a positive Net Present Value would require the convergence of a range of external scenarios including low mine closure costs, structural changes in the long term uranium contract price, a drop in Australian exchange rates, cost easing in the mining sector and better efficiency in mining, milling and recovery rates so the project proceeds on time, within budget and without technical snags. The chance of all these factors occurring is very low.

“The Toro project represents risk at every stage”, said Mia Pepper. “It is a risk to the environment at Lake Way, a risk to shareholders and investors and a risk to WA tax payers. This report confirms that the economics of the project are volatile and uncertain – however it is certain that the project will remain strongly contested”.

“From people taking action on country – like the seventy committed people walking through the region in opposition to uranium mining right now – to sounding the alarm in the board room, this flawed mine plan will be contested. The Toro Energy plan has never made sense and this report shows that it also won’t make dollars”.

The author of the report, Roderick Campbell, economist with Economist at Large, is available for comment on 0438503249.


May 20, 2013 - Posted by | business, uranium, Western Australia

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