Antinuclear

Australian news, and some related international items

ERA’s uranium mining at Ranger ends: ERA can afford rehabilitation of site

Ranger 3ERA to unveil strategy as Ranger mining ends  BARRY FITZGERALD, RESOURCES EDITOR,  THE AUSTRALIAN APRIL 12, 2016   MELBOURNE  BARRY FITZGERALD HAS COVERED THE RESOURCES INDUSTRY FOR 30 YEARS. THE INAUGURAL WINNER OF THE DIGGERS & DEALERS MEDIA AWARD IN 2003, BARRY IS A COMMITTEE MEMBER OF THE MELBOURNE MINING CLUB, A NON-PROFIT ORGANISATION FORMED TO FOSTER INDUSTRY DEBATE.

Energy Resources of Australia is close to releasing the outcome of its strategic review into its future. The review was forced upon the company after Rio Tinto and Ranger’s traditional owners rejected its plan to extend the life of its uranium mining and processing operations inside Kakadu by developing the Ranger Deeps deposit.

Its pending release comes as ERA continues to narrow the gap between its cash balance and the $509 million needed to complete the rehabilitation of Ranger. At last report, ERA was holding cash of $433m and had no debt after adding $72m to its cash balance during 2015.

While mining operations have stopped, ERA continues to produce from stockpiled material, and has said previously it could possibly continue to do so until late 2020.

The rate of cash accumulation over the past five years suggests ERA could end up with cash surplus to the rehabilitation costs, raising the prospect of an eventual capital return to shareholders, depending on what plans for ERA’s future emerge from the strategic review.

ERA said in its March quarter report, released yesterday, that the board had considered the strategic review and that the company was now working on optimising its key elements. The outcomes are expected to be announced to the market by June 30.

It has said previously the review was about “identifying executable options to maximise shareholder value”.

As it is, all mining and processing must cease by January 2021 under the existing Ranger authority, one that Rio, a 68 per cent ERA shareholder, and the Mirarr people, do not support being extended.

That forced ERA to last year abandon plans to develop the Ranger Deeps resource that sits below a mined out open-cut at Ranger. It would have extended the life of the operation beyond the treatment of stockpiled material.

The lack of support from Rio and the Mirarr also killed off any prospect of the big but undeveloped Jabiluka deposit being developed.

Rehabilitation of disturbed land at Jabiluka, 22km north of Ranger, has been completed.

Uranium production in the March quarter from the processing of stockpiles was 593 tonnes, a 21 per cent increase on the previous corresponding period but down by 11 per cent against the preceding December 2015 quarter.ERA has previously given guidance that production for 2016 would be between 1900 to 2300 tonnes of uranium. Last year the remaining uranium that could be recovered from the stockpiles was 10,383 tonnes.

ERA traded weaker yesterday at 33.75c a share for a market capitalisation of $174m.

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April 13, 2016 - Posted by | business, Northern Territory, uranium

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