Mirrar In The News

The Australian: Mirarr people refuse ERA extension at Kakadu

16 Oct 2015

by Barry Fitzgerald

The death knell has been sounded for Energy Resources of Australia’s uranium operations inside Kakadu, smashing the market value of the listed Rio Tinto subsidiary and reducing Australia’s supplier role to the world’s nuclear power industry.

The bad news was delivered by the Mirarr people, the traditional owners of land that hosts ERA’s Ranger operation and the undeveloped Jabiluka deposit, both near Jabiru in the Northern Territory.

They have formally told ERA that they will not support an extension of the current authority to mine beyond its expiry in 2021 because of the June decision by Rio — ERA’s 68 per cent shareholder — to withdraw its support for ERA’s mine life-extending plans.

The decision effectively kills off any hope ERA had of extending the life of the Ranger operation by developing the Ranger 3 Deeps deposit as an underground mining operation, following the recent exhaustion of Ranger’s open cut resources. Developing the Jabiluka deposit using Ranger infrastructure has also been killed off.

The in-situ value of the two deposits is currently more than $25 billion at current depressed prices for the nuclear fuel.

The decision also means that Australia’s ability to contribute to the global warming challenge by fuelling overseas power stations will be diminished, to a degree at any rate.

Despite Rio’s lack of support, there had been a slim hope that ERA could eventually secure the support of the Mirarr. But those hopes have been dashed.

ERA shares fell 8c or 21 per cent to 30.5c yesterday, valuing the company at $158 million. In 2010, it was a $7 billion company. But that was before the 2011 Fukushima disaster in Japan, and before ERA’s ability to extend the life became an issue it has because of a lack of support from Rio and the Mirarr people.

After saying earlier this week that it was still in negotiations with the Mirarr for an extension, ERA had to back-track yesterday.

ERA said it had been formally advised that the Mirarr do not support an extension to the authority to continue operations beyond 2021.

“ERA respects the views of the traditional owners and will undertake a review of its business in light of their decision,’’ the company said.

It said it would continue to process ore from existing stockpiles and undertake its progressive rehabilitation activities. An asset impairment charge is likely.

Rio dropped a bombshell on ERA in June when it said it did not support any development of the Ranger 3 Deeps project. Rio went further at the time to state that it stood ready to provide financial support to ERA if it was needed to meet rehabilitation obligations.

Through the Gundjeihmi Aboriginal Corporation (GAC), the Mirarr yesterday called on ERA to “secure Rio funding for the full cost of rehabilitation to ensure that there is no long-term issue left to the cost of the Australian taxpayer and the community.’’

http://www.theaustralian.com.au/business/mining-energy/mirrarr-people-refuse-era-extension-at-kakadu/story-e6frg9df-1227570819538