Fairfax: ERA shares meltdown follows Ranger spill

Publish Date:
10th December 2013

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By Peter Ker
Uranium processing at Energy Resources of Australia's Ranger mine has been officially halted after ndustry Minister Ian Macfarlane imposed a formal suspension. Mr Macfarlane's move came after a briefmg with ERA's new chief execu tive, Andrea Sutton, at which the pair discussed Saturday's leak of radioactive uranium particles and industrial acids from a leaching tank at the mine.

Shares in ERA, majority owned by mining giant Rio Tinto, had already dropped more than 12 per cent on Monday before Mr Macfarlane clarified his stance in a statement "I have told ERA today that they cannot resume processing at Ranger until the company demonstrates the integrity of the processing plant to the satisfaction of the regulatory authorities," he said.

"ERA must also demonstrate thatKakadu National Park and human safety remain protected. I understand
the concerns of traditional-owners and local residents and can assure them that governments will continue to ensure the mine operates to the highest standards."

The Northern Territory arm of WorkSafe is understood to be launching an investigation into the incident, and a cooperative taskforce has been set up between the Federal and Territory agencies that are  investigating the spill. ERA had already indicated that processing would be stopped for an indefinite length of time but it was not previously known that a restart would hinge on Federal and Northern Territory regulators. ERA said the halt would not affect production guidance for 2013, but it was unclear whether it would persist long enough to affect production guidance for 2014.

In 2011 an extended production break forced ERA to buy uranium on the open market to satisfy its supply
contracts with international nuclear power entities.

Saturday's incident prompted a selldown of ERA shares, with the stock closing 16.5e lower at $1.135 on Monday. The stock has traded around $1.30 for the past five to six weeks, but is now fetching its lowest price since June.