Australian court rejects green group’s appeal plea on Whitehaven’s Narrabri judgment
Proceedings were relating to climate change effects of coal emissions in respect of the Narrabri Stage 3 Project.
Australia’s Federal Court has issued and interim order to stay the government’s decision to not extend Rio Tinto-owned Energy Resources of Australia’s (ASX: ERA) lease for a high-grade uranium deposit in the country’s Northern Territory.
ERA had applied in March for a 10-year lease renewal for Jabikula, surrounded by the Kakadu National Park. The asset is considered one of the world’s largest untapped deposits of high-grade uranium.
The Northern Territory government, however, had declined to renew ERA’s Jabiluka lease, which prompted Boss Energy [ASX: BOE] to retract an offer to pay ERA A$550 million ($360 million) for the site.
Shares of ERA soared on the announcement, a small win in the battle to keep the lease, as the ruling sets a status quo on the licence until further court orders. The stock closed up more than 14% to A$0.016, leaving the uranium miner with a market capitalization of A$496.12 million ($326m).
“The matter has been listed for a case management hearing before the court on Aug. 19 to set a timetable for the hearing of ERA’s case,” the company said in a statement.
Earlier this week, the uranium miner said it had initiated legal action against Australia’s resources minister and other officials, following the non-renewal of its lease for Jabikula — a project long opposed by the Mirarr people.
The Mirarr, the traditional owners of lands in Australia’s north, are against mining activities in the region, and organized protests in the late 1990s and early 2000s.
Rio Tinto (ASX: RIO), which owns roughly 80% of ERA but does not operate it, has backed their position in recent years as it works to repair its ties with indigenous groups after destroying sacred rock shelters at Juukan Gorge in Western Australia in 2020 for an iron ore mine expansion.
Activity in the Australian uranium market has spiked over the past year, with developers such as Boss Energy (ASX: BOE), Bannerman Energy (ASX: BMN) and Deep Yellow (ASX: DYL) seeing their value soar.
Paladin Energy (ASX: PDN), a Western Australia-based uranium miner, recently announced a proposed acquisition of Canadian competitor Fission Uranium (TSX: FCU). If successful, the combined company would produce 10% of global uranium output.
In contrast, ERA’s value has steadily dropped since the Ranger uranium mine, located near Jabiluka, stopped producing in 2021, after 40 years of operations.
Rehabilitation costs for the site have surged to A$2.2bn ($1.4bn) over the past year and the company is expected to run out of funds by year-end. With no other significant assets, raising capital would be a very difficult task.
Australia is home to almost one-third of the world’s identified uranium reserves, yet the mining of this resource is permitted in only two of its eight states and territories — South Australia and the Northern Territory.
The country’s only operating uranium mines are BHP’s Olympic Dam, which generates uranium as a secondary product of its copper mining activities and Boss Energy’s Honeywell mine. Together, they account for around 9% of the global reported production.
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