Bauxite miner hits out at West Australia’s permitting delays

afr.com:

Alumina Limited chief executive Mike Ferraro has welcomed further regulatory oversight of his bauxite mines in Western Australia but says the company can’t tolerate the administrative delays that helped drive his company to its worst financial result in nine years.

Alumina has traditionally been a reliable, low-risk dividend stock but declined to pay an interim dividend on Tuesday as it reported a $US42.9 million underlying half year loss. The loss was driven by modest prices for its eponymous commodity and poor productivity forced by environmental permitting challenges in Western Australia.

Alumina Limited boss Mike Ferraro. Eamon Gallagher

The benchmark price for alumina was $US345 a tonne this week; similar to the $US330 a tonneit was fetching one year ago.

Current prices are a far cry from 2018 when Alumina received an average of $US445 a tonne and boasted the highest dividend yield in the ASX200.

While demand for aluminium and alumina remains soft, the big issue for Alumina over the past six months was the poor productivity at its three alumina refineries in Western Australia, which struggled because permitting challenges in WA forced them to consume low-grade bauxite.

Alumina and its partner Alcoa have mined bauxite in the Jarrah forests south of perth for 60 years, but have faced increased pressure from environmental activists and regulators in recent times, particularly over the potential impact on Perth’s drinking water dams.

Five-year plans for the Huntly and Willowdale bauxite mines are traditionally approved directly with the state government without involvement from WA’s Environment Protection Authority.

But the EPA announced on August 7 that it was considering whether it should assess those five-year mine