Ranger uranium mine rehab costs blow out
A Rio Tinto-controlled group has flagged the clean-up of the Ranger uranium mine, in the environmentally and culturally sensitive Kakadu National Park in the Northern Territory, will blow out beyond $2.2 billion.
Energy Resources of Australia, which counts Rio Tinto as a controlling shareholder with an 86.3 per cent stake, told investors the rehabilitation would “materially exceed” $2.2 billion, increasing the prospect that shareholders will face further equity raising.
Ranger uranium mine rehab costs breeze past $2.2 billion
Minority shareholders, including fund manager Willy Packer, have so far refused to let Rio exceed 90 per cent ownership of ERA, which would allow Rio to compulsorily acquire the ERA shares it does not own. The high pricetag for Ranger means minority shareholders face stumping up more cash or diluting their shareholding.
ERA is no longer generating revenue as it rehabilitates its Ranger uranium mine, about 20 kilometres south of Jabiluka in the Northern Territory. The last uranium was sold from the site last year after almost four decades of mining. ERA holds the licence for the famous Jabiluka uranium deposit, also in Kakadu.
The Ranger rehabilitation process was previously estimated by ERA to cost between $1.6 billion and $2.2 billion in February 2022.
“The company now expects the total rehabilitation costs to materially exceed the previous estimated range,” the group said on Tuesday. The company also flagged the clean-up would be delayed.
ASX-listed ERA was legally bound to complete rehabilitation of Ranger to a level commensurate with the surrounding Kakadu National Park by 2026. However, the federal government agreed to tweak the legislation in November to allow rehabilitation work to push
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