PERTH (miningweekly.com) – Uranium miner Energy Resources of Australia (Era) has completed a feasibility study for the closure of its Ranger project, in the Northern Territory.
The closure and rehabilitation feasibility study has increased the rehabilitation provision from the A$526-million estimated at the end of 2017, to A$830-million.
The ASX-listed company said on Friday that the A$305-million increase in the rehabilitation provision stemmed from costs associated with tailings transfer to Pit 3, additional water treatment and related infrastructure as well as revegetation requirements, higher forecast costs relating to site services and owner’s costs, and an increase in contingency.
Era told shareholders that as a result of the increase in the rehabilitation provision, the company would continue to review all of its funding options, with parent company Rio Tinto advising that it would work with Era to ensure that the uranium miner was in a position to meet its rehabilitation requirements for the Ranger project.
In addition to the funding arrangements, Era has also implemented a business transformation programme aimed at increasing cash flow from identified and new cost-saving and productivity opportunities.
The programme would generate cash while maintaining the core values of health and safety, as well as continued environmental protection.
Meanwhile, Era reported that the Ranger project had produced 1 999 t of uranium oxide (U3O8) during the full year ended December, which was at the top-end of the production guidance of between 1 600 t and 2 000 t.
U3O8 production in the full year was 13% lower than 2017, with production impacted by the completion of the laterite ore processing early in the June quarter, and the impact of declining ore grades from existing stockpiles.
Revenue for the full year declined from the A$211-million reported in 2017, to A$201-million, with Era reporting a net loss after tax of A$435-million, compared with a net loss after tax of A$44-million in 2017.
The miner told shareholders that the widening loss was driven by two non-cash charges during the year, including a A$343-million non-cash charge for an increase in the rehabilitation provision.
At the end of the financial year, Era held cash resources of some A$388-million.
For 2019, Era was expecting uranium production to reach between 1 400 t and 1 800 t, with production to be drawn from existing stockpiles.
Creamer Media Senior Researcher and Deputy Editor Online