Australian gold miner Regis Resources has warned that its McPhillamys project becomes “unviable” due to government environmental and Indigenous concerns.
The company intended to build a tailings dam near the upper Belubula River to handle waste from its planned McPhillamys gold and silver mine in New South Wales. However, Environment Minister Tanya Plibersek’s decision to protect Indigenous cultural heritage area means the dam cannot be built at the planned location near Blayney.
Regis Resources could locate the dam elsewhere, the government says. But the company believes choosing a new location would effectively reset the approval process and potentially delay the project by 5 to 10 years. Regis CEO Jim Beyer expressed disappointment at the federal minister’s intervention, pointing out that the project had already been assessed and approved under both state and Commonwealth legislation following a nearly four-year process. With the new input, Australia’s third-largest gold producer will have to review the project’s A$190 million ($127 million) book value in development and its ability to continue to report the asset’s ore reserves. That official estimate is crucial to how investors value mining companies.
The company believed the Indigenous group with the clearest legal authority to assess the heritage value of a property, the Orange Local Aboriginal Land Council, had not opposed the project. They believed any potential heritage impacts could be “appropriately managed and mitigated,” Regis said. Other Indigenous groups in the area had opposed the project over cultural heritage concerns. Warren Pearce, CEO of the Association of Mining and Exploration Companies of Australia (AMEC), said the government's decision made no sense and set a "truly terrible" precedent for investment risk in Australia. "Absolutely nobody benefits from this decision. Not the local community, not Traditional Owners, not the state of New South Wales, nor the industry. It’s a lose, lose, lose," Pearce said.
The company had planned to mine up to 60 million tonnes of ore and produce 2 million ounces of gold at the proposed mine.
Hélène Tarin, Editor-in-Chief of the Asian Bureau, Rough&Polished
