PERTH (miningweekly.com) – ASX-listed Terramin Australia has launched legal proceedings in the Supreme Court of South Australia against the South Australian government’s refusal for a mining lease and miscellaneous purposes licence for the Bird in Hand gold project.

South Australian Energy and Mining Minister Tom Koutsantonis refused the mining lease and miscellaneous purposes licence application for the gold project in February this year, with the Governor of South Australia subsequently issuing a proclamation under the Mining Act, preventing future mining applications at the Bird in Hand gold project.

The proposed gold mine lies beneath an Adelaide Hills winery, with Koutsantonis saying threats to the tourist region were too great to give the mine final approval, despite recommendations in an assessment report by the South Australian Department for Energy and Mining (DEM) which indicated that DEM supported the granting of the Mining Licences in respect of the mine.

Terramin on Wednesday said that the Minister’s decision was made notwithstanding an extensive review of the company’s application by the DEM, which made a positive assessment of the application and found that appropriate environmental outcomes could be achieved should the mining lease and miscellaneous purposes licence be granted.

Terramin is seeking a judicial review of the refusal of the application, as well as the Governor’s recommendation.

The company stated that among other things, each decision should be set aside on the basis that the decisions misapprehended the statutory power in the Mining Act, were legally unreasonable, did not take into account relevant considerations, took into account an irrelevant consideration, and that Terramin was not accorded procedural fairness.

“It should never have come to this,” Association of Mining and Exploration Companies CEO Warren Pearce said on Wednesday.

“Today’s legal action is the inevitable conclusion to a failed government approvals process. Terramin met all expectations in a lengthy and complex approvals process, with the recommendation to proceed by the Department, and ultimately blocked by the Minister.”

“This project deserved to be approved, and its rejection was a very disappointing outcome for South Australia’s mining and mineral exploration industry,” Pearce said in a statement.

“When a company complies with all government processes and meets all requirements but is not allowed to proceed, then they should be fairly compensated for the significant investment they have made into developing that project.”

“We don’t want to see this outcome reoccurring, so there is a strong need for a government position to assure the industry it will not.”