PERTH (miningweekly.com) – The share price of ASX-listed gold major Newcrest traded lower on Thursday after the company said that an exploration licence near its Cadia gold mine was being reviewed.
This follows Land and Environment Court of New South Wales Judge Nicola Pain’s ruling in favour of unlisted junior Gold and Copper Resources (GCR), cancelling a 2008 and 2011 decision to renew Newcrest’s exploration licence 3856.
The exploration licence stretches across some 120 km2 of surface near the existing Cadia gold mine and covers 70% of the gold company’s wholly owed exploration area in New South Wales.
In October, Newcrest rejected the accusations laid against it by GCR, which at the time, brought four legal actions against the gold miner. Two of the actions disputed the awarding of exploration licences to Newcrest, one was in relation to an alleged breach of confidence in respect of GCR exploration technology, and one was in relation to permitting of activities beyond the current mining lease borders at Cadia.
The gold major said at the time that the exploration tenure under threat was not material to its mining operations.
Newcrest spent some A$2-billion on Cadia’s development, and the project is estimated to contain some A$200-billion worth of gold.
The miner said on Thursday that despite the court order, the exploration licence remained firmly within the company’s ownership.
“The latest renewal of the term of EL3856 is to be reconsidered by the New South Wales Minister for Resources and Energy. This follows a finding by the court that there was insufficient evidence on the Mines Department file to demonstrate that the Minister’s delegate had been satisfied that ‘special circumstances’ existed to support a decision to renew the exploration licence for it entire geographic area,” Newcrest said in a statement to the market.
The miner noted that the new court order required the Minister to reconsider and properly record the reasons for arriving at the “special circumstances” decision. “The court confirmed that Newcrest’s EL3856 remains valid pending the reconsideration of the ‘special circumstances’ renewal application,” it said.
Newcrest reiterated that its Cadia operations would not be impacted by any aspect of the court’s decision, maintaining that the exploration tenement was separate from the operation.
Shares continued to fall on Thursday, trading 4% lower at A$14.28, extending the previous day’s fall of 4.7%.