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PERTH (miningweekly.com) – ASX-listed junior Venture Minerals on Tuesday announced its plans to suspend operations at its Riley direct shipping ore (DSO) project, in Tasmania, citing the weak iron-ore prices and the ongoing appeals against the project.
The Federal Court upheld the environmental approvals for the Riley project in May, dismissing an appeal from the Tarkine National Coalition on all four grounds of appeal. However, the appellant has lodged an appeal against the court’s decision to uphold the approval.
Before the appeals were lodged, Venture had secured financing for the project, which included an iron-ore hedge facility at a time of high iron-ore prices.
The miner said that it was regretful that the ongoing appeals had delayed the project and deprived shareholders and the local Tasmanian community of benefitting from the mine in the medium term.
Despite the decision to halt operations, Venture pointed out that the company had completed extensive preproduction work at the Riley project over the past 18 months, which would remain in place, and would afford the company the opportunity to start production, on short notice, should circumstances change.
Further, Venture would also continue to be a party to appeal proceedings, with the company actively seeking to recover all legal costs associated with the past and present legal challenges.
A 2012 scoping study found that at a capital cost of less than A$7-million, the DSO project, which consists of the Livingstone and Riley deposits, could deliver a net present value of A$123-million, at a net revenue for the life-of-mine of A$170-million.
Meanwhile, Venture would continue to progress its Mt Lindsay tin/tungsten project, also in Tasmania, and was evaluating financing options for the development of the project.
Venture’s share prices dropped 12% on Tuesday, to trade at a low of 8.7c a share.