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Ranger could face higher costs and more delays - ERA

28th July 2023

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – ASX-listed Energy Resources of Australia (ERA) has warned of further delays and cost increases for the rehabilitation of its Ranger project in the Northern Territory.

The company on Friday said that the 2022 feasibility study process into the rehabilitation operations continued during the three months to June, and a preliminary finding relating to the reassessment of the water model had shown an increase in the estimated volume of water that would require treatment.

An increase in the volume of water would likely have a corresponding impact on the Ranger rehabilitation completion date, and the revised total cost of completing the rehabilitation work, ERA said.

Other preliminary findings have also suggested changes to the bulk material movement, which would further impact the forecast costs and schedule.

Following the preliminary findings, ERA has commissioned an additional study to consider a range of options for an increased volume of water treatment, with the additional study expected to continue past September. The company is also undertaking further review to consider bulk material movement.

ERA last year revealed that it would require an additional A$1.06-billion to A$1.65-billion in capital to complete rehabilitation of the Ranger uranium project, in the Northern Territory, after an independent review of the rehabilitation estimated a cost of between A$1.6-billion and A$2.2-billion for the project, compared with the 2019 cost estimates of A$973-million, while pushing back the completion of rehabilitation work to between the fourth quarter of 2027 and the fourth quarter of 2028.

The government last year passed legislation allowing the company to extend its existing authority of the Ranger mine beyond the current 2026 deadline allowing the company to continue rehabilitation work at the mine, until complete.

ERA in May completed a non-underwritten pro rata renounceable entitlement offer raising A$369-million, which will fund the Ranger rehabilitation through to the third quarter of 2024. The company also settled a credit facility with major shareholder Rio Tinto of A$100-million.

The company is expected to require further funding by 2024.

Edited by Creamer Media Reporter

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