Canada-listed junior explorer Sandfire Resources America, a subsidiary of Sandfire Resources, has been issued a water permit for the Black Butte copper project from the state of Montana Department of Natural Resources and Conservation (DNRC).
The permits issued by the DNRC authorise the company to divert groundwater for use in the mining of the Johnny Lee copper deposit and to store high-water flows for stream flow maintenance.
The DNRC also approved Sandfire’s change applications to use six existing water rights to mitigate surface water flow reductions resulting from the groundwater diversion.
While the Company received objections to the water use permits and the mitigation changes, Sandfire said that it was able to resolve all, but one of the objections through negotiated settlements, which may not be challenged as agreed upon by the parties.
The one remaining objection to the groundwater permit, which is pending before the Meagher County district court, relates to the DNRC’s interpretation of whether mine dewatering constitutes “waste” under the Montana Water Use Act.
“We are extremely pleased with this positive progress. We have now obtained the water permits needed to begin Phase 2 construction of the mining operations at the Johnny Lee deposit. We are optimistic that the remaining objection to the groundwater permit will be resolved in our favour,” said senior VP Jerry Zieg.
One other regulatory hurdle to Phase 2 Construction will be resolving the narrow issues going in front of the Montana Supreme Court regarding the mine operating permit, with opening briefs due November 1.
Regulatory finalisation will be followed by the requirement of the Sandfire Resources America’s board approval and securing financing.