24/09/2009 - 00:00

Scene set for Shovelanna II

24/09/2009 - 00:00

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AN administrative blunder by copper miner Aditya Birla Minerals has set the scene for another David and Goliath battle over mineral resources in the Pilbara.

Scene set for Shovelanna II

AN administrative blunder by copper miner Aditya Birla Minerals has set the scene for another David and Goliath battle over mineral resources in the Pilbara.

Just as Cazaly Resources laid claim to the Shovelanna iron ore deposit when Rio Tinto forgot to renew its tenements in 2005, sparking a three-year battle which extended as far as the High Court, Birla is facing the loss of rich copper leases surrounding its flagship Nifty copper mine near Telfer.

The ASX-listed Indian miner, which bought Nifty in 2004, blamed "an administrative error by the company's external consultants" for the expiry of eight key tenements near the mine last week.

Perth-based Midas Resources, Giralia Resources and unlisted explorer MPF Exploration, immediately pegged the tenements, which extend directly along strike from the main Nifty ore body.

As the competing applications were lodged simultaneously, the applications will be decided by ballot on December 18.

Birla said the tenements did not contain any of its current resources, but flagged it would fight to retain the ground.

"The company is considering all options in respect to the expiry of the tenements and is taking legal advice in that regard," it said.

WA mining regulations prevent companies from re-applying for ground it has relinquished for at least three months. But Birla may appeal to Mines Minister Norman Moore to intervene on public interest grounds.

Rio Tinto took the same approach in its fight with Cazaly, in the process charting one of the most controversial chapters in Western Australian mining law.

When then mines minister John Bowler ruled it was in the public interest to strike out Cazaly's application for Shovelanna, he was roundly criticised by explorers as favouring big business. Following an unsuccessful challenge to the ruling in the Supreme Court, Cazaly's final appeal was rejected by the High Court in April 2008.

Echoing Cazaly, Midas managing director Geoff Balfe said his company had done everything by the book and Birla had no-one to blame but itself.

"The dog ate my homework story is really not good enough. They are a very big company and they should have all the internal systems in place to ensure their documentation is lodged in time," he said.

"The minister needs to act in the public interest when he makes a decision like this, and we would simply take the view that the public interest doesn't mean that the rights of the biggest company should always prevail over the rights of the smaller company."

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