Toro uranium mine finally gets federal nod

TORO Energy has secured long-awaited federal environmental approval for its flagship Wiluna uranium mine, the first of its kind in Western Australia.

Environment Minister Tony Burke announced this week he would back Toro’s $269 million project, subject to 36 strict conditions, after a “rigorous environmental assessment”.

Federal approval for the project comes six months after it was given the go-ahead by the state government.

A decision had been expected in December, having already been delayed once before but it was pushed back again for several months at the request of the minister.

Among Mr Burke’s conditions of approval are demands that Toro prevents “significant adverse impact” on groundwater-dependent flora and fauna, and ensures the site is safe and non-polluting after its closure.

Toro managing director Vanessa Guthrie said the latest approval “provides a clear pathway to complete detailed engineering design, infrastructure and cost estimates for Wiluna”.

“Wiluna is one of the few projects in the world capable of bringing new uranium production to the market in the medium term, when a shortfall is predicted from 2015 onwards,” Dr Guthrie said.

“The rigorous government assessment of the mine proposal at both state and federal levels has demonstrated that all impacts can be safely and sustainably managed.”

The key challenge for Toro now is to secure more funding for the project.

Its working capital stands at $19.5 million, following the signing of a $12 million convertible debt facility with Macquarie Bank late last year.

There are also concerns over the low uranium spot price, which has plunged since reaching highs of $US130 per pound in 2007.

The spot price climbed to a recent peak of $US64 per pound at the beginning of 2011 but plunged in the wake of the Fukushima nuclear disaster in Japan two months later.

It currently sits at $US42 per pound.

Perth-based miner Paladin Energy said in November last year a uranium spot price “at or above $US85 per pound” was needed for new mines to become commercially viable.

New federal Resources Minister Gary Gray said the Wiluna project was “a step forward for the Western Australian resources industry” and he gave it his full support.

“The proposed mine will be the most advanced of the new generation of uranium mines in the world and will provide a variety of social and economic benefits both to local communities and Australia more broadly,” Mr Gray said in a statement.

Australian Conservation Foundation spokesperson Dave Sweeney expressed doubt about the project’s viability, warning that “conditional approval for a behind-schedule and above-cost uranium project is a long way from a working mine”.

“In the past 12 months, BHP Billiton has exited the WA uranium sector while Cameco has shelved projects in the Pilbara and Goldfields citing ‘challenging economics’ and market uncertainty post-Fukushima,” Mr Sweeney said.

“We have deep concerns about Toro’s ability to finance the project and maintain the highest environmental standards.”

Toro has to provide Mr Burke with a detailed environmental management plan before substantial works can begin.

First production from the mine is anticipated by the end of 2015.