Giant says rehabilitation of uranium mine – site of a radioactive spill last year – is a matter for its Australian subsidiary
It’s a long way from central London to Kakadu national park in Australia’s Northern Territory. When Rio Tinto’s chief executive, Sam Walsh, addressed shareholders at the company’s annual general meeting last week, there was a strong sense of the distance.
Walsh refused to offer any guarantees that the mining giant would help its Australian subsidiary company Energy Resources of Australia (ERA) clean up the site of its Ranger uranium mine within the park.
“This is a public Australian company and clearly that is an issue for them,” Walsh said. When pressed on the point he added: “We are clearly shareholders, but it is a matter for all shareholders and a matter for the ERA board.” The Ranger mine was in the news in December last year when a leach tank containing 1.4m litres of acidic radioactive slurry leaked.
Walsh’s words were alarming for Mirarr traditional owners who live in the park and are no strangers to negotiating with mining companies. They are anxious about ERA’s commitment to the rehabilitation of the site. ERA is obliged to ensure it is fit to be be reincorporated into the park by 2026. The traditional owners fear that if Rio Tinto won’t take responsibility for the site, no one will.
The ERA share price has recovered after a dramatic drop after the spill (its shares lost 30% in the first three days after it happened), but uranium prices globally are very low. Market confidence has remained poor since the Fukushima disaster, and there have been other blows, such as Germany getting out of nuclear power altogether.
ERA has its sights set on massive expansion plans. It wants to press ahead with a new underground uranium exploration alongside Ranger called Ranger 3 Deeps. The underground uranium deposit contains an estimated 34,000 tonnes of uranium oxide, making it one of the world’s most significant recent uranium discoveries.
And in ERA’s 2013 annual report was a condition that was already troubling the Mirarr: “If the Ranger 3 Deeps mine is not developed, in the absence of any other successful development, ERA may require an additional source of funding to fully fund the rehabilitation of the Ranger project area.”
At the Rio Tinto AGM, Andy Whitmore, an activist shareholder, asked Walsh to clarify whether the leak at Ranger had affected the company’s expansion plans and whether it would affect its ability to rehabilitate the mine site by 2026.
Walsh said: “There was a rights issue at ERA to fund the rehabilitation work and those funds are still sitting within that business.”
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