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Issue #1560      15 August 2012

Toro – time to come clean on costs

Western Australia’s peak environment group, the Conservation Council of WA, one of the appellants against Toro Energy Ltd’s proposed Wiluna uranium mine, has called on the company to reveal the expected costs for closure and rehabilitation for the mine, which the Council says could make the project uneconomic.

Piers Verstegen, CCWA Director said “Under WA’s new mine closure guidelines, mining companies are required to pay the full costs of mine closure. In addition, the WA Parliament recently passed a motion that would require uranium mine waste to be isolated from the environment for no less than 10,000 years.”

He said that despite these requirements, Toro are making claims about the financial viability of the Wiluna uranium project without disclosing the costs of mine closure and rehabilitation to shareholders, the WA government or the community they expect to host the mine.

“Mining giants BHP and Cameco have both recently concluded that their uranium projects in WA and South Australia are not economically viable. After carefully analysing the cost structure of uranium projects, including the very high mine closure and rehabilitation costs, these companies have shelved their projects as they simply don’t stack up.

“The big difference between Toro Energy and the mining giants is they have no operating mining projects and nothing to lose. Unlike BHP and Cameco who have huge portfolios at stake, Toro energy could easily abandon an uneconomic uranium mine and leave the clean-up bill to be paid by WA taxpayers.

“Even their largest investor Oz Minerals, which holds a 43 percent stake in the company, described Toro as a “tiny company” and a “non core asset” at their recent AGM in Melbourne.

“It may be that Toro’s business model does not involve ever paying their mine closure costs, with the company instead planning to abandon the mine site and leave this liability to the WA taxpayer. This would explain the company’s failure to account for mine closure costs in the information they have provided to shareholders.

“Given this very real possibility, the WA government should apply the same standards used by the big mining companies in assessing uranium proposals. If companies like BHP and Cameco are not prepared to gamble their extensive assets on this uncertain industry, our government should not be prepared to gamble taxpayers’ money and the health of our environment and communities on uranium mining.”  

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