Andrew Forrest-backed Vimy Resources is hoping an announcement about its Mulga Rock project lodged with the Australian Securities Exchange 24 hours before Saturday’s State election will bolster the chances of the uranium play going ahead despite the opposition of the new Labor State government.
Incoming premier Mark McGowan has said his government would not permit new uranium mines but would allow existing projects if “all necessary approvals are in place for them to operate”.
As momentum for a Labor win grew on Friday, Vimy announced that it had “commenced work on the Mulga Rock project”.
The note did not detail what work had started and contained the admission that a final investment decision had not been made.
The statement noted that the “next phase of work will involved some initial construction activity associated with both infrastructure facilities and mining and will expedite development of the project once the final investment decision is made and full-scale construction starts”.
It is understood the greenhorn McGowan administration will wait for a comprehensive briefing from the Department of Mines before decided what constitutes “all necessary approvals”. Mulga Rocks, 240km north-east of Kalgoorlie, is one of four uranium projects that have received State environmental approval since the Barnett Government removed WA’s ban on uranium mining in 2008.
The others are Cameco’s Yeelirrie and Kintyre projects and Toro Energy’s extension of the Wiluna uranium project.
Vimy, which is run by Mike Young, had been in a race against time to secure relevant approvals before the election.
On March 6, Federal Environment Minister Josh Frydenberg approved Mulga Rock. Canberra’s decision triggered an Australian Securities Exchange announcement from Vimy that it had had “final approval” to start earthworks at the 75 million pound uranium deposit, discovered in 1979.
The project will not be economic until the price of uranium doubles from the current $US24.50/lb spot price.