Energy Resources of Australia (ERA) has added an additional $600 million to the rehabilitation cost of its ceased Ranger uranium mine in the Northern Territory.
It comes as ERA announced preliminary findings for a reforecast exercise the company is conducting on the cost and timeline for the rehabilitation project.
ERA forecasts the revised total cost of rehabilitating Ranger, including incurred spend from January 1, 2019, to be between approximately $1.6 billion and $2.2 billion. The price outlined in the 2019 Ranger closure feasibility study was $973 million.
The timeline for Ranger’s clean-up has also been extended, with ERA hoping to complete the project between the fourth quarter of 2027 and the fourth quarter of 2028. ERA had previously outlined its goal to complete rehabilitation by January 2026.
ERA’s Ranger reforecast exercise has highlighted the many processes involved in closing a uranium mine.
The company has factored in additional costs and scheduled impacts in converting Ranger’s tailings storage facility into a water storage facility.
Anticipated technical risks, additional costs and scheduled impacts in capping works at pit three have also been factored in.
ERA has also had to consider the cost of additional personnel required for the job and prolonging costs related to schedule delays, such as further project and site management costs including power generation and water management.
Under the Atomic Energy Act 1953, ERA is required to complete rehabilitation activities by January 2026. The company is working with government and relevant stakeholders to have this amended and extend its tenure at Ranger.
ERA hasn’t ruled out the potential for further amendments to the forecast cost and timeline of Ranger’s rehabilitation. This would be necessary if the case execution methodology has changed.
Despite this, the company doesn’t expect the overrun costs to fall outside the $1.6bn-$2.2bn range.
As of December 31, 2021, ERA had $699 million of cash funding, with the bank holding $164 million and the Commonwealth Government holding $535 million as part of the Ranger Rehabilitation Trust Fund.
ERA ceased activities at Ranger in January 2021 after four decades of operation.