Regis Resources holds out hope for scuttled McPhillamys gold mine

Environment Minister Tanya Plibersek vetoed the site of a tailings dam based on disputed Aboriginal heritage grounds but Regis managing director Jim Beyer says the fight is not over.

Regis is not giving up on the McPhillamys project even if a potential legal challenge fails, but maintains it will take 5-10 years to go through another approvals process. Picture: Rohan Kelly

Regis Resources has not given up hope of overturning an 11th-hour call by federal Environment Minister Tanya Plibersek that scuttled plans for the McPhillamys gold mine in NSW, managing director Jim Beyer says.

Mr Beyer said the company was still “fully evaluating our legal options regarding this surprising and disappointing decision”.

Ms Plibersek vetoed the site of a tailings dam based on disputed Aboriginal heritage grounds and has since pointed to an increase in the Regis share price in defending her decision.

Mr Beyer said the increase was all about the strong performance of Regis’s two operating mines – Tropicana and Duketon – and the surging gold price.

Regis opted to close out an unfavourable hedge book that had dragged on market sentiment at a cost of $98m last December. It has since raked in the cash with the gold price surging above $US2700 an ounce for the first time last week.

Gold production from the Tropicana and Duketon mines generated free cash flow of $85m in the September quarter.

“Regis is much more than just McPhillamys,” Mr Beyer said.

“McPhillamys still has the potential to be a robust project with low operating costs and significant leverage to the spot gold price.”

Regis is not giving up on the project even if a potential legal challenge fails, but maintains it will take 5-10 years to go through another approvals process even if it can find an alternative site for tailings storage.

“We have to pick up the team, dust them off, and start to think about what the solutions are to find an alternative location for the tailings dam,” Mr Beyer said.

“There isn’t any easy, obvious one, apart from the one that we had already permitted, which is now unviable.”

Asked about revelations in The Australian about a blue-banded bee Dreaming story that influenced Ms Plibersek but did not appear in any of the six ethnographic studies seen by Regis, Mr Beyer said it was difficult for him to comment.

“I’m not a lawyer, so I’ve got to be careful about describing the process,” he said.

Evolution Mining executive chairman Jake Klein spoke out in support of the fellow gold miner, saying Ms Plibersek’s decision on disputed Aboriginal heritage grounds was unacceptable and had damaged Australia’s reputation as a mining jurisdiction.

“The recent federal government decision to effectively overturn the NSW government’s decision to approve the development of Regis’s McPhillamys mine is a great example of what we should not be doing,” Mr Klein said.

“NSW has one of the most rigorous and thorough approval processes in the world. This project went through years of extensive scrutiny, including public consultation, by the Independent Planning Commission before its approval by the NSW government.

“We cannot have a repeat of this and there needs to be a change to the legislative process that ensures that any red flags at a state or federal level that risk a project’s approval are identified and dealt with early.

“To have them emerge at the end of the process after millions of dollars have been invested is unacceptable and unnecessarily tarnishes the attractiveness of Australia as a mining destination.”

Originally published as Regis Resources holds out hope for scuttled McPhillamys gold mine