Mine CEO ‘absolutely astonished’ as government shuts down Hellyer Gold operation
The sudden closure of Tasmania’s Hellyer mine has sparked a bitter clash between its CEO and the state government over unpaid debts and compliance issues. The latest:
The boss of the West Coast mine that was shuttered by a state government stop work order says the mine was working closely with the government on its debts when it received the “sudden and unexplained’ notice.
Hellyer Gold Mine CEO Graham Cox said he was “absolutely astonished” by the behaviour of the government, after they were handed a cease work notice over non payment of debts and compliance issues.
“This is a shocking and deeply damaging move to suspend mining operations without seeking to understand factual information prior to making decisions,” Mr Cox said.
On Tuesday Business, Industry and Resources Minister Felix Ellis said the cessation notice to Hellyer Gold Mines Pty Ltd was due to multiple and significant noncompliances with financial and operational requirements.
Mr Cox said the decision was reckless, unnecessary and completely at odds with the state’s
claims of being open for business, as all environmental and financial obligations had been met or were being finalised with government oversight.
“We’ve worked in good faith to take on an operation that was severely distressed, riddled with debt and turn it around within a short period of time to become an environmentally and financially responsible mining operation and all we ask is that we be treated with the same good faith in return,” Mr Cox said.
He said the company had been working closely with Mineral Resources Tasmania on a government-approved environmental bond program and a broad range of obligations when it received the “sudden and unexplained” cease work notice.
“The decision demonstrates a lack of common sense from the Tasmanian Government,” Cox said.
“We have paid our dues, we have done everything asked of us without government bailouts or financial support and yet we’ve been suspended from mining over very minor issues, without warning.”
Hellyer Gold Mines started re-treatment of tailings from the historic main tailings storage facility in October 2018 with hopes of generating product worth up to $1.5 billion and ongoing employment of 50 jobs.
Minister explains why he lost patience with Hellyer
Mr Ellis said the Hellyer mine operation near Waratah had fallen significantly behind in paying their debts to local suppliers, contractors and the Crown.
On Tuesday Mr Ellis ordered the closure of the operation for “multiple and significant noncompliances with financial and operational requirements under the Mineral Resources Development Act 1995”.
He said on Wednesday that compliance issues had continued to escalate.
“We have worked with Hellyer over a long period to fix these issues and bring the mine back into compliance,” he said.
“This action is necessary to prevent those matters worsening.
“The Hellyer mine has strong fundamentals and if the company resolves these matters, operations could recommence quickly and lawfully.
Earlier Tasmanian Minerals and Mining Council CEO Ray Mostogl told ABC radio that the late payment of royalties appeared to be the key reason why the State Government had ordered the closure of the Hellyer mine at Waratah,
Mr Mostogl said a further likely noncompliance was that the company had failed to follow the operational plan it had submitted to Mineral Resources Tasmania.
“If they are not following all of those steps and making other choices with how they process or what the quantity of the product is when it leaves then they are effectively non-compliant with their plan,” he said.
Mr Mostogl said royalties payments were generally paid quarterly.
He said ultimately it was about directors of the operation making a decision on what they were going to do with the mine — to either continue the operation and address the non conformances or put it into administration or sell it.
Before closure the operation was processing tailings form historic mining operations to extract lead, zinc, gold silver, and pyrite.
Mr Mostogl said that the Hellyer Gold Mine was a name which emphasised the attractive element of the operation.
“It’s actually a lead and zinc concentrate that is the predominant product that comes out of that mine,” he said.
“I’m not sure of the history of the naming convention, it might have something to do with attracting more investors with that name but it goes back a long time.
“There is elements of gold and silver in their ore but effectively it sells lead and zinc concentrate.”
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Originally published as Mine CEO ‘absolutely astonished’ as government shuts down Hellyer Gold operation
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