PARTNERS in the shiny new but stalled $US1.5 billion ($A1.37 billion) Ramu nickel project in Papua New Guinea can finally flick the on switch after a court win against the environmental challenge to the project's planned deep-sea disposal of tailings.
Ramu has been ready to go since last year. However, a series of legal actions to block the disposal plans has delayed commissioning and first production.
The project is majority owned by China Metallurgical Group Corporation and 8.56 per cent by ASX-listed Highlands Pacific, which has an option to go to a 20.55 per cent interest at market prices.
The National Court of Madang yesterday refused to grant a permanent injunction against the deep-sea disposal plans and removed a temporary injunction.
Highlands noted that the decision could be appealed to the High Court of PNG but said the partners were confident the outcome would be the same.
A work-restriction order issued by the Chief Inspector of Mines in early June has also been removed. Highlands said the pathway for the commissioning of the fully constructed project was now clear.
Highlands shares gained 4¢, or 13.3 per cent, to 34¢ on news of the court decision.
Ocean disposal of tailings is frowned on elsewhere in the world but is common practice in PNG because of the availability of deep-water settings close to shore. The country's high rainfall and rugged terrain have created problems in the past for the normal global practice of land-based tailings dams.
Annual production from Ramu, 75 kilometres west of Madang, is expected to be more than 31,000 tonnes of nickel and 3300 tonnes of cobalt for at least 20 years.
Highland's interest will increase to 11.3 per cent at no cost after repayment of project debt, estimated to be in eight years.
■Xstrata has given the go-ahead for a $246 million development of the high-grade zinc-lead-silver Lady Loretta deposit in north-west Queensland.
First production from the mine, 140 kilometres north-west of Xstrata's Mount Isa operations, is planned by the end of 2013. The mine's annual forecast production is 126,000 tonnes of zinc in concentrate and 40,000 tonnes of lead in concentrate, over an initial 10-year mine life. The concentrates will be processed at Mount Isa.
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