Junior iron ore player Cazaly Resources has failed in its bid to wrest control of the Rhodes Ridge iron ore deposit in Western Australia from Rio Tinto.
Late on Friday afternoon the Perth Warden’s Court rejected Cazaly’s argument that Rio had lost its right to hold on to the project by failing to renew its rights properly.
Cazaly had also argued Rio and joint venture partners Wright Prospecting and Hancock Prospecting should be forced to relinquish control of the deposit after making no moves to develop it over more than three decades.
With resources of 3.26 billion tonnes, Rhodes Ridge is believed to be Western Australia’s most significant remaining undeveloped high-grade iron ore deposit.
Based on the current iron ore sale price of US$61 a tonne, the Rhodes Ridge deposit contains more than US$197 billion of iron ore.
Warden Graeme Calder found that Rio and its joint partners sill held valid ownership over the deposit.
Despite the finding of Rio’s rights to occupancy, the Warden found that Cazaly could still apply for exploration licenses for the deposit, although he conceded that they would be largely pointless given the State Agreement rules out anyone else from exploring for iron ore.
The defeat follows Cazaly’s failed 2007 High Court attempt to take control of Rio’s much smaller Shovelanna deposit using a similar argument.