A New South Wales court has brought into question an exploration licence held by Australia’s largest gold miner Newcrest.
Renewed in 2011 under disgraced former mining minister Ian Macdonald, the licence surrounds the company’s existing Cadia Valley Operations mining leases, SMH reports.
Justice Nicola Pain has found that the Mines Department file failed to demonstrate that the Minister’s delegate had been satisfied that ‘special circumstances’ existed to support a decision to renew the exploration licence for its entire geographical area.
The decision will see the latest renewal of the term of EL3856 be reconsidered by the NSW Minister for Resources and Energy.
Unless 'special circumstances' apply to a renewal, 50 per cent of the area of an exploration licence must be relinquished.
In a statement Newcrest stated that the exploration licence “continues to have full effect and remains in Newcrest’s ownership”.
The licence will remain in play pending the reconsideration of the ‘special circumstances’ renewal application.
Following the judgement, Newcrest shares slumped 83 cents, or 5.3 per cent, to $14.80.
The company’s Cadia mine is Australia’s biggest underground mine containing about $200 billion worth of gold.
A spokesperson for Newcrest said only one of GCR’s four claims was established in the judgement.
"Overall, the ruling was positive for Newcrest," she said.
"It has no impact on our operations, and it doesn't mean we will have to relinquish any ground from our exploration licence.
"GCR was not able to establish its claim of false and misleading conduct in the renewal."
Commenting on the decision GCR managing director Brian Locke said "We walked out with the decision quashed. End of story".
This isn’t the first time GCR has challenged EL3856, late last year the explorer launched proceedings against Newcrest claiming the miner had breached confidentiality.
The NSW Supreme Court dismissed the claims with Judge James Stevenson ruling that even though Newcrest breached a confidentiality agreement with GCR there were no financial losses as a result.
Although to date Newcrest has played down the legal proceedings, GCR still has another five actions to pursue and the next two concern the Cadia ore body, with one alleging the miner continued to mine without a legitimate mining licence.
For a mining licence to be granted it must be preceded by a valid exploration licence.
In an ASX statement last October Newcrest said “none of the claims have merit” and “this exploration tenure is not material to Newcrest’s mining operations”.
According to the SMH the exploration licence in question runs through the Cadia East Zone and alongside the Cadia East Subsidence Zone; it is also the authority Newcrest needs to get its Cadia East Mining Lease Applications approved.