Regis Resources tumbles on uncertainty over key project
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The news: Gold producer Regis Resources has warned its McPhillamys project is “not viable” after an environmental protection declaration by the federal government, sending its shares lower.
The numbers: Regis said the decision was made by federal environment minister Tanya Plibersek by declaration under Section 10 of the Aboriginal and Torres Strait Islander Heritage Protection Act 1984.
As a result, it has been forced to revisit the $190 million carrying value of the under development project in New South Wales, and its ability to continue to report the project's ore reserves, the company said.
Regis shares were down nearly 6% to $1.56 in early trading on the ASX.
The context: Regis said it was made clear to the minister during the assessment process that the project would not be viable if the Section 10 declaration was made. The McPhillamys project has already been assessed and approved under both state and Commonwealth legislation.
The group said it is assessing the decision and is considering all legal options and added it would also consider any ongoing expenditure commitments for McPhillamys.
What they said: "Regis is extremely surprised and disappointed that, after a nearly four-year, protracted Section 10 assessment process, Minister Plibersek has concluded there are grounds to block the development of the McPhillamys Gold project," CEO Jim Beyer said.
The source: ASX announcement
