News Archive

2009

2008

2007

2006

1999

1997

1996

1995

1994

1993

1992

1991

1988

1987

Wmc Faces Fight Over Find

The Age

Wednesday October 28, 1992

Barry FitzGerald

A greatly improved production performance by Western Mining Corporation in the September quarter has been marred by a looming legal battle over the big Ernest Henry copper and gold discovery near Cloncurry in north-west Queensland.

WMC (70 per cent of Ernest Henry) and Hunter Resources (30 per cent) said yesterday that they were taking advice ``regarding their legal remedies" against Savage Exploration as a result of its alleged failure to transfer to them mining leases covering the discovery.

The partners said an option agreement dated 16 October 1991 between them and Savage granted them an option to acquire six mining leases held by Savage in the Mount Fort Constantine district, home of the Ernest Henry discovery.

WMC and Hunter said they gave notice on 11 June this year that the option would be exercised and requested Savage to deliver the transfers of the mining leases on Monday.

They alleged Savage failed to deliver the transfers and noted that the Ernest Henry discovery was ``on or in the vicinity" of one of the mining leases Savage had not transferred.

WMC and Hunter said they had received legal advice ``confirming they are entitled to require the transfer of the mining leases".

Hunter has said previously that Savage retained a 1.25 per cent gross production royalty on the mining leases and that one of them ``covers the current known extent of the Ernest Henry deposit".

Results to date from Ernest Henry point to a deposit of about 100 million tonnes. Although there is no official resource estimate yet, an estimate for the shallower northern part of the ore body is being calculated.

WMC as operator of the project is impressed enough by the results to date to plan for a December start to a preliminary feasibility study into the deposit's development.

Elsewhere, WMC's September-quarter production report, issued yesterday, shows nickel production from the Kambalda operation improved substantially.

© 1992 The Age

Back to News Index | Back to Home