Little Reward in native title headaches Monday, 27 May 2013 Hannah Vickers
WHILE many companies have hit project delays over native title, few have run into as many stumbling blocks as potash-focused explorer Reward Minerals and although its flagship project is moving ahead, there are more problems waiting in the wings. Development is finally progressing on the Lake Disappointment potash project in Western Australia but it has certainly been a long road.
The project was delayed for three years from 2008 through 2011 due to protracted negotiations with traditional owners and it was the first mine application rejected by the National Native Title Tribunal in 2009.
It was not until December 2011 that the company was able to reach terms with the Martu people and their prescribed corporate body the Western Desert Lands Aboriginal Corporation, though the mining and indigenous land use agreement was not registered until December 2012 due to the need to perform a clearance area heritage survey.
Reward received approval for the ILUA in January this year, with construction works underway.
The company expects to receive approvals for the next phase of development at the project this quarter, which will include drilling and pump testing of the potash brine resource.
This is not the end of the line for Reward when it comes to native title delays.
Lake Mackay, which is straddles the Western Australia-Northern Territory border in the Gibson Desert, has an inferred potash resource of 4.78 billion bench cubic metres at 4.3kg of potassium sulphate for 20.56 million tonnes of contained potassium sulphate.
Despite the strong resource, Reward does not know when it will be able to advance the project.
In its quarterly activities report released April 30, the company said the next stage of development at Lake Mackay will involve infill drilling, construction of pilot ponds and pump testing as well as flow sheet development in preparation for a feasibility study.
“Prior to committing to this phase the company has engaged in discussions with Tjamu Tjamu people and other traditional owner groups aimed at reaching agreement on terms which would be acceptable for the development to proceed at Lake Mackay in the event feasibility analysis proved favourable,” the company said.
“While it is the understanding of Reward Minerals that the majority of the native title holders are in favour of development of the Lake Mackay project, no satisfactory commercial agreement has been forthcoming to date.
“Negotiations are continuing.”
While Reward is waiting, other companies have received clearance from the Tjamu Tjamu people, including Corazon Mining which announced in February that the Tjamu Tjamu (Aboriginal Corporation) RNTBC had signed a land access agreement for the Top Up Rise copper-gold project.
Toro Energy has also developed what it calls a “close relationship” with traditional owners at Lake Mackay, where it holds 420sq.km of exploration licenses.
The story is similar when it comes to Reward’s Officer Basin potash project in Western Australia, though in this case the news is a bit better.
Several of the tenements are located within Martu lands, the same traditional owners involved in the Lake Disappointment agreement, and negotiations regarding Officer Basin had been put on the backburner to prioritise the flagship project.
Given the progress Reward made at Lake Disappointment, the company is hopeful to reach similar deals at Officer Basin where it has 13 exploration licence applications covering roughly 5600sq.km.
“Since reaching agreement with the Martu people on the mining agreement for potash operations at Lake Disappointment and recent discussions with the Martu representative body WDLAC regarding the Officer Basin project, the company believes that it may be able to reach agreement on terms allowing exploration and mining of the company’s Officer Basin tenements in the foreseeable future,” Reward said.
Like Lake MacKay, negotiations are ongoing.
Meanwhile in Queensland, the company’s Adavale project also hit a snag with traditional owners when the Bidjara people invoked native title protection conditions over all three tenements.
As a result of the delay, the agreement signed with freehold title owners at the project expired and needed to be renewed.
Now that Lake Disappointment is moving ahead, the company said it is exploring other development options for Adavale.
“Since reaching agreement with the Martu people on development of the Lake Disappointment project, the company has elected to farm-out the Adavale potash project,” Reward said last month.
“Several companies have expressed interest in earning an interest in the project and negotiations on this front are in progress.”
Reward also holds a 15% interest in the Karinga Lake joint venture with Rum Jungle Resources in the Northern Territory but while that project is progressing through exploration, the company said it expects to further dilute its interest.
The company declined to comment for this story.
Reward shares were down 1.8% to A27.5c in early trading.
RWD Price at posting:
27.5¢ Sentiment: None Disclosure: Not Held
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