cazaly lodges application for judicial review

ASX Release
7 August 2006
CAZALY LODGES APPLICATION FOR JUDICIAL REVIEW OF
MINISTER’S DECISION TO TERMINATE SHOVELANNA APPLICATION
Highlights
• Application for Judicial Review lodged
• Minister John Bowler, Hamersley Resources Ltd, Hancok Prospecting Pty Ltd and
Wright Prospecting Pty Ltd named as respondents
• Application and supporting affidavits served on all respondents
• Preliminary hearing set for 2:15pm on Friday 11 August 2006
Cazaly Resources Ltd (ASX: CAZ) and Echelon Resources Ltd (ASX: ECH) confirm that Cazaly
Resources Ltd has, by it’s subsidiary Cazaly Iron Pty Ltd, lodged an application in the Supreme
Court for judicial review of the Minister’s decision to terminate application E46/678 pursuant to
section 111A of the Mining Act 1978 (WA).
The application names Minister John Bowler, Hamersley Resources Ltd (a subsidiary of Rio Tinto
Ltd), Hancok Prospecting Pty Ltd and Wright Prospecting Pty Ltd as Respondents. The parties
will appear before a Judge of the Supreme Court for a preliminary hearing at 2:15pm on Friday 11
August 2006 so that various procedural issues can be addressed.
The application and supporting affidavit has been served on all respondents.
As part of its application Cazaly alleges that the Minister’s decision should be set aside because:
(a) The Minister relied upon the government’s iron ore policy which is invalid because it is
contrary to the Mining Act, anti-competitive and also irrelevant to the decision.
(b) The Minister failed to afford Cazaly procedural fairness because the Minister refused to
disclose to Cazaly and allow Cazaly an opportunity to respond to relevant information
and documents including:
(i) the “statement of principles” relating to confidential discussions between Minister
Carpenter and Rio Tinto Ltd (Rio) which Rio insist were relevant to its section
111A application; and,
(ii) the ministerial briefing paper prepared by the Department of Industry and
Resources (DoIR) which included information about the iron ore policy and legal
advice provided by the State Solicitors Office.
(c) The Minister misconstrued the scope of his power under section 111A and took into
account irrelevant matters that did not pertain to Cazaly’s application, such as how the
previous tenement came to expire.
(d) The Minister proceeded under the misconception that if Rio had lodged the extension
of time application on time it would have been granted. This was incorrect because the
application could not have been lawfully granted because it did not disclose
exceptional circumstances demonstrating that Rio should be entitled to hold the
exploration licence for a further year.
(e) The Minister proceeded under the assumption that if the Cazaly application was
terminated then Rio’s competing mining lease applications would be granted. This
assumption cannot be made because Cazaly is seeking to object the Rio mining lease
applications on the basis that Rio has made no real effort to explore or develop the
Shovelanna deposit in the past and had no plans to do so in the foreseeable future.
One preliminary issue which Cazaly will pursue is discovery of various relevant documents that the
Minister and Rio have refused to disclose to Cazaly including the statement of principles and the
ministerial briefing paper prepared by DoIR.
Cazaly will also seek to have the proceedings expedited because it believes that the dispute
should be resolved as quickly as possible so that development of the Shovelanna deposit can
commence.
An issue that will be central to the proceedings is the “secret” iron ore policy which has been
administered by the DoIR for many years. Cazaly has uncovered information relating to this policy
during the course of this dispute.
Cazaly has learned that DoIR has a policy of giving special treatment to applications made under
the Mining Act 1978 (WA) including extension of term applications in respect of iron ore tenements
so as:
(a) to allow tenements authorised for iron ore to be held on “less onerous terms” and as
“long-term tenure” compared to tenements that are not authorised for iron ore because
“tenements containing iron ore deposits will not be mined for a lengthy period from the
time of discovery”; and/or
(b) to allow exploration licences the holders of which are authorised to explore for iron to
be “utilised as holding titles”.
Cazaly believes that this policy is clearly inconsistent with the Mining Act 1978 (WA) and therefore
invalid. It also believes that the policy is anti-competitive in that it allows the traditional iron ore
duopoly to retain land and therefore makes it more difficult for new entrants into the iron ore
industry.
Cazaly hopes that as a result of these proceedings the policy will be set aside so that in future all
mining companies are treated fairly and in accordance with the Mining Act 1978 (WA).
Yours Sincerely,
Nathan McMahon
Managing Director