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New Century Resources achieves $14.1m reduction of ERC

New Century Resources achieves $14.1m reduction of ERC

McCullough Robertson’s expert Resources & Renewables team has successfully delivered a reduction of $14.1m in estimated rehabilitation costs (ERC) for New Century Resources (NCZ).

This agreement, validated by the Queensland Government’s Department of Environment and Science (Department), is the first of its kind for an operating mine in Queensland, since the commencement of the Mineral and Energy Resources (Financial Provisioning) Act 2018 (Qld) (MERFP Act), for a company still undertaking mining operations.

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NSW mine rehabilitation animation

Partner, Peter Stokes, and Senior Associate, Claire Meiklejohn, advised NCZ over the course of this matter, including on NCZ’ initial application, its appeal against the decision, and subsequent negotiations.

This was a complex process, involving extensive engagement with independent experts with regards to the covers proposed to be on waste rock dumps and tailings storage facilities, and the suitability of the covers’ design having regard to a range of site-specific factors.

New Century Resources’ Managing Director, Patrick Walta commented: “The Department’s agreement to this ERC reduction is a significant achievement for the Company and a demonstration that our strategy of undertaking progressive mine rehabilitation during operations can deliver materially beneficial economic outcomes.

The ERC reduction will have the effect of lowering Century’s overall environmental liability. The Company is already planning its next submission and looks forward to making further reductions over the coming years as our economic rehabilitation activities progress.”

Peter Stokes commented: “We are delighted to have secured this significant reduction on behalf of NCZ and its shareholders. This result will impact many mining operations in Queensland, creating a precedent to argue a site-specific methodology in estimating rehabilitation costs.”

The reduction in the ERC is subject to approval by the Land Court, and will be put into effect by the scheme manager under the MERFP Act.

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