THE CORK in Alkane Resources’ bottle of champagne has not been popped despite yesterday’s announcement by the state government that it has approved the company’s Tomingley Gold Project (TGP), 50 kilometres south-west of Dubbo.
Managing director Ian Chalmers is waiting for the issuing of a mining lease before contemplating opening the bottle that has been on ice for more than a decade.
The government’s green light did not negate the need for the company to show authorities how it would comply with development conditions, he said.
By the end of the month he imagines the “final step” in the approval process will have been completed.
But even then, the champagne might not be flowing.
Much work lies ahead to get the TGP up and running, including the installation of a 46-kilometre water supply pipeline, and the building of an on-site electricity substation and a haulage road underpass at the Newell Highway.
“Having state government approval means we’re 99.9 per cent of the way there,” Mr Chalmers said yesterday from Alkane Resources’ headquarters in Perth.
“I am happy now but in 12 months’ time when we’re producing gold I will be really happy.”
The contained reaction is in keeping with the company’s cautious yet courageous quest to get back to gold mining in the region.
Production at its Peak Hill operation shut down about six years ago. Five years earlier the company had begun poking the ground at Tomingley where $25 million has
been spent in the pursuit of gold.
Alkane regards the TGP as a “bread and butter” project which will help it eventually get the ambitious and grand Dubbo Zirconia Project (DZP) over the line.
The environmental impact statement for the DZP is set to be lodged later this year.
Alkane Resources waited about 15 months for yesterday’s announcement, despite public exhibition of the TGP resulting in just eight submissions and “no public objections”.
The small number of submissions meant the project could be determined by the NSW Department of Planning and Infrastructure under delegation, reported its deputy director-general Richard Pearson.
“All the issues raised in the submissions have been addressed through the assessment process including surface and groundwater impacts, management of hazardous materials, ecological impacts, traffic impacts, air quality and noise,” he said.
The TGP will involve open-pit and potentially underground mining, offering up to 250 jobs in the construction phase and 100 permanent jobs in the operational phase, expected to start in the second half of next year and last a decade. Estimated capital costs are $107 million for the project based on a resource of 812,000 ounces of gold.
Alkane Resources expects the TGP to generate a cash flow of up to $30 million a year.
Dubbo MP Troy Grant yesterday called the project a “huge vote of confidence in the strength of our resources sector”.
“I welcome the economic benefits that will flow to our region from such a significant investment,” he said.
NSW Resources Minister Chris Hartcher noted that mining royalties “pay for our nurses, our police and our teachers”.
“We welcome the jobs and investment that the mining industry offers NSW as part of the economic revival the O’Farrell government was elected to deliver,” he said.