EMED receives regulatory clarification over Rio Tinto copper mine

Copper and gold miner EMED Mining (LON:EMED) has announced that its wholly owned subsidiary EMED Tartessus has received formal clarification from the Department of Industry of Andalucía of certain regulatory administrative matters which were previously reported as outstanding.
These matters included the care and maintenance obligations in relation to the tailings dams and confirmation that all landowners need to provide environmental rehabilitation plans and undertake to provide the requisite bonding, as has been done by EMED Tartessus. The authorities have also advised that the public risk insurance coverage for the tailings dams should be for €180 million and be arranged by each landowner proportionally to their ownership.
The estimated annual insurance cost is included in the projected cash flows previously announced by EMED Mining.

The company is currently seeking a negotiated agreement with the two other part-owners of the tailings dams. Spanish law facilitates compulsory acquisition of the subject lands as a last resort and the relevant independent valuations for such acquisition have been carried out to provide further clarification.

“These regulatory confirmations are another step forward in setting up the arrangements between all stakeholders for the restart of the Rio Tinto Mine and we appreciate the clarifications made by the Andalucian authorities,” said managing director Harry Anagnostaras-Adams.
Broker Fairfax featured EMED in its 'Daily Morning Report', saying "That the government is requiring that the land holders have obligations that entail costs could accelerate the process of negotiations for EMED to acquire the entire land package as the other land owners are unlikely to want to start paying and may seek a more rapid exit."
The most important developments achieved during the past quarter included the submission of all relevant reports for the permission to commence production in 2011 and the receipt of authorization to connect the mine to the national power grid.
The project’s updated financial model calls for an increase in production to 9 Mtpa (million tonnes per annum) in two years, estimating the ore reserve at 123 Mt at 0.48% copper for 585,000 tonnes contained with contained copper in concentrate averaging 37,000 tonnes per annum.
Drilling programs have been planned along with project engineering to maximise the value, while also stating there was “significant potential” to expand the life of mine and annual production.
Meanwhile, EMED is continuing discussions with potential customers of the Rio Tinto Mine product and financiers, while preparing to dual-list on the Toronto Stock Exchange (TSX).
The company also has a gold project in Slovakia, Biely Vrch, where the regulators have recently approved the mineral resource estimate totalling 1.1 Moz (million ounces) of gold, marking the first statutory step in the permitting process.