Tasmanian govt to help open two mines

A mothballed nickel mine in Tasmania is slated to re-open, thanks to a cash injection from the Tasmanian state government, which also granted a mining lease to an iron ore company hoping to move its project forward to production.

ABC News reports that Tasmania is willing to provide AUD$3.5 million in financial assistance to Avebury Nickel Mines Limited (ANML), which is trying to secure private investment to buy the Avebury nickel mine located on the west coast of Tasmania. The mine is currently owned by Minerals and Metal Group (MMG). It was put on care and maintenance in 2009 when the nickel price plummeted.

However Avebury Nickel Mines says it wants to see an improvement in the nickel price before it commits to an opening date. Nickel has slipped from just under $9 a pound a year ago, to $6.11/pound as of June 11th.

Meanwhile Tasmania has also given a mining lease to Forward Mining to start constructing a new iron ore mine in the northwest part of the island, located off Australia's south coast.

Resources Minister Paul Harris said the Rogetta iron ore project would push Tasmania's net commodity export volume of iron ore from around 2.8 million tonnes to 3.8 million, and provide 200 direct construction jobs and 100 more during the life of the project, ABC News reported.

According to Forward Mining, the iron ore would be extracted from a site southeast of Hampshire, and trucked to the Port of Burnie for export. The greenfield, open-cut magnetite mine would produce at a rate of 1 million tonnes per annum for a proposed life of seven years.

Both announcements are a relief to Tasmania's beleaguered mining sector, which has suffered a number of setbacks recently. Despite having one of the world's most highly mineralized regions, with over 560 operating leases and six major operating mines, including Australia's largest tin producer Renison, mine closures during the current downturn have cost the state hundreds of jobs.

Plans to revive iron ore mining have also run into opposition from environmentalists who claim that increased mine development will adversely affect the tasmanian devil – an endangered animal that has been nearly wiped out by the incurable devil facial tumor disease.

The deaths of three miners at the Mount Lyell copper mine in 2013 also cast a pall on the industry and raised questions about safety. The mine was shut down last year and is now under care and maintenance. The Henty gold mine is also slated to close next year. The two operations represent about 350 jobs.