Rio Tinto Moves to Fully Acquire ERA Amid Ranger Rehab Authority Uncertainty

Strong Financial Position Bolsters Rehabilitation Efforts

Energy Resources of Australia (ERA) closed the December 2024 quarter with a solid financial footing, reporting $331 million in cash and an additional $460 million in other financial assets. This liquidity follows the successful completion of an entitlement offer in November 2024, which raised approximately $766 million before costs. These funds are earmarked to cover the extensive rehabilitation work at the Ranger Project Area through to around the third quarter of 2027, as well as the costs associated with the entitlement offer itself.

The substantial capital injection provides ERA with a comfortable runway to continue its environmental obligations without immediate financial pressure, a critical factor given the complex and costly nature of mine site rehabilitation.

Rehabilitation Progress and Operational Highlights

During the quarter, ERA maintained its focus on progressive rehabilitation activities at the Ranger Project Area, incurring approximately $47 million in related expenditures. Notably, the capping of Pit 3, a key milestone in the rehabilitation timeline, advanced with the awarding of the contract to Q.H. & M. Birt Pty Ltd. The contractor mobilised to site and began installation of geofabric in December, marking tangible progress on this critical path activity.

Water treatment operations continued, utilizing existing brine concentrator and reverse osmosis plants. However, commissioning of the new Brine Squeezer has been deferred to the third quarter of 2025. ERA expects this delay to have no material impact on rehabilitation expenditure guidance through 2027, as ongoing studies will inform future process water treatment strategies.

Regulatory and Corporate Developments

ERA is actively negotiating a new Section 41 Authority under the Atomic Energy Act 1953 to extend its operational authority beyond the current January 2026 deadline. This extension is essential to allow sufficient time to complete rehabilitation activities and undertake long-term monitoring and maintenance. Discussions involve the Commonwealth Government, Northern Land Council, and Gundjeihmi Aboriginal Corporation representing the Mirarr Traditional Owners, reflecting the complex stakeholder environment surrounding the Ranger Project.

On the corporate front, Rio Tinto now holds over 98% of ERA’s shares following the entitlement offer and has announced plans to compulsorily acquire the remaining shares. This move signals Rio Tinto’s intent to consolidate control over ERA as it navigates the final stages of the Ranger rehabilitation.

Additionally, ERA reported no mining, production, or exploration expenditures during the quarter, consistent with its transition from active mining to rehabilitation. Leadership changes include the appointment of David Pritchard-Davies as CFO and Joint Company Secretary, succeeding Richard Prest, while CEO Brad Welsh’s role shifted from a Rio Tinto secondment to a consultancy arrangement.

Legal Proceedings and Future Outlook

ERA’s legal challenge concerning the non-renewal of the Jabiluka Mineral Lease remains ongoing, with the hearing rescheduled to commence in May 2025. This case adds an additional layer of complexity to ERA’s operational landscape, though it does not currently affect rehabilitation activities.

Looking ahead, ERA’s ability to secure regulatory approvals and maintain steady rehabilitation progress will be closely watched by investors and stakeholders. The company’s financial strength and Rio Tinto’s near-complete ownership position provide a stable platform for the challenging work ahead.