EMED Mining reports positive reviews for Rio Tinto copper project from regulators in Spain

EMED Mining (AIM: EMED) has reported further progress in securing the necessary regulatory approvals for the restart of its Rio Tinto copper mine (Proyecto Rio Tinto, PRT) in Spain, announcing the results of preliminary reviews conducted by two regulatory bodies, one of which prohibited any works on the mine site five years ago.

The Department of Culture & Heritage, which banned any activity at Rio Tinto in 2005, issued a positive evaluation for the company’s plans provided that the restart will allow for conservation of heritage items that depict the mining history at the site. Any extension of the open pit and waste dumps will require prior documentation of heritage items and authorisation by the department, which also said that parts of the disused gold processing plants should be preserved and a large scale model built and the dismantled Alfredo Mine should be reassembled and preserved.

The Water Authority of the Junta de Andalucía (the government of Andalucía province) concluded that the company's plans for PRT, when it is in operation, properly maintain it as a closed system with managed levels in each dam, controlled filtration ponds, emergency water control systems, corrective measures for run-off waters from the mine, waste dumps and process plant, including the treatment of waters contaminated by hydrocarbons.

The Department of Innovation and Industry will co-ordinate the overall process with the Department of Environment and take into account all required reviews such as those presented today.

“The preliminary conditions set by (the Department of Culture) reflect a pragmatic approach to seeking the right balance between heritage, environmental and operational agendas. The preliminary conditions set by the Water Authority seem straightforward and the recent exceptional heavy rainfalls at Rio Tinto serve to highlight the need for the site to be improved in several respects as soon as permitting allows,” said managing director of EMED Mining Harry Anagnostaras-Adams.

In the final quarter of 2009, the Andalucía government confirmed the process for permitting the start-up. The company also received expressions of support from the government, local municipalities and key labour unions. Additionally the copper price appeared positive during the quarter, at current prices projected net operating cash flow is estimated to average €67m per year under the current development plan.

Last month, Equity Development upped its valuation of EMED Mining (AIM: EMED) from 35 pence to 37 pence to reflect exchange rate movements, noting that the stock is lagging behind the growth witnessed in the rest of the sector, which has sharply rebounded from the lows reached in March 2009.

EMED plans to commence production from the Rio Tinto mine in 2011, having timetabled the regulatory and permitting process over the course of the next twelve months. Public consultations, further regulatory reviews and administrative approvals are expected to be completed from the second quarter of the 2010 calendar year onwards, while the company plans to seek shareholder approval and commence start-up activities at the mine through the third and fourth quarter of 2010.

In December, EMED raised £3.3 million through a placing to finance the permitting process in Spain as well as the mine-development planning and the exploration programme at its projects in Slovakia.