Does This Company Deserve Another Chance?


Last week’s announcement that Marathon Resources Ltd has been granted another 12 month licence to continue exploration for uranium in the Arkaroola Wilderness Sanctuary has shocked and surprised many South Australians. But the controversial decision is already generating capital for the troubled company. 

It comes only three years after the Rann government suspended Marathon’s exploration drilling at Mt Gee indefinitely in February 2008 for burying unauthorised waste on the site in plastic and calico bags. The waste included unauthorised drilling sample material and other non-radioactive waste, and had been buried shallowly at three separate sites.

Arkaroola is 600 square kilometres of extraordinary, arid rugged mountain country, a stunning landscape characterised by sweeping ochre hills and renowned for its diversity of desert flora and fauna. The pastoral lease was purchased by the parents of the current owners in 1967. Geologist Reg Sprigg was a student of Douglas Mawson in the 1940s, and was inspired by his appraisal of the landscape as precious and beautiful; Mawson called mineral-rich Mt Gee a "crystal candy mountain".

After lobbying for national park status failed, the Spriggs bought the land to run as a low-impact ecotourist venture and wilderness sanctuary. Efforts to rehabilitate the land from the impacts of previous use as a sheep station, such as controlling of feral animal populations, have been successful and the area is still being surveyed for new species; it is home to a significant population of the rare, endangered Yellow-Footed Rock Wallaby. The eco-tourist venture has won multiple awards.

The current owners of the wilderness sanctuary at Arkaroola last week expressed disappointment they were not informed of the move to renew the exploration licence.

Just days later, on 14 February, Marathon announced that Talbot Resources was selling its 17 per cent share in the company, prompted by the spike in value which resulted from the licence renewal. The buyer has not been disclosed. Talbot Industries was owned by Ken Talbot who died in a plane crash in the Congo last year. Now the company is offering shareholders a 10 per cent rights issue to raise $4.4 million to fund the continued exploration and testing of materials, and revealed it is also searching for lucrative rare earths in the Arkaroola/Mt Gee region.

Opposition to the Mt Gee mine proposal comes from all sides except Labor, with the Greens and the Liberals, particularly Nick Minchin, pledging their support for Arkaroola’s protection. Even Adelaide’s conservative Sunday Mail ran a cover story about the mine and an editorial against it. But Labor is sticking to its pro-mining stance.

Consultation about the mine has been fraught. In October 2010 the SA government’s consultation document Seeking a Balance (pdf) was shelved after months of inaction. Submissions were 82 per cent against the mine, and the document has disappeared into a bureaucratic vortex.

A number of prominent ALP members have connections to the mining company. Former Labor senator John Quirke is a registered lobbyist for Marathon, while another former Labor senator Chris Schacht is a company director. Labor powerbroker and union heavyweight Paul Howes has also lent his support to mining in Arkaroola.

So is the party too close to Marathon for comfort?

Greens MLC Mark Parnell thinks so. He told Adelaide Now in December that the project was being pushed by "a conga-line of Labor luminaries". "The only reason it is still alive is due to powerful and influential lobbying by ALP mates," he said. "Governments should make decisions on the basis of sound advice, not the sound of highly paid lobbyists whispering in their ears."

The decision to award Marathon another exploration licence comes on the heels of another decision last year to expand the nearby Beverly Uranium Mine. This pressure to expand is coming from international buyers. Federal Resources Minister Martin Ferguson’s enthusiasm for expanding the industry is proven, with public support for exporting uranium to India. The US, which has long worked out its own deposits, is our biggest uranium customer.

Now the Federal Government looks set to sign a 30 year trade deal (pdf) with the US which would lock us into a new generation of uranium mines. Agreement passed through the Joint Standing Committee on Treaties last week and will soon be brought before parliament.

Although it has stringent conditions in line with the non-proliferation of nuclear weapons, the 30 year deal cannot be re-negotiated and cannot guarantee the safety of mining operations.

Senator Scott Ludlam told Parliament last week that the nuclear industry is the "most volatile and dangerous of industries … Even if every kilogram goes exclusively into civil nuclear energy in the US there are very serious problems in tying ourselves to this industry."

Doubts about the industry’s safety were heightened recently after a Comcare investigation found serious safety breaches at Lucas Heights, Australia’s only reactor. Such doubts run deep and nuclear lobbyists are having to work hard to convince the community of the value of this industry.

"There are no second chances with this unforgiving technology … this is an industry that we should be getting out of, rather than getting ourselves further into," Ludlam told Parliament.

Uranium mines risk seeping radioactive material into groundwater as heavy rainfall can lead to material escaping from containment sumps.

In 2009 a government scientist confirmed the Ranger uranium mine in Kakadu National Park was leaking 100,000 litres of contaminated water into the ground beneath the park on a daily basis, just the latest in a long series of safety breaches at Ranger.

Beverley and Olympic Dam have also been prone to spills, with a leak of 62,000 litres of radioactive fluid at Beverley mine in 2002, followed by a separate leak of 6000 litres of a uranium-bearing brine solution, and a leak at Olympic Dam in South Australia which released more than 420,000 litres of uranium mining slurry, also in 2002.

Arkaroola Sanctuary sits on top of the Artesian Basin which supplies much of SA and the NT with water. A leak of that scale could be catastrophic for residents and the pastoral industry.

Any semblance of trust has broken down between the company and the sanctuary’s owners.

Owner Marg Sprigg said in a press release, "We don’t believe a company like Marathon should be allowed back in here. They want to do a lot more drilling in a much wider area than just around Mt Gee; they will be drilling into the very heart of Arkaroola."

Relations are so bad that Marathon has been flying workers in by helicopter from a neighbouring property rather than paying for them to stay in Arkaroola village.

New South Australian Mineral Resources Development Minister Tom Koutsantonis said the government was considering a range of conservation options "which may include exclusion, or limiting of mining". But the minister refused to say whether those options include National Park status.

The SA tourism industry has also been a vocal opponent of the mine. SATIC Chief Executive Ward Tilbrook says any mining activity in the Arkaroola Wilderness Sanctuary will damage the image of South Australia as a world-class eco-tourism destination.

"While mining is a finite resource, tourists are an infinite sustainable resource for the State creating 53,000 jobs in South Australia and an economic impact of $4.4 billion" he said.

The submission to the Seeking a Balance report by Ivor Ries of EC Baillieu Stockbrokers said "We estimate that the Greater Mt Gee project would pay approximately $2.1 billion in income taxes and royalties during the first decade of production."

Like the crystal mountains of Arkaroola, that gain is finite and non-renewable.

It is clear something does not add up about the SA government’s renewal of the exploration licence. The question remains whether public opinion can change the direction of a state government which seems determined to ignore it.


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