Rio Tinto subsidiary to offer $100m loan to Energy Resources of Australia

28 April 2016 (Last Updated April 28th, 2016 18:30)

Rio Tinto subsidiary North Limited has entered an agreement to provide a loan of up to $100m to Energy Resources of Australia (ERA) to support cleaning the Ranger Project Area.

Rio Tinto subsidiary North Limited has entered an agreement to provide a loan of up to $100m to Energy Resources of Australia (ERA) to support cleaning the Ranger Project Area.

Currently, rehabilitation of the Ranger Project Area uranium mine has to be completed by 2026.

As of 31 December 2015, ERA had $433m in total cash resources and a rehabilitation provision of $509m.

"Rehabilitation of the Ranger Project Area uranium mine has to be completed by 2026."

ERA stated that it would have sufficient financial resources to fully fund its rehabilitation programme, according to its cash position and after considering the expected years of future production.

However, should anything go wrong, and in the absence of any other developments or asset sales, ERA would then use the credit facility.

The arrangement offers additional assurance to the ERA's stakeholders that rehabilitation of the Ranger Project Area can be fully funded in a range of business scenarios.

ERA stated that it is compatible with a range of strategic options and can be terminated at any time. Rio Tinto holds 69% stake in ERA.