Moreton Resources is preparing to restart a Queensland silver project that has been idle for three years amid contamination concerns.
Moreton (ASX:MRV) told investors on Friday its Granite Belt project — a 1100 sq km portfolio of tenements near the town of Texas in south-east Queensland — would restart within a month.
Moreton’s shares climbed 8 per cent to 1.4c on Friday — their highest point in the past year.
The site has been idle since 2014 when it was abandoned after the failure of its last operator Alcyone Resources.
At the time, ABC’s 7.30 program reported local fears that abandoned storage ponds containing water contaminated with heavy metals and cyanide could spill over creating an “environmental catastrophe” for nearby farms and the Murray Darling Basin.
Cyanide is used in the mining process to separate silver particles from ore in four large processing ponds near the site’s Twin Hills mine. Issues were raised about contamination of the Murray Darling water basin from mine runoff.
“The company will ensure from today, that all environmental compliance activities are undertaken and that the site is operated and maintained in an appropriate fashion, consistent with public expectations to ensure confidence that the restart of the project, is a safe and viable prospect for the company not only now, but to the end of the 20-year mining operations projected,” Moreton told investors.
Moreton hopes to pick up where the previous owner left off, with estimates there could be significant quantities of metal waiting in the ponds. They hope to have silver concentrate production under way in 30 days.
Moreton anticipates silver production of about 90,000 oz a month from January.
The site’s tenements high-grade silver and copper as well as early indications of gold, lead and zinc, Moreton reports.
“Moreton has committed to advancing the exploration and potential development of additional deposits and prospects within the broader Granite Belt Project.
“The company enjoys a significant landholding with secure tenure, and as part of the acquisition that was finalised in June 2016, gained access to geological reports dating back to the 1950s that contain valuable data that is currently being collated and reassessed.
“These activities, along with further exploration work on the project, are expected to drive significant news flow in the months ahead.”
Moreton Resources has projects scattered across Queensland, mostly related to coal, with the exception of the Texas mine which was acquired in early 2016.
Moreton reported a loss of $1.7 million last year and had $2.6 million in the bank at the end of June.