The federal government has refused to allow CI Resources to undertake drilling for phosphate on a 6.8-hectare patch of Christmas Island.

Environment minister Josh Frydenberg said the government decided not to approve the exploration program because it was likely to have “significant and unacceptable impacts” on the island.

“Environmental damage on small islands has a far greater impact because of its limited capacity to recover from declines in biodiversity caused by the cumulative effects of land clearing, habitat fragmentation and invasive species compared to large land masses,” Mr Frydenberg said.

The government is concerned the clearing of land will impact endangered species like the Abbott’s Booby, whose rainforest home on the island is the only remaining nesting habitat for this bird in the world, and the cave fern.

“There is also a very real threat that this pattern of clearing would allow the introduction of aggressive weed species with the capacity to overwhelm native vegetation and to alter the structure of the surrounding forest,” Mr Frydenberg noted.

CI Resources (ASX:CII) shares over the past year.
CI Resources (ASX:CII) shares over the past year.

CI Resources has been trying to gain access to an extra 130 hectares of unallocated crown land on Christmas Island to extend its mining operations from the mid-2020s to the early 2030s.

The company operates under mining leases for the salvage of stockpiles and secondary in situ recovery over previously mined and cleared ground.

The leases were granted under West Australian legislation that runs until 2034 and provides CI Resources with access to some 1040 hectares.

Christmas Island sits between Western Australia and Indonesia.

“While the decision is regrettable, the board confirms that the anticipated life of the existing approved mining operations remains unchanged from the previous market update issued in July 2017,” CI Resources told investors.

CI Resources began looking for new opportunities in November last year as a result of the environmental opposition.

The company is considering phosphate mining in Africa, biological fertiliser opportunities in Australia and New Zealand and property and tourism developments on Christmas Island.