The Group has a 1% life of mine NSR royalty on the Four Mile uranium mine in South Australia. Four Mile is operated by Quasar Resources Pty Ltd (‘Quasar’).
The Group did not receive any income from its Four Mile royalty in 2017 compared to the £0.3m it received during 2016. This is due to the ongoing dispute with the operator over how the royalty should be calculated. Quasar continues to treat the contract, in our view, as akin to a profit interest, whereas the Group remain of the view that this is an NSR and that refining or processing costs should not be taken into account.
We have engaged with senior counsel lawyers and experts in Australia to build a case file and, once complete, we will be seeking to escalate the matter through the judicial system in South Australia.
We remain confident of being successful in this process.