As Kidman Resources’ securities resumed trading today, i.e. 17 September 2018, it plunged 15.02% on the bad news of Warden court’s refusal to exemption of tenements.
The long awaited decision from the Perth Mining Warden has been finally released today by the company. After pressing the pause button on 12 September 2018, the lithium miner today announced that the application for exemption from minimum obligation on tenements expenditure at Mt Holland Project has been refused by the Warden in recommendation to Minister.
But the company disagrees with their recommendation and so does the Minister for Mines and Petroleum, Western Australia. As notwithstanding the Warden’s recommendation, Minister has the discretion to grant certificates of exemption to Kidman and its subsidiaries in relation to 13 tenements for the period of August 2014 to March 2016.
The company therefore is underway preparing submissions to the Minister outlining why the certificates of exemption should be granted. Now, it all depends on the Minister and if the Minister grants the exemptions subsequent Kidman’s submissions, the forfeiture applications will be unsuccessful and Kidman and SQM will continue to develop the Mt Holland Lithium Project.
Kidman also indicated that the Warden’s valuation about expenditure shortfall by previous owner on concerning group of tenements was just $ 102,771, and this is not of great significance against the opportunity offered by Mt Holland Project, which has a strategic importance. Mt Holland project is a lithium and gold exploration and development joint venture between Kidman and SQM, for equal ownership. As per the company’s information, up till now more than $55 million has been invested in the project. Since the project is of state importance, it has been granted Lead Agency Status. Patricio de Solminihac, CEO of SQM, has stated: “SQM and Kidman consider that the development of the Mt Holland mine and concentrator and Kwinana refinery is clearly in the interests of Western Australia and believe that the decision on the exemption will be positive to continue to develop the project as planned.” It is worth noting that the Definitive Feasibility Study on mine and concentrator has been prepared for while outcome of the Prefeasibility Study will be released soon.
At the moment, the company aims to defend the decision in all possible ways even if the Minister intends to now follow Warden’s recommendation. The Minister though has the ultimate decision making power, Kidman is on its foot to prepare the justifications to support disagreements with the latest decision.
With this update, KDR is trading at $1.075 on 17 September 2018 (as at 12:32 PM AEST). The stock has seen a daily price change of -15.027% and a performance change of +52.41% over the past one year. The stock also saw a spark in its movement by about 34% in the past five trading days before being placed in a halt late last week. Meanwhile, the group also informed the market about change in its registered office.
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