Whitehaven shares up on mine approval
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PERTH, Feb 12 AAP
February 12 2013, 6:50PM
Investors have backed Whitehaven Coal's controversial Maules mine project by pushing the miner's share price higher a day after it was granted federal environmental approval.
Whitehaven was 23 cents, or 7.8 per cent, higher at $3.19 on Tuesday, but had been as high as $3.29 during the trading session.
Federal Environment Minister Tony Burke on Monday gave conditional approval for Whitehaven's Maules Creek mine proposal and Idemitsu's neighbouring Boggabri mine expansion in north west NSW.
Mr Burke's green light came just several days after he said a decision on environmental approval had been delayed to April 30.
However, the approval remains subject to strict conditions requiring wildlife corridors, limits on the clearance of native vegetation and a $2.5 million investment in rehabilitation research for threatened species.
At a Senate hearing on Tuesday it emerged the Department of Environment was aware Whitehaven had been accused of providing misleading information in its mine application and that it plans to investigate the claims.
The company's shares plunged last week when Mr Burke said he had delayed his decision on Maules Creek, reaching a low of $2.96.
Analysts expect the conditions on the environmental approval to be met and construction work to begin as soon as possible.
CommSec market analyst Juliette Saly said the federal government's conditional approval had been a strong boost for the stock.
"It does look like they are satisfied that the project isn't going to have too many unacceptable environmental impacts," Mr Saly said.
"Of course, it's just the first hurdle but it's a strong win for Whitehaven."
Maules Creek is expected to produce 10.8 million tonnes of a coal a year (Mtpa) of thermal and coking coal.
Community and environmental activists fear the project threatens koala habitats, thousands of hectares of old-growth forest and will force farmers off their land through soil and water damage.
Patersons analyst Andrew Harrington said he expects production to begin at Maules Creek in about 15 months.
"Whitehaven is the standout of the ASX-listed coal producers because it has the most production growth, has all rail and port allocations for its expansions, and has all its funding for these expansions," Mr Harrington said.
The upcoming half yearly result should not detract from the company's prospects of running several profitable, long-life mines, he said.
At the Senate hearing on Tuesday, Australian Greens senator Larissa Waters asked if the department was aware of allegations around Whitehaven's pledge to conserve thousands of hectares of forests and natural habitat in exchange for mining rights.
Experts commissioned by the Maules Creek community claim the trees proposed in the company's "offset package" are unsuitable as an ecological replacement for those under threat by the project.
Whitehaven has until December 30 to submit its offset package to the minister for approval, before which the project cannot progress.
Mr Burke has ordered Whitehaven's proposed offset package to be independently audited before he gives final approval.