Cape Alumina: Queensland's Wild River Move Threatens Bauxite Project

CANBERRA, June 3 -- A decision Friday to declare the Wenlock River basin as a Wild River by Australia's Queensland state government will jeopardize the economic viability of a proposed bauxite mine and port in the area, Cape Alumina Ltd. (CBX.AU) said Friday.

The viability of the company's Pisolite Hills project on Cape York Peninsula will now be reviewed and avenues for administrative appeal and compensation explored as a result of the decision that puts the forecast A$1.2 billion boost to gross domestic product and the creation of 1,700 jobs at significant risk, the company reported.

Work on an environmental impact statement, a bankable feasibility study and an indigenous land use agreement with the traditional owners of the project area, about 50 kilometers northeast of Weipa, one of Australia's premier bauxite provinces, have been put on hold pending completion of the review, the company said in a statement.

Earlier Friday, Queensland state's Natural Resources, Mines and Energy Minister Stephen Robertson declared the Wenlock River a Wild River, which means the near pristine river will be preserved.