Miner navigates hurdles as Mallee mineral sands mine advances to next phase

ASX-listed VHM Ltd is gearing up to begin construction of the mine later this year wanting to start digging up the valuable rare earths in 2025.

The freehold land has already been secured from four willing sellers for its initial Goshen mine which covers about 1534 hectares (3791 acres).

The entire project area covers about 8300ha (20,510 acres) about 20km south of Swan Hill.

VHM has also identified further mineral resource locations in the area which could extend the company's stay.

First is its flagship Goschen project which means 20-25 years of round-the-clock mining to open cut five million tonnes of mineral sands every year.

The public exhibition of its 4000-page Environmental Effects Statement was a major milestone for the project.

Public submissions officially closed on Wednesday despite failed calls to extend the deadline because of a delayed grain harvest.

The next steps are to test that document before an independent panel hearing comprising expert environmental planners Michael Kirsch, Elissa Bell and Colin McIntosh.

After that a positive ministerial assessment for Goschen would allow VHM to apply for its relevant permits and mining licence (already under way), so the company can make its final investment decision.

Then it needs to build its water pipeline 38km from Kangaroo Lake to the Cannie Ridge mine, build a generator-driven power station, upgrade some local roads and prepare its truck convoy route from the mine to the closest rail at Ultima.

A directions hearing on how the panel will begin the EES hearings will be held online in less than a month.

For there the public hearing has already been scheduled to begin on March 25 and possibly take three weeks given the expected number of submissions.

The panel is to provide its report to the government within 40 days after those hearings but there is no timeline on the government's final decision.

Local opposition to the mine project has grown since the EES was made public with the formation of the Mine Free Mallee Farms group.

VHM Ltd's chief executive officer Ron Douglas is holding an online shareholder briefing on the Goschen project's progress on Wednesday, January 31.

In VHM's annual report last year, chairman Don Runge said the EES addressed all identified environmental and community aspects with a view to minimise and avoid impacts where possible.

"This work involved engagement with the local community, and I'm pleased to report that existing relationships have been strengthened and increased in support for our submission," he said.

"The community recognises the lasting benefits that will be delivered for the district and is now expressing public support for the project."

VHM Ltd wants to start its mining operation from next year to collect mineral sands from about 20-30 metres below the fertile Cannie Ridge to supply overseas processors with the "big four" rare earths needed for renewable energy technology like wind turbines and electric vehicles.

One key matter to be debated over the next few months is whether the project "has the potential for a range of significant environmental effects", including the impact on existing land uses like grain growing.

Local farmers say the Cannie Ridge is some of the most fertile cropping country in the southern Mallee.

VHM's EES allows for an extra 25 per cent of crop yields from that choice country.

"Despite progressive rehabilitation and restoration of parts of the project land, the agricultural use may be impacted for approximately 25 years," its experts state.

But it is a key number in the report which many expect will sway the government's final decision.

"... the existing potential gross margin from growing winter cereal crops in the study area was calculated at up to $340,170 per annum (or $481,651 with a 25pc assumed yield increase for the Cannie Ridge).

"... it is estimated that the project would generate $2 billion in additional gross regional product for the Loddon-Mallee region, which equates to an average output of $206 million per annum."

Agriculture was said to be worth $284 million per year in the local Gannawarra Shire.

"While there would be loss of agricultural income during the life of the project, this loss would be considerably offset by the additional income streams and employment opportunities provided by the project," the EES states.