Wednesday, 23 May, 2007

by Lindsay Murdoch and Barry Fitzgerald
Sydney Morning Herald

RIO TINTO's hard sell this week on its rising hopes for a near- term clearance from the Mirarr people to develop the $50 billion Jabiluka uranium deposit in the Northern Territory has backfired on the mining giant.

The Mirarr continue to say no, despite the the multimillion-dollar royalty stream Jabiluka's development would secure them.

Rio wants to cash in on the uranium boom by developing Jabiluka, and its group's energy chief executive, Preston Chiaro, told the market earlier this week there were good reasons to believe that the leader of the Mirarr, Yvonne Margarula, would say "yes" in the near term.

But Ms Margarula's OK is not forthcoming. The Gundjeihmi Aboriginal Corporation, which represents the Mirarr people, made clear last night that their opposition to reopening Jabiluka was unchanged.

The corporation will today release a statement saying the Mirarr people are "extremely distressed" at the interpretation that Rio has put on their relations with ERA, the Rio subsidiary that owns Jabiluka and the nearby Ranger uranium mine.

Rio's comments are "injurious" of the relationship, the statement will say. It will also say that the Mirarr people are disappointed Jabiluka has become the subject of renewed public speculation.

Should the statement also confirm the Mirarr's continuing objections to the development of Jabiluka, Rio could be forced to backtrack on uranium production projections it made in the presentation to London investors on Monday. Rio shares closed up 31c yesterday at $92.60.