THE OPERATOR of the Territory's only uranium mine has reported a net loss of $154 million for 2011, pointing to a temporary production halt and a revaluing of stockpiled ore for the result.

ERA had to stop processing uranium at Ranger mine in January last year during the third biggest wet season rains on record.

The processing plant was shut for four and a half months, damaging profits as the company had to buy 2126 tonnes of uranium oxide to meet its sales contracts.

This also resulted in a reduction in royalties to $16 million, down from $26 million in 2010, as the fee is not paid on purchased ore.

In its annual report, released today, the company also pointed to an unfavourable valuation of its stockpiled ore, which resulted in $99 million being wiped off the year's result.

"ERA experienced very significant operational challenges in 2011, which had a major negative effect on the company's performance," wrote chief executive Rob Atkinson.

But there was a silver lining on the year for the embattled miner.

A successful $500 million capital raising has ensured funding for the construction of the Ranger 3 Deeps exploration tunnel and other exploration studies.

Work on the $120 million decline will begin this year.

The development of the Ranger 3 Deeps resource is necessary to ensure continued mining as Rangers ore reserves are depleted.

The report revealed reserves declined by 16,364 tonnes to leave just 13,484 tonnes of uranium oxide - including the stockpiles.

The company is in the middle of negotiating a new mining agreement with the Gundjeihmi Aboriginal Corporation who represent the Mirarr traditional owners.

While the Mirarr have long opposed further mine development, moves this month have shown relations are starting to thaw.

The company has said it will not mine Ranger 3 Deeps without their approval.