Successful Completion Of Water Rights Permitting In Montana

WHITE SULPHUR SPRINGS, MT - Sandfire Resources America Inc. reported the necessary permits to appropriate water for the Black Butte Copper Project have been issued by the State of Montana Department of Natural Resources and Conservation (DNRC). The permits issued by the DNRC authorize the Company to divert groundwater for use in the mining of the Johnny Lee copper deposit and to store high-water flows for stream flow maintenance. The DNRC also approved the Company’s change applications to use six existing water rights to mitigate surface water flow reductions resulting from the groundwater diversion. Water right permits and change applications are issued by the DNRC in accordance with the Montana Water Use Act (Title 85, chapter 2, MCA).

The Company, as the applicant, was required to prove the following criteria for issuance of the new water right permits. While the Company received objections to the water use permits and the mitigation changes, the Company was able to resolve all but one of the objections through negotiated settlements, which may not be challenged as agreed upon by the parties. The one remaining objection to the groundwater permit, which is pending before the Meagher County district court, relates to the DNRC’s interpretation of whether mine dewatering constitutes “waste” under the Montana Water Use Act.

Senior Vice President, Jerry Zieg, said, “We are extremely pleased with this positive progress. We have now obtained the water permits needed to begin Phase II Construction of the mining operations at the Johnny Lee Deposit. We are optimistic that the remaining objection to the groundwater permit will be resolved in our favor.”