Rio Algom, Denison both sue over Elliot mine practices

Uranium miners Rio Algom (TSE) and Denison Mines (TSE) are suing each other over mining practices near the borders of their respective properties close to Elliot Lake, Ont. In two separate lawsuits, Rio Algom is accusing Denison of alleged breach of contract and trespass while Denison alleges that Rio Algom engaged in mining practices at its Quirke and Panel mines that led to unsafe mine conditions at Denison’s mine.

Neither company will comment on the lawsuits which were launched in the Supreme Court of Ontario and relate to Rio Algom’s Spanish American orebody.

However, in its statement of claim, Rio Algom is accusing Denison of building a tailings dam within the 2.5 sq. km Long Lake Basin that is too small to contain waste material from the Spanish American project. The site can handle only 9-11 million tonnes of tailings at the height prescribed under a 1969 agreement, not the 23 million tonnes that Rio Algom has the right to dump.

Denison built the dam on Rio Algom’s ground without the latter company’s prior knowledge or agreement, Rio Algom alleges.

In its own lawsuit, Denison alleges that Rio Algom mined ore from the north limb of its Quirke and Panel mines in such a way as to cause rock bursts, which in 1982 were measurable in Ottawa.

According to Denison, Rio Algom’s mining method caused so much regional instability that Denison was unable to mine certain sections of its own mine.

The Quirke and Panel mines are scheduled to close in mid-1991 due to a combination of low uranium prices and the expiration of long- term contracts with Ontario Hydro.