Mining suspended at Ranger after radioactive spill

Uranium processing at Energy Resources of Australia's Ranger mine will not be allowed to restart until federal agencies are satisfied it is safe, after Industry Minister Ian Macfarlane imposed a formal suspension on the controversial mine.

Mr Macfarlane's move came after a briefing with ERA's new chief executive, Andrea Sutton, where the pair discussed Saturday's leak of radioactive uranium particles and industrial acids from a leaching tank at the mine.

ERA shares had already sunk more than 12 per cent on Monday before Mr Macfarlane clarified his stance in a statement.

"I have told ERA that they cannot resume processing at Ranger until the company demonstrates the integrity of the processing plant to the satisfaction of the regulatory authorities," he said.

"ERA must also demonstrate that Kakadu National Park and human safety remain protected.

"I understand the concerns of traditional owners and local residents and can assure them that governments will continue to ensure the mine operates to the highest standards."

The Northern Territory arm of Worksafe is understood to be launching an investigation into the incident, and a co-operative taskforce has been set up between the federal and territory agencies that are investigating the spill.

ERA, majority-owned by Rio Tinto, had already indicated that processing would be stopped for an indefinite length of time, but was it was not previously known that a restart would be at the pleasure of regulators.

ERA said the halt would not affect production guidance for 2013, but it was unclear whether it would persist long enough to affect production guidance for 2014.

In 2011 an extended production break forced ERA to buy uranium on the open market to satisfy its supply contracts with international nuclear power entities.

Saturday's incident prompted a sell-down of ERA shares, with the stock closing 16.5¢ lower at $1.135 on Monday. The stock has traded around $1.30 for the past five to six weeks, but is now fetching its lowest share price since June.

There has so far been no evidence to challenge ERA's original claim that the spill had been contained without spilling into the nearby Kakadu National Park.

But the incident may yet prove to be a breach of strict operating conditions that are imposed on the mine. Even if Kakadu is not harmed, the incident may hurt ERA, given it has shaken the confidence of an indigenous group whose will must be obtained before mining can be restarted at Ranger as an underground operation.