Widespread Energy posts loss

Widespread Energy Ltd today reported an interim loss of $29,000 and said a delay in granting it a permit for a marine mineral resource was a huge opportunity cost for New Zealand.

The loss in the six months to September 30 compared to a loss of $78,000 in the same period last year.

Widespread Energy has no sources of income, apart from interest bearing cash deposits, so a trading loss is also anticipated for the year to March 31, 2010.

The company continues to invest in a Chatham Rise rock phosphate project and in work programmes for our two directly held petroleum exploration permits.

In August 2007 a consortium in which Widespread Energy has a 90 percent share applied for an offshore prospecting permit covering 3048sq km on the central Chatham Rise 600km east of Christchurch.

"At the time of writing the licence grant process, which has already taken over 26 months compared with the norm of six weeks to three months, is stalled as Crown Minerals officials attempt to use our licence application as a test case to rewrite the law and practice relating to the grant of mineral prospecting licences," managing director Chris Castle said.

The opportunity cost to the New Zealand economy of this "flat-earth-society approach being taken by Crown Minerals" was huge, he said.

Increases in the market value of rock phosphate made exploitation of marine mineral deposits more likely to be feasible.

"At present virtually all of the rock phosphate used by the New Zealand fertiliser industry is imported from Morocco, with rapidly increasing transport costs arising from oil price increases adding to the local landed costs of this product," he said.

Published reports arising from the 1980s exploration programmes indicated that the phosphorite resource may exceed 100 million tonnes.

NZPA