A pumped hydro energy storage project in the Adelaide Hills has stalled, mine operator Hillgrove Resources has revealed.
The company had been due to hand part of its Kanmantoo mine over to energy company AGL, but pushed back the handover date after discovering more copper ore nearby.
The ore could only be accessed via tunnels from the bottom of the mine's giant pit, which would become impossible when AGL filled the pit with water for its hydro-electric project.
The delay was warranted because drilling to the north and south of the pit had returned "highly promising" results, managing director Lachlan Wallace said in a statement.
"Discussions with AGL to develop a mining window are ongoing," he said.
The delay meant Hillgrove had to forego a scheduled $4 million payment from AGL, at least for now.
The deal, struck last April, is worth a total of $31 million to Hillgrove Resources.
AGL plans to store water in a dam at the mine site, allow it to flow down into the pit to generate electricity when power prices are high, then pump it back up when prices are low.
The facility would perform the same function as a battery: providing extra power to stabilise the energy network at short notice.