Alliance Resources (ASX: AGS) disclosed on Monday that it has settled its legal dispute with venture partner, Heathgate, paving the way for the fifth uranium mine in Australia.

The Four Mile project initially targeted to start production in April 2011 after it won a clearance in July 2010 from then federal Environment Minister Peter Garrett. It is forecast to have an annual output of 1,400 tonnes of uranium and would cost the partnership $210 million to develop.

It is located four miles from Heathgate's existing Beverly mine and would be the 10th largest uranium mine in the world. The resolution of the legal issue came at a time that Australia is considering lifting the ban of uranium export to India.

Australia's fourth uranium mine, the Honeymoon project also in South Australia, was recently approved. It is a joint venture between Uranium One of Canada which owns a 51 per cent stake and Mitsui of Japan which holds a 49 per cent stake.

Alliance Resources Managing Director Steve Johnston did not disclose the terms of settlement with its partner, but news of the settlement led to a 77 per cent share price gain to 24 cents on Alliance's shares on Monday.

The legal dispute was over a native title mining arrangement. Following the adjournment by the South Australian Supreme Court of the case to allow a settlement, Alliance said it would register the native title mining agreement.

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