MAREEBA exploration company Republic Gold has hit a snag in its bid to establish a major tungsten mine on the Atherton Tableland with the rejection of its overtures for the old Mt Carbine mine. 

Republic notified the Australian Stock Exchange yesterday the option time on its offer to the Nicholson Group for the Mt Carbine mine assets had expired.

Mt Carbine owner Geoff Nicholson rejected the Republic offer of cash, shares and a royalty - an offer Republic said had a potential value of about $14 million.

While Republic is confident about the mineral quantities at its nearby Whumbal West deposit, the Mt Carbine reserves were regarded as the key to establishing a major tungsten mine in the Hodgkinson Basin.

Republic spent eight months and almost $500,000 on exploring, drilling, historic research and due diligence on the old mine under an exclusive option.

Republic managing director John Kelly said the company was "bitterly disappointed that a very generous offer was rejected".

"Given the technical risk associated with Mt Carbine, the board's technical, legal and financial advisers indicated that it was not in the best interests of shareholders for the company to increase its offer further by offering an excessive price," Mr Kelly said.

While saying Mr Nicholson had said the door was still open to further discussions, Republic would continue with other projects in Far North Queensland and NSW.

Mr Nicholson, who operates Mt Carbine Quarries, could not be contacted for comment yesterday.

The rejection of the Republic offer could carry some potential stumbling block for any other party interested in the Mt Carbine deposits.

In its stock exchange announcement, Mr Kelly said Republic had bought an "extensive amount of original data on the project", including many historic reports and hundreds of mine plans.