Environmental groups are threatening legal action to stop the development of what could be Western Australia’s first uranium mine after state regulators endorsed its progress.

Perth-based Vimy Resources is planning to advance its $393 million Mulga Rock project, Australia’s third-largest undeveloped uranium site.

The site, located 290 kilometres north-east of Kalgoorlie, is known to contain 76.8 million pounds of uranium in four deposits, which Vimy intends to extract using shallow open-pit methods.

Vimy was granted state environmental approval for the project in 2016 and had been required by Thursday to demonstrate it had substantially commenced the proposal.

A spokesperson for the Department of Water and Environmental Regulation said the agency had reviewed evidence supplied by Vimy and determined the proposal had substantially commenced as required under the approval.

Vimy chief executive Steven Michael welcomed the confirmation, saying the project would bring substantial benefits to the state.

“Vimy can now advance Mulga Rock to the next stage of development and will continue to work closely with state and federal departments to secure the remaining approvals required to bring the project into production by 2025,” he said in a statement to the ASX.

But the Conservation Council of WA and Australian Conservation Foundation hit back, saying they would explore all available options to stop the mine from going ahead.

“Vimy’s works to date have been a clumsy last-minute attempt to hold on to controversial environmental approvals for a toxic commodity that has no social licence,” CCWA campaigner Mia Pepper said in a statement.

“We are shocked that the department has set this dangerous precedent, putting unnecessary pressure on the environment and communities.”

The Upurli Upurli Nguratja registered native title group say Vimy has not met with traditional owners and the project is proceeding without their consent.

“It’s very clear that as a native title group we don’t want uranium mining on our country,” Upurli Upurli Nguratja claimant Debbie Carmody said.

“This decision has sidelined our voice and undermined the native title process.”

A final investment decision on the project is not due until next year.

Environmentalists say the proposed mine is unacceptably close to where the rare sandhill dunnart marsupial has so far managed to survive despite the encroachment of livestock and predation by introduced foxes and cats.

The McGowan Labor government banned uranium mining in 2017 but it does not apply to projects which had already been approved.

-AAP