Allied's claim against GR spikes to $47m

Allied Gold has revealed that its claim against GR Engineering Services is actually for $47 million, up from the figure of $25 million disclosed in June by the engineering contractor.

The legal dispute originated from a $4.5 million claim against Allied by GR, over an unpaid design and construct deal at the Gold Ridge mine in the Solomon Islands.

Allied launched a counter-claim in October last year, seeking damages relating to alleged defects in work performed under the contract.

Allied said today the claim comprised $4 million in rectification costs, $1.15 million in compensation for false and misleading statements by GR Engineering managing director Joe Ricciardo, $24.9 million to account for loss of gold production and $17.1 million in compensation for losses associated with work carried out by GR that Allied claimed was defective.

GR has previously said the allegations are inconsistent with previous announcements made by Allied in relation to the performance of the Gold Ridge plant.

GR Engineering stocks were down 2 per cent, at 97.5 cents at close of trade today.

Arbitration between the two companies is scheduled to proceed to trial in November.