Junior miners settle $26m JV dispute

A dispute involving junior miners over a $26 million joint venture deal with Wesfarmers Chemicals has been settled for more than $6 million.

Last month, Perth-based Ora Banda Mining and its subsidiary, Carnegie Gold, lodged a writ in the Supreme Court of Western Australia, naming Ian Gandel's Riverina Resources and West Perth junior miner Greenstone Resources as defendants.

Ora Banda and Greenstone Resources today released statements to the market, announcing the court dispute had been resolved through a $6.4 million settlement.

The parties will sign a settlement deed to resolve all claims relating to the Supreme Court proceedings, the companies said on the ASX.

The settlement payable to Greenstone and Victoria-based Riverina comprises a $3.4 million cash payment and $3 million in Ora Banda shares.

In the writ, Ora Banda alleged Riverina and Greenstone unreasonably withheld their consent as third parties to the Davyhurst tenements west of Kalgoorlie.

The tenements were subject to a $26 million joint venture between Ora Banda and Wesfarmers Chemicals.

Under a 2007 sale agreement, Riverina and Greenstone sold the Davyhurst tenements to Ora Banda and Carnegie but still keep the rights to mine and treat nickel ore on site.

According to the Supreme Court writ, no party could transfer or dispose its rights over the tenements without written consent of the other parties involved.

Ora Banda and Carnegie entered an agreement with Brenahan Exploration and Australian Light Minerals, companies in the Wesfarmers Chemicals, Energy and Fertilisers division (WesCEF), over the Davyhurst tenement package in October 2023.

Under the agreement, Ora Banda will sell 65 per cent of its mineral rights on the Davyhurst tenements for $26 million cash consideration and 2 per cent royalty but subject to conditions including obtaining third-party consents by April 30 2024.

Ora Banda alleged, in the writ, that Riverina and Greenstone did not provide their consent within a reasonable time.

In the ASX statements published by Ora Banda and Greenstone today, the companies announced the 2007 agreement had been terminated.

Ora Banda managing director Luke Creagh said the out-of-court resolution was to the mutual satisfaction of all parties.

“Importantly for Ora Banda, it helps clear the way for our joint venture with WesCEF to proceed in a timely manner, which would provide further funds to accelerate the development opportunities within our gold business,” he said.

Ora Banda said the WesCEF deal included an outstanding payment of $16 million to Ora Banda subject to satisfaction of remaining conditions.