St Barbara Limited has signed a ‘Deed of Sale’ today for the unconditional sale of the Gold Ridge Project and a number of associated St Barbara Group subsidiaries to a Solomon Islands company associated with local landowners.
Completion of the sale is due on 6 May.
The sale is for a nominal purchase price and on confidential terms.
The parties also signed a ‘Deed of Indemnity and Release’ as part of the sale in favour of the remaining St Barbara Group companies in respect of the Gold Ridge Project.
The terms of this Deed are confidential.
As a result of the sale, the St Barbara Group will reverse a number of balance sheet reserves and provisions that will be finalised as part of the 30 June year end reporting.
The net result of the divestment is anticipated to result in a non-cash profit to the Group.
Meanwhile, St. Barbara says following completion of the process, the company will have no residual provisions for environmental or rehabilitation liabilities relating to the Gold Ridge Project.
The statement adds, the Solomon Islands Government has formally rejected GRML’s proposal to discharge untreated water in accordance with the environmental expert report commissioned by the Government and prepared for the World Health Organization, and also rejected GRML’s offer of AUD$1 million funding for the construction of a water treatment plant.
GRML considers it has done everything reasonably within its power to minimise the risk of the tailings storage facility (TSF) overflowing.
It further explains, GRML has the infrastructure in place to immediately commence the discharge of untreated water upon receipt of the applicable permission from the Solomon Islands Government.
As part of sale negotiations, St Barbara has agreed to fund the manufacture and delivery to GRML of a replacement water treatment plant.
This is likely to take up to four months.