Junior explorer Barton Gold (ASX:BGD) has withdrawn from its minority joint venture (JV) arrangements over a string of Sandstone tenements in South Australia.
The company has been hit by claims from JV partner Half Moon (HMP) and its owner, Marmota (ASX:MEU), of denying access to certain Sandstone tenements under the WGCJV partnership — claims Barton has vehemently denied.
In Barton’s response to the public claims in early August, it offered HMP and Marmota a settlement, but the company now says it received no response from either party before the settlement deadline of 5pm on 31 August.
As such, Barton has made the call to withdraw from its joint ventures in the Sandstone region entirely and instead focus more on its core Tarcoola and Tunkillia gold projects and its Central Gawler Mill.
Barton Gold Managing Director Alex Scanlon says notwithstanding the company’s position on the HMP and Marmota claims, it has made ‘multiple attempts’ to settle the dispute on terms it believes are ‘commercially attractive’ to HMP. In fact, Scanlon says he believes Barton’s settlement offer was ‘far superior’ to any outcome HMP could hope to achieve in litigation.
“Based upon HMP’s conduct, we do not see any prospect for a constructive future relationship or, therefore, any merit in maintaining these joint venture interests.
They are not material to our larger regional strategy, and in any event, are unlikely to be commercially viable without substantial investment and access to an existing mill.
“The termination of these joint ventures is a significant and welcome simplification of our regional holdings“
For the reasons detailed in our 3 August 2023 ASX statement, we believe that any claim by Marmota would be ill-advised. However, if necessary, we will vigorously defend our position and bring a substantial counterclaim.
The termination of these joint ventures is a significant and welcome simplification of our regional holdings which eliminates a low-value, time-consuming distraction and allows us to sharpen our focus on the core mission of building a long-term, multi-million-ounce development platform at the Tarcoola and Tunkillia projects.”
The JV partnerships include the Sandstone JV and the WGCJV, under which Baron held around 19% and 21% gold rights interests in the JV tenements, respectively.
Baron will now look to transfer its titled interest in the Sandstone tenements to partner Coombedown Resources (CBD) and transfer its 21.16% gold rights in the WGCJV to HMP.
Barton’s mineral resources will reduce by around 61,400 ounces of gold once this withdrawal is complete, but the company says the move will have no effect on its main areas of focus, Taroola and Tunkillia.
Listed on the ASX, Frankfurt Stock Exchange, and OTCQB markets, Barton holds an ‘advanced’ portfolio of exploration projects and brownfields mines in South Australia. The company, which has a $41.98 million market capitalisation, also owns the only regional gold mill in South Australia’s Central Gawler Craton region.
Barton held a cash balance of around $11 million after completing a $3.5 million institutional placement and a $1 million share purchase plan in July.
Write to Joshua Smith at Mining.com.au
Images: Barton Gold