St Barbara (ASX:SBM) has agreed to sell its remaining interest in the New Simberi Gold Project to Lingbao Gold Group (HKG:3330) for $453 million in cash plus royalties.
The transaction includes $410 million in cash consideration and $43 million representing St Barbara’s share of construction capital between April 2026 and signing.
St Barbara will also receive a 2.75% net smelter return royalty on gold and silver production from New Simberi and a 1.5% royalty on minerals from the Tabar Island Group exploration licences.
Completion is targeted for the March quarter of 2027, subject to regulatory approvals in China and Papua New Guinea, plus shareholder approvals from both companies.
Managing Director Andrew Strelein says the transaction ‘crystallises’ substantial value for shareholders and allows the company to focus on Nova Scotia gold projects, as well as the surrounding 15-Mile Processing Hub.
“St Barbara recognises that New Simberi is an outstanding development project and looks forward to participating in the future benefits via the royalties over New Simberi’s production, and through exploration of the Tabar Islands licences, whilst offering St Barbara the option to consider opportunities to realise the value of its royalty portfolio,” Strelein says.
Following completion, St Barbara’s pro-forma assets will comprise approximately $880 million in cash, the 15-Mile Processing Hub Project, the Touquoy Restart Project, and its royalty portfolio with no debt or hedging.
The New Simberi royalty has a net present value of $212 million based on a 5% discount rate and $4,000 per ounce gold price assumption. New Simberi is forecast to produce 2.2 million ounces of gold over an initial 13-year mine life.
St Barbara currently holds a 50% interest in New Simberi, which will reduce to 40% following completion of a separate transaction with Kumul Mineral Holdings announced in December 2025.
The board is considering an additional fully franked special dividend of approximately $0.13 per share following the transaction’s completion. The company declared a $0.05 per share fully franked dividend in August.
St Barbara’s board also reconfirms it is considering an on-market share buyback of up to 100 million shares after releasing the updated Prefeasibility Study for the 15-Mile Processing Hub Project due later this month (September 2026).
Under the terms, Lingbao will fund St Barbara’s share of capital requirements from signing until completion. If the transaction fails to complete due to Lingbao not satisfying conditions precedent, the funding becomes a construction loan repayable in 24 months.
The transaction includes customary warranties and an indemnity for an existing Papua New Guinea tax reassessment matter where St Barbara will maintain carriage of discussions with the Internal Revenue Commission.
Macquarie Capital serves as St Barbara’s financial adviser while Allens provides legal advice on the transaction.
St Barbara is a gold explorer and developer focused on the development of long-life assets, with operations spanning Papua New Guinea and Canada.
Write to Paula Fabe at Mining.com.au
Images: St Barbara
