Malachite Resources has initiated a dispute resolution process on joint venture partners after lower-than-anticipated returns at its Lorena open-cut gold mine near Cloncurry.
In an announcement to the ASX, Malachite Resources, whose 55 per cent stake in the project is held by its wholly-owned subsidiary Volga Elderberry, said “the head grade, metallurgical recoveries and plant usage were all lower than forecast over the month of January, continuing the trend observed over the December quarter”.
The project, about 15km east of Cloncurry, is a joint venture between Volga, Cloncurry Gold Recovery Management (CGR) and Ore Processing Services. CGR is the manager of a joint venture between Chinova Resources and BIM Gold, while BIM Metals is the joint venture manager.
Chinova Resources had previously withdrawn finance for ongoing operations and the ASX was told that Malachite Resources had received a notice from OPS demanding payment of a $574,342 loan.
Malachite Resources said it was taking legal advice with regard to its obligations under the loan.
It also indicated to the ASX that Volga Elderberry was reviewing recent cashflow forecasts provided by the joint venture manager.
“Volga has initiated a dispute resolution process in accordance with the terms of the Joint Venture Agreement dealing with numerous matters, which principally relate to achieving a reconciliation of historical joint venture expenditure and the future conduct of the joint venture,” the Malachite statement reported.