Lihir Quits Ballarat, At Last

  Lihir Gold may have & #160;finally freed itself from the very expensive mistake on the & #160;Ballarat goldfield in Victoria that has cost it more than & #36;400 million.The end of this expensive disaster will come when the would-be-buyer, Castlemaine Gold, raises around & #36;20 million in a share issue which started Friday after the sale deal was revealed.Lihir said on Friday & #160;it proposed to sell the project to Castlemaine Goldfields for just & #36;4.5 million cash and royalties capped at a maximum & #36;50 million.The sale is subject to conditions, including Castlemaine shareholders approving the issue of new equity to raise a minimum of & #36;20 million.Lihir said on Friday the operation would be wound down and redundancies offered.Lihir said in its recent annual result that it had taken a one-off charge of & #36;413 million after-tax, & quot;being the impairment charge and operating losses from the discontinued Ballarat operation & quot;. & quot;Castlemaine has indicated it intends to take the Ballarat operation forward as an exploration project, and will therefore cease mining and processing for the immediate future, & quot; Lihir said in its statement. & quot;In preparation for the transition to new ownership, the operation will be wound down and placed on care and maintenance from today. & quot;Redundancies will be offered to affected employees. & quot;LGL will provide full entitlements and support services to employees and their families, including outplacement assistance, & quot; it said.Castlemaine Goldfields said the acquisition presents it & quot;with the opportunity to create significant value for shareholders through the consideration of operations to two historically prolific Victorian Goldfields & quot;.The company said that following the completion of the sale, it would follow a defined strategy to target the northern compartments of the field.Castlemaine said on Friday that it was & quot;announcing its intention to raise between A & #36;20m and A & #36;40m in new equity by way of placement to institutions and sophisticated investors to complete the acquisition and provide additional funding. & quot;CGT is aiming to identify sufficient resources to recommence development and production, targeting a 50,000 oz per annum operation. This would present an opportunity to re-employ local personnel and re-engage local contractors. & quot;Lihir Gold shares fell 3c to & #36;2.91. Castlemaine (CGT) shares last traded at 40c before going into a trading halt on Friday. & #160; & #160;  

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