St Barbara will no longer work with Catalyst Metals to develop the Drummartin gold project in Victoria after withdrawing from its joint venture (JV) agreement.
The decision comes as St Barbara focuses its capital expenditure on its existing operations, comprising assets in the Leonora region of Western Australia, Papua New Guinea and Canada.
St Barbara spent $2.2 million on Drummartin during the farm-in, with works focused on geochemical and gravity surveys, soil sampling and aircore drilling.
The mid-tier gold miner had the right to acquire a 50 per cent in Drummartin by funding $3.5 million of exploration expenditure across four years. The JV commenced in November 2019.
Catalyst has retained all data from the JV and will now own 100 per cent of Drummartin.
“St Barbara has been an outstanding joint venture partner and supporter of Catalyst over several years,” Catalyst technical director Bruce Kay said.
“They have generated many highly promising targets at Drummartin and we will pursue these as part of our ongoing exploration campaign.”
The Drummartin JV has identified 13 gravity targets from a detailed gravity survey completed last year. Catalyst will follow-up these prospective targets as part of its ongoing exploration program.
Drummartin is located directly along strike from Agnico Eagle’s Fosterville gold mine, which produced approximately 212,000 ounces of gold in the first half of 2022, which Agnico Eagle said was well positioned to deliver on guidance.
Agnico Eagle flagged reduced Fosterville production in the third quarter of 2022 but expected the mine to bounce back in the fourth quarter due to the expected timing of high grade stopes.
Fosterville continues to be a low-cost operation for Agnico Eagle, with gold produced at total cash costs of $351 per ounce in the second quarter of 2022. This coincided with gold grades of more than 22 grams per tonne.
St Barbara continues to be involved in merger and acquisition (M&A) discussions with Genesis Minerals regarding regional consolidation in the Leonora region of WA.
Speaking at the recent Diggers & Dealers conference, Genesis managing director Raleigh Finlayson said the company was taking a cautious approach to further consolidation in Leonora, having recently purchased Dacian Gold.