Court gives Empire the greenlight to recoup $1m from gold project partner
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Junior gold producer Empire Resources has won a court decision allowing it to take action to recover about $1 million it’s owed by a partner in the Penny’s Find gold mine northeast of Kalgoorlie.
Brimstone Resources, which has a 40 per cent stake in the mine, previously sought an injunction in the WA Supreme Court to prevent Empire from taking action under the mortgage and security documents it has over Brimstone’s interest in the joint venture.
But earlier in June the court dismissed the application for the injunction and Brimstone lodged an appeal.
The court dismissed the appeal at yesterday’s hearing and Empire will now exercise its rights to recover the $1 million, the company told investors this morning.
Managing director David Sargeant told Stockhead Empire had now appointed a receiver and was going through the process of taking back full control of the Penny’s Find operation.
Initial open-pit mining has been completed at Penny’s Find and Empire now needs to make a final investment decision on whether the mine will make the transition to an underground operation.
Mr Sargeant said Empire would probably look to find another joint venture partner that had the infrastructure to support the operation.
Two of the directors of Brimstone are associated with a dissident shareholder group that is trying to spill the board.
“On all observations, Brimstone’s actions were designed to both delay its $1 million plus mine payment obligations and create smokescreens around the incumbent board,” Mr Sargeant told investors.
While Mr Sargeant does not know how the battle for control of the Empire board will play out, he told Stockhead shareholders have expressed their support for the current directors.