Reunion Gold settles claim brought by Barrick on alliance termination

South America-focused explorer Reunion Gold (TSXV: RGD; US-OTC: RGDFF) has settled a claim brought by Barrick Gold (TSX: ABX; NYSE: GOLD) with respect to a strategic alliance agreement signed by the companies in early 2019.

In December 2022, Reunion gave notice to terminate this agreement, which Barrick challenged in the Ontario Superior Court of Justice, alleging that the alliance should continue in perpetuity, and that unilateral termination is invalid.

At the time, the only project remaining under the alliance was the NW Extension project in Suriname, as Barrick had previously elected to exclude all other projects from the pact, Reunion stated in a Feb. 13, 2023, news release.

Prior to that, the parties had agreed on a rehabilitation and demobilization plan and budget for NW Extension. In terminating the agreement, Reunion said it offered to assign its rights in the NW Extension to Barrick.

In its statement of claim, the gold mining giant said it’s seeking relief in the form of, among other things, declarations affirming its position, orders compelling Reunion to perform its obligations under the alliance, related injunctive relief, and damages.

On Wednesday, Barrick’s claim was settled on what Reunion calls “a mutually acceptable basis”, and the parties now have no outstanding obligations to each other, since there are no properties under the alliance agreement.

Reunion said the company’s main focus remains on exploring and developing its 100%-owned Oko West project in north-central Guyana, which Barrick excluded from the alliance in January 2020 and has no back-in rights on.

Discovered by Reunion’s initial drill program in 2020, Oko West has a pit-constrained resource estimate of 41.8 million tonnes grading 1.84 grams gold per tonne for 2.5 million oz. of gold in the indicated category. It also has 27.1 million inferred tonnes grading 2.02 grams gold for 1.8 million ounces.

Shares of Reunion Gold were up 2.2% to 45¢ in mid-afternoon on Wednesday in Toronto. The gold junior has a market capitalization of $553.3 million.