PNG’s Kumul Joins Simberi JV: What Risks Lie Ahead for St Barbara?
St Barbara Limited has agreed to sell a 20% interest in its Simberi Gold Project to Papua New Guinea’s Kumul Mineral Holdings for A$100 million, forming a strategic joint venture that aligns with PNG’s resource ownership goals.
- Kumul to acquire 20% interest in Simberi Gold Project for A$100 million
- St Barbara retains 80% ownership and management control
- Joint venture supports PNG Government’s local ownership and benefits sharing objectives
- Kumul to farm-in for up to 20% of Tabar Islands Exploration Licenses
- Transaction subject to regulatory approvals and Simberi Mining Lease renewal
Strategic Partnership with PNG State Entity
St Barbara Limited (ASX – SBM) has formalised a significant partnership with Kumul Mineral Holdings Limited, the Papua New Guinea State Nominee for mineral project interests, through binding agreements for Kumul to acquire a 20% stake in the Simberi Gold Project. The transaction, valued at A$100 million, establishes an unincorporated joint venture that reflects the PNG Government’s broader agenda to increase local participation and benefits from its mineral resources.
Under the agreement, St Barbara’s subsidiary, Simberi Gold Company Limited, will maintain an 80% ownership share and continue as the project manager, ensuring operational continuity while welcoming Kumul as a strategic partner. This collaboration is expected to enhance alignment between the mining operation and PNG’s national interests.
Financial and Operational Implications
To facilitate Kumul’s acquisition and subsequent construction costs, St Barbara Mining Pty Limited will provide non-recourse loan funding at commercial rates. This financial arrangement allows Kumul to participate without immediate capital outlay, with repayments structured from its future share of precious metals revenues, including from the ongoing remnant oxide mining and the planned Simberi Expansion Project.
The deal also includes provisions for Kumul to farm-in to earn up to a 20% interest in the Tabar Islands Exploration Licenses, potentially expanding the partnership’s footprint in the region’s mineral exploration landscape.
Regulatory and Development Milestones Ahead
The transaction remains subject to customary conditions precedent, including regulatory approvals from PNG’s Independent Consumer and Competition Commission and the National Executive Committee, as well as the renewal of the Simberi Mining Lease. St Barbara targets a Final Investment Decision for the Simberi Expansion Project by the third quarter of fiscal year 2026, marking a critical milestone for the joint venture’s future development.
Managing Director and CEO Andrew Strelein emphasised the shared commitment to equitable resource value distribution, noting that the agreement not only meets but exceeds PNG Government expectations for benefits sharing. The partnership also complements St Barbara’s recent strategic moves, including Lingbao Gold Group’s acquisition of a 50% interest in the Simberi Expansion Project.
Broader Context in PNG Mining Sector
Kumul’s involvement in Simberi adds to its existing portfolio of significant PNG mining interests, such as majority stakes in Ok Tedi and Porgera Joint Venture, and ongoing negotiations for equity in the Wafi-Golpu Project. This deal reinforces PNG’s strategy to increase sovereign participation in its mineral wealth, potentially setting a precedent for future resource developments.
For St Barbara, the partnership offers a strengthened local alliance and financial backing that could accelerate project timelines and enhance community relations, critical factors in the complex operating environment of PNG mining.
Bottom Line?
As regulatory approvals progress, this joint venture could redefine local ownership models and accelerate Simberi’s expansion trajectory.
Questions in the middle?
- Will regulatory approvals and mining lease renewal proceed smoothly to enable the joint venture?
- How will the loan funding terms impact Kumul’s financial position and future revenue streams?
- What are the prospects and timelines for Kumul’s farm-in to the Tabar Islands Exploration Licenses?
