A gold miner has dropped a $47 million damages claim against GR Engineering in a dispute settlement which saw the contractor accept a $2 million fee deduction.
The deal with Gold Ridge Mining followed the acquisition last month of parent company Allied Gold by St Barbara.
Both sides dropped their claims against each other and Gold Ridge Mining agreed to pay GR Engineering $2.65 million for work carried out at a Solomon Islands mine.
The contractor said the $2 million written off the contract would be more than offset by avoiding further legal costs from the dispute and establishing a good working relationship with St Barbara.
The companies had discussed GR Engineering providing further services at the Gold Ridge mine.
"GR Engineering is pleased to reach this mutual settlement outside of arbitration with the positive and pragmatic cooperation of St Barbara, which has only recently assumed ownership of the Gold Ridge mine and assets," managing director Joe Ricciardo said.
"Having reached this settlement delivers several positive outcomes to GR Engineering, with none more important than a preservation of its excellent reputation and standing in the marketplace," he said.
"GR Engineering would welcome the opportunity to work collaboratively with St Barbara to unlock the value at Gold Ridge."The contractor's shares were up 4.5 cents to, or 5 per cent, to 97.5 cents at 11.10am.