KUALA LUMPUR (Jan 11): Sabah-based gold miner Borneo Oil Bhd has ended its gold-mining venture with Syarikat Ratna Pura Sdn Bhd (SRP) and Ricco Mining Sdn Bhd in Mukim Keratong, Rompin, Pahang, as part of plans to downsize its mining operations in the state.

In a filing with Bursa Malaysia on Thursday, Borneo Oil said it has entered into a deed of cancellation and novation with Lum Har Chi @ Lum Kong Fatt, Lum Kong Sun and Zainab Mohd Taib (vendors) to acquire a 90% stake in SRP for RM1.8 million cash. SRP is the concession owner of a mining area measuring 194.22ha in Rompin, with a validity period of five years expiring on March 16, 2025.

In March 2021, Borneo Oil, via its wholly-owned subsidiary Borneo Oil & Gas Corp Sdn Bhd, had signed a share sale agreement (SSA) with the three vendors to acquire the stake in SRP.

Following the signing of the SSA, Borneo Oil and SRP had entered into a tripartite agreement with Ricco Mining in January 2022 to carry out mining works in the area.

However, in Thursday's filing, Borneo Oil said the termination and nullification of the SSA represent an opportunity for the group to recoup its costs.

"The deed will not have any effect on the group's issued and paid-up capital or the shareholdings of the group’s substantial shareholders. (It) will also not have any material effect on the net assets and earnings per share of Borneo Oil for the financial year ending June 30, 2024," said Borneo Oil.

Borneo Oil shares closed unchanged at 1.5 sen on Thursday, giving it a market capitalisation of RM134.91 million. The stock has fallen 25% over the past year.