Precious metals company Adelong Gold escalated its standoff with joint venture (JV) partner Great Divide Mining over the Challenger gold mine in South Australia, invoking a formal dispute resolution process after rejecting Great Divide’s claim that a development plan had been approved.

The Melbourne-based firm said on Wednesday that Great Divide had formally disputed the validity of a “deadlock notice” issued last week over what Adelong described as a fundamental disagreement on the annual programme and budget for the mine. Adelong reaffirmed its position that a contractual deadlock had occurred.

“ADG reaffirms its position that a deadlock has occurred in accordance with the objective criteria set out in the JV agreement and that the deadlock notice issued on August 13, 2025 is valid and effective,” the company said in a statement.

The dispute centers on Great Divide’s August 13 announcement that the JV entity had adopted a first annual plan targeting up to 20 000 oz/y of gold. Adelong has rejected that claim, arguing the plan was never validly approved and that key technical and cost assumptions lack sufficient support.

“Our duty is to act in the best interests of ADG shareholders. We are fully prepared to fund and advance the Challenger project, but only on the basis of a robust, technically supported work programme that offers an attractive risk-adjusted return,” Adelong MD Ian Holland said last week. “At present, the information before the board does not meet that threshold.”

Adelong has also raised concerns about proposed initial operations to process mullock, spoil and tailings material to produce as much as 500 oz of gold a month, noting that this material is not included in the current mineral resource estimate or its 2022 scoping study.

With Great Divide disputing the very existence of a deadlock, Adelong said it considered a broader dispute to exist over the budget and related matters, and has triggered the JV's formal dispute resolution procedure.

The Challenger mine, about 165 km south-west of Coober Pedy, produced more than one-million ounces of gold before operations were suspended in 2018. The JV between Adelong and Great Divide is attempting to revive the project.