The overtaking of the Ballarat Gold Mine by the Castlemaine Goldfields would render about 90 workers employed in the Gold Mine jobless.

Peter Smith of Lihir Gold confirmed that 40 workers were made redundant and hinted that 50 other employees would eventually lose their jobs.

"The package is quite attractive and there's obviously no issue with paying it. We've been speaking to all the people today individually and we've also started a program to try and move a few, some of the people into our other operations", Smith said.

As per the agreement, the Ballarat Gold Mine, along with receiving $4.5 Million in cash, would also receive a 2.5% royalty interest capped at $50 Million.

Lihir Gold took over the operation in 2006 and this disastrous Ballarat investment is suspected to be the reason for stepping down of the CEO Arthur Hood in January.

The Victorian Secretary of the Union, Cesar Melhem said, "The AWU is really frustrated with the way Lihir conducted itself in Ballarat and came in and sold themselves as the white knight and promised everyone jobs".