http://www.kingsgate.com.au/wp-content/uploads/2013/08/QR-Icon.png 80 80 Kingsgate Web Admin http://www.kingsgate.com.au/wp-content/uploads/2015/05/KCN_WebLogo_SMALL.png Kingsgate Web Admin2017-10-30 12:17:152018-04-30 10:54:45September 2017 Quarterly Report
Quarterly Report for the period ending 30 September 2017
- Kingsgate has commenced proceedings in the New South Wales Supreme Court against Zurich Insurance Australia Ltd, and other named insurers, under a Political Risk Insurance Policy held by the Company when the Thai Government expropriated the Chatree Gold Mine in May 2016.
- The Political Risk Insurance Policy has a maximum liability of US$200 million.
- Kingsgate made a claim under the Policy which was denied, and while the outcome of the proceedings cannot be guaranteed, the Board considers that the terms of the Policy respond to the actions taken by the Thai Government against the Company in 2016.
- Kingsgate has appointed the leading international law firm Clifford Chance to represent it, and Dr. Andrew Bell S.C. as Senior Counsel on the matter.
- Kingsgate announced a Share Buy-Back Scheme of up to 10% of the Company’s shares, given the Board’s concern that the share price does not accurately reflect the value of the Company’s assets.
- The Share Buy-Back Scheme should increase the net asset backing per share, therefore providing a benefit to shareholders. Bell Potter Securities has been appointed to conduct the buy-back.
- Kingsgate continues to progress its 100%-owned Nueva Esperanza Gold-Silver Project in Chile, with work commencing on a seasonal exploration program as well as permitting and feasibility related activities.
- Following a number of encouraging drill intercepts earlier in calendar 2017, the principal focus of the spring exploration program will be to further unlock the excellent potential of the Cerro Blanco West exploration target. (See ASX:KCN “New Silver Discovery at Nueva Esperanza, Chile” dated 17 July 2017).
- The Environmental Impact Statement (“DIA”) for Nueva Esperanza was submitted to Chilean regulatory agencies in July 2017 and, at their request, this has now been upgraded to a more comprehensive Environmental Impact Assessment (“EIA”) to better outline measures to ameliorate the impact of noise and dust on flora and fauna in the project footprint.
- As the majority of the work for the EIA has already been completed, it is expected to be submitted in early 2018.
- After notifying the Thai Government, in April 2017, that Kingsgate would be seeking a range of remedies including compensation for the measures taken against the Chatree Gold Mine in violation of The Australia – Thailand Free Trade Agreement (“TAFTA”), the Company has had meetings with the Thai Government on 27 June and 16 August 2017. (Noting however, that the consultations period which is the first step required under a TAFTA claim expired on 27 July 2017).
- While the dialogue continues in good faith, if at any point in the future Kingsgate considers that a mutual outcome is not able to be reached, Kingsgate has reserved its rights under TAFTA and is free to commence international arbitral proceedings.
- Cash at 30 September 2017 totaled A$15.8 million.
- CCorporate debt at 30 September 2017 remains at zero.