December 2018 Quarterly Report

Quarterly Report

For the period ending 30 December 2018



  • Kingsgate has appointed a corporate advisor to identify options to monetise the Nueva Esperanza Project.
  • A number of parties are completing due diligence and the Company expects to provide a further update soon.


  • Political Risk Insurance Claim (“PRI”) – In October 2017, Kingsgate commenced proceedings in the New South Wales Supreme Court against Zurich Insurance Australia Ltd, and other named insurers, under a Political Risk Insurance Policy (with a maximum liability of US$200 million) that was held by the Company when the Thai Government expropriated the Chatree Gold Mine in May 2016.
  • On 6 July 2018, a Directions Hearing was held in the Supreme Court of New South Wales for the Company’s PRI claim.
  • The Court listed the Proceedings for trial, for up to fifteen days commencing on 3 June 2019.
  • Kingsgate remains open to achieving a settlement, but in the meantime will continue to prosecute its claim against the insurers in the Supreme Court of New South Wales.
  • TAFTA Claim – The Tribunal has adopted a Procedural Calendar which provides that the merits of the TAFTA (“Australia Thailand Free Trade Agreement”) Claim will be heard on 18 November to 29 November 2019.
  • However, the Tribunal has also ordered that the proceedings are to be kept confidential, except where disclosure is required to fulfil a legal duty.
  • Kingsgate remains committed to seeking a settlement of the matter with the Thai Government.


  • In May 2018, Kingsgate drew down a $15.0 million Standby Loan Facility (“SLF”) in order to ensure continuing funding of its activities.
  • The SLF is on normal commercial terms for a loan of this nature, and includes a utilisation fee under the SLF which has been satisfied by the issuance of 2,641,003 Kingsgate shares. (See ASX:KCN “Appendix 3B – Issue of Shares” dated 7 May 2018).
  • Investec Australia Finance Pty Limited (“Investec”) has agreed to increase the SLF limit from A$15 million to A$20 million, (of which $18.75 million had been advanced as at 31 December 2018) and the maturity date of the loan while originally scheduled for February this year, is currently being re-negotiated. A further $1.25 million has been drawn down in January 2019.
  • In addition to the monetisation of Nueva Esperanza, Kingsgate is investigating a range of alternative funding options to secure its future.
  • Cash at 31 December 2018 totalled A$1.1 million.
  • Corporate debt at 31 December 2018 is A$18.75 million.

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