In relation to reports in the Thai media regarding alleged corrupt conduct, the Company is not aware of any basis for an investigation into any such matter.
Kingsgate Consolidated Limited (ASX:KCN) and its mining operations are subject to a wide range of laws and government regulations and policies applying in Australia and a number of foreign jurisdictions, with respect to matters such as land use, employee health and safety, rehabilitation of mining properties, environmental damage and pollution and payments to government officials.
In mid 2014, ASIC concluded an investigation into payments made by the Company to a consultant for business and commercial advisory services in connection with its Thai operations. ASIC has taken no action following the completion of its investigation, and the Company considers this matter to be closed.
The company has operated successfully in Thailand for more than 14 years in compliance with applicable Thai and Australian laws, and will continue to do so.
Chief Executive Officer
Kingsgate Consolidated Limited
To read the Directors’ Report and Financial Statements for the year ended 30 June 2015, click HERE
- Strong cash flow generated from operations of $100.2 million
- Improved balance sheet
- Debt reduction of $40.1 million
- A sound operating performance
- Production within guidance with gold sold of 202,489 ounces
- Total cash costs US$833/oz, All?In Sustaining Costs (AISC) of US$998/oz.
- EBITDA* (before significant items) of $70.9 million.
- Profitability impacted by lower US dollar gold prices
- 6.4% lower realised gold price of US$1,208 per ounce
- Profit before tax and significant items of $1.7 million.
- Loss after tax and significant items of $147.1 million.
- Non-cash asset impairment of $148.2 million, relating predominantly to the impact of lower gold price assumptions on the Chatree Gold Mine.
- Group quarterly gold production of 55,601 ounces at a total cash cost of US$821/ounces.
- Group annual gold production of 205,245 ounces at a total cash cost of US$833/ounces – well within the guidance range of 195,000 to 215,000 ounces despite the loss of 44 days of production at Chatree, Thailand.
- Chatree quarterly gold production of 36,413 ounces at a total cash cost of US$722/ounces.
- Challenger quarterly gold production of 19,188 ounces at a total cash cost of US$1,011/ounces.
- In Chile, the new gold discovery at Nueva Esperanza, “Chimberos Gold”, has increased Mineral Resources by 250,000 ounces of gold and 5.1 million ounces of silver.
- Total Mineral Resources at Nueva Esperanza have increased by 21% to 1.9 million gold equivalent ounces (GEO^).
- At Nueva Esperanza, an optimisation study in conjunction with Ausenco is underway to provide indicative capital and operating cost estimates for a 2Mtpa milling operation.
- Cash and bullion/doré at quarter end was A$82.1 million after debt repayments of approximately A$7 million during the quarter. Total debt outstanding was approximately A$130 million.
- The A$25 million Senior Corporate Loan Facility is in the process of being restructured with A$15 million to be re-paid in FY16 and A$10 million in FY17.
- Group production guidance for FY16 is in the range 165,000 to 180,000 ounces. The mine plan at Challenger is under review with the current reserves expected to be depleted in the March quarter 2016. Scheduled stripping activities at Chatree result in production strongly skewed to the second half.
Kingsgate Consolidated Limited (ASX: KCN) is pleased to provide an update on the 100% owned Nueva Esperanza gold-silver project following completion of the 2014/15 exploration program and a new Mineral Resource estimate.
The significant outcomes from the program include the following:
- Discovery of the Chimberos Gold deposit, to the west of the current Chimberos pit;
- The addition of 250,000oz of gold and 5.1Moz ounces of silver to the August 2013 Mineral Resource estimate, taking total Mineral Resources to 34.6Mt at 1.7g/t AuEq60 for 1.9Moz gold equivalent;
- The relatively high grade nature of the recently discovered gold mineralisation has now led to reconsideration of agitated leach (milling) for the process route rather than heap leach; and
- Further high potential targets following initial results at Boulder, Rifle and Carachitas Central.
Following the discovery of Chimberos Gold and the substantial upgrade to the total Mineral Resources, Kingsgate has commenced a project optimisation study in conjunction with Ausenco that will utilise the comprehensive technical work completed to date and incorporate the newly enlarged Mineral Resources. It is also believed that significant opportunities may be available to benefit the project within the current mining landscape.
The study, which has an anticipated timeline of three months, is intended to deliver the following:
- Design parameters around a 2 million tonne per annum (Mtpa) agitated leach (milling) operation;
- Indicative capital and operating cost estimates;
- Updated Ore Reserve estimates; and
- Relevant information for amendments to existing permits.
While water and power options are currently in place, there has been a structural shift in the power generation and distribution market in Chile that is anticipated to significantly lower the cost of electicity for the project.
Kingsgate CEO, Greg Foulis, said “We are delighted by the results of the work completed on the project to date, which confirm our long held belief in the underlying quality and opportunity of Nueva Esperanza.
Whilst there is considerable work to be done, we intend to move the project forward in a cost efficient manner in order to de-risk and maximise the value of the project in the current metal price environment.”
Chief Executive Officer
Kingsgate Consolidated Limited
- Group quarterly gold production of 34,538 ounces at total
cash cost of US$843/oz.
- Chatree produced 15,899 ounces of gold at US$604/ounce
and Challenger produced 18,639 ounces of gold at
US$1,049/ounce for the quarter.
- The Chatree processing plant was not operating for 44 days
during the quarter as a result of a temporary suspension
notice issued by the Department of Primary Industry and
Mining (DPIM) in Thailand.
- Strong drilling results continue at Nueva Esperanza, Chile.
Recent results include the following:
- 12m @ 3.24g/t gold & 118g/t silver (5.2g/t AuEq60)
from 232 metres in ECHR-84;
- 21m @ 6.62g/t gold & 260g/t silver (11.0g/t AuEq60)
from 149 metres in ECHR-89; and,
- 20m @ 4.12g/t gold & 115g/t silver (6.0g/t AuEq6)
from 177 metres in ECHR-90.
- Cash position at quarter end was A$66.1 million after debt
repayments of approximately US$5.5 million during the quarter.