Page 63 - GGG

Kingston readies the

throne for DFS

by Fraser Palamara

39% increase to the Misima gold project’s indicated Misima’s indicated resource increase to 2.5 moz gold joins
A resource is paving the way for a strong DFS for Kingston its existing 1.25 moz reserve, which alone supports 10 years
Resources Ltd. of the proposed mine life. The total indicated and inferred
The Papua New Guinean project is expecting improvement resource contains 169mt @ 0.71 g/t gold and 4.1 g/t silver
to its 2020 PFS which spoke of a 130,000 ozpa production for 3.8 moz and 22.1 moz respectively.
rate over a 17-year mine life with AISC of $1,159/oz. Life-of- Last year’s PFS saw a healthy conversion rate from
mine revenue was anticipated at $4.9 billion for $1.5 billion resources to reserves at 71% efficiency, and Corbett is
in free cash flow. bullish on a similar performance with the upcoming DFS,
At the time of print, gold prices were bobbing around scheduled for March.
$US1,784/oz. Considering a price of $US1,900/oz, Misima “Even if we don’t make further improvements with the mine
could achieve payback in 2.75 years with a 48% IRR and plan and design, that’s what people should be looking for,”
NPV of $1.28 billion. he said. “We’ve got 2.5 moz in indicated which can convert to
While Kingston managing director Andrew Corbett is already reserves…we should expect a similar result for the reserve
content with the current gold price, he is confident about a to grow.
long-term increase. “When we did the PFS, we came out with a 2.1 moz
“It’s a great gold price,” Corbett told GMJ. “At around this production target, that includes the 1.35 moz reserve as well
$US1,800 number, we’re very happy with it and we would as what we thought we could convert from the inferred.
be funding the project at this number once we get approvals. “I guess the latest increase backs that up now. The reserve
“I am optimistic on the outlook for gold in the medium and is going to grow to that production target number, which is
long term…there’s industry specific drivers; there’s not an outstanding result.”
a lot of big projects or expansions that you can see in the An ESIA is scheduled to coincide with the March DFS.
majors…simple supply and demand economics.” Kingston has contracted the PNG-experienced Lycopodium
Minerals Pty Ltd for process plant design. Metallurgical test
work for the DFS is complete with geotechnical programmes
also under way.
Like many revitalised gold plays, the brownfields Misima
shuttered its doors when the spot price fell under ideal
figures. It operated for 15 years until 2004 and produced
more than 4 moz at 230,000 ozpa.
Corbett now looks forward to a very important March quarter,
proud of the laborious drilling and patience that continues to
build up Misima’s stature.
“We got involved in Misima through a JV in 2018 when it had
a 2.3 moz resource and we owned 49% of the project,” he
said. “We got full ownership in 2018 and have been drilling
since. Now it has grown to a 2.8 moz total resource, with the
application of new mining assumptions and cut-off grades.
This year’s upgrade is a continuation of that strategy of more
drilling into the inferred section.
“We always said we were doing an infill drilling campaign,
but we were also open for an extension and we achieved
Andrew Corbett both, so we’re pretty happy with that – it’s a great result.
“It’s a pretty important catalyst year coming.”

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