September 2013 Quarterly Results Presentation

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# September 2013 Quarterly Results Presentation

Source: https://www.kingsgate.com.au/wp-content/uploads/2024/07/281013b.pdf
Published: 2013-09-30T00:00:00+00:00
Fetched: 2026-05-12T15:20:03.328+00:00
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## Content

# September 2013 Quarterly Results Presentation
Kingsgate Consolidated Limited
September Quarter 2013
Disclaimer
Forward Looking Statements:
These materials include forward looking statements. Forward looking statements inherently involve subjective judgment &
analysis & are subject to significant uncertainties, risks & contingencies, many of which are outside of the control of, & may be
unknown to, the company.
Actual results and developments may vary materially from that expressed in these materials. The types of uncertainties which
are relevant to the company may include, but are not limited to, commodity prices, political uncertainty, changes to the
regulatory framework which applies to the business of the company & general economic conditions. Given these uncertainties,
readers are cautioned not to place undue reliance on such forward looking statements.
Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under
applicable law or any relevant stock exchange listing rules, the company undertakes any obligation to publicly update or revise
any of the forward looking statements, changes in events, conditions or circumstances on which any such statement is based.
Some statements in this presentation regarding estimates or future events are forward looking statements. They involve risk
and uncertainties that could cause actual results to differ from estimated results. Forward looking statements include estimates
of future production, cash and total costs per ounce of production, reserve and mineralized material estimates, capital costs,
and other estimates or prediction of future activities. They include statements proceeded by words such as “believe,”
“estimate,” “expect,” “intend,” “will,” and similar expressions. Actual results could differ materially depending on such things
as political events, labour relations, currency fluctuations and other general economic conditions, market prices for Kingsgate
Consolidated Limited products, timing of permits and other government approvals and requirements, changes in operating
conditions, lower than expected ore grades, unexpected ground and mining conditions, availability and cost of materials and
equipment, and risks generally inherent in the ownership and operation of mining properties and investment in foreign
countries.
September Quarter - Key Points
• Group quarterly gold production of 50,786oz in line with
expectations.
• Highest quarterly gold production from Challenger since the June
quarter 2012 at 18,545oz.
• New mine plan and new contractor at Challenger delivering lower
costs and improved productivity.
• Continued focus on cost initiatives at Chatree results in lower unit
operating costs for the quarter.
• Akara IPO documentation submitted to Thai authorities for review.
Timing will depend on market conditions and valuation metrics.
• Nueva Esperanza moving into final feasibility and design with
preliminary results supporting a 3Mtpa heap leach.
• Continued focus on lowering costs with a number of
initiatives delivering across the Group.
All-in Sustaining Cost
Chatree Challenger Group
Gold Sales oz 36,203 19,594 55,797
Adjusted Total Cash Costs
US$/oz 785 1,439* 1,017
(incl royalties and bi-product)
Sustaining Capex US$/oz 191 73 150
Exploration Expense US$/oz - - -
Corporate and Admin Costs^ US$/oz - - 56
All-in Sustaining Cost US$/oz 976 1,512 1,223
* Includes underground mine development.
^ Corporate and Admin costs have been allocated 73% : 27 % between operating assets
and development projects.
Chatree
 Gold production 32,241oz Chatree Quarterly Gold Production
and Costs
 1,593Kt @ 0.79g/t & 80.1% Oz US$/Oz
(1,553Kt @ 1.01g/t & 84.1%) 50,000 1,000
 Total cash costs US$807 900
(incl.US$123/oz royalty) 40,000 800
700
 Costs reflect lower grade and
30,000 600
recovery as current Q high grade
completed and use of stockpile ore. 500
20,000 400
 Mining impacted by heavy wet-
300
season rain
10,000 200
 Cost initiatives delivering results 100
 Revised grade control 0 0
Sep 2012 Dec 2012 Mar 2013 Jun 2013 Sep 2013
 Improved blast patterns
 New pit designs Gold Production Total Cash Cost
Akara Resources Thai IPO
IPO of Akara Resources on Thai stock exchange
 Advisors appointed and IPO documents lodged with Thai
authorities
 Prospectus registration is current for 12 months
 Timing will depend on a number of factors including valuation
metrics and market conditions
 High quality Asian gold listing expected to be very well
supported
 Operate fully as a Thai company with a broad Thai ownership
 Kingsgate to retain 49%
Capital raised from IPO
 Funds to be used to finance capital projects, re-investment in
Thailand, debt reduction and return to shareholders
Challenger
Production and costs improving
Challenger Quarterly Gold Production
 Gold production 18,545oz and Costs
 Highest production since June Qtr Oz
2012 20,000 2,500
 129Kt @ 4.67g/t & 95.5%
2,000
(156Kt @ 3.47g/t & 94.4%) 15,000
 Higher grade with transition to
1,500
Challenger west
10,000
 Total cash costs US$1,454 1,000
(incl.US$51/oz royalty)
5,000
 Costs include mine development 500
expenditure
 Costs down 28% on June Qtr 0 0
Sep 2012 Dec 2012 Mar 2013 Jun 2013 Sep 2013
 New contractor commenced on
1 August with lower costs and Gold Production Opex + Capex
improved productivity
Challenger
High grade structures at Challenger West
Nueva Esperanza
Moving to final feasibility and design stage
 Heap leach processing and on-site
power confirmed.
 Confidence in technical and financial
robustness
Feasibility Study  Moving to final feasibility and design
stage.
 DFS expected to be finalised in March
Qtr 2014.
 Modification to approved EIA for
Environmental heap leap and on-site power via a
Impact Assessment DIA (Declaracion Impacto Ambietal)
expected by mid 2014.
Nueva Esperanza
Positive preliminary feasibility results
Resources 93.3Moz Silver Eq / 1.6Moz Gold Eq
Throughput 3,000,000 tonnes per annum
Initial mine life +6 years
Annualised production (post ramp up)
‐ Silver 6,000,000 – 8,000,000 oz
‐ Gold 18,000 – 22,000 oz
Estimated start-up capital cost US$130-150 million
Average metallurgical recovery
‐ Silver 70-75%
‐ Gold 65-70%
Average strip ratio 5.5:1
Average operating cost (after gold credits) US$11-13/oz silver
• Three stage crushing circuit with High Pressure Grinding Rolls (HPGR)
• On site power costs in line with spot price, eliminating a 45km power line
• Overland conveyor to leach pads (4.7km)
• Merrill Crowe circuit to recover silver/gold doré
• Proceeding to final feasibility and design stage
Bowdens Silver Project
Project timing to reflect market conditions
Feasibility  Completion of the technical feasibility study
including mine planning and infrastructure
Study aligned to the finalisation of the EIS in 2014.
 Open pit mining with pit optimisation
Mining delivering a low strip ratio and a high grade
starter pit. 10+ year mine life.
 DFS based on 4Mtpa conventional flotation
plant initially producing 8Moz – 9Moz AgEq.
Processing  Process design parameters finalised.
 Sterilisation drilling underway in current qtr.
Environmental  EIS work to be completed in 2014.
Impact  Ongoing community consultation prior &
Statement post EIS submission.
Outlook
• Group gold production for the fiscal year FY2014 is
expected to be 190,000 to 210,000 ounces gold.
• Chatree production expected to be 120,000 to
130,000 ounces.
• Challenger production expected to be 70,000 to
80,000 ounces following restructure.
• Nueva Esperanza DFS expected to be finalised in the
March quarter with EIA variation anticipated in June
2014.
• Sterilisation drilling to be completed at Bowdens in
the December quarter. EIS and DFS work aligned for
completion in 2014.
• Focus on cost reduction to continue for mining
operations, development projects and corporate.
Kingsgate Consolidated Limited
Shares: 152 Million Market Cap: ~A$235 Million
ASX: KCN
www.kingsgate.com.au
Appendix
General Disclaimer:
The information contained in this presentation is for informational purposes only and does not constitute an offer to issue, or arrange to issue
securities or other financial products. The information contained in this presentation is not investment or financial product advice and has been
prepared without taking into account the investment objectives, financial situation or particular needs of any person. To the maximum extent
permitted by law, none of Kingsgate Consolidated Limited, its directors, employees or agents, nor any other person accepts any liability including
without limitation any liability arising out of fault or negligence for any loss caused from the use of the information contained in this presentation.
No representation or warranty, express or implied, is given as to the accuracy, completeness or correctness, likelihood of achievement or
reasonableness of any forecasts or other forward looking statements.
Competent Persons Statements:
In this report, information concerning Thailand operations relates to Exploration Results, Mineral Resources and Ore Reserve estimates is based on
and fairly represents information compiled by the following Competent Persons: Ron James, Brendan Bradley Kevin Woodward and Suphanit
Suphananthi who are employees of the Kingsgate Group. All except Brendan Bradley are members of The Australasian Institute of Mining and
Metallurgy; Brendan Bradley is a member of the Australian Institute of Geoscientists. These people qualify as Competent Persons as defined in the
Australasian code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2012 edition) and possess relevant
experience in relation to the mineralisation of being reported herein as Exploration Results, Mineral resources and Ore reserves. Each Competent
Person has consented to the Public reporting of these statements and the inclusion of the material in the form and context in which it appears.
In this report, the information concerning Challenger operations that relates to Exploration Results, Mineral Resources and Ore Reserves estimates
is based on and fairly represents information compiled by Stuart Hampton and Luke Phelps who are full-time employees of the Kingsgate Group.
Both are members of The Australasian Institute of Mining and Metallurgy. These persons have sufficient experience that is relevant to the
mineralisation and type of deposit under consideration and to the activity that they are undertaking to qualify as Competent Persons as defined in
the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Paul Androvic and Tim
Benfield consent to the inclusion in the report of the matters based on their information in the form in which it appears.
The information in this report that relates to Bowdens and Nueva Esperanza Mineral Resource estimation is based on and fairly represents work
completed by Jonathon Abbott who is a full-time employee of MPR Geological Consultants and a member of the Australian Institute of Geoscientists
and Mr Ron James. Mr Abbott and Mr James have sufficient experience that is relevant to the style of mineralisation and type of deposit under
consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Abbott and Mr James consent to the inclusion in the report of the
matters based on his information in the form and context in which it appears.
www.kingsgate.com.au
Chatree
Chatree Ore Reserves as at 30 April 2013 (>0.35g/t gold cut-

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