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Kingston Resources - Acquisition of Mineral Hill Gold and Copper Mine


Key Points:

• Kingston enters binding agreement to acquire the Mineral Hill Mine from US-based Quintana MH Holding Co LLC for up to A$22.7M (US$17.0M) in cash and shares.
• Located 65km north of Condobolin in NSW, Mineral Hill has extensive gold and copper Resources, a long production history, a recently upgraded 400ktpa CIL circuit, and an existing flotation plant.
• Gold tailings on site are currently being processed through the CIL circuit, delivering immediate gold production for Kingston.
• Tailings processing forecast to deliver gold production of 40,000oz at AISC of A$1,550-1650/oz over 29 months, with positive free cash-flow expected in early 2022.
• Reserves of 71,163oz Au and a Resource base of 469,217oz Au Equivalent underpin Kingston’s intent to establish initial mine production following conclusion of the tailings project.
• Outstanding exploration potential with multiple targets located within the Mining Licence hosting high-grade historic drilling results to be followed up.
• The Project comes with a highly prospective regional tenement package and is strategically located within a resource-rich region with a skilled local workforce.
• The mine re-opening will provide local employment and business opportunities for the surrounding townships within the Lachlan Shire.
• The acquisition is consistent with Kingston’s stated objective of becoming a substantial gold producer in the Asia-Pacific region. The transition to production and strengthened balance sheet will also enhance its ability to advance the 3.8Moz Misima Gold Project in PNG.
• Transaction to be funded through an institutional placement raising $14.0 million and a A$4.0 million Share Purchase Plan. 

Kingston Resources Limited (ASX: KSN) (Kingston or the Company) is pleased to announce that it has entered into a binding agreement (Share Purchase Agreement or SPA) with US-based Quintana MH Holding Co. LLC (Quintana) to acquire a 100% interest in the Mineral Hill Mine (Mineral Hill), located in central NSW (the Transaction).

The acquisition represents a unique opportunity for Kingston to accelerate its transition to an operating mining company. The Mineral Hill Mine includes two processing circuits, current gold production, a number of developed polymetallic deposits and extensive exploration upside.

With first gold poured in September, Mineral Hill is currently ramping up production from the processing of existing tailings. Production is forecast to total 40,000 ounces at an average all-in sustaining cost (AISC) of A$1,550-1,650/oz over 29 months. The operation is expected to deliver positive free cash-flow by early 2022.

For more information, download the attached PDF.

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