Kingston Resources positions itself for growth and success in 2021 after having a solid December quarter

Kingston Resources Ltd (ASX:KSN) has positioned itself for growth and success in 2021 building over the effective steps taken in the December quarter, which includes delivering a robust pre-feasibility study (PFS) on the 3.6-million-ounce Misima Gold Project, raising $13 million and appointing respected industry leader Mick Wilkes as chairman of the company. Following on from the successful release of the PFS and Maiden Ore Reserve, Kingston completed a $13 million capital raising in December. The company ended the quarter with a cash balance of $16.6 million after spending $1.8 million in exploration activities. “Strong momentum to achieve our key objectives this year” Kingston managing director Andrew Corbett said: “We’ve hit the ground running in 2021 after what was a really successful December quarter for the company. “The combination of four key events – an outstanding PFS for Misima, a maiden 1.35 million ounces Ore Reserve, a successful $13 million raising, and the appointment of Mick Wilkes as Chairman – has given us really strong momentum to achieve our key objectives this year.  “The large-scale, high-quality reserve at Misima underpins the company’s value proposition, and I am confident that as we continue exploration to grow our inventory and progress the Definitive Feasibility Study, we will see greater market recognition in the months ahead. “Plus, with a strengthened balance sheet and with Mick’s strategic input and guidance, we are really well-placed to achieve our goal of becoming a significant new gold producer in the Asia-Pacific region.” Misima Gold Project, PNG Kingston released the results of the Misima PFS during the December quarter and it showcased an attractive gold development project with strong economic fundamentals. The technically robust PFS confirmed the potential for a long-life, low-cost gold mine. Key components of the PFS A significant, long-life Asia-Pacific gold operation: 130,000 ounces per annum average annual gold production over a 17-year mine life; and 5.5 million tonnes per annum mining and processing operation on a brownfields site with extensive mining history; Compelling project economics: Life-of-mine (LOM) average AISC of $1,159/ounces; LOM revenue of $4.9 billion; LOM free-cash-flow of $1.5 billion; Pre-tax Net Present Value (NPV8%) of $1.28 billion and 48% IRR at spot US$1,900/ounce gold price; and Payback period of 4.7 years at US$1,600/ounce gold price, reduced to 2.75 years at US$1,900/ounces. Large high-quality Mineral Resource and Ore Reserves: 1.35 million ounces ore reserve for a 10-year mine life based on reserve ounces only; and 12.5% increase in global Mineral Resource from 3.2 million ounces to 3.6 million ounces gold. The significant upside to be unlocked as development studies advance: Significant project upside to be delivered through drilling campaigns currently underway to identify additional near-surface ounces for early years of ore production; and Work programs now being planned for the next phase of studies. Maiden ore reserve As part of the PFS, Kingston released a maiden JORC Ore Reserve during the December quarter. The maiden JORC probable ore reserve of 48.3 million tonnes at 0.9g/t for 1.35 million ounces underpins a large scale, long-life gold project at Misima, together with a further 12.5% increase in the global resource to 144 million tonnes at 0.78g/t for 3.6 million ounces. The ore reserve is based on a standalone mine plan and financial model excluding inferred resources. Capital raising Following on from the successful release of the PFS and maiden ore reserve, Kingston completed a $13 million capital raising in December. Funding from the share placement will be used to progress development studies, approvals and extensional/in-fill drilling as Kingston advance its large-scale PNG gold project towards development. New chairman During the December quarter, Kingston appointed highly-experienced Australian mining executive Mick Wilkes as non-executive chairman. Wilkes, who has been a non-executive director of Kingston since July 2018, will succeed Anthony Wehby, who remains on the board as a non-executive director.