Kingsgate Consolidated Limited · ASX:KCN
Kingsgate Consolidated — Diggers and Dealers 2012
38 slides from Kingsgate Consolidated's conference presentation, August 2012
Slide 1: Growing a Premier Mid-Tier Gold Miner in Asia/Pacific
Kingsgate Consolidated Limited Growing a Premier Mid-Tier Gold Miner in Asia/Pacific Diggers and Dealers August 2012
Slide 2: Disclaimer
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,
Slide 3: Growing Gold Miner in Asia/Pac
Growing Gold Miner in Asia/Pac Two gold mines and two advanced projects Chatree Gold Mine Nueva Esperanza Challenger Bowdens Silver/gold Project Gold Mine Silver Project
Slide 4: Records Set in June Quarter
Records Set in June Quarter • Record quarterly gold production of 61,835oz, up 2% on the March quarter at total cash cost of US$744/oz. • Record annual gold production of 208,760oz, up 85% on FY11 (113,134oz) at a total cash cost of US$720/oz. • Strong operating performance at Chatree with gold prod
Slide 5: Chatree Gold Mine in Thailand
Chatree Gold Mine in Thailand Asian showcase gold mine Chatree
Slide 6: Chatree – Thai Gold Belt
Chatree – Thai Gold Belt Chatree Thailand World Class Gold Bangkok Province Thai Gold Belt Phitsanulok Province Phetchabun First Mover Province SPLs Pending Advantage Chatree 63 km Phichit Province 1,200 km2 Tenement SPL Applications Package Multiple Targets Nakhonsawan Province
Slide 7: Chatree - World Class Deposit
Chatree - World Class Deposit Phitsanulok Chatree +5Moz system Province to date & growing (including mined to date) Phichit Province CHATREE NORTH Large low grade and low Phetchabun Province cost gold deposit Ban Kho Ban Din Dong Long Expansion completed CHATREE ~6.2Mtpa @ 0.8g/t – 1.0g/t Approx. 14
Slide 8: Chatree Unit Operating Costs
Chatree Unit Operating Costs Asian competitive advantage 20.00 *18.65 18.00 16.48 16.41 16.00 15.11 15.21 15.42 13.77* 14.00 12.48 12.00 10.03 10.45 10.00 8.00 6.00 4.00 2.00 0.00 Total Direct Cost Per Tonne Milled ($/t) ----- Transition Year Established infrastructure. Competitive input costs inclu
Slide 9: Chatree Growth Strategy
Chatree Growth Strategy Plant expansion under optimisation Completed and operating at +6.2Mtpa C North high grade zone completed Incremental expansion options to Under Review ~7.2Mtpa Access to surrounding resources Underground potential through Future high grade feeder structures Region
Slide 10: Challenger Gold Mine
Challenger Gold Mine Acquired by Kingsgate in Feb 2011 Challenger
Slide 11: Challenger Gold Mine
Challenger Gold Mine Challenging six months June Qtr 19,647oz @ US$1,000/oz (incl. US$59/oz royalty ) Full year 87,388oz @ US$862/oz (incl. US$62/oz royalty) Stope availability fell behind due to development shortfall and ore dilution Strategy being implemented to address the issues. Dec Q
Slide 12: Challenger Strategy
Challenger Strategy Turning around the operation Contractor Underperforming Understand the Development shortfall due to poor issues equipment availability, maintenance manning and experienced operators Site responsible for business unit. Implementing Additional KCN experienced people change in m
Slide 13: Challenger Exploration Upside
Challenger Exploration Upside South East Zone 2.0m @ 14.1g/t South East Zone Challenger West Challenger West 800 level 2.0m @ 14.1g/t 1.1m @ 13.8g/t 0.6m @ 28.6g/t stope meets expectations 0.9m @ 15.7g/t M1 2.1m @ 12.5g/t 0.4m @ 29g/t Aminus 2 New shoot, Aminus 2, 1.0m @ 81.0g/t 0.3m @ 1,443.1g/t id
Slide 14: Nueva Esperanza
Nueva Esperanza Advanced silver/gold project in Chile Nueva Esperanza
Slide 15: Located in the highly prospective Maricunga Belt
Nueva Esperanza Located in the highly prospective Maricunga Belt Nueva Esperanza Teterita Chimberos Arqueros 5 Kilometres
Slide 16: Nueva Esperanza
Nueva Esperanza Preliminary mine and plant layout
Slide 17: Fast track to production
Nueva Esperanza Panorama Fast track to production Teterita Chimberos Huantajaya Arqueros Norte Arqueros Looking north from Arqueros Total Mineral Resource: 1.9 million oz AuEq (85 million oz AgEq). Potential fast track to mining with low strip and high grade at Teterita. Evaluation of Chimbero
Slide 18: Nueva Esperanza
Nueva Esperanza Project advancing rapidly Teterita metallurgical work underway. Resource Two drill holes completed at Chimberos Evaluation Camp and fieldwork reduced for winter Integrated mine plan fpr Arqueros and Teterita progressing. Feasibility Study Ausenco appointed to take feasibility through
Slide 19: Nueva Esperanza
Nueva Esperanza Highly prospective regional exploration Three established resources TETERITA Multiple highly prospective targets CHIMBEROS CERRO HUANTAJAYA POTOSI AMARILLO RIFLE ROSA BOULDER ARQUEROS GRANDOTE High grade intercepts from historical drilling CARACHITA CARACHAPAMPA
Slide 20: Bowdens Silver Project
Bowdens Silver Project Kingsgate growth project in NSW Bowdens
Slide 21: Bowdens Overview
Bowdens Overview Epithermal silver deposit with lead and zinc by-products Large, continuous, near surface deposit hosted in volcanics Resource estimate 99Moz Ag, 131Moz AgEq (JORC) Established infrastructure and mining workforce Resource definition drilling and environmental field monitori
Slide 22: Bowdens Upside Potential
Bowdens Upside Potential Mineralisation intersected outside current resource A B A B C D C D Resource drilling continues to intersect mineralisation outside current resource Assays include 45m @ 117.8 AgEq and 40m @ 96.1 AgEq Technical feasibility and preliminary EIS expected in the December q
Slide 23: Strong Production Growth
Strong Production Growth 700 Group Production Growth 600 (in ‘000 ounces gold AuEq) 500 Chatree Mine 400 Challenger Mine 300 Nueva Esperanza Bowdens Chatree 200 Gold Mine 100 0 2009 2010 2011 2012F 2013F 2014F 2015F Nueva Esperanza Challenger Silver/gold Project Gold Mine Bowdens Silver Project
Slide 24: KCN – Strong Value Proposition
KCN – Strong Value Proposition Diversified Production Growth Strong production growth: 209Koz FY12 from 113Koz FY11 Strong Resource Growth Nearly doubled to ~10Moz AuEq from 5.4Moz AuEq FY10 Development Project Pipeline Feasibility studies for Nueva Esperanza and Bowdens in 2H12 Generating Str
Slide 25: Highly Attractive Value Metrics
Highly Attractive Value Metrics
Slide 26: Highly Attractive Value Metrics
Highly Attractive Value Metrics
Slide 27: Kingsgate Consolidated Limited
Kingsgate Consolidated Limited Shares: 151 Million Market Cap: ~A$700 Million ASX: KCN www.kingsgate.com.au
Slide 28: Appendix
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
Slide 29: Dividend Yield
Dividend Differential 10% 8% Dividend Yield 6% 4% 2% 0% 17 28 28 15 6 3 5 13 15 1 3 2 6 3 6 21 Sep Mar Aug Mar Sep Mar Sep Apr Sep Mar Sep Mar Sep Mar Sep Mar 02 02 03 04 04 05 06 06 06 07 09 10 10 11 11 12 Interim 2012 dividend A$0.10/share (unfranked) Paid A$1.54/share over past 10 years Hig
Slide 30: Corporate Structure
Corporate Structure KINGSGATE 100% 100% 70% Dominion Laguna KCN Capital Gold Operations Resources 49% 49% 49%** Phar Mai 51%* Issara Akara 51%* Thai Challenger Arqueros Exploration Mining Mining Shareholders Gold Mine Project Limited Limited Limited 100% 100% Gold Chatree 51%* Exploration * Held via
Slide 31: Thai Progressive Royalty Rate
Thai Progressive Royalty Rate 20% 15% 10% US$1600/oz 5% 0% Baht/gm 0 400 600 1000 1500 2000 US$/oz 0 385 580 970 1450 1950 US$1.00=Baht 30, Jan 2011.
Slide 32: Working in Thailand
Working in Thailand Asian Competitive Advantage Cost Comparisons – Thailand vs Australia Established Infrastructure Grid Power Open Pit Mining (US$): Sealed roads Waste: $1.70/t vs $2.50/t Lower cost support Ore: $3.40/t vs $4.00/t Skilled manufacturing “Buy Thai” sourced supplies Po
Slide 33: Corporate Social Responsibility
Corporate Social Responsibility World Safest Gold Mine Over 9 years – No incidents Zero Environmental Incidents ISO Standards on all activities Only mining company granted Thailand National Zero Accident Award 2010.jpg Occupational Social Accountability SA8000 Safety & Health Award 2010 T
Slide 34: Thai Political Change
Thai Political Change Landmark victory by Puea Thai Party with 265 seats out of 500 seats Formed coalition to strengthen majority Chatree Led by Yingluck Shinawatra sister of Thailand former prime minister Thaksin Bangkok Shinawatra Decisive victory should lead to a more politically stable T
Slide 35: Chatree
Chatree Chatree Ore Reserves as at 30 June 2011 (>0.4g/t gold cut-off grade) Tonnes Gold Silver Gold Silver Source Category Grade Grade Contained Contained (millions) (g/t) (g/t) (Moz) (Moz) From Pits Proven 36.0 0.99 8.5 1.14 9.9 Probable 15.6 0.97 7.0 0.49 3.5 Stockpiles 8.4 0.69 11.7 0.19 3.3 Cha
Slide 36: Challenger
Challenger Challenger Ore Reserves as at 30 June 2011 Tonnes Gold Gold Source Category Grade Contained (thousands) (g/t) (‘000 oz) From Mine Proven 600 4.46 90 Probable 2,740 5.94 520 Challenger Total Total 3,340 5.67 610 Challenger Mineral Resources as at 30 June 2011 Gold Gold Tonnes Grade Contain
Slide 37: Nueva Esperanza
Nueva Esperanza Mineral Indicated Inferred Total Resources >0.5g/t Tonnes Gold Silver Tonnes Gold Silver Tonnes Gold Silver Gold Silver Gold Eq AuEq M g/t g/t M g/t g/t M g/t g/t MOz MOz MOz Arqueros 16.0 0.32 81 4.0 0.3 50 20.0 0.32 75 0.20 48.1 1.3 Chimberos 3.7 0.2 85 3.7 0.20 85 0.02 10.1 0.2 Te
Slide 38: Bowdens
Bowdens Cut-off Grade Contained Silver Resource Class AgEq Tonnes (g/t) (t) Silver Lead Zinc AgEq Silver AgEq g/t % % g/t (Moz) (Moz) Indicated 30 31.2 60.6 0.30 0.40 77.5 60.8 78 Inferred 30 27.0 44.0 0.30 0.40 61.0 38.7 53 Indicated & 30 58.2 52.9 0.30 0.40 69.8 99.4 131 Inferred Notes: 1. Roundin