Kingston Resources closer to reviving famed Misima gold mine

Kingston Resources ASX KSN Misima gold mine
Kingston Resources will wholly own Misima which has a current resource of 3.2Moz of gold and 18.2Moz of silver.

Brownfield development is all the go among Australian gold explorers at present high metal prices but Kingston Resources (ASX: KSN) has what must be one of the most successful historic mines now on the brink of revival.

The company expects to reveal its pre-feasibility study on the Misima gold project in Papua New Guinea in the December quarter, clearing the path for future re-development of this mine.

Kingston, with Misima and its Livingstone gold project in Western Australia, is positioning itself to be “the next low-cost, large-scale gold producer in the Asia Pacific”.

Misima is located on the island of the same name that lies in the Solomon Sea east of the PNG mainland and almost directly south from Woodlark Island where Geopacific Resources (ASX: GPR) is developing a 1.6 million ounce gold project.

Kingston’s Misima project currently holds a resource of 3.2Moz of gold and 18.2Moz of silver.

The company says that the project’s extensive mining history significantly de-risks its development pathway.

And what a history.

One of the great gold mines of the Asia Pacific

Canaccord Genuity, in one of their notes on Kingston, termed Misima “one of the great gold mines of the Asia Pacific”.

Gold was discovered there in 1888 and by the early 1900s Australian prospectors and miners were active on the island.

By the time of the Japanese invasion of PNG in 1942 an estimated 230,000oz had been mined.

Exploration began again in the 1960s and in 1989 Canada’s Placer Dome started mining there, producing 3.6Moz of gold over 15 years, with peak production coming in 1992 with 320,000oz that year.

Cash costs were an average US$218 per ounce, although that wasn’t low enough to allow the mine to survive the slumping gold prices of the late 1990s and in the first years of the new century, resulting in Placer shutting up shop in 2004.

Kingston acquired its interested in Misima in 2017, when it acquired Canada’s WCB Resources that held a 49% interest in the ground. It subsequently earnt-in to an 81% interest, and in June formalised its agreed to move to 100%  ownership.

Misima already has in place ports, an airstrip and haul roads. The pits to be mined, as well as the plant and camp designs and locations are all expected to be largely unchanged since Placer’s time.

Additionally, the current 3Moz resource at the Umuna deposit is open at depth.

Kingston says its plan is to replicate the successful Placer mine design while the extensive historical data available means the deposit’s geotechnical and metallurgical information are well understood.

The company is targeting a large open pit with mining at 5Mt per year.

Key exploration areas include a 200,000oz target at Quartz Mountain, and Umuna extensions at Misima North and Umuna East.

‘Outstanding’ drill results in WA

Meanwhile, Kingston last month reported “outstanding” drill results from its 204 square kilometre Livingstone gold project in Western Australia’s Bryah Basin.

From the first 11 reverse circulation holes, drill results at the Kingsley prospect included 9m at 2.73g/t, 20m at 1.96g/t (including 3m at 4.99g/t), and 12m at 2.63g/t all at shallow depths

While these were the best intersections, all 11 holes returned multiple intervals of gold mineralisation.

Livingstone, located 140km north-west of Meekatharra, was discovered by Kingston in 2018. That year drilling at Kingsley returned assays of 1m at 100g/t gold and 15m at 4.66g/t gold.

The Homestead deposit has a JORC resource of 49,000oz with mineralisation at shallow depths.

Kingston is now awaiting the remainder of the assays from the program completed in August with results expected to be reported this month. On the back of what it has seen so far, Kingston has already announced its intention to mobilise rigs again at Livingston.

With a large scale resource with a proven track record up at Misima, and an exciting WA based exploration play at Livingstone, Kingston is well positioned to deliver an exciting end to 2020 and looks to have the right assets to benefit from current strong gold markets.

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