Kingston's island of gold

KINGSTON Resources is knuckling down at its newly acquired Misima gold project in Papua New Guinea with the aim of bringing the historical mine back into production.
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Kingston Resources MD Andrew Corbett presenting at ResourceStocks Sydney

Kingston completed a merger with Toronto-listed WCB Resources late last year.

Managing director Andrew Corbett told ResourceStocks Sydney last week that the company had made huge progress in the first six months on the ground.

"We're not messing around here to get this thing going," he said.

Kingston has already announced a maiden JORC resource of 82.3 million tonnes at 1.1 gram per tonne gold and 5.3gpt silver for 2.8 million ounces of gold and 13.9Moz of silver, using a 0.5gpt gold cut-off.

Corbett pointed out that the resource was 78Mt at 1.2gpt gold when Placer Dome made the final decision to build the project.

Placer mined the project in the 1990s, producing around 3.7Moz of gold and 22Moz of silver until the low gold price forced its closure.

"We think the endowment is over 7 million ounces," Corbett said.

"There's a lot of gold here."

WCB - with the backing of Sandfire Resources - had been searching for a large copper-gold porphyry deposit at Misima.

"We're the first company to be exploring for gold on Misima in 15 years," Corbett said.

PPC, a consortium owned by Japan's JX Nippon Metals and Mining and Mitsui Mining and Smelting, holds 51% of Misima currently, reflecting the previous copper hunt.

Kingston expects to reach a 70% interest during the September quarter, after which PPC can either contribute - which is seen as the mostly likely outcome - or dilute its interest.

"Both results would be a good outcome for shareholders," Corbett said.

Initial drilling at Misima will focus on the Umuna East Side area, targeting extensions to the existing resource and following up historical high-grade results like 40m at 15.12gpt gold from 168m.

The phase one drilling program began almost two weeks ago.

The company plans to drill around 10,000m this year.

Channel sampling at Misima in March discovered a new target at Ginanwamwa, with a best result of 14m at 12.2gpt gold.

The prospect sits next to the site of the former mill and the haul road runs over the top of it.

"It's fantastic to have early success and this is one of our prospects to drill over the next year," Corbett said.

Kingston also sees potential at depth.

"Structural workings indicate this deposit is as deep as it is long," Corbett said.

"We're already talking about a 3.5km-long orebody."

Kingston has $5.6 million on hand after recently raising $4.5 million at 2.2c.

The company has also been drilling its 50,000oz Livingstone gold project, 140km northwest of Meekatharra, with assays pending.

"We think this is a feeder project or stepping stone into Misima," Corbett said.

The island of Misima is across from Woodlark Island, where Geopacific Resources is hoping to start building a 100,000oz per annum mine later this year.

"We like being in the islands of PNG. It's a favourable location," Corbett said.

The islands have none of the unrest that overshadows projects in the PNG Highlands.

"The islanders are almost Fijian-style in culture and are very relaxed," Corbett said.

"On top of that, we've got a trained workforce."

Around 100 residents of the island are former Placer employees who now do fly-in, fly-out to other PNG operations like Lihir.

Kingston shares were unchanged today at 2.2c, valuing the company at just under $27 million.