Kingsgate Consolidated Ltd (ASX: KCN), which took over Dominion to give it a firm operating base in Australia, said today that exploration drilling on the Challenger West shoot at the Challenger mine had produced high grade to bonanza grade results.
This included an intercept of 2.16 metres grading 109.83 grams/tonne gold.
Kingsgate was undertaking a drill programme to test continuity of the high grade Challenger West Shoot below currently defined reserves. This was being achieved by drilling from an exploration drive 400 metres below surface on the Challenger mine’s 800 level.
Kingsgate’s managing director, Gavin Thomas, said the latest results give significant confirmation of the potential to identify and define mineralised shoots in the upper levels of the mine that could generate increased resources and reserves over the next 12 to 24 months.
“We are extremely pleased with this early success in the renewed exploration program to find additional gold resources close to the surface at Challenger.”
“While early days, it is a strong endorsement of the confidence and belief we have in the potential to add to the gold resources at Challenger.”
Significant surface and underground drilling results on Challenger West include 1 metre from 326m depth grading 251.95 g/t; 0.9m at 383m 310.87 g/t and 3m @ 28.46 g/t including 1.2m @ 65.87 g/t gold.
In a separate announcement today Kingsgate said its operating Thai subsidiary Akara Mining LTd had executed a $US100 million baht-denominated syndicated loan facility to complete expansion of its Chatree mine in Thailand.
The blueprint is to lift production to 5 million tonnes per annum.
Kingsgate’s chairman Ross Smyth-Kirk said the continued support of Investec and that of our new Thai lenders demonstrates their strong confidence in the future of the Chatree mine.”
He said expanding the plant to over 5 Mtpa brings a “new dimension” to the Thai operations and accelerates Kingsgate’s thrust to become the preferred mid-tier ASX gold producer.
In 2010 the Chatree mine milled 2.7 Mtpa at 1.7 g/t gold and 14.9 g/t silver for 132,628 oz gold and 549,522 oz silver.