GOLD miner Kingsgate Consolidated says it will take six months to turn around its underperforming Challenger gold mine.
The company, Australia’s second-biggest gold producer behind Newcrest Mining, also acknowledged that it would need to share some of the riches of its open-pit Chatree mine in Thailand.
Kingsgate Consolidated managing director Gavin Thomas said over the past six months his company had experienced a less than satisfactory performance at its Challenger operations in South Australia.
“We’ve had challenging times, mainly because we lost key people,” Mr Thomas said at the 2012 Diggers and Dealers conference in Kalgoorlie today.
Kingsgate has been criticised for its $376 million acquisition of Dominion Mining in 2010, which gave it the Challenger gold mine.
The company, Australia’s fifth largest gold producer, had lost senior people to competitors and the iron ore industry, but there were now good people coming back to mid-tier companies, Mr Thomas said.
“We’re turning ourselves around and certainly the mining contractor is helping, but we will need another six months to get this mine turned around.”
Mr Thomas was also upbeat about the company’s open-pit operation in Thailand, but said doing business in that country could be frustrating due to its old style of mining law.
Still, Thailand had a low-taxing regime with incentives for investment.
“Longer term, they’re still very competitive,” Mr Thomas said.
“In general terms, I think we understand Asia well.
“We understand that we need to share. If we don’t, it will be nationalised off you. What we intend to do is get value for the assets that we own.”
Kingsgate expects to be in Thailand for at least a decade.
“There’s still decades of mining to be had at Chatree,” Mr Thomas said.
“We think there’ll be gold mines for generations to come.”