KINGSTON Resources Limited (ASX: KSN) has completed its resource definition drilling programme at the Ewatinona deposit within its 2.8Moz Misima Gold Project in Papua New Guinea.
Managing Director, Andrew Corbett, said the successful drilling campaign paved the way for the release of an updated Mineral Resource estimate in the June 2020 Quarter.
The Resource drilling programme was designed to expand and upgrade the existing 220koz Inferred Resource estimate at Ewatinona, which represents a key target to deliver near-surface gold mineralisation for a potential starter-pit for the proposed Misima mining operation.
Starter-pit ore offers the opportunity to generate early cash flow for Kingston while it establishes access to the larger-scale 2.6Moz Umuna Resource.
Mr Corbett said the recent drilling at Ewatinona has delivered encouraging results and has also confirmed the company’s updated structural interpretation, with strong potential to both expand and upgrade the existing Resource.
“Our recent exploration strategy has been an outstanding success, putting us on track to announce an updated Resource in the coming months,” Mr Corbett said.
“Kingston Resources is very confident in the development pathway we have mapped out for the Misima Gold Project with multiple advanced stage exploration prospects in the pipeline while the future of the project remains securely underpinned by the 2.8Moz Resource already in place.
“We look forward to delivering on a number of important project milestones at Misima over the remainder of 2020, as we move this exciting project towards development.”
Independent consultants have now been engaged to commence work on the updated JORC Resource, which Kingston anticipates will be completed in the June 2020 Quarter.
Alongside potential Resource expansion, the Resource update will be focused on converting the existing 220koz Ewatinona Inferred Resource to the higher-confidence Measured and Indicated categories, making it available for conversion to Ore Reserves following the completion of a Pre-Feasibility Study (PFS) for the Misima mining operation.
Mr Corbett said that in addition, Kingston also anticipates an opportunity to review the underlying gold price assumption of US$1200/oz which was used to inform the “reasonable prospects for eventual economic extraction” requirement for the estimation of the existing 2.6Moz Umuna Resource.
Kingston aims to commence the Misima PFS shortly after the completion of the Resource update and anticipates appointing a Study Manager in the June Quarter.
Mr Corbett said that in light of the current market uncertainty relating to the global spread of the COVID-19 virus, together with logistics constraints imposed by international travel restrictions, as well as the State of Emergency declaration in PNG which has resulted in heavy domestic travel restrictions, Kingston and its drilling contractor have agreed to suspend drilling at Misima from the conclusion of the Resource drilling programme.
He said this decision will not impact Kingston’s ability to deliver on its key strategic objectives for 2020, namely, to deliver the Misima Mineral Resource update, complete a Pre-Feasibility Study and release an Ore Reserve estimate by the end of the year.
“I would like to take this opportunity to thank all our employees, contractors, and stakeholders for their support during this difficult time as we respond to the global COVID-19 pandemic,” Mr Corbett said.
“The Misima people have been extremely understanding and supportive following our decision to suspend drilling and we look forward to recommencing exploration work in the near term when conditions allow.
“Our recent exploration strategy has been an outstanding success, putting us on track to announce an updated Resource in the coming months.