Kingsrose Mining has agreed to accept a further A$500,000 under the second tranche of its share placement. The increase, which is in response to investor demand, takes the total amount to A$9 million which will help fund underground development of the Talang Santo Gold Mine in Indonesia.
One of the company’s lenders, Michael Andrews, has also agreed to reduce the amount outstanding under his loan facility via a share placement. This will result in the loan balance being reduced by A$500,000 in return for the company issuing him shares as the same price to sophisticated investors in the placement.
Michael Andrew and the company’s other lenders, Beaurama Pty Ltd and Great Golden Investment Ltd, have reached an in-principle agreement to defer debt repayments until July 2017.
Kingsrose executive chairman John Morris said the demand for the placement and ongoing support provided by the company’s lenders were strong votes of confidence in the outlook for the Way Linggo project and the potential of the Talang Santo mine to deliver high-grade, low-cost production.
“The proceeds of the placement will help fund completion of the external haulage shaft to the 5 Level which will in turn underpin increased production rates and lower costs,” he said. “With our financial position strengthened considerably and the review of our mining practices and water management strategy now well advanced, we are moving towards unlocking the true value of Talang Santo.”
Kingsrose owns 85% of the Way Linggo Gold Project in South Sumatra. The project is held under a 100sqkm, 4th Generation Contract of Work (CoW) and is on the mineral-rich Trans-Sumatran Fault. The project has established infrastructure with a 140,000 tonnes/annum processing plant and has a track record of high grade, low cost production from the original Way Linggo mine.
The company is producing from its second mine on the project area – Talang Santo – which, based on current development is pointing to being a significantly larger mineralised system than the Way Linggo mine. In addition, significant exploration upside exists on the wider project area with numerous high priority targets identified.