Nueva Esperanza & the re-discovery of Chimberos Chile Explore Congress August 2015 Laguna Resources Chile Limitada
Disclaimer Forward Looking Statements: These materials include forward looking statements. Forward looking statements inherently involve subjective judgment & analysis & are subject to significant uncertainties, risks & contingencies, many of which are outside of the control of, & may be unknown to, the company. Actual results and developments may vary materially from that expressed in these materials. The types of uncertainties which are relevant to the company may include, but are not limited to, commodity prices, political uncertainty, changes to the regulatory framework which applies to the business of the company & general economic conditions. Given these uncertainties, readers are cautioned not to place undue reliance on such forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, the company undertakes any obligation to publicly update or revise any of the forward looking statements, changes in events, conditions or circumstances on which any such statement is based Some statements in this presentation regarding estimates or future events are forward looking statements. They involve risk and uncertainties that could cause actual results to differ from estimated results. Forward looking statements include estimates of future production, cash and total costs per ounce of production, reserve and mineralized material estimates, capital costs, and other estimates or prediction of future activities. They include statements proceeded by words such as believe, estimate, expect, intend, will, and similar expressions. Actual results could differ materially depending on such things as political events, labour relations, currency fluctuations and other general economic conditions, market prices for Kingsgate Consolidated Limited products, timing of permits and other government approvals and requirements, changes in operating conditions, lower than expected ore grades, unexpected ground and mining conditions, availability and cost of materials and equipment, and risks generally inherent in the ownership and operation of mining properties and investment in foreign countries. 2
Kingsgate 210,000 oz Gold Producer Geographic and operational diversity in the Pacific Operating gold mines Chatree Gold Mine Chatree open pit mine in Thailand, producing 130,000 oz pa Challenger underground mine in South Australia, producing 70,000 oz pa Advanced-development gold silver project Nueva Esperanza gold-silver project in Chile Challenger Gold Mine Nueva Esperanza Gold-Silver Project 3
Corporate Background Kingsgate is an ASX-listed (KCN) gold mining company A$150 million market capitalisation About Kingsgate Directors: Ross Smyth-Kirk (Chairman), Peter McAleer, Peter Alexander, Peter Warren & Sharon Skeggs Chief Executive Officer: Greg Foulis Contact: Suite 801, 14 Martin Place, Sydney NSW 2000, Australia. Tel: +61 2 8256 4800 Website: www.kingsgate.com.au Chatree mill at night 4
Nueva Esperanza project description Operating company in Chile is Laguna Resources Chile Limitada, fully owned subsidiary of Kingsgate Consolidated. -------------------------------------------------- Esperanza gold-silver mineralised high sulphidation epithermal system located on NE flank of Cerro Bravos volcano (Miocene). Discovered in 1981 by ANCOM; Chimberos OP mined 1998-99 and Arqueros UG 2000-04 by different operators. Arqueros acquired in 2009 by LRC, with Chimberos and remaining Esperanza in 2011, reconstituted as Nueva Esperanza FS mill (Arqueros) wrapped up in 2012 Chañaral Copiapo Diego de Almagro El Salvador Esperanza La Coipa Cerro Maricunga Volcan Minera Maricunga Caspiche Cerro Casale Salares Norte Elvira Marte Lobo Salar de Pedernales Salar de Maricunga Environmental authorisation (RCA) in 2013 Water rights secured & power options DFS heap leach completed in 2014 Resource (Jul15): 34.6 Mt @ 1.7 g/t Au EQ60 for 1.9 Moz gold equivalent ounces Esperanza system is located in the northern Maricunga gold belt characterised by high sulphidation epithermal gold-silver systems such as La Coipa, Elvira and Salares Norte 5
Teterita The Esperanza alteration system stands out as a clear colour anomaly covering about 100 km2 Chimberos Arqueros 6
Panorama of the Esperanza Alteration System Looking west Scale bar 1 km Arqueros Chimberos Teterita Cerros Bravos paleovolcano Chimberos Potosi Rosa Arqueros Grandote Teterita Cerro Blanco Huantajaya Rifle Boulder Looking east 7
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Exploration & Development of the Esperanza system (1981 2015) 1981-87 Discovery & exploration: By Minera Anglo American Chile as part of ANCOM Maricunga regional program, ended with Marte gold mine development in 1987 (closed in 1992). 1988-2010 Period of Fragmentation: Chimberos sold to MDO in 1992, Esperanza [excl. Chimberos] optioned to Orvana 1995-96, Arqueros leased to Minera Can Can 1999-2004, and remaining Esperanza [excl. Arqueros] sold to MDO in 2006, followed by Arqueros to Laguna in 2009. Chimberos mined (OP) in 1998/99 by MDO, and Arqueros (UG) in 2000-2004 by Minera Can Can. 2011-present: Esperanza alteration system and properties restored under one ownership and re-badged Nueva Esperanza / discovery of significant gold mineralisation at Chimberos DISCOVERY & EXPLORATION PERIOD OF FRAGMENTATION CONSOLIDATION Anglo American exploration Sale of Chimberos to MDO (now Kinross) Orvana-Hemlo exploration Mining of Chimberos (OP) Mining of Arqueros (UG) Kinross explores Esperanza Laguna acquires Arqueros PFS on Arqueros Kingsgate acquires Laguna Kingsgate acquires Chimberos & Esperanza Mill FS (Arqueros) Heap Leach DFS Discovery of Chimberos West gold sector 8
Exploration of Esperanza (1981-87) ANCOM exploration in 1980s with MAAC as operator, and leading roles by BTX (Bernstein & Thompson) & RH Sillitoe Traditional exploration geochem / drilling (RC & DDH) / tunneling into mineralisation Focus on Chimberos with highest grade (silver) Vila 1991 published a measured reserve for Chimberos of 4.3 Mt at 320 g/t Ag and 0.14 g/t Ag (150 g/t Ag cut-off) Original geochemical survey that led to the identification of 12 centres of mineralisation. Map from Vila 1991. 9
Chimberos & Arqueros 1 Moz Au Eq mined Chimberos (1998-99) open pit - 40 Moz Ag & 31 koz Au mined (700 koz Au EQ60 @ 5.1 g/t Au EQ) Arqueros (2000-04) underground - 14.2 Moz Ag & 52 koz Au mined (289 koz Au EQ60 @ 7.4 g/t Au EQ) 2 Moz Au EQ remaining or discovered subsequently @ 1.70 g/t Au EQ Endowment, koz Silver Gold Au EQ60 Historical mining Chimberos OP 39,956 31 697 Arqueros UG 14,223 52 289 Resources (current) Chimberos West (gold) 11,860 282 480 Chimberos East (silver) 8,604 17 161 Arqueros 45,940 201 967 Teterita 16,821-280 On lease targeted xx xx xx Total endowment, koz 137,406 584 2,874 10
Esperanza Alteration System Stratigraphy: Miocene dacite pyroclastics and domes overlying folded late Paleozoic volcaniclastic sediments Structure: NE trending controlling feeders with NW and Riedel shears hosting gold Alteration: High sulphidation with vuggy and massive quartz, silica-argillic alteration with alunite and jarosite. Mineralisation styles: 1. Mantos silver at Arqueros & Teterita 2. Vein gold (various locations) 3. Hydrothermal breccia with gold and/or silver (Chimberos) 4. Porphyry gold (Carachitas West) Ore Mineralogy: 1. Predominantly oxidised with silver salts (halides) in silver zones, gold & electrum in gold zones 2. Underlying sulphide zones with gold and enargite (unexplored) ** Silver salts (AgCl, AgBr, AgI) are all highly soluble in cyanide *** Mining concession granted 9326 hectares (93.3 km2) 11
Arqueros Sector High sulphidation gold-silver epithermal mineralisation hosted in vuggy silicified Tertiary pyroclastics. Oxidised mineralisation in mantos of vuggy quartz: silver salts, mainly cerarygyrite (AgCl) 17.4 Mt @ 0.36 g/t Au & 82 g/t Ag (200 koz Au & 46 Moz Ag) Silver bearing mantos (horizontal) Gold bearing structures (sub-vertical) Arqueros North Arqueros South Geological interpretation of Arqueros showing flat-lying mantos (silver domain) and vertical mineralized structures (gold domain) 12
Teterita Sector High sulphidation silver epithermal mineralisation hosted in Tertiary vuggy silicified pyroclastics. Oxidised mineralisation in mantos of vuggy and massive quartz: silver salts, mainly cerarygyrite (AgCl) 5.7 Mt @ 92 g/t Ag (16.8 Moz Ag) Near-surface with low strip; feeder zones yet to be explored 13
Chimberos Sector High sulphidation gold-silver epithermal mineralisation hosted in Paleozoic sediments. Oxidised mineralisation in silicified hydrothermal breccia: silver salts, mainly cerarygyrite and iodargyrite (AgI) in silver zone, electrum in gold zone Bonanza grades mined with sections of 1000 s g/t Ag 11.5 Mt @ 0.81 g/t Au & 55 g/t Ag (300 koz Au & 20.5 Moz Ag) remnant ore; extension to west and at depth West wall of Chimberos pit showing goethite stain, assoc. with mineralisation Maintenance workshop, canteen & accommodation 14
Exploration Model High S epithermal system Productive horizon @ 3900-4100 metres 15
7 053 000N 7 055 000N 7 057 000N 7 059 000N 7 051 000N 7 049 000N 7 047 000N S:\1.-Pry_Nueva Esperanza\20.-Proyecto_Esperanza\Tarjets Exploracion2014\3.-Julio 2014\Nueva Esperanza_091014.dwg EBDR-01 EAQR-01 ECHR-21 ECHR-23 ECHR-22 ECHR-18 ECHR-26 ECHR-20 ECHR-08 ECHR-17 ECHR-07 ECHR-19 ECHR-25 ECHR-29 ECHR-28 ECHD-01 ECHR-27 ECHR-32 ECHR-31 ECHR-33 PIT Limit 7 059 000N 7 057 000N 7 055 000N 7 053 000N 7 051 000N 7 049 000N 7 047 000N Exploration Strategy 2014 - Focus on high grade gold Objective of Spring 2014 drilling campaign was to test highly prospective local targets to increase mine life and gold metal output 476000 E 478000 E 480000 E 482000 E 484000 E 486000 E 488000 E 490000 E N S Many highly prospective targets yet to be tested, including high grade epithermal gold intercepts Historical drilling was erratic, focused on exposed mineralisation, generally shallow and often lacking structural interpretation Chimberos West discovery was unexpected but demonstrated that the property was capable of yielding significant gold mineralisation in a previously underestimated style Resulted in new targeting criteria based on: a. Structural mapping b. Integrated geophysics c. Geochemistry Discovery zone TETERITA C BANCO P4 P1 P2 P3 CHIMBEROS C AARI LLO POTOSIL RIFLE SANTA ROSA ARQUEROS BOULDER HOYO NEGRO CARACHITA CARACHITA W. CARACHAPAMPA SYMBOLOGY Drilling Executed Exploration Area Nueva Esperanza Exploration Targets 0 1 2km 1 / 20k 476000 E 478000 E 480000 E 482000 E 484000 E 486000 E 488000 E 490000 E Note the gaps in drilling 16
What we found west of Chimberos pit Gold zone of substance, previously unknown at Esperanza, with high grade intercepts eg. 170 m @ 4 g/t Au (ECHR-25 discovery hole ) Immediate reinterpretation of previous gold intercepts in progress, armed with Chimberos West model Gold-rich hydrothermal breccia, a new variant of historical Chimberos bonanza (silver) mineralisation Delivered an additional 250koz Au & 5.1 Moz Ag straight to project inventory Has changed the focus of the Nueva Esperanza project towards gold targets & agitation leaching Coarse gold panned from ECHR-25 36m @ 8.6 g/t Au & 177 g/t Ag from 168m (ECHR25) 35m @ 3.4 g/t Au & 33 g/t Ag from 204m includes 6m @ 15.4 g/t Au & 52 g/t Ag (ECHR19) 20m @ 5.2 g/t Au & 84 g/t Ag (ECHR42) from 118m 15m @ 7.1 g/t Au & 103 g/t Ag (ECHR50) from 150m 48m @ 7.7 g/t Au & 94 g/t Ag (ECHR47) from 142m 100m @ 2 g/t Au & 152 g/t Ag (ECHR55) from 92m ECHR-25 152.00 153.00 1.00 1.05 158 153.00 154.00 1.00 1.60 123 154.00 155.00 1.00 3.93 148 155.00 156.00 1.00 2.44 162 156.00 157.00 1.00 1.93 112 157.00 158.00 1.00 1.58 86 158.00 159.00 1.00 1.26 106 159.00 160.00 1.00 1.29 115 160.00 161.00 1.00 1.60 103 161.00 162.00 1.00 2.41 87 162.00 163.00 1.00 1.96 78 163.00 164.00 1.00 2.13 62 164.00 165.00 1.00 1.40 64 13.00 1.89 108 165.00 166.00 1.00 4.99 143 166.00 167.00 1.00 1.57 57 167.00 168.00 1.00 0.85 34 168.00 169.00 1.00 58.30 81 169.00 170.00 1.00 2.55 57 170.00 171.00 1.00 8.62 121 171.00 172.00 1.00 17.95 150 172.00 173.00 1.00 9.60 140 173.00 174.00 1.00 7.25 207 174.00 175.00 1.00 6.86 178 175.00 176.00 1.00 5.58 99 176.00 177.00 1.00 6.55 123 177.00 178.00 1.00 20.00 202 178.00 179.00 1.00 9.16 173 179.00 180.00 1.00 5.06 149 180.00 181.00 1.00 6.92 145 181.00 182.00 1.00 30.20 297 182.00 183.00 1.00 6.69 148 183.00 184.00 1.00 6.33 192 184.00 185.00 1.00 13.60 141 185.00 186.00 1.00 14.60 255 186.00 187.00 1.00 10.00 206 187.00 188.00 1.00 3.68 120 23.00 11.17 149 3.68 3.65 6.40 5.14 3.79 3.01 3.03 3.20 3.32 3.86 3.26 3.16 2.47 3.69 7.37 2.52 1.41 59.65 3.50 10.64 20.45 11.93 10.70 9.83 7.23 8.60 23.37 12.04 7.54 9.34 35.15 9.16 9.53 15.95 18.85 13.43 5.68 13.65 17
Discovery of Chimberos West Started with sterilisation drilling from the Chimberos pit to close off historical mineralisation Significant gold intercepts prompted immediate reassessment of geology and drilling priorities: 17,200 metres of drilling in 74 holes. Core/chip logging, geophysics (magnetics) and structural geology were critical in positioning drill holes Resulted in 20% increase in gold equivalent resource Open at depth with drilling intercepts and IP/resistivity identifying gold & copper sulphide zone underlying the high grade oxide mineralisation Sep 2014 18
Chimberos West drilling Grandote Fault Core logging Interpretation 19
Chimberos Gold Discovery Chimberos Silver Gold: 20koz Silver: 8.6Moz AuEQ60: 160koz Chimberos Gold Gold: 280koz Silver: 11.9Moz AuEQ60*: 480koz Chimberos Total Gold: 300koz Silver: 20.5Moz AuEQ60*: 640koz Chimberos Historical Gold: 310koz Silver: 40Moz AuEQ60: 700koz 20
Section SW-100 Model: Structurally controlled replacement of Paleozoic conglomerates by massive silica/hydrothermal breccia, and gold mineralisation 21
Nueva Esperanza Mineral Resource (JORC) July 2015 Deposit Category Tonnes Grade Contained Metal Arqueros Teterita Chimberos Silver Chimberos Gold Total Million Gold g/t Silver g/t Gold EQ60 g/t Gold 000 oz Silver million oz Gold EQ60 000 oz Silver EQ60 million oz Measured - - - - - - - - Indicated 14.1 0.35 88 1.82 160 39.9 824 49.4 Inferred 3.3 0.4 57 1.35 40 6.0 143 8.6 Subtotal 17.4 0.36 82 1.73 200 45.9 967 58.0 Measured 1.5-101 1.69-4.9 82 4.90 Indicated 3.5-92 1.54-10.4 174 10.4 Inferred 0.7-71 1.19-1.6 27 1.6 Subtotal 5.7-92 1.54-16.8 282 16.9 Measured - - - - - - - - Indicated 3.0 0.16 76 1.43 15 7.3 138 8.3 Inferred 0.6 0.10 66 1.20 2 1.3 23 1.4 Subtotal 3.6 0.15 74 1.39 17 8.6 161 9.6 Measured - - - - - - - - Indicated 6.2 1.17 51 2.02 233 10.2 403 24.2 Inferred 1.7 0.90 31 1.42 49 1.7 77 4.6 Subtotal 7.9 1.11 47 1.89 282 11.9 480 28.8 Measured 1.5-101 1.69-4.9 82 4.9 Indicated 26.8 0.47 79 1.78 410 67.7 1,537 92.2 Inferred 6.3 0.50 52 1.34 94 10.6 271 16.2 Total 34.6 0.45 75 1.70 503 83.2 1,890 113.4 Cut-off grade 0.5 g/t Au EQ60 22
What Next? Discovery of significant gold mineralisation at Chimberos West has resulted in a change of project strategy, and re-opened the project to further new gold discoveries. Significance of the discovery: Provided a critical level of gold ounces to gold inventory Resulted in a new exploration model to be applied to remainder of property Reassessment of known centres of gold mineralisation new gold targets Showed the value of traditional geological prospecting tools when competently applied Showed an under appreciation of bonanza gold in this silver dominant system 30 years after initial exploration Re-focus on northern Maricunga for higher grade high sulphidation epithermal systems 23
KINGSGATE CONSOLIDATED LIMITED www.kingsgate.com.au 24