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2016
24 February 2016
Lue silver project sold
Kingsgate Consolidated Limited has announced an agreement to sell 85 per cent of its interest in the Bowdens Silver Project at Lue to Silver Investments Holdings Australia (SIHA) Ltd for $20 million.
In an announcement to the Australian Stock Exchange (ASX), Kingsgate CEO Greg Foulis said the deal is part of a strategic portfolio realignment for Kingsgate.
'Following the successful divestment of the Challenger Operation, we believe that the time is right to deal with the Bowdens Silver Project,' he said.
Mr Foulis said in the current market, Kingsgate had to choose between two significant feasibility stage projects and chose to focus on the more advanced Nueva Esperanza Project in Chile.
The $20 million sale proceeds, which equate to approximately $0.08 per Kingsgate share, will enhance balance sheet flexibility, he said.
SIHA is a public unlisted company incorporated as a New South Wales specific resources group, with particular emphasis on silver and related minerals.
Anthony McClure of SIHA said the company had been evaluating the project for almost 12 months and had worked closely with Kingsgate to reach this agreement.
'We very much look forward to completing the transaction and working alongside the Kingsgate team in the Joint Venture to realise the value of this unique asset.'
Mr Foulis said the deal will re-invigorate regional exploration at the mine site and the work on the Environmental Impact Statement.
Kingsgate purchased the Bowdens silver mine project in 2011.
The Bowden's Silver project is proposed for a 610 hectare site north east of Lue. The site is bisected by Blackman's Gully and Maloney Road.
Around 70 per cent of the site would be occupied by the open cut mine, two waste rock emplacements, a processing plant and tailing storage.
Previously Kingsgate have said Bowden's would produce an estimated 46 million tonnes of silver, lead and zinc1 .