Numerous share price catalysts on the horizon for Kingston Resources
There is plenty of positive news emerging from Kingston Resources Limited on multiple fronts (ASX:KSN) as it prepares for exploration and progresses a prefeasibility at two of its projects, and the highly prospective nature of upcoming news has attracted the attention of brokers.
Reg Spencer from Canaccord Genuity is particularly upbeat on the company, recently reaffirming his speculative buy recommendation and price target of 85 cents per share.
This implies share price upside of more than 400% from the company’s current price of 16.5 cents.
On one hand, the quantum of such a rerating may seem a stretch, but on the other, one only has to view the extensive newsflow that is imminent, particularly the PFS and reserve estimation work to understand that these could be the foundation for a significant rerating.
Macroeconomic conditions couldn’t be better for the company with the gold price at near-record highs, and the volatile economic environment suggesting there will be further support for the traditional safe haven precious metal.
Crunching the numbers, Spencer said, ‘’Kingston’s enterprise value to resource multiple of A$9 per ounce is well below the peer group weighted average of $58 per ounce which we consider unwarranted given Misima’s (PNG project) scale and near-term development potential.
‘’A positive outlook for the gold price and relative dearth of advanced gold projects of scale on the ASX further supports our favourable view.’’
5000 metres resource definition drilling program imminent
Management has just advised that a 5000 metre resource definition reverse circulation (RC) drilling program is set to commence next month at the Kingsley prospect in Western Australia.
The prospect is situated within the company’s 75%-owned Livingstone Gold Project, 140 kilometres north-west of Meekatharra within the Bryah Basin.
The upcoming drilling program has been designed from knowledge gained from the structural review conducted over the wider Livingstone Project, including Kingsley, in late 2019.
The Livingstone Project, including the Kingsley prospect can be seen on the map below.
The aim of the program is to define shallow oxide mineralisation that will contribute towards an initial Maiden JORC Compliant Resource Estimation.
Several holes have also been designed to further test potential depth extensions to the known mineralisation.
The program is fully permitted with mobilisation and drilling anticipated to commence by mid-July and concluding in August.
Final assays are expected from Livingstone by September.
Assays from Livingstone and drilling at Misima in September quarter
Kingston has also been successful in securing co-funding for a further 1000 metres of deep RC drilling at the Stanley Deeps prospect (see above) through R21 of the WA Government Exploration Incentive Scheme.
This drilling will be undertaken following completion of the resource definition program at Kingsley.
As we mentioned, Kingston should benefit from numerous share price catalysts over the next three months with one of the main ones being progress on the PFS for the group’s Misima Gold Project in PNG.
This work has already commenced and is now in full swing, with the appointment of a dedicated Study Manager in early June, together with the appointment of mining, geotechnical, metallurgical and environmental consultants.
Engineering consultants have been short-listed with an appointment anticipated in early July.
Commenting on these developments, Kingston Resources managing director, Andrew Corbett said,
“With this next round of drilling at Kingsley we are aiming to define a shallow oxide resource, as a base from which we can grow the project.
Short-term positions in small, early stage ASX companies,
with high potential and near term price catalysts.
Focusing on resource exploration, early-stage tech, and biotech.
Exceptional opportunities across a broad range of
early-stage growth sectors with strong management.
Seeking 1,000% plus returns across medium to long-term holds.
Longer-term positions in a variety of sectors.
Seeking strong management where traction is established and have entered into a growth phase.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.