KCN - Kingsgate Consolidated

[brerwallabi]

The Thai Digital Economy and Society Ministry has warned people not to believe or share news and internet posts that the government has lost its legal case against Kingsgate Consolidated and has to compensate Kingsgate.​

Careful finicky don’t fly to Thailand or you may end up in the Bangkok Hilton.

In the unsuccessful February no confidence vote brought against the Thai ruling government it was mentioned that Thailand may have to forfeit 25 billion baht in a payout to Kingsgate which equates to just over one billion Australian dollars.
The Thai prime minister Prayut responded by saying he was forming a special committee to reach a compromise with Kingsgate.

 

[finicky]

It's great that in Australia someone could opine that the Thai king is a profligate depraved little degenerate who loots his country and runs like a little rat from Covid taking his harem of sluts and his bloated entourage to a Swiss chalet where expense is no issue while his countrymen die and commit suicide in a zombie economy. A Thai who opined that would end up in the equivalent of a hellish oubliette even if such slander was true to the letter.

 

[finicky]

Email to free subscribers today from unemon who also posts at twitter @unemon1
This is not the patiently (or exasperatedly) awaited settlement or tribunal decision but a meeting slated by the Thai DPIM explicitly about the matter of renewing Kingsgate's Akara mining licence; so intuitively, why would they have such a meeting unless they are heading towards relicensing? If they had no positive intention, wouldn't they just continue to do nothing? Anyway unemon is expecting a big market reaction if this comes out well - meeting is on June 21. There might be buying pressure in anticipation?

Gist of the email:

"Potentially great news today for KCN!

KCN shareholders have now been waiting for over 5 years for Akara Resources to get a renewal of the mining license and finally be able to operate the Chatree mine in Thailand again! Akara is the owner and operator of the Chatree Mining Complex in Thailand and is a subsidiary of Kingsgate Consolidated Limited.

Per my findings, today a date was put on agenda of the Thai "Department of Primary Industries and Mines" TO RENEW THE LICENSE of AKARA. KCN shareholders have been waiting for this development for over 5 years now, since when it 2016 the Chatree mine was ordered to shut down! "

On twitter someone answered:
"When confirmed, an important first step. Next, details of the financial settlement..."

To which unemon said:
"reopening is the most important part, financial settlement is just the ice on the cake!"

 

[sptrawler]

Who is unemon?

 

[finicky]

@sptrawler
He's seems a very cluey financial newsletter writer who does some incredible primary research including fossicking through public notices of government departments that are expressed in a foreign language. He is on twitter under the handle of @unemon1
He's super long to his subscribers on KCN. He'll be a legend if all this comes off.

I forgot that he also rates a fully operating Chatree as worth $800m - haven't tried to value it myself. He says,

"A fully Operating Chatree mine should be valued at at least AUD $800m vs the current market cap of KCN of just AUD $200m .... and I do believe the news about this license renewal should unlock part of this value once it gets discovered by investors!"

 

[finicky]

 

[finicky]

This dream is fading somewhat. Kingsgate announced a letter of intent to sell the Nueva Esperanza project today for around $60m in staged payments of cash and shares. This does not look good to anyone hoping for a big cash settlement in the company's dispute with Thailand. However there are various ways to interpret it. It does sound like Kingsgate may settle for resumption of the right to operate the Chatree mine along with perhaps some lucrative but non cash concessions, such as: a moratorium on royalties and taxes and more exploration leases. Anyway it's all guesses, including how the balance of shareholders will react. Today they sold down the shares a little.

 

[finicky]

So the announcement of a settlement with Thailand dra-a-ags on.

Sale of Nueva Esperanza has gone binding - conditional only upon a successful financing for the buyer, TDG Gold Corp. Goss is that TDG has already done one placement for $4m
Up front, close of the deal payment is CAD $25m = $27M AUD
Close could be as early as mid Aug but there is some leeway.
KCN also gets 14% of the ordinary shares of TDG Corp calculated post equity raising by TDG for the acquisition. KCN gets up to another $25m CAD at several milestones.

It's up for interpretation as to why they are selling Esperanza:
It was costing cash, even on care and maintenance.
Signaling to the predatory Thais that the company isn't going broke and can continue to fight its case.
Restart money for the Chatree mine and plant upon settlement.
Maybe they are arming against even further substantial delays by the Thais.

Kingsgate had $10m cash left at end of June, enough for another 3 Quarters without the NE cash. The company said it intends no capital raisings. It says the tribunal panel is still deliberating on an award, ffs.

In the Quarterly, the company sketched out what it wants for a settlement. A cash component for lost income, interest and start up costs is notably absent. Quote from the Qtrly:

" ... there are a number of issues that Kingsgate would need to have guaranteed by the Thai Government for this [settlement] to occur. These include but are not limited to:
 tenure around key licences and permits,
 investment and taxation incentives,
 access to significant exploration areas; and
 the right to freely enjoy the asset without any further obstruction.

 

[brerwallabi]

So the announcement of a settlement with Thailand dra-a-ags on.

Sale of Nueva Esperanza has gone binding - conditional only upon a successful financing for the buyer, TDG Gold Corp. Goss is that TDG has already done one placement for $4m
Up front, close of the deal payment is CAD $25m = $27M AUD
Close could be as early as mid Aug but there is some leeway.
KCN also gets 14% of the ordinary shares of TDG Corp calculated post equity raising by TDG for the acquisition. KCN gets up to another $25m CAD at several milestones.

It's up for interpretation as to why they are selling Esperanza:
It was costing cash, even on care and maintenance.
Signaling to the predatory Thais that the company isn't going broke and can continue to fight its case.
Restart money for the Chatree mine and plant upon settlement.
Maybe they are arming against even further substantial delays by the Thais.

Kingsgate had $10m cash left at end of June, enough for another 3 Quarters without the NE cash. The company said it intends no capital raisings. It says the tribunal panel is still deliberating on an award, ffs.

In the Quarterly, the company sketched out what it wants for a settlement. A cash component for lost income, interest and start up costs is notably absent. Quote from the Qtrly:

" ... there are a number of issues that Kingsgate would need to have guaranteed by the Thai Government for this [settlement] to occur. These include but are not limited to:
 tenure around key licences and permits,
 investment and taxation incentives,
 access to significant exploration areas; and
 the right to freely enjoy the asset without any further obstruction.

There is a distinct chance of another coup in Thailand.
So there may well be different palms to grease.
When it can barely afford to give its Covid affected unemployed workers the equivalent of $8 in a one off payment to get through the current Covid debacle there, the chances of closing a settlement soon are slim.
Thai’s hate losing face and that’s what it would be for the present government and its so-called democratically elected leader.
A new government may well put the saga to rest.
Hope so for the many frustrated shareholders.

 

[finicky]

Faked a move outside the 8 month downtrend channel today, volume up a bit.

 

[finicky]

Boom, as they say.
Some stronger volume came in after market close @ 0.95

Daily

 

[finicky]

Company update on Chatree mining operation in Thailland rings with confidence. The lame tribunal has informed the company that it is ready to hand down a decision. However both the Thai Govt and KCN have requested a short extension so that a settlement can be finally signed off on. The Thai Govt is on notice. One thing I hope I have learned is 3xpect an u imaginable long time for lega.os and judiciary to do their job - people must have died waiting for this and many ex shareholders won't otherwise ben

Lots of non monetary value will be added to the company and the share market is responding. Pity that the corrupt dictator government gets away without punishment via the settlement route. Kingsgate says that once the settlement is ratified it will switch on 'optionality' which includes selling Chatree - yes please.

 

[finicky]

Something broke I the functionality of the above post and I have given up trying to edit it

 

[brerwallabi]

It’s a big loss of face for the Thai government and the cost will be approximately 30% more then if they had settled for an early agreement on the matter when the Thai baht was languishing just over 18 baht to the Oz dollar eighteen months ago compared to 24.2 now.
The loss of face will mean the government will possibly not support the continuation under Kingsgate, the best result will be a listing on the SET with ownership drifting eventually into Thai hands.
Hopefully no further delays..

 

[finicky]

Where's the cost for the Govt if it settles before the tribunal hands down a decision? All the benefits that KCN obtains are non monetary except for tax and royalty exemptions (which Govt would not be getting anyway if the mine and plant stayed moth-balled).

Didn't mention that the company has independent advice that reserves could be more than doubled by adjusting for the current gold price @ US$1,700. That's without bringing in new resources through exploration. They have many new special prospecting licenses with strong potential that have already been awarded as part of the Govt's capitulation.

 

[UMike]

Just got rid of over half my holdings Proving I am improving on my greatest weakness in knowing when to sell and not holding on too long

 

[bux2000]

You would have to be pretty happy with your holding in KCN @finicky and it may not be finished. ? The KWR chart appears to be at an interesting stage as well.

All the best

bux

 

[finicky]

Yes KCN still looking good @bux2000 understandable that some are monetizing at this time to cover risk, we can't be sure that the scummy Thai Govt doesn't have some trick up its sleeve. I still hold all my shares.
Will comment some time on KWR on that page - it's back at my average buy price and if it drops further could be considered a punt for the speculatively inclined; I would feel better if KWR was more cashed up as the upcoming RC and DD drilling campaign from a track mounted rig will not be cheap.

 

[finicky]

A new modern times high for KCN. It is strange to me that none of the momentum traders here have thought it worthy to punt on the mounting positive signs for an imminent settlement. It's like my hot t1ts are paid no attention on this forum.

 

[finicky]

* tips