cyanide was technically feasible although high 
capital and power costs negatively impacted 
project economic returns. 
As a consequence, feasibility work has transi-
tioned to assess a lower capital cost and lower 
power requirement option, namely the potential 
for heap leach processing. Recently completed 
metallurgical testwork demonstrated that 
processing of mineralisation from all three 
deposits by heap leaching has the potential to 
be technically and economically feasible and, as 
a consequence, may become the preferred 
alternative for development.
Environmental approval for the original Arqueros 
Project was granted in July 2013.
Bowdens Silver Project
The Bowdens Project continued to advance 
during the year with field programs supporting 
the feasibility and environmental studies 
ongoing. Sterilisation drilling and additional 
metallurgical sampling were undertaken with 
the resource evaluation drilling completed in 
October 2012.
During 2013, the process design and engi-
neering work for the Definitive Feasibility Study 
(“DFS”) progressed to a point where the study 
was close to draft completion as at 30 June 
2013. The study encompassed detailed process 
design based on using the most recent metal-
lurgical test results, capital and operating cost 
estimates, project water and power supply, 
infrastructure requirements and mine 
optimisation.
The preparation for lodgement of an EIS to the 
NSW Department of Planning continues. It is 
envisaged that the EIS will be completed and 
lodged in 2014. Data for flora and fauna, surface 
water, groundwater, meteorology, ambient 
noise and dust levels are collected routinely. 
Further investigations of cultural heritage, 
social-economic impact, traffic impact, soil  
type and agricultural suitability have also been 
undertaken.
With the fall in metal prices in late 2013, work 
and expenditure on the DFS and EIS have been 
phased to coordinate the two programs with 
completion and submission now not expected 
before mid-2014.
Exploration
The Group has a portfolio of exploration tene-
ments and applications in Thailand, Chile and 
Lao PDR. Following the sale of exploration 
tenements to Caravel (refer below), exploration 
in Australia is currently only conducted in the 
vicinity of the Challenger Mine in South Australia 
and the Bowdens Silver Project in New South 
Wales.
Sale of Exploration Assets
On 28 March 2013, the Group sold its explora-
tion assets in Western Australia and Queensland 
through the sale of shares in its subsidiary 
company, Quadrio Resources Limited, to Caravel 
Minerals Limited (“Caravel”), an Australian 
company listed on the ASX.
Kingsgate received 135,000,000 fully paid 
ordinary shares in the issued capital of Caravel 
and 20,000,000 unlisted options to acquire 
Caravel shares exercisable at 10 cents on or 
before three years from the date of issue. 
Subsequent to the sale, Kingsgate became the 
largest shareholder in Caravel with 35.54% held 
at 30 June 2013. Kingsgate’s holding in Caravel 
reduced to 27.04% post 30 June 2013 following 
a rights issue by Caravel that Kingsgate did not 
participate in.
 
continued
u