Kingston to Divest Misima Gold Project to Ok Tedi Mining for $61M

Kingston Resources, an Australian Securities Exchange (ASX)-listed mining company, has signed a binding agreement with Ok Tedi Mining to sell its Misima gold project in Papua New Guinea for A$95 million. The deal, announced recently, includes an initial payment of A$50 million, A$10 million deferred for 12 months post-transaction, and another A$10 million upon Ok Tedi’s final investment decision for the project.

Kingston plans to repay its $15m (A$23.26m) debt to Pure Asset Management and save up to $4m annually in costs related to the Misima project and debt servicing.

The agreement also grants Kingston a 0.5% uncapped gross revenue royalty on gold and copper production from Misima, starting after 500,000 ounces of gold are produced, with Ok Tedi holding a A$25 million buyback option for the royalty. Kingston’s managing director, Andrew Corbett, stated: “The sale of Misima concludes a comprehensive global strategic process that commenced in November 2024. This deal will deliver Kingston up to $70m in cash plus ongoing exposure to the future large-scale production profile of Misima through an gross revenue royalty, unlocking significant value for our shareholders.”

The Misima gold mine, operational since 1989, ceased open-pit production in 2001 and closed in 2004. The sale allows Kingston to repay a A$15 million debt to Pure Asset Management and save approximately A$4 million annually in project and debt-related costs. The transaction, expected to finalize in the first quarter of fiscal year 2026, requires approval from Papua New Guinea’s Independent Consumer & Competition Commission and renewal of exploration license EL 1747.

This divestment enables Kingston to focus on its Mineral Hill gold and copper mine in New South Wales, Australia, acquired in 2021 from Quintana MH. The company plans to commence underground production at Mineral Hill in 2026, aiming to extend the mine’s life beyond 2030. Corbett noted: “The total consideration is greater than Kingston’s current market capitalisation whilst we retain 100% of the Mineral Hill gold and copper operation.”

Kingston will prioritize exploration at Mineral Hill, seeking a second underground ore source, conducting surface exploration nearby, and pursuing greenfield exploration at EL 8334 for new discoveries. The company is also open to partnerships for third-party processing of nearby mineral resources, enhancing its operational scope.

The agreement supports Kingston’s strategy to optimize shareholder value while advancing sustainable mining operations at Mineral Hill, leveraging funds from the Misima sale to drive exploration and production growth.