The fairytale ending for KBL
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Jim Wall, chairman of KBL Mining. Michel OSullivan
by
Trevor Sykes
Uncork a Bollinger and light up a Cohiba! Pierpont has a thrilling story this month about a small mining company driven to the edge of ruin by a rich foe before it won a famous victory and miraculously escaped.
You will tremble with fear as the dark clouds loom, sigh with relief when they vanish and may even (at a stretch) have your faith restored in the Australian legal system.
The small mining company is KBL Mining, chaired by Jim Wall, which produces copper in concentrate with gold and silver credits from Mineral Hill in central NSW. But, like every small company on the mining board, KBL did not have enough cash to develop the mine.
In 2011 it raised $11.2 million from a convertible note issue and placement at 38¢. That cash was to build a carbon-in-leach (CIL) circuit and additional flotation plant at Mineral Hill, together with a pre-strip of the Pearse gold-silver orebody, only a few hundred metres away.
But KBL kept passing the hat around. It borrowed a further $3 million, made another convertible note issue for $10 million in 2013 and received a $14.5 million reimbursement of research and development costs. If you add all those numbers together, KBL had raised the impressive total of nearly $40 million in less than three years and still didn't have a CIL plant. And Pearse still needed the overburden stripped.
www.pierpont.com.au)
