Kingsgate Lifts Nueva Esperanza Silver Reserves 31% Extending Mine Life to 12 Years
Key Takeaways
- Kingsgate's Nueva Esperanza Ore Reserves increased 31% to 51.9 Moz silver and 37% to 0.26 Moz gold as at 30 June 2026, underpinning a mine life of over 12 years at a 2 Mtpa processing rate.
- The upgrade was driven by two structural changes: higher long-term price assumptions (US$35/oz silver, US$2,500/oz gold) and reduced royalty obligations following Kingsgate's acquisition of Anglo American's royalty interests in May 2026.
- Kingsgate now 100% owns a borefield supplying up to 50 litres per second for the full mine life, eliminating a key infrastructure dependency and further de-risking the development path.
- Environmental approvals for Nueva Esperanza are already in place — both the original EIA and a 2020 modification covering dry-stacked tailings and additional pits are currently in force.
- Infill drilling is planned to upgrade Inferred Resources to Indicated classification, providing a clear pathway to further reserve growth beyond the current 51.9 Moz silver position.
Nueva Esperanza Ore Reserves surge 31% as Kingsgate builds toward development
Kingsgate Consolidated (ASX: KCN) has reported a material increase in Ore Reserves at its Nueva Esperanza silver-gold project in Chile, with reserves rising 31% to 51.9 million ounces (Moz) of silver and 37% to 0.26 Moz of gold as at 30 June 2026. Two factors drove the upgrade: updated long-term silver and gold price assumptions, and a reduced royalty burden following Kingsgate’s acquisition of Anglo American’s royalty interests earlier in 2026. Mineral Resources also increased, rising 3% to 62.4 Moz silver and less than 1% to 0.36 Moz gold. At a 2 million tonne per annum (Mtpa) processing rate, the updated reserves support a mine life of over 12 years.
Jillian Terry, General Manager Technical – Nueva Esperanza
“We are delighted to announce a material increase in the Nueva Esperanza Ore Reserves estimate due to a robust outlook for long term silver and gold prices and reduced royalty payments as a consequence of the 2026 Anglo American royalty purchase. The increased Ore Reserves supports a longer reserve life for Nueva Esperanza and underpins the work that we are currently doing to progress development of the project.”
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Reserve and resource upgrade at a glance
The table below summarises the movement from the June 2025 estimates to the current June 2026 position. All Probable Reserves are derived from Indicated Mineral Resources; no Proved Reserves have been reported, and no Inferred Resources have been converted to Ore Reserves. Mineral Resources are inclusive of Ore Reserves.
| Metric | June 2025 | June 2026 | Change | Price Assumption |
|---|---|---|---|---|
| Ore Reserves – Silver | 39.7 Moz | 51.9 Moz | +31% | US$35/oz |
| Ore Reserves – Gold | 0.19 Moz | 0.26 Moz | +37% | US$2,500/oz |
| Mineral Resources – Silver | 60.7 Moz | 62.4 Moz | +3% | US$38.50/oz |
| Mineral Resources – Gold | 0.36 Moz | 0.36 Moz | <1% | US$3,000/oz |
| Reserve Life | — | >12 years | — | 2 Mtpa basis |
What’s driving the upgrade — and why it matters
Price assumptions reflect today’s precious metals market
The primary driver of the reserve increase is an upward revision to long-term silver and gold price assumptions. Ore Reserves are now estimated using US$35/oz silver and US$2,500/oz gold, while Mineral Resources use the higher modelling assumptions of US$38.50/oz silver and US$3,000/oz gold. Higher assumed prices expand the volume of material that clears the economic cut-off threshold, converting previously marginal tonnes into the mineable reserve. Kingsgate describes these assumptions as reflecting a robust outlook for long-term precious metals prices.
Anglo American royalty purchase removes a structural cost
The second driver is a reduction in royalty obligations following the acquisition of Anglo American’s royalty and water rights at Nueva Esperanza, completed in May 2026 (per ASX:KCN release dated 14 May 2026). Royalty rates now applicable are: Arqueros 3% NSR, Teterita 3% NSR, and Chimberos 4% NSR. These rates feed directly into the net smelter return (NSR) cut-off calculations used to determine which material qualifies as an Ore Reserve. Lower royalty deductions improve the net revenue per tonne, allowing more material to clear the economic threshold.
The same transaction also included the purchase of water rights. Kingsgate now 100% owns a borefield supplying up to 50 litres per second for the full mine life, removing a potential infrastructure dependency and further de-risking the project’s development path.
Understanding Mineral Resources and Ore Reserves — what these numbers mean
For investors unfamiliar with mining terminology, the distinction between a Mineral Resource and an Ore Reserve matters considerably.
A Mineral Resource is the total quantity of mineralised material in the ground that has reasonable prospects for eventual economic extraction. Think of it as the geological inventory. An Ore Reserve is the subset of that inventory that has been assessed against a confirmed mine plan, with costs, recoveries, royalties, and prices all factored in. It represents the portion the company actually expects to mine economically.
The JORC Code (Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves) is Australia’s standard for how these estimates must be calculated and disclosed. It ensures consistency and gives investors confidence that reported figures meet defined technical and governance requirements.
Why does a reserve increase matter directly to project economics? More reserves mean a longer mine life, which means more years of potential revenue generation. At 51.9 Moz of silver in reserves, processed at 2 Mtpa, Nueva Esperanza is estimated to support over 12 years of mine operation.
Key terms at a glance:
- Mineral Resource: Total mineralised material with reasonable economic prospects
- Ore Reserve: The portion with a confirmed, economically viable mine plan
- JORC Code: Australian standard governing how these estimates must be reported
- Reserve Life: How long the mine can operate at planned production rates
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Nueva Esperanza — a project taking shape
Nueva Esperanza comprises three deposits — Arqueros, Chimberos, and Teterita — located 140km northeast of Copiapó in Chile’s Atacama Region and 100% owned by Kingsgate.
The planned operation is a conventional open-pit mine feeding a 2 Mtpa processing plant using cyanide leach and Merrill-Crowe recovery, a well-tested technology combination used widely across gold and silver operations. Environmental approvals are in place: the original Environmental Impact Assessment (EIA) was approved under RCA151/13, and a subsequent modification (covering the shift to dry-stacked tailings and the addition of the Teterita and Chimberos pits) was approved in June 2020 under RCA64/2020. Both approvals are currently in force.
The reserve estimate is underpinned by the 2016 Pre-Feasibility Study (PFS), with mining and processing costs, revenue assumptions, and foreign exchange rates updated in 2025 and 2026. An updated financial model indicates the project provides an economically viable mine plan across a range of reasonable input sensitivities, including metal price, foreign exchange, mining costs, and processing costs. Infill drilling is planned to upgrade Inferred Resources to Indicated classification, which would provide a further pathway to reserve growth.
Key project metrics:
- Processing rate: 2 Mtpa (nominal)
- Pre-production period: 1 year
- Production schedule: 13 years mining, 12 years ore processing
- Metallurgical recoveries: 71%–90% depending on deposit and material type
- Water supply: 100% secured via Kingsgate-owned borefield
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