A Thai petroleum millionaire has launched a low-ball offer for ailing Australian gold miner Kingsgate Consolidated as its future teeters on the brink.
Kingsgate shares were suspended from trade on the Australian Securities Exchange in mid-May, priced at 41 cents, valuing the company at $91.7 million.
It is facing a government-imposed closure of its Chatree mine in Thailand by December 31.
Chatchai Yenbamroong's Northern Gulf Petroleum has offered 4.2 cents per share for a 50.1 per cent stake in Kingsgate, valuing the target at just $9.4 million.
The Thai government dropped its bombshell in May, saying it would only extend Kingsgate's mining licence until the end of 2016, not three to five years as hoped, amid allegations nearby villages had been contaminated with arsenic and manganese.
There were also claims cyanide had escaped the mine's tailing pond, which Kingsgate vehemently rejected.
Mr Yenbamroong, who is also Perth-based Tap Oil's second biggest and most dissident shareholder, says several studies have shown the accusations against Kingsgate - spread by a handful of disgruntled former employees - are false.
Arsenic levels in Thailand's geology were naturally high, he said.
"It's not contamination - it's already there," he told AAP on Friday.
With Kingsgate's current liabilities exceeding its assets by $37 million, Mr Yenbamroong is also concerned lenders will dry up, and believes the company is not doing enough to save itself.
"They've got no solution to the challenges in Thailand," he said.
"I don't see any positive signs from them that they know how to get out of the situation. They've hit the brick wall.
"They're trying but it's got to do with strategy, access to decision makers, key people, and you have to know the environment you're in."
Mr Yenbamroong said if his bid was successful, lobbying the Thai government to renew the mining licence was his urgent priority.
"I'll be negotiating, negotiating, convincing, convincing," he said.
Gaining the support of Kingsgate shareholders would also be hard, he conceded.
"If we win, it's going to be a hard-won battle.
"It's going to be fought here in Bangkok, not in Sydney. You have to be close to the scene."
