P. ZIHLMANN INVESTMENT • MANAGEMENT AG
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KINGS MINERALS NL (ASX: KMN): FOLLOW-UP N° 6 / DECEMBER 22, 2008


RECOMMENDATION BUY
RISK RATING HIGHEST

1,345 KM² EXPLORATION PERMITS MT ISA INLIER AUSTRALIA AND ~72.3% OF TSX LISTED SAN ANTÓN RESOURCE CORP FOR GOLD, SILVER, COPPER, MOLYBDENUM AND URANIUM

Business Summary
Kings Minerals NL is a well established ASX-listed global metals exploration and development company.
Led by highly experienced and historically successful board and mining personnel, the company is developing 2 projects:
Cerro del Gallo: a major gold/silver/copper project in Mexico now entering the development stage, and
Kalman: an exploration stage molybdenum/copper/gold/rhenium project of significant promise, near Mt Isa, Australia.

2009 is expected to see key advances for both projects, particularly: a detailed, independent scoping study on the Cerro del Gallo project, and more exploration drilling results and potentially resource upgrades from the Kalman project and surrounding targets.

The company regards both projects as evidencing strong potential to be mined, at their respective stages of advancement.

SAN ANTÓN PROJECT, MEXICO
The San Antón Project is located in the state of Guanajuato in central Mexico, approximately 270km northwest of Mexico City. The San Antón Property fully incorporates the San Antón de las Minas mining district, centered 23km east northeast of Guanajuato city and the historic Guanajuato Mining District where production from 1700 to 2004 is reported to be 1.14 billion ounces of silver and 6.5 million ounces of gold. Although the Guanajuato Mining District has a long history of silver and gold mining and production extending back to 1558, production records at San Antón only date back to the 1860’s although mining is reported from Spanish colonial times. San Antón lies within the central-southern segment of the world-class Mexican Silver-Gold Belt.
The San Antón Project covers an area of 23,562.48 hectares (approximately 15km north-south by 16km east-west) and consists of a total of ten granted, contiguous exploitation and exploration concessions all owned by San Antón de las Minas S.A. de C.V. (SAM).

The San Antón Project is wholly owned by SAM, a resident Mexican company owned 51% by San Anton Resource Corporation Inc. (ticker code: SNN) and 49% by Desarrollos Mineros San Luis S.A.
DMSL’s ultimate holding company is Goldcorp Inc. (Goldcorp) a Canadian company.

SNN was listed on the Toronto Stock Exchange on 12 December 2006 following completion of the business combination and merger between Kings Canada Inc and Andaurex Industries Inc and the completion of a C$17.25M fund raising. The business combination and merger was effected by the delivery of Kings’ 51% interest in the San Antón Project in exchange for 75M SNN Common Shares and 10M SNN Common Share Purchase Warrants (5 years at an exercise price of C$1.20). Kings holds 72% (approximately) of SNN.

Mineral Resource Estimate
• Highlights of the Cerro del Gallo mineral resource update dated Jun 17, 2008 include:
• 43% increase in the Measured and Indicated Mineral Resources tonnes to 461 Mt
• 28% increase in the Measured and Indicated Resources contained metal to 1,087 Mlbs Cu, 3.9 Moz Au and 163 Moz Ag
• In addition to the Measured and Indicated Resources, there are 166 Mt of Inferred Resources containing 356 Mlbs Cu, 0.6 Moz Au, and 39 Moz Ag.

MT ISA PROJECT
The Mt Isa Project covers 1,345km2 owned predominantly 100% by the consolidated entity and earning up to 70% in the Pelican tenement (EPM 13870).
Kalman Prospect
Kalman is situated 34km south of the Mary Kathleen U-REE deposit (9.5Mt @ 0.13% U3O8) and 62km southeast of Mt Isa in the Mt Isa Mineral Province of northwest Queensland. The prospect lies within the Mary Kathleen zone of the Eastern Succession of the Mt Isa Inlier and is hosted by calc-silicate rocks of the Corella Formation. There is general consensus that the Corella Formation is a carbonate-evaporite-pelite sequence regionally metamorphosed to amphibolite facies. Kalman is located in an area of complex structural architecture. Mineralisation is located adjacent to, and near the intersection of a set of sub-parallel northeast trending widely spaced fractures and two northerly trending shear zones immediately adjacent and sub-parallel to the regional-scale Pilgrim Fault.
Kalman represents an unusual style of intrusion-related hydrothermal copper-molybdenum-gold mineralisation hosted by calc-silicate rocks comprised dominantly of alkali feldspar, actinolite and chlorite. Chalcopyrite-molybdenite mineralisation is accompanied by a hydrothermal alteration assemblage of calcite-chlorite-quartz without development of intense or pervasive silicification and quartz veining. Mineralisation generally occurs as fine grained disseminations and anastomosing discontinuous millimetre-wide veinlets. Pyrite averages <1% in zones of strongest copper-molybdenum-gold mineralisation. Rhenium is also present associated with the molybdenite. Copper grades are consistently elevated, although variable, over broad widths, and molybdenite grades are often highly elevated over narrower widths.
Drilling throughout the year has been proceeding to define the gross geometry of the copper-molybdenum-gold mineralisation on a nominal 100 metres by 100 metres grid. This program has demonstrated copper-molybdenum-gold mineralisation extends along strike for 1,000 metres (Figure 2) and to a depth of 700 metres below surface. Mineralisation remains open along strike to the north and south, and at depth. The mineralised zone dips sub-vertical to steeply west, however there is evidence of a dip reversal at depth.
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Recent News: San Anton Regional Exploration
The Directors are pleased to announce results of ongoing regional exploration within the San Anton Project, located in the state of Guanajuato, central Mexico. Exploration this year has included multi-element Niton® soil analysis and conventional soil sampling and a regional stream sediment Bulk Leach Extractable Gold (BLEG) sampling program.
Highlights
• Niton® soil analysis program identified 9 geochemical anomalies
• Conventional soil sampling further defined 1 geochemical anomaly
• Stream sediment BLEG sampling identified 12 new gold anomalies
Regional Exploration
The 2008 regional exploration program has included geological mapping, conventional -80 mesh multi-element soil geochemistry, handheld Niton® XRF multi-element soil analysis, and high density regional stream sediment BLEG sampling.
Conventional -80 mesh B-horizon soil sampling was completed at the Southern soil copper-molybdenum-gold anomaly to fully cover and define the eastern limitation of this geochemical anomaly, and at the West Tranquilino copper anomaly to validate Niton® XRF analyser soil results. The difference between the Niton® XRF analyser results and conventional - 80mesh soil assay results is relatively minor and confirms Niton® as a valid technique for rapid qualitative geochemical soil surveys at San Anton.
The handheld Niton® XRF soil program covered an area of 12.5km centred over the Cerro del Gallo gold-silver-copper deposit. A total of 3,107 samples were analysed during the program. A total of 10 geochemical anomalies have been identified based on individual or coincident values greater than either 100ppm CU, 120ppm Pb or 230ppm Zn; except for the Southern anomaly, which is based on coincident values greater than 60ppm Cu, 5ppm Mo and 22ppb Au.
The main geochemical anomalies are summarised below:

• Wildcat Cu-Pb-Zn
• La Plomo Pb-Zn
• Monument Hill Pb-Zn
• San Isidro Cu
• Epiphano Lopez Zn
• West Tranquilino Cu
• Angel East Pb-Zn
• Zinc Gossan Pb-Zn
• Mariposa Pb-Zn
• Southern Cu-Au-Mo (conventional -80 mesh soil)
•
A single diamond core hole, SA-359 was drilled at the Wildcat Cu-Pb-Zn geochemical anomaly. This hole intersected significant copper mineralisation including 119.3m @ 0.17% Cu, 0.04g/t Au, 30g/t Ag from 570.0m, plus several zones of low grade zinc-lead mineralisation, including 25.0m @ 0.31% Zn and 0.10% Pb from 545.0m None of the other geochemical anomalies have yet been drilled.
A high density regional stream sediment BLEG sampling program was completed throughout the tenement area. A total of 445 samples were collected during this program. In total 12 gold anomalies greater than 4ppb Au, not associated with known historic mine workings were defined (Figure 2). The source of these gold anomalies requires further investigation.
Comment
Regional exploration has identified many targets requiring further detailed investigation. Even though drilling is currently suspended, this work will enable targets to be prioritised for drill testing in the future.
The Company’s main focus remains to advance the technical studies on Cerro del Gallo while concurrently developing a pipeline of exploration targets for future testing.
Fundamental Considerations
• 10.19 Million Gold Equivalent Ounces – eventually 72% for San Anton or 7.34 Million ounces or a MC of $ 4 per ounce AuEq.
• Coeur d’Alene Mines (NYSE:CDE) has recently completed the purchase of Palmarejo for US$1.1 billion and paid more than $ 200 per Ounce of Gold (Au-Eq oz).

• Principals of Kings Minerals (which owns 72% of San Anton) was involved with Palmarejo.
• When CDE purchased Palmarejo, the gold price was at $ 750, 10% less than today.
• Each share of Kings Minerals of AUD 0.11 is backed by US$ 15 in form of metal in the ground at today’s market prices.
Kalman in Australia is Unique because of Molybdenum – “The 21st Century Metal”
About 25% of all molybdenum produced is used to make moly grade stainless steel.
About 50% is used for other iron-based alloys such as constructional steel, tool and high speed steel and cast iron. Steel mills add molybdenum either as Technical Mo Oxide or as Ferromolybdenum.
The remaining 25% is upgraded and used as lubricant grade MoS2, molybdenum compounds and moly metal.

At Kalman, at today’s price, King Minerals
• has Molybdenum worth US$ 2 in the ground for each outstanding share of AUD 0.11.
• has Copper worth US$ 1.25 in the ground for each outstanding share of AUD 0.11.
• has Gold worth US$ 0.50 in the ground for each outstanding share of AUD 0.11.

"I guess we've decided it's big enough now. In fact, it's enormous," president and CEO John Cook of San Antón says. "We really don't need to do any more drilling."

Peter Zihlmann
www.pzim.com
www.timeless-gold.com
[email protected]
phone +41 44 268 51 10
mobile +41 79 379 51 57
THE TIMELESS PRECIOUS METAL FUND and THE SIERRA MADRE GOLD & SILVER VENTURE FUND
are shareholders in the company and will benefit from any increase in the company’s share price.