"VANCOUVER, British Columbia, July 27, 2020 (GLOBE NEWSWIRE) -- K92 Mining Inc. (“K92” or the “Company”) (TSX-V: KNT; OTCQX: KNTNF) is pleased to announce the results of the Preliminary Economic Assessment (“PEA”) on its Kora gold deposit (“Kora”), which together with its Irumafimpa gold deposit (“Irumafimpa”) comprise the Kainantu Gold Mine Project (the “Kainantu Project”) in Papua New Guinea. Based on the results of the study, the Company is proceeding to a Definitive Feasibility Study (“DFS”) for the Kora Stage 3 Expansion.
Stage 3 Expansion PEA Study Highlights:
1. After-tax NPV5% of US$1.5 billion at US$1,500 per ounce gold, increasing to an after-tax NPV5% of US$2.0 billion at US$1,900 per ounce gold.
2. Average annual expansion run-rate production of 318,000 ounces gold equivalent (“AuEq”)(1) per annum at 1.0Mtpa, commencing in late-2023, representing a 165% increase from Stage 2 Expansion Life of Mine (“LOM”) average annual production.
3. LOM average cash costs of US$353 per AuEq ounce and AISC(2) of US$489 per AuEq ounce.
4. Low cash costs of US$202 per gold ounce and AISC costs of US$362 per gold ounce net of by-product credits.
5. Initial pre-expansion capital cost of US$125 million and life of mine sustaining capital cost of US$341 million with all capital costs fully funded by existing Stage 2 Kainantu mine cash flow.
6. Mine life of 12 years, including ~3 years of Stage 2 production (2021 to late-2023).
AuEq – calculated on the following metal prices: Au – US$1,500/oz, Ag – US$18.00/oz, Cu – US$3.00/lb. Note that gold equivalence factors for the production estimates are different to those used for reporting the Mineral Resource estimate.
AISC – All-In Sustaining Costs include cash costs plus estimated corporate G&A, sustaining costs and accretion.
The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the PEA will be realized. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
John Lewins, K92 Chief Executive Officer and Director, stated, “Over the past three years, Kainantu has delivered tremendous production and exploration growth and we are very pleased to report the results for the next major growth plan - Stage 3 Expansion. The PEA economics are robust, with run-rate production of ~318,000 oz AuEq per annum; low average all-in sustaining costs net of by-product credits of $362/oz gold which benefitted from higher copper grades and economies of scale, and; an after-tax NPV5% of US$1.5 billion at US$1,500/oz. Importantly, the Stage 3 Expansion is a low capital intensity project and within our ability to self-fund from scheduled mine cash flow. ...."