K92 Mining projects 34% production growth in 2022

K92 Mining projects 34% production growth in 2022

K92 Mining is expecting a “significant” year-over-year increase in gold-equivalent production of up to 34%, from to 115,000 to 140,000 ounces. The company reported that high-margin production is also forecasted in 2022, with cash costs between $560-$640/oz gold and all-in sustaining costs (AISC) between $890-$970/oz gold.

K92 owns and operates the Kainantu gold mine in the Eastern Highlands province of Papua New Guinea. A high-grade, low-cost underground mine, Kainantu is located within a large 860 km2 land package hosting many highly prospective vein field and porphyry targets.

Current mining operations are focused exclusively on the northern portion of the Kora deposit, which outputs gold, silver and copper. Longer-term production will balance out between the K1 and K2 veins, the company said.

“2021 was a record year, and we plan to deliver another record year in 2022. The end-of-year momentum from the fourth quarter of 2021, which delivered record production, mill throughput, mine throughput and some of the highest metallurgical recoveries over the past two years for both gold and copper, has certainly set the operation up well for 2022,” CEO John Lewins said.

Growth capital

On the exploration front, K92 is expecting a significant increase in both near-mine and regional activities, with expenditures of $12-15 million projected for 2022.The company recently made a major pivot to focus on resource growth from previously largely infill drilling at Kora, with plans to drill the Judd, Kora, Judd South and Kora South vein systems, as well as the Blue Lake porphyry.

Growth capital is forecasted to be $41-$47 million, which includes the ongoing Stage 2A expansion to 500,000 tonnes per year, substantial upgrades to underground and surface infrastructure, and the twin incline development to also support the Stage 3 expansion.

“Advancing the Stage 3 expansion is a key part of our plans this year, with considerable progress planned on multiple fronts. Twin incline development advance has performed well, exceeding budget in the second half of 2021,” Lewins said.

The resource update for Judd and Kora is planned to be announced together this quarter, and the Stage 3 definitive feasibility study and updated preliminary economic assessment (PEA) are planned for Q2 publication, he added.


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