Drilling and blasting has commenced a nd the drive to Kora will represent a
Suite 488 – 1090 West Georgia Street
Vancouver, British Columbia
Canada V6E 3V7
Telephone: (604) 687-7130
Facsimile: (604) 608-9110
NEWS RELEASE
March 7, 2017 Vancouver, British Columbia
K92 Mining Commences Underground Drive to High Grade Kora Deposit
Drilling and blasting has commenced a nd the drive to Kora will represent a
continuation, from the switchback point, of the current Irumafimpa incline drive
that is accessed from the 840 Portal
Kora is a large and high grade deposit, open for expansion in every direction and
strongly mineralized at the extent of all drilling, with a current resource estimate of
4.36 million tonnes of 7.3 g/t Au, 35 g/t Ag and 2.23% Cu
Underground drive will allow access to Kora for future production as part of the
Company’s growth strategy
Expansion and exploration drill testing alon g the drive from underground set ups is
expected to commence within 60 days
K92 is targeting the commencement of pr oduction in First HalfQ1 2018 from the
Kora Deposit
K92 Mining Inc. (“K92” or the “Company”) is pleased to announce that it has commenced the
underground incline drive from the Irumafimpa Mine towards the Kora Deposit.
This 5m x 5m drive is designed to provide access to the Kora deposit, where K92 is targeting the
commencement of production in First Half 2018, wh ile also providing the Company with the
ability to drill test thereafter between Irumafimpa and Ko ra from underground set ups. This area
has not been previously tested due to topographical challenges asso ciated with drilling from the
surface and is considered highly perspective give n the current interpretation of Irumafimpa and
Kora being on the same vein structure.
K92 Chief Executive Officer, Ian Stalker, states, “Kora is already a large and high grade
deposit and the upcoming drill program is designed to test our belief that this high grade deposit
has significant expansion potential. While accessi ng Kora as part of our production strategy is
important, equally exciting is the ability to use underground set ups to drill test the area between
Irumafimpa and Kora, and Kora at depth. Also, wh ile the gold and silver grades at Kora are
exceptional, it is also important to point out that this is a high grade copper deposit which bodes
well should the macro environment for copper continue to strengthen.”
Drilling and blasting has commenced and the driv e to Kora will represent a continuation, from
the switchback point, of the current Irumafimpa incline drive that is accessed from the 840
Portal.
It is estimated that the Kora deposit is appr oximately 700 metres from the switchback point. The
Company estimates that it will take about nine months from the st art date to complete the drive
and the drive is planned to extend to the Mining Lease 150 boundary, which is the current known
limit of Kora mineralization. Dril l testing from underground set ups, designed to take place at
100 metre intervals along the way, is expected to commence within the next 60 days.
In addition to drilling between the Irumafimpa and Kora deposits, K92 will also be drilling down
dip from the known resource to infill between the known resource and the single deepest known
hole drilled on the deposit BKDD0023. This hole reco rded an intersection of 30.6 metres @ 2.0
g/t Au, 4.8 g/t Ag and 1.3% CU, including 6.4 metr es @ 5.52 g.g/t Au and 8M @ 3.7% Cu from
from 920.8 metres, approximately 500 metres below the current resource.
Consideration will be given to extending th e drive beyond the Mining Lease 150 into the
adjacent Exploration Lease (EL 693) which is also held by K92, to allow exploration drilling to
be undertaken to potentially extend the known limit of mineralization to the North.
K92 has filed and made available for downloa d on the Company’s SEDAR profile, a technical
report titled "Independent Technical Report, Mineral Resource Update and Preliminary
Economic Assessment (“PEA”) of Irumafimpa and Kora Gold Deposits, Kainantu Project, Papua
New Guinea” with an effective date of March 2, 2017 (the "Technical Report").
The PEA estimates for Kora, based on the current resource estimates (4.36 million tonnes of 7.3
g/t Au, 35 g/t Ag and 2.23% Cu);
Over a 9 year operating life the plant would treat 3.2 million tonnes averaging 7.1 g/t Au,
25 g/t Ag and 1.7% Cu (9.3 g/t Au Eq*)
this would generate an estimated positive cash flow of US $537 million using current
metal prices if 15m levels are used in mini ng. If 25m levels are used then net cashflows
are estimated as US $558 million. This cash flow includes conceptual allowances for
capital
production of an estimated average of 108,000 Au Eq* ozs per annum over an 8 year
period from Year 2 through to Year 9
An estimated pre-tax NPV of US $415 million for 25m levels; or US $397 million for
15m levels; using current metal prices, exchange rates and a 5% discount
an estimated after-tax NPV of US $329 m illion for 25m levels; or US $316 million for
15m levels; using current metal prices, exchange rates and a 5% discount
initial capital cost is estimated to be US $13.8 million, including the US $3.3 million for
the plant upgrade identified in the Mincor e Scoping Study but excl uding the proposed
Kora exploration inclines and diamond drilling. Sustaining Capital Cost is estimated to a
further US $64 million spent over the life of the Kora mining for 25 m levels or US $83
million for 15m levels
operating cost per tonne is estimated to be US $125/tonne for 25m levels or US $126 /
tonne for 15m mining levels
excluding initial capital expenditu re of US $14 million, cash cost is estimated to be US
$547 / oz Au Eq (inclusive of a 2.5% NSR) and AISC of US $619/oz Au Eq for 25m
mining levels; or US $549/oz (inclusive of a 2.5% NSR) and AISC of US $644/oz Au Eq
for 15m mining levels
Metal prices used were Au - $1300; Ag – US $18/oz; Cu – US $4800/tonne
*Au Eq calculated on above metal prices
Kora remains open for expansion in every directi on and strongly mineralized at the extent of all
drilling.
The PEA is preliminary in nature and includes inferred mineral resources that are considered too
speculative geologically to have the economic consid erations applied to them that would enable
them to be categorized as mineral reserves, and there is no certainty that the PEA will be
realized. The Technical Report cont ains a full description of all underlying assumptions relating
to the PEA. Mineral Resources that are not Mineral Reserv es do not have demonstrated
economic viability.
On behalf of the Company,
Ian Stalker
Chief Executive Officer and Director
The TSXV has neither approved nor disapproved the contents of this press release.
K92 Advisor, Brian Lueck, P.Geo, a qualified pe rson under the meaning of Canadian National
Instrument 43-101, has reviewed and is responsible for the technical content of this news release.
CAUTIONARY STATEMENT REGARDING FORWARD-LOO KING INFORMATION: This news release
includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-
looking statements are necessarily based upon a number of estimates and assumptions that, while considered
reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the
actual results and future events to differ materially from those expressed or implied by such forward-looking
statements. All statements that address future plans, activities, events or developments that the Company
believes, expects or anticipates will or may occur are forward-looking information, including statements
regarding the realization of the preliminary economic analysis for the Project, expectations of future cash
flows, the proposed plant expansion, potential expansion of resources and the generation of further drilling
results which may or may not occur. Forward-looking statements and information contained herein are based
on certain factors and assumptions regarding, among other things, the market price of the Company's
securities, metal prices, exchange rates, taxation, the estimation, timing and amount of future exploration and
development, capital and operating costs, the availability of financing, the receipt of regulatory approvals,
environmental risks, title disputes, failure of plant, equipment or processes to operate as anticipated,
accidents, labour disputes, claims and limitations on insurance coverage and other risks of the mining
industry, changes in national and local government regulation of mining operations, and regulations and other
matters. There can be no assurance that such statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements. The Company disclaims any intention or obligation to update
or revise any forward-looking statements, whether as a result of new information, future events or otherwise,
except as required by law.
CONTACT INFORMATION
K92 Mining Inc.
Mario Vetro, Investor Relations
(604) 687-7130
(604) 608-9110 (FAX)