K92 Mining Inc. Reports Significant Resource Increase at High-Grade Kora Deposit
Suite 488 – 1090 West Georgia Street
Vancouver, British Columbia
Canada V6E 3V7
Telephone: +1 (604) 687-7130
Facsimile: +1 (604) 608-9110
www.k92mining.com
NEWS RELEASE
K92 MINING INC. REPORTS SIGNIFICANT RESOURCE INCREASE AT
HIGH-GRADE KORA DEPOSIT
Vancouver, British Columbia, May 19, 2020 - K92 Mining Inc. (“K92” or the “ Company”)
(TSXV: KNT; OTCQB: KNTNF) is pleased to announce results from the updated resource
estimate that has been completed on the Kora deposit, at its producing Kainantu Gold Mine in
Papua New Guinea . The resource estimate is based on surface and underground exploration
diamond drilling and underground face sampling (grade control).
Kora Deposit Mineral Resource Estimate Highlights:
• Measured and Indicated Resource of 1.1 million ounces at 10.45 g/t gold equivalent
(“AuEq”) representing a +180% increase from the previous resource estimate of 0.39
million ounces AuEq in October 2018.
• Inferred Resource of 3.7 million ounces at 9.01 AuEq representing a +50% increase
from the previous resource estimate of 2.39 million ounces AuEq in October 2018.
• Significant component of the updated resource is high grade, with only moderate
reductions in overall ounces as cut -off grade increases ( see Table 2-3 for grade
sensitivity table).
o Measured and Indicated Resource of 1.0 million ounces at 12.58 g/t AuEq at a
2 g/t gold cut-off and 0.8 million ounces at 20.51 g/t AuEq at a 5 g/t gold cut
off.
o Inferred Resource of 3.3 million ounces at 11. 82 g/t AuEq at a 2 g/t gold cut-
off and 2.6 million ounces at 19.78 g/t AuEq at a 5 g/t gold cut off.
• Kora North, Kora and Eutompi deposits now combined and shown to be one
continuous deposit, open at depth and open along strike to the south.
• Kainantu vein field has numerous opportunities to expand resources from near-mine
high-priority exploration areas including: Kora strike extension; Kora deeps; Kora
and Judd South veins; Judd vein; Karempe vein, and; Arakompa and Maniape (see
Fig 3).
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Table 1 – Global Kora Mineral Resource (Effective Date April 2, 2020, 1 g/t gold cut-off)
Tonnes Gold Silver Copper AuEq
mt g/t moz g/t moz % kt g/t moz
Measured 0.66 13.34 0.28 11.6 0.25 0.51 3.4 14.14 0.3
Indicated 2.47 8.44 0.67 16.3 1.29 0.63 15.6 9.46 0.8
Total M&I 3.13 9.47 0.95 15.3 1.54 0.61 19 10.45 1.1
Inferred 12.67 7.32 2.98 19.9 8.11 1.1 139.4 9.01 3.7
• The Independent and Qualified Person responsible for the Mineral Resource Estimate is
Simon Tear, P.Geo. of H & S Consultants Pty. Ltd., Sydney, Australia, and the effective
date of the estimate is April 2, 2020.
• Mineral Resources are not Mineral Reserves and do not have demonstrated economic
viability.
• Resources were compiled at 1,2,3,4,5,6,7,8,9 and 10 g/t gold cut-off grades.
• Density (t/m3) is on a per zone basis, K1 and Kora Link: 2.84 t/m3; K2: 2.93 t/m3; Waste:
2.8 t/m3
• Reported tonnage and grade figures are rounded from raw estimates to reflect the order
of accuracy of the estimate.
• Minor variations may occur during the addition of rounded numbers.
• Calculations used metric units (metres, tonnes and g/t)
• Gold equivalents are calculated as AuEq = Au g/t + ((0.923 x Cu%)*1.38)+ ((0.77 x Ag
g/t*0.0115). Gold price US$1,400/oz; Silver US$16.05/oz; Copper US$3.05/lb. Metal
payabilities and recoveries are incorporated into the AuEq formula. Recoveries of 92.3%
for copper and 77% for silver.
Table 2 – Sensitivity to Au Cut-off grade for Kora Measured and Indicated Resource Block
Model - see Fig 2 for Grade Tonnage Curve.
(Resource Statement is for 1 g/t Au cut-off; tabulation of other cut-off values for information only)
Measured and Indicated Resources
Au Cut-
Off Grade
Tonnes Gold Silver Copper AuEq
g/t mt g/t moz g/t moz % kt g/t moz
1 3.1 9.47 0.95 15.3 1.5 0.61 19.0 10.45 1.1
2 2.5 11.55 0.92 16.8 1.3 0.64 16.0 12.58 1.0
3 1.9 14.11 0.88 18.7 1.2 0.68 13.2 15.22 0.9
4 1.6 16.72 0.83 20.5 1.0 0.71 11.0 17.89 0.9
5 1.3 19.29 0.80 22.5 0.9 0.74 9.5 20.51 0.8
6 1.1 21.71 0.76 24.3 0.9 0.76 8.3 22.98 0.8
7 1.0 23.97 0.73 25.6 0.8 0.78 7.4 25.27 0.8
8 0.8 26.05 0.71 26.9 0.7 0.79 6.7 27.38 0.7
9 0.8 28.04 0.68 28.2 0.7 0.81 6.1 29.41 0.7
10 0.7 30.06 0.66 29.5 0.6 0.82 5.6 31.45 0.7
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Table 3 – Sensitivity to Au Cut-off for Kora Inferred Resource Block Model - see Fig 2 for
Grade Tonnage Curve.
(Resource Statement is for 1 g/t Au Cut-off; tabulation of other cut-off values for information only)
Inferred Resources
Au Cut-
Off Grade
Tonnes Gold Silver Copper AuEq
g/t mt g/t moz g/t moz % kt g/t moz
1 12.7 7.32 2.98 19.9 8.1 1.10 139.4 9.01 3.7
2 8.8 9.89 2.80 23.1 6.5 1.25 110.2 11.82 3.3
3 6.5 12.60 2.61 25.0 5.2 1.33 86.1 14.66 3.0
4 5.1 15.11 2.46 26.1 4.3 1.36 69.0 17.22 2.8
5 4.1 17.63 2.32 27.0 3.5 1.38 56.6 19.78 2.6
6 3.4 20.26 2.19 27.7 3.0 1.38 46.3 22.40 2.4
7 2.8 23.01 2.08 28.7 2.6 1.33 37.3 25.09 2.3
8 2.4 25.86 1.97 29.7 2.3 1.28 30.3 27.89 2.1
9 2.1 28.41 1.89 30.7 2.0 1.26 25.9 30.41 2.0
10 1.8 31.50 1.80 32.0 1.8 1.21 21.5 33.44 1.9
John Lewins, K92 Chief Executive Officer and Director, state d, “In eighteen months of
underground and surface drilling, K92 has significantly increased our resource at Kora and at a
very low discovery cost of less than U S$5 per oz. The Measured and Indicated Resource now
stands at 3.1 million tonnes at 10.45 g/t AuEq for 1.1 million ounces AuEq and Inferred at 12.7
million tonnes at 9.01 g/t AuEq for 3.7 million ounces, confirming that Kora is a very large system.
The resource estimate has also demonstrated Kora’s significant high-grade operational flexibility
going forward, with moderate reductions in overall ounces , and significant increases in grade at
increasing cut-off grades.
Going forward, there remains tremendous potential to increase resources at Kainantu. At Kora,
approximately 75% of the originally planned 1,000m by 1,000m target area was drilled for th is
resource. The remaining drill target area is highly prospective and continuing exploration drilling
from underground has already shown continuity of mineralization into this area. In addition, there
are also multiple high priority near-mine targets that are planned to be drilled this year.
With the resource significantly increased, we are working on a Preliminary Economic Assessment
(“PEA”) for the next potential production expansion phase – Stage 3. This work had commenced
prior to the completion of the updated Kora Resource Estimate and we look forward to announce
the results near-term.”
Key Assumptions and Parameters
The Kora Deposit compri ses of two parallel, steeply west dipping, north -south striking quartz -
sulphide vein systems, K1 and K2, within an encompassing dilatant structural zone hosted by
phyllite. An additional structure, the Kora Link, has also been defined between K1 and K2. There
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are five Kora Link structures identified, of which three are included in the updated resource
estimate.
The current resource estimate area covers an area of approximately 1250 metres along strike by
1050 to 1150 metres vertically (see Fig 1), representing ~75% of the drill target area. K92 plans to
continue to drill the area not yet drilled. The updated resource estimate includes results from 266
diamond drill holes in addition to face samples taken from horizontal development and from cut
and fill faces along the K1 and K2 veins.
Underground drilling consists of diamond core for a range of core sizes depending on the length
of hole and expected ground conditions. Sampling is sawn half core under geological control and
generally ranges between 0.5m to 1.0m. Underground face sampling is completed for every fired
round and is to industry standard. QAQC data indicated no significant issues with the sampling or
the accuracy of the on-site analysis. Current core recovery of the mineral zone is +95%, with initial
drilling around the 90% mark.
Geological logging is consistent and is based on a full set of logging codes covering lithology,
alteration, and mineralization.
The geological interpretation of the vein systems is represented as 3D wireframe solids snapped
to a combination of diamond drillhole data and underground face sampling (see Fig 1). Definition
of the wireframes is based on identified gold mineralization in drill core nominally at a 0.1-0.2g/t
Au gold-off in conjunction with geological control/sense and current mining widths.
The wireframes were used to extract 1-metre composites (minimum of 0.5m) from the drillhole &
sampling database for gold, copper and silver. A gold top cut of 1000g/t was applied to K2
composites and a 150g/t top cut for the Kora Link #2. No top cuts were applied to silver or copper.
Variography was generally poor, as would likely be expected, although K1 indicated better along
strike grade continuity.
Grade interpolation of the composite data was completed using Ordinary Kriging with a block size
of 1m by 5m by 5m. A larger block size check model indicated no evidence of over-smoothing of
gold grade with the smaller block size.
Default average density values have been applied to the different lodes. The defaults are based on
limited core measurements using the Archimedes Method (weight in air/weight in water). Density
(t/m3) is on a per zone basis, with K1 and Kora Link: 2.84 t/m3; K2: 2.93 t/m3; Waste: 2.8 t/m3
A three pass search strategy was applied to the grade interpolation . Search ellipse parameters are
listed below. Search ellipse orientations generally reflected the subtle changes in dip and strike of
the vein systems, with up to 8 search domains used for each lode.
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Table 5 – Mineral Resource Search Ellipse Pass Specifications
Pass No X radius
(m)
Y radius
(m)
Z radius
(m) Min Data Min Octants Max Data
1 2 25 25 12 4 32
2 4 50 50 12 4 32
3 8 125 125 6 2 32
Allocation of the classification of the Mineral Resources is derived from the search pass numbers
which essentially is a function of the drillhole and face sample data point distribution. Additional
considerations were included in the assessment of the classification; in particular, the geological
understanding and complexity of the deposit, sample recovery, quality of the QAQC sampling and
outcomes, density data and reconciliation with production.
Table 6 – Resource Classification by Pass Category
Pass Category Resource Classification
1 Measured
2 Indicated
3 Inferred
All material mined within the mineral wireframes up to the effective dat e (of April 2, 2020) has
been removed from the model. Gold reconciliation of the resource model with the mill production
up to the effective date has been reasonably good in terms of recovered ounces from the mill being
12% above that estimated by the model.
The Inferred Mineral Resources in this estimate have a lower level of confidence than that applied
to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably
expected that the majority of the Inferred Mineral Resource could be updated to an Indicated
Mineral Resource with continued exploration.
Gold Equivalent (AuEq) g/t was calculated using the formula AuEq = Au g/t + ((0.923 x
Cu%)*1.38)+ ((0.77 x Ag g/t*0.0115) and the aassumptions are Gold price US$1,400/oz; Silver
US$16.05/oz; Copper US$3.05/lb and recoveries of 92.3% for copper and 77% for silver.
The estimate of Mineral Resources may be materially affected by environmental, permitting, legal,
title, taxation, socio-political, marketing, or other relevant issues.
Mineral Resources, which are not Mineral Reserves, do not have demonstrated economic viability.
The complete Technical Report prepared in accordance with National Instrument 43 -101 -
Standards of Disclosure for Mineral Projects (“NI 43-101”) will be released within 45 days of this
news release.
The new resource estimate will be used to update the existing PEA, with compl etion expected in
July.
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Conference Call and Webcast to Present Results
K92 Mining will host a conference call and webcast to present the results of the updated Kora
mineral resource at 8:30am (Eastern Time) on Wednesday, May 20.
• Listeners may access the conference call by dialing toll-free 1-800-319-4610 within North
America or +1-604-638-5340 from international locations.
• The conference call will also be broadcast live (webcast) and may be accessed via the
following link:
o http://services.choruscall.ca/links/k92mining20200520.html
• Presentation slides will be available under the investor/ presentation tab on K92 Mining’s
website:
o https://k92mining.com/investor/presentation/
Qualified Persons
K92 mine geology manager and mine exploration manager, Andrew Kohler, PGeo, a qualified
person under the meaning of Canadian National Instrument 43-101 – Standards of Disclosure for
Mineral Projects, has reviewed and is responsible for the technical content of this news release.
Data verification by Mr. Kohler includes significant time onsite reviewing drill core, face
sampling, underground workings, and discussing work programs and results with geology and
mining personnel.
Simon Tear, P.Geo of H & S Consultants Pty. Ltd. of Sydney, Australia is a Qualified Person as
defined under NI 43-101 for the mineral resource estimate discussed above. Mr. Tear has reviewed
and approved the contents of this press release.
On Behalf of the Company,
John Lewins, Chief Executive Officer and Director
For further information, please contact David Medilek, P.Eng., CFA at +1-604-687-7130.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT
TERM IS DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING 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 Kainantu Mine, expectations of future
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cash flows, the planned plant expansion, production results, cost of sales, sales of production,
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 li mitations on
insurance coverage and other risks of the mining industry, changes in national and local
government regulation of mining operations in PNG, and regulations and other matters.. There
can be no assurance that such statements will prove to be acc urate, 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. For information on risks, please
refer to the Company’s Manage ment Discussion and Analysis for the year ended December 31,
2019. 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.
Figure 1 – Kora Resource Lode Wireframes Long Section, Cross Section and Plan View