Junior Mining Weekly

K92 Mining Inc. has received results from the continuing grade-control and exploration drilling of the Kora North extension. Results reported include holes KMDD0026, 28 30, 32 and 34 from diamond drill cuddy one (DDC1), as well as holes to the north of this area (KMDD0025, 27, 29, 31 and 33) evaluating further extensions of Kora.

  • Drill hole KMDD0034 records 4.1 metres at 9.19 grams per tonne gold, 4.2 g/t silver and 0.02 per cent copper (9.27 g/t gold equivalent) plus 3.6 m at 36.06 g/t Au, 354 g/t Ag and 0.66 per cent Cu (41.56 g/t AuEq);
  • Second diamond drill cuddy now established and third diamond drill rig has commenced drilling from this cuddy.

In addition, the company has now completed the development of the second drill cuddy (DDC2) 125 metres to the south of DDC1 and has commenced drilling from this cuddy with a third drill rig.

John Lewins, K92 chief executive officer and director, stated: “The ongoing results from the grade-control drilling from DDC1 have confirmed our interpretation of this northern extension of Kora in this area. In addition, drilling further to the north of the DDC1 zone has indicated that Kora may not have pinched out as previously interpreted, but may persist parallel, and to the west of, Irumafimpa. Further drilling is planned in this area to confirm this.”

The associated table provides a summary of the results from the latest diamond grade-control drill hole drilled into the Kora vein.

     KAINANTU GOLD MINE -- SIGNIFICANT INTERCEPTS FROM KORA UNDERGROUND DIAMOND DRILLING
 
Hole ID      From       To   Interval   True width    Gold   Silver   Copper   Gold equivalent
               (m)      (m)        (m)          (m)    (g/t)   (g/t)      (%)

KMDD0025     46.6     46.9        0.3         0.29     6.86       5     0.07              7.03
KMDD0025     52.2     55.4        3.2         3.06     1.68    2.30     0.02              1.74
Including    52.2    52.75        0.5         0.53     2.36       2     0.02              2.41
Including   52.75     53.1        0.4         0.34     1.75       1     0.00              1.77
Including    53.1     53.6        0.5         0.48     0.35       1     0.00              0.37
Including    53.6     55.4        1.8         1.72     1.83       3     0.03              1.91
KMDD0026    15.44     17.7        2.3         1.55     1.32       3     0.21              1.68
Including   15.44    15.64        0.2         0.16     6.78      15     1.83              9.77
KMDD0026     52.8    54.63        1.8         1.49     3.94       4     0.11              4.16
Including    52.8     53.5        0.7         0.57     4.45       3     0.07              4.60
Including    53.5    54.63        1.1         0.92     3.62       4     0.14              3.88
KMDD0027    45.47    45.88        0.4         0.40    15.43       3     0.08             15.59
KMDD0027    53.05    57.03        4.0         3.84     4.05       2     0.05              4.15 
Including   53.05     54.2        1.2         1.11     7.53       5     0.04              7.66 
Including    54.2     55.3        1.1         1.06     1.29    0.05     0.01              1.30 
Including    56.4    57.03        0.6         0.61     4.04       2     0.09              4.20 
KMDD0027    86.51     86.8        0.3         0.28     5.53       1     0.02              5.56 
KMDD0028     19.7     26.5        6.8         3.66     4.20       2     0.02              4.25 
Including    19.7     20.8        1.1         0.70     18.2       4     0.07             18.36
Including      22     22.9        0.9         0.57     2.11       1     0.02              2.16 
Including    22.9     23.6        0.7         0.45     1.06       1     0.00              1.08 
Including    25.1     26.5        1.4         0.34     2.33       1     0.01              2.35 
KMDD0028     65.6     66.3        0.7         0.45     8.17      18     0.29              8.84 
KMDD0029     65.3     65.8        0.5         0.46     5.18       2     0.02              5.23
KMDD0029   109.15   110.25        1.1         0.94     2.22      17     0.22              2.77
KMDD0030       14     17.4        3.4         1.88     3.18       6     0.34              3.78
Including      14       15        1.0         0.55     2.82     1.6     0.01              2.86
Including      15     16.3        1.3         0.72     1.63     2.5     0.02              1.69
Including    16.3     17.4        1.1         0.61     5.33    14.7     1.03              7.10
KMDD0030       73     74.2        1.2         0.39     3.82       5     0.31              4.36
KMDD0030     79.2     79.7        0.5         0.28     3.45      22     2.56              7.63
Including    79.2     79.5        0.3         0.17     4.93    34.3     4.08             11.61
Including    79.5     79.7        0.2         0.11     1.22     2.5     0.27              1.67 
KMDD0031     65.5     65.8        0.3         0.23     1.97      13     2.56              6.06 
KMDD0031     71.4       77        5.6         4.33     6.17       3     0.10              6.36 
Including    72.2     73.2        1.0         0.77     4.23     1.5     0.08              4.37 
Including    75.1       76        0.9         0.70     5.59     4.2     0.02              5.68 
Including      76       77        1.0         0.77    20.11     4.6     0.05             20.25
KMDD0032     66.4     68.6        2.2         1.43    8.905   26.95     1.09             10.92
Including    66.4     67.5        1.1         0.71    10.24     1.8     0.06             10.36
Including    67.5     68.6        1.1         0.71     7.57    52.1     2.12             11.48
KMDD0033       39     39.5        0.5         0.30     0.86      18     3.20              5.98 
KMDD0033       51       52        1.0         0.60     3.03       0     0.02              3.07 
KMDD0033    65.45     68.1        2.6         1.58     1.07       0     0.13              1.27 
Including   65.45     65.6        0.1         0.09     1.83     1.4     0.04              1.91 
Including    66.3     67.4        1.1         0.66     1.57     0.4     0.23              1.93 
KMDD0033       71     72.3        1.3         0.78     3.25       3     0.27              3.70 
KMDD0033      147    148.8        1.8         1.07     2.35       5     0.21              2.73 
KMDD0034       14     18.1        4.1         3.15     9.19    4.21     0.02              9.27 
Including      14     14.6        0.6         0.46     1.90       2     0.02              1.94 
Including    17.7     18.1        0.4         0.31    90.99      41     0.02             91.54
KMDD0034     55.6     59.2        3.6         2.77    36.06     354     0.66             41.56
Including    55.6     56.7        1.1         0.85     3.71       5     0.78              4.96 
Including    56.7    57.75        1.1         0.81     1.63       9     0.95              3.20 
Including   57.75     58.7        1.0         0.73   129.91   1,327     0.53            147.56

Notes
Gold equivalent uses copper price -- $2.90 (U.S.)/pound; silver price $16.5 (U.S.)/ounce and gold 
price of $1,300 (U.S.)/oz.

A table accompanying this press release is available on-line.

The current Kora/Eutompi inferred resource, as defined by previous drilling to date, is 4.36 million tonnes at a grade of 7.3 g/t Au, 35 g/t Ag and 2.23 per cent Cu, or 11.2 g/t gold equivalent (see attached table) and is open for expansion at depth and in both directions along strike.

K92 has filed and made available for download on the company’s SEDAR profile a technical report titled “Independent Technical Report, Mineral Resource Update and Preliminary Economic Assessment of Irumafimpa and Kora Gold Deposits, Kainantu Project, Papua New Guinea,” with an effective date of March 2, 2017, that provides additional information on the geology of the deposits, drilling and sampling procedures, lab analysis, quality assurance/quality control for the project, and additional details on the resource estimates.

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 per cent Cu):

  • Over a nine-year operating life, the plant would treat 3.2 million tonnes averaging 7.1 g/t Au, 25 g/t Ag and 1.7 per cent Cu (9.3 g/t AuEq (1));
  • This would generate an estimated positive cash flow of $537-million (U.S.) using current metal prices if 15-metre levels are used in mining; if 25-metre levels are used, then net cash flows are estimated as $558-million (U.S.); this cash flow includes conceptual allowances for capital;
  • Production of an estimated average of 108,000 AuEq (1) ounces per annum over an eight-year period from year 2 through to year 9;
  • An estimated pretax net present value (NPV) of $415-million (U.S.) for 25-metre levels, or $397-million (U.S.) for 15-metre levels, using current metal prices, exchange rates and a 5-per-cent discount;
  • An estimated after-tax NPV of $329-million (U.S.) for 25-metre levels, or $316-million (U.S.) for 15-metre levels, using current metal prices, exchange rates and a 5-per-cent discount;
  • Initial capital cost is estimated to be $13.8-million (U.S.), including the $3.3-million (U.S.) for the plant upgrade identified in the Mincore scoping study, but excluding the proposed Kora exploration inclines and diamond drilling; sustaining capital cost is estimated to a further $64-million (U.S.) spent over the life of the Kora mining for 25-metre levels, or $83-million (U.S.) for 15-metre levels;
  • Operating cost per tonne is estimated to be $125 (U.S.) per tonne for 25-metre levels, or $126 (U.S.) per tonne for 15-metre mining levels;
  • Excluding initial capital expenditure of $14-million (U.S.), cash cost is estimated to be $547 (U.S.) per ounce AuEq (inclusive of a 2.5-per-cent net smelter return (NSR) royalty) and all-in sustaining cost (AISC) of $619 (U.S.) per ounce AuEq for 25-metre mining levels, or $549 (U.S.) per ounce (inclusive of a 2.5-per-cent NSR royalty) and AISC of $644 (U.S.) per ounce AuEq for 15-metre mining levels.

Metal prices used were $1,300 per ounce for gold, $18 (U.S.) per ounce for silver and $4,800 per tonne for copper.

(1) Gold equivalent calculated on above metal prices.

Kora remains open for expansion in every direction 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 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. The technical report contains a full description of all underlying assumptions relating to the PEA. Mineral resources that are not mineral reserves and do not have demonstrated economic viability.

                              IRUMAFIMPA AND KORA/EUTOMPI RESOURCES                       
                                                                                                     
Deposit     Resource category   Tonnes          Gold       Silver       Copper    Gold equivalent
                                    Mt    g/t    MOz   g/t    MOz      %   Mlb         g/t    MOz 
   
Irumafimpa          Indicated     0.56   12.8   0.23     9   0.16   0.28    37        13.4   0.24   
                     Inferred     0.53   10.9   0.19     9   0.16   0.27    74        11.5   0.20   
Kora/Eutompi         Inferred     4.36    7.3   1.02    35    4.9   2.23   215        11.2   1.57   
Total indicated                   0.56   12.8   0.23     9   0.16    0.3     4        13.4   0.24   
Total inferred                    4.89    7.7   1.21    32   5.06    2.0   218        11.2   1.76 

M in table is millions.  
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. 
Gold equivalents are calculated as AuEq equals Au g/t plus Cu per cent times 1.52 plus Ag g/t times 0.0141.

K92 vice-president Chris Muller, PGeo, a qualified person under the meaning of Canadian National Instrument 43-101, has reviewed and is responsible for the technical content of this news release. Data verification by Mr. Muller includes significant time onsite reviewing drill core, surface exposures, underground workings and discussing work programs and results with exploration personnel.

 

LEAVE A REPLY

Please enter your comment!
Please enter your name here