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K92 Announces Results from Further Underground Exploration Drill Hole from Kora Northern Extension

  • Drill Hole KMDD0093 records intersection of 22.20 m at 61.81 g/t Au, 6 g/t Ag and 0.27% Cu (62.30 g/t AuEq)
  • Drill Hole KMDD0089 records multiple high grade intersections, including 6.60 m at 10.70 g/t Au, 3 g/t Ag and 0.14% Cu (10.94 g/t AuEq)
  • Drill Hole KMDD0091 records multiple high grade intersections, including 2.60 m at 24.42 g/t Au, 5 g/t Ag and 0.06% Cu (24.58 g/t AuEq) and 8.40 m at 4.18 g/t Au, 5 g/t Ag and 0.35% Cu (4.79 g/t AuEq)

VANCOUVER, British Columbia, June 05, 2018 (GLOBE NEWSWIRE) -- K92 Mining Inc. (TSX-V:KNT) (OTCQX:KNTNF) (“K92”) is pleased to announce results from the ongoing underground exploration drilling of the Kora North Extension including an intersection of 22.20m at 61.81 g/t Au, 6 g/t Ag and 0.27% Cu (62.30 g/t AuEq) in drill hole KMDD0093 (see Table 1 below for a summary of drill results including true widths).

The results reported are from three exploration drill hole drilled from Diamond Drill Cuddy Two (DDC2) (see Kora North Plan below for hole locations). This exploration drilling program is targeting the area immediately up dip and down dip from the recently reported resource defined by grade control from DDC1 and DDC2 as well as an area along strike to the south. The intersections reported are consistent with expectations based on the grade control drilling. In addition, the results from hole KMDD0093 appear to indicate that the extremely high grades intersected in the K1 vein continue to the south beyond the area covered by the current grade control drilling, as well as being over 100 metres above the current Kora North mining level.

Hole KMDD0093 was terminated immediately after intersecting the interpreted K1 lode due to loss of barrel down hole. This hole and the other southern exploration holes will be drilled from diamond drill cuddy, DDC4 which is located almost 200 metres to the south of the current exploration cuddy, as this cuddy is now scheduled to be completed by late June.

John Lewins, K92 Chief Executive Officer and Director, states, “These results continue to expand our knowledge of the Kora system and the area in which we have interpreted as the Northern Extension of the Kora deposit. Our latest intersection in KMDD0093 shows the interpreted high grade K1 vein over 100 metres above our current mining level and within 200 metres along strike from the closest hole drilled from surface as part of the original Barrick program.”

Table 1 below provides a summary of the results from the first exploration drill hole drilled into the Kora North Vein system and Table 2 provides details of collar location and hole orientation.

Table 1.0 Significant Intercepts from Kora Underground Exploration Drilling

Hole_idFrom (m)To (m)Interval (m)True width (m)Gold g/tSilver g/tCopper %Gold equivalent
KMDD008952.6059.206.602.7810.7030.1410.94
Including52.6053.901.300.553.1450.183.49
Including53.9054.901.000.421.1520.051.26
Including54.9055.901.000.429.4640.4510.19
Including56.3057.000.700.298.5310.048.60
Including57.0057.500.500.2194.0360.1694.36
Including57.5058.000.500.212.6420.012.69
Including58.0059.201.200.511.2410.031.30
KMDD008965.0066.601.601.231.0880.732.29
KMDD008977.8078.801.000.710.591603.205.69
KMDD0089138.00140.002.001.203.95170.374.73
Including138.00139.201.200.724.5680.415.28
Including139.20140.000.800.483.04310.323.92
KMDD0089261.00261.600.600.575.34280.816.92
Including261.00261.400.400.382.27321.014.22
Including261.40261.600.200.1911.48190.4012.34
KMDD009173.5076.102.601.0124.4250.0624.58
Including73.5074.400.900.3528.77120.0929.06
Including74.4075.501.100.436.0810.026.13
Including75.5076.100.600.2351.5310.1051.69
KMDD009181.1089.508.403.194.1850.354.79
Including81.1082.000.900.347.2110.137.42
Including82.0082.800.800.300.2010.070.32
Including82.8083.400.600.2318.7980.1319.10
Including83.4084.000.600.235.0610.045.14
Including84.0084.500.500.190.5510.030.61
Including84.5085.801.300.492.6510.112.84
Including85.8086.801.000.380.2030.711.32
Including86.8087.500.700.270.4230.060.54
Including87.5088.501.000.382.06140.462.94
Including88.5089.501.000.387.84181.3410.11
KMDD0091111.00130.0019.007.411.44160.171.90
Including111.00112.001.000.393.94110.244.45
Including112.00113.001.000.390.2520.130.47
Including113.00114.001.000.390.86330.371.84
Including114.00115.001.000.391.8210.071.94
Including115.00116.001.000.391.3530.091.53
Including116.00118.202.200.861.14120.201.60
Including118.20119.301.100.430.4550.180.80
Including119.30121.201.900.742.88120.223.36
Including121.20122.401.200.471.1740.211.54
Including122.40123.901.500.591.5730.131.81
Including123.90124.800.900.352.2740.202.63
Including124.80125.700.900.351.5680.091.80
Including125.70126.500.800.310.301920.333.24
Including126.50127.300.800.311.3770.131.66
Including127.30128.601.300.511.2160.101.44
Including128.60130.001.400.550.3530.050.46
KMDD0091144.00145.001.000.401.17352.855.97
KMDD0093177.00199.2022.206.2261.8160.2762.30
Including177.00177.700.700.201.6910.111.87
Including177.70178.500.800.226.2330.416.90
Including178.50179.501.000.281.1310.041.21
Including179.50180.601.100.310.8110.020.85
Including180.60181.100.500.145.0240.766.23
Including181.10181.600.500.143.3940.103.59
Including181.60182.601.000.286.0410.056.12
Including182.60183.500.900.2524.1510.0324.20
Including183.50184.501.000.2852.5430.2152.89
Including184.50185.400.900.2590.9030.1691.19
Including185.40185.900.500.140.4610.010.49
Including185.90187.001.100.31120.4260.11120.67
Including187.00187.800.800.2213.8330.1414.09
Including187.80188.801.000.289.23141.0110.96
Including188.80189.400.600.171.5410.312.03
Including189.40190.501.100.31925.00540.68926.73
Including190.50191.501.000.283.0550.794.32
Including191.50192.501.000.281.8410.362.41
Including192.50193.501.000.280.9810.321.48
Including193.50194.501.000.281.3020.221.65
Including194.50195.300.800.224.5230.585.45
Including195.30196.000.700.2010.4530.3010.94
Including196.00197.601.600.451.5830.081.75
Including197.60198.500.900.254.2950.044.41
Including198.50199.200.700.202.4520.042.54

Notes
Gold Equivalent uses Copper price – US$2.90/lb; Silver price US$16.5/oz and Gold price of US$1300/oz

Table 2.0 – Collar Locations for Kora Exploration Holes

Hole_idCollar locationCollar orientationEOH depth (m)Lode
Local northLocal EastmRLDipLocal azimuth
KMDD008959001.4529875.571187.33-47.63244.90279.2Kora
KMDD009159002.4229876.041192.3362.80223.52184.6Kora
KMDD009359001.1829876.031191.5841.24196.79203.0Kora

The current Kora/Eutompi inferred resource, as defined by previous drilling and prior to the discovery of the northern extension of Kora by K92, 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 table 3.0 below) 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, and 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.

Table 3.0 IRUMAFIMPA AND KORA/EUTOMPI RESOURCES

Resource by Deposit and Category
DepositResource
Category
TonnesGoldSilverCopperGold Equivalent
Mtg/tMOzg/tMOz%Mlbg/tMOz
IrumafimpaIndicated0.5612.80.2390.160.283713.40.24
Inferred0.5310.90.1990.160.277411.50.20
Kora/EutompiInferred4.367.31.02354.92.2321511.21.57
Total Indicated0.5612.80.2390.160.3413.40.24
Total Inferred4.897.71.21325.062.021811.21.76

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 = Au g/t + Cu%*1.52+ Ag g/t*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.

On Behalf of the Company,

John Lewins, Chief Executive Officer and Director

For further information, please contact Investor Relations 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 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.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/a44d1f8b-f6e7-4f92-9460-e53d2b13af21

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