Kevin Silva | BNN | 2 February 2017
K92 Mining, the fast emerging gold producer that purchased Barrick’s Kainantu Gold Mine in Papua New Guinea during 2015, has just announced multiple high grade intercepts from drilling in the Irumafimpa area of the project.
While much of the attention garnered from the news release has been focused on the multiple holes that intersected high grades over wide cuts (such as 8.18m at 33 g/t Au, plus 1m at 4.51 g/t Au, plus 1.1m at 4.96 g/t Au in hole GCDD0020a), it is also important to note that the company also announced that it was now in the midst of its longest production run to date, since the restart of mining and processing operations. K92 is ramping towards commercial production and this news release touched on this fact, as well as describing results from a previously under-drilled area of the Irumafimpa deposit that exceeded expectations of management.
K92 Chief Executive Officer, Ian Stalker, states,
“In the context of K92 moving towards achieving Commercial Production, these high grade results are extremely pleasing as they confirm the continuity of the high grade system previously reported in the first six holes. The holes were drilled from an area at the southern extremity of the resource, where data is limited and significantly lower grades were expected. The results also show consistent evidence of multiple parallel high grade veins within close proximity to each other, providing the potential for several veins to be mined from the same underground access.”
The combination of near term production, alongside of exploration potential, has not been lost on the analyst community. While K92 might be considered relatively unknown, it is gaining visibility from brokerage firms that have had personnel visit the site and see the potential. Recently, K92 hosted industry professionals onsite from Macquarie, Clarus, Haywood and GMP, and the initial comments that have been released by analysts after this visit speak to the near, medium and long term upside potential. In fact, Clarus titled their post-visit note on K92 “Production Fast Track with Massive Exploration Upside” while Haywood reminded readers that “Papua New Guinea (PNG) is well known for its endowment of world-class porphyry and epitermal deposits.”
The current grade control drilling program is focused on the areas of Irumafimpa and is designed to bring a high degree of confidence to the production planning and scheduling. K92 plans to mine this area in the coming six months. The closed space drilling pattern of approximately 15 metres by 15 metres has significantly increased the confidence in this sparsely drilled area, with most holes recording high grade intersections. Approximately 80 per cent of the holes completed to date have recorded multiple high-grade intersections, indicating the presence of multiple parallel to sub parallel high-grade veins.
The results from this drilling are used to finalize the various stope and ore development designs, and provide updated information on projected production from the areas in terms of tonnage, grade and contained ounces. The drilled grade control holes are situated at the lowest point in the underground that K92 plans to mine, and are also at the southern edge of the known resource that was previously only drilled on a 100 metre by 100 metre pattern.
Bryan Slusarchuk, K92 President, states,
“The onsite team has continued to exceed expectations, both in terms of production ramp up and drilling. It’s a testament to the skill of this group that it was just 8 months ago we launched K92 as a publicly traded company, and we have now not only fast tracked into production, but have also continued to advance knowledge of Irumafimpa through drilling efforts such as just achieved.”
K92 trades on the TSX Venture Exchange with the symbol KNT, in the United States (KNTNF) and in Germany (92K).