Production exceeded expectations, says miner

K92 MINING Ltd, operator of the Kainantu gold mine in Eastern Highlands, says its production results for the fourth quarter of 2019 and the whole year exceeded expectations.
Chief executive and director John Lewins said this was a testament to the quality of not only the Kora North deposit but also the entire team at Kainantu.
Lewins said the record production of 23,646 ounces gold equivalent (AuEq) was delivered during a quarter in which there were significant interruptions to underground operations resulting from the ongoing upgrading of key infrastructure as well as interruptions to plant operations associated with the installation of new equipment.
“Importantly, underground development has significantly ramped up over the course of the year, with total tonnes mined, increasing from under 60,000 tonnes in first quarter to 120,000 tonnes in the final quarter,” he said.
“This increased development activity reflects the impact of additional equipment and personnel following the decision to go ahead with the expansion project during the first quarter of 2019.
Lewins said, in addition, the company continued to work on the expansion of the Kora/Kora North Resource, with a further 26 holes completed during the quarter.
“During first quarter, the company announced the commencement of the expansion of the Kainantu gold mine, with a goal of doubling current capacity to 400,000 tonnes per annum and increasing annual production to an average of 120,000 AuEq oz.”
Meanwhile, total production over the next 13 years would be 1.33 million oz.
Total revenue for the period would be over US$2 billion (K6.65 billion) with royalty payments for the period would be US$50 million (K166.4 million). Tax paid to the Government for the period, from payroll and corporate tax would total US$300 million (K998.3 million), total sustaining capital of US$202 million (K672million) would be required over the 13-year period, and net cash flow would be US$1.03 billion (K3.4 billion).
The net present value would be US$710 million (K2.3billion) pre-tax, or US$559 million (K1.86billion) after tax, and internal rate of return would be in excess of 350 per cent.
K92 Mining is engaged in production of gold, copper and silver from Kora and Kora North deposits of Kainantu gold mine.