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Wednesday, 10/11/2017 1:53:20 PM

Wednesday, October 11, 2017 1:53:20 PM

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K92 ANNOUNCES POSITIVE RESULTS FROM TREATING THE INITIAL 800 TONNES OF BULK SAMPLE FROM THE KORA VEIN
By admin Posted October 11, 2017 In News Releases 0 0
The average feed assay of the material treated was 7.7 g/t Au and 0.91 % Cu

The gold recovery achieved was 92.4% and the copper recovery was 95.6%
34 tonnes of concentrate at an average grade of 163 g/t Au and 20% Cu containing 177 ozs of gold and 6.8 tonnes of copper was produced from the 800 tonne sample
K92 Mining Inc. (“K92”) is pleased to announce it has commenced treating an initial 2,000 tonne bulk sample from the interpreted Kora vein, and has results from treating the first 800 tonnes of material.

The bulk sample is being mined from a four-metre-by-four-metre horizontal development designed to reflect the production stoping width envisaged in the Preliminary Economic Assessment (“PEA”) referred below. The average grade of the first 800 tonnes of material treated was 7.7 g/t Au and 0.91 % Cu is consistent with that predicted from grade control face sampling underground.

The horizontal development has mined through where the K92 Kora extension discovery hole KMDD0009 intersected the vein (see K92 news release dated May 24, 2017, for details including true thicknesses).

The KMDD0009 intersection is approximately 500 metres along strike and 150 metres downdip from the closest point of the currently defined Kora deposit inferred resource and is typical of the Kora/Eutompi mineralization.

John Lewins, K92 Chief Executive Officer and Director, states,

The results from the treatment of the first 800 tonnes of material from the Kora vein are significantly better than we had anticipated, with gold recovery of 92.4% and copper recovery in excess of 95%. This is above the 91.5% recovery assumed in the PEA and even more impressive when considering that this is the first batch of material treated and was achieved without a gravity gold circuit. It is our expectation that further optimization should improve on this performance as will the introduction of a gravity gold circuit.”
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, 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.


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