PNG's K92 Mine in strong position
K92 Mining Ltd chief executive and director John Lewins says the third quarter saw a substantial strengthening of the financial and commercial position of the company and the achievement of a number of major milestones. During the quarter, he said, the company paid out all outstanding gold ounces owed to Cartesian Royalty Holdings II (CRH) and having previously paid US$3 million (K9.96m) to extinguish the royalty held by CRH on Kora and Irumafimpa, now had no outstanding liabilities or obligations to CRH.
Lewins said in addition, the company operating out of Eastern Highlands, paid a sum of US$12.5 million (K41.53m) to Barrick Gold Corporation (Barrick) to eliminate the contingent payment of up to US$60 million (K199.38m) payable under the original share sale agreement dated June 11, 2014, again leaving no outstanding liability or obligation to Barrick.
As a result, as at Sept 30 this year, the company held just under US$18 million (K59.81m) in cash, with the only material debt being a US$15 million (K49.84m) secured facility with Trafigura Pte Ltd. “The company celebrated 1,216 days with no lost time injury (LTI) at the end of the quarter, a very special and industry-leading achievement,” Lewins said.
“At the same time, the progress on the Kainantu mine expansion project has been very pleasing with a number of significant capital projects completed, including the incline bypass and debottlenecking.
“The first phase of the camp expansion and the installation of the gravity circuit in the plant which is currently being commissioned.
“With production of just under 20,000 oz (ounces) AuEq (gold equivalent) for the third quarter and just under 60,000 oz AuEq for the year-to-date and despite significant disruption associated with the expansion project, we have confirmed our conviction that we will achieve the top half of our updated AuEq production guidance, while delivering all-in sustaining costs at below our guidance.”