K92 Mining Nears Stage 3 Completion, Eyes 300,000 Gold-Equivalent Ounces

Key Points

• Stage 3 expansion is nearing completion and remains on budget. The new 1.2-million-tonne-per-year processing plant is fully commissioned and operating, with K92 targeting a run-rate of 300,000 gold-equivalent ounces annually.
• K92 expects 2026 production of 190,000–225,000 gold-equivalent ounces, with stronger output anticipated in the second half as mining volumes and grades improve. Underground infrastructure upgrades, including ore passes, ventilation and fleet expansions, are supporting the ramp-up.
• The company is advancing a potential Stage 4 expansion that could lift throughput to 1.8 million tonnes annually and production above 400,000 gold-equivalent ounces. Exploration at Kora South, Judd and Arakompa—including a planned maiden resource at Arakompa—could provide additional growth.

K92 Mining TSE: KNT outlined progress on its Stage 3 Expansion in Papua New Guinea, saying the project remains on budget and is approaching completion as the company ramps toward higher production levels.

The company said its Stage 3 process plant, a standalone facility designed for throughput of 1.2 million tonnes per year, has completed construction and commissioning and has begun full operations. K92 is targeting run-rate average production of 300,000 gold-equivalent ounces annually through the expansion.

As of Aug. 31, 98% of Stage 3 growth capital had either been spent or committed, according to the presentation. The company said its balance sheet included roughly C$350 million in cash at midyear and C$40 million in debt, adding that cash increased and debt was reduced during the third quarter.

Leadership transitions and production outlook

K92 announced several leadership transitions intended to provide continuity. John, the company’s non-executive chair, plans to continue visiting Papua New Guinea and maintaining relationships with government and the resource sector. Chris Kinver, previously vice president of projects and engineering, is moving into the chief operating officer role. Anne Giardini is transitioning to a director position.

The company said it expects 2026 production of 190,000 to 225,000 gold-equivalent ounces, with the second half of the year expected to be stronger than the first. K92 expects the fourth quarter to be its strongest period, supported by higher mining volumes and a higher-grade stoping sequence.

During the second quarter, the company reported records for ore tonnes processed, total development and total mine material. It said record-setting operational trends continued into the third and fourth quarters. In July, K92 achieved 1,220 meters of lateral development, above the approximately 1 kilometer per month required for Stage 3 and the 1.2 kilometers per month targeted for a future Stage 4 expansion.

The company said the new processing plant has delivered gold recoveries above definitive feasibility study parameters for nine consecutive quarters, including the past two quarters using only the new facility. Copper recoveries have been approximately in line with feasibility study assumptions.

Infrastructure upgrades support mine ramp-up

K92 said it has undertaken extensive underground infrastructure work to support higher mining rates. The company began sending material through its first ore pass in August 2025 and now has separate ore and waste passes. A third ore pass is under development and is expected to enter service during the fourth quarter.

The company also completed the connection of an internal ramp in late January and achieved breakthrough of the Puma ventilation incline in late February. The ramp connection linked mining areas to the twin incline, allowing K92 to shift from separate upper- and lower-mine crews and fleets to a single crew and fleet.

The Puma ventilation work increased airflow by 75% to 350 cubic meters per second, K92 said. Commissioning of the primary ventilation chamber is underway, with full commissioning expected during the second half of October. The chamber is intended to lift airflow capacity to as much as 700 cubic meters per second, sufficient for Stage 3, Stage 4 and potential future requirements.

K92 said it is tripling the number of mining fronts during 2026. The Lower Kora mining front began producing its first stope material in April, while the twin-incline mining front produced its first stope from Judd in September.

Other work includes upgrades to roads and river crossings that enabled 60-tonne trucks to operate, replacing a prior 20-tonne payload limitation. K92 also expanded and renewed its underground fleet, with an additional jumbo rig expected to arrive at year-end.

Stage 4 option and exploration activity

The company said the Stage 3 plant was designed for a potential low-capital-cost expansion to 1.8 million tonnes per year. By upgrading the flotation circuit and filter press while relying on an oversized comminution circuit, K92 believes it could increase throughput by 50% and support run-rate average production of more than 400,000 gold-equivalent ounces annually.

Management said it currently sees the underground mine remaining at 1.8 million tonnes per year, unless exploration identifies additional subparallel veins or expanded strike lengths. Beyond Stage 4, the company sees potential growth from the Arakompa area.

K92 is operating 14 drill rigs, including seven underground rigs focused on Kora South and Judd South, and seven surface rigs. Surface drilling includes one rig at Judd North, five at Arakompa and one at Wera.

The company highlighted drilling at Kora South that identified high-grade areas and dilating zones near mine infrastructure, including reported intervals of 20 meters grading 14 grams per tonne and 16 meters grading 16 grams per tonne. It also said deep drilling at Judd has continued to demonstrate mineralization at depth.

At Arakompa, located about 4.5 kilometers from the processing plant, K92 said drilling has outlined a bulk zone with an average true thickness of roughly 40 meters, punctuated by high-grade veins. The company expects to announce a maiden resource for Arakompa either late this year or in the first quarter.

In response to an analyst question, the company said it is currently drilling one porphyry target at Arakompa and could potentially expand to a second porphyry target later in 2027. K92 said its broader land package totals 830 square kilometers and contains more than 25 years of highly prospective drill targets, according to its vice president of exploration.

About K92 Mining (TSE:KNT)

K92 Mining Inc is engaged in the production of gold, copper and silver at the Kainantu Gold Mine in the Eastern Highlands province of Papua New Guinea, as well as exploration and development of mineral deposits in the immediate vicinity of the mine. The Company declared commercial production from Kainantu in February 2018, is in a strong financial position, and is working to become a Tier 1 mid-tier producer through ongoing expansions. A maiden resource estimate on the Blue Lake copper-gold porphyry project was completed in August 2022.

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