K92 Mining Inc. (TSX: KNT) announced on Thursday that it has approved the stage 2A expansion at its Kainantu gold mine in Papua New Guinea. The move is expected to increase the mine’s throughput to 500,000 tonnes per annum or 1,370 tonnes per day.
The stage advancement represents a 25% increase from the stage 2 capacity of 400,000 tonnes per annum or 1,100 tonnes per day. The company said the mine has been consistently performing above requirement, including a notable daily record of 1,408 tonnes on September 22, 2021.
The mining firm also relayed that the incremental capital investment for the expansion is estimated to be US$2.5 million, which it said would be funded from existing cash flow.
“[At] an estimated plant expansion capital cost of US$2.5 million, the expansion is not only funded from existing cash flow but is also expected to considerably strengthen our near-term ability to self-fund the Stage 3 Expansion while continuing to advance our vein field and porphyry exploration,” said K92 Mining CEO John Lewins.
Lewins also added that the decision for the expansion was also supported by “the significant exploration and development results at Judd [vein]”. The first production stope at the vein is expected to be mined within the quarter.
The company said that the full commissioning of the stage 2A expansion is expected to start in Q3 2022.
The mining company previously reported drill results at Kainantu mine in August 2021, highlighting an intersect of 49.93 g/t gold over 6.25 metres.
K92 Mining last traded at $6.12 on the TSX.
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