K92 Mining is pushing on relentlessly with the growth of its Kainantu mine in Eastern Highlands. CEO John Lewins provides a progress report to Business Advantage PNG and shares the secrets to the operator’s success.

Workers at the K1 vein, one of two subparallel veins that are part of the Kainantu gold mine’s Kora epithermal vein system. Credit: K92 Mining

World gold production has seen very little growth since around 2018, as “it’s getting harder to find gold, permit it, finance it and operate it,” John Reade, Chief Market Strategist at the World Gold Council, said in a recent interview with CNBC.

All the more impressive that K92 Mining has succeeded in continuously expanding production at its Kainantu gold mine since pouring first gold in 2018.

We took the view that the staged expansions would create higher cashflow [at a] relatively low cost.

Kainantu’s processing plant was initially capable of handling 200,000 tonnes per annum (tpa) of ore throughput – enabling 50,000 ounces per annum (oz pa) of gold-equivalent production – before its stage 2 and 2a expansions took the plant to 600,000 tpa by May 2023.

The Canadian operator recently announced another major milestone in its growth trajectory: the commissioning of its Stage 3 expansion processing plant, which will be capable of handling 1.2 million tonnes per annum. It has now spent or committed 86 per cent of the US$320 million earmarked for its stage 3 and 4 expansions, which are expected to quadruple current gold, copper and silver production to 470,000 oz pa of gold-equivalent by 2027.

John Lewins, CEO of K92 Mining, tells Business Advantage PNG that the staged expansions have been key to successfully ramping up production.

“We took the view that the staged expansions would create higher cashflow [at a] relatively low cost,” he says, explaining that this would allow K92 to fund each stage from the cash that it has built up.

“What that means is that we don’t build a debt, we haven’t got interest payments. The [only] bad news is you keep paying tax because you can’t write off interest payments or whatever else.”

Enabled by exploration

According to Lewins, the other secret ingredient in K92’s success has been its commitment to exploration. It spent around US$20 million on exploration in 2024 – roughly half of PNG’s entire mineral exploration spend – and its board has approved in principle for this figure to double over the next two to three years.

“Depending on success, that could rise to anywhere up to K180 million [US$40 million] in 2026 – which is more than PNG’s entire exploration spend this year,” he says.

CEO John Lewins. Credit: K92 Mining

This continued commitment to exploration has enabled K92 to increase measured and indicated resources at its producing Kora and Judd deposits from 1.6 million ounces of gold equivalent (Moz AuEq) in 2017 to 2.7 Moz AuEq in 2023, while also announcing a maiden 14.6 Moz AuEq inferred resource at the Blue Lake deposit in 2022.

K92 currently has 11 drill rigs operating across its exploration sites, including four at Arakompa – a newer discovery located outside of the mining lease area.

Lewins expects to announce a maiden resource for Arakompa in 2026 and believes results from the 92 holes drilled so far are already cause for excitement.

Several holes have made the weekly or monthly top-ten gold or copper intercepts in the world, according to Fynd Exploration, a content platform for mining investors.

In February, K92 confirmed the discovery of two significant high-grade subparallel veins at Arakompa, which it named AR1 and AR2. Drilling has defined the two veins to a depth of more than 500 metres, at strike lengths of approximately 675 and 775 metres respectively, with both veins open in multiple directions.

Exploration is also continuing in earnest at Kora and Judd, where Lewins says K92 has yet to begin drilling at depth.

“That’ll be the next area of focus,” he says, adding that “when you’re [mining underground], you’ve got an orebody sitting there, and you have to develop it so that you can get access.”

Rewarding investors

K92 has gone from strength to strength since entering production, with its share price on the Toronto Stock Exchange rising more than 30-fold between January 2018 and September 2025, when this publication went to print.

In all that time, it has never paid a dividend to shareholders, allowing it to preserve cash for expansions – and to meet its obligations in Papua New Guinea. But Lewins says all that is about to change, with investors about to get a reward for their patience.

“For the first time, our investors will get a dividend – hopefully in 2026, definitely in 2027,” Lewins says.

“When you think about it, we’ve been here 10 years. In PNG, everyone’s got to eat, but to date the shareholders of K92 are the only ones who have yet to eat.”

This article was first published in Mining and Energy 2025/26, released in October. Read the full edition here.

If you are attending PNG Investment Week in Sydney (8 to 11 December), you can pick up a free copy from the Business Advantage PNG stand at the event expo (Stand E01).