K92 Mining Inc.

Thank you, operator, and thanks, everyone, for attending K92 Mining's 2025 Second Quarter Results Conference Call. We hope you and your families are doing well.

In addition to myself, we have on the line John Lewins, Chief Executive Officer and Director; and Justin Blanchet, Chief Financial Officer. I would also like to remind everyone that after the remarks from management, the call will be followed by a Q&A session.

As we will be making forward-looking statements during the call, please refer to the cautionary notes and risk disclosure in our MD&A and Slide 2 of the webcast presentation. Also, please bear in mind that all dollar amounts mentioned in the conference call are in United States dollars unless otherwise noted.

Now I'll turn it over to John to provide you with an overview.

Well, thank you, David, and welcome, everyone. We begin with safety, K92's #1 priority as always.

I'm pleased to report that there have been no lost time injuries recorded in the second quarter, marking yet another major safety milestone with 8 consecutive LTI- free quarters. This achievement is particularly significant as it was achieved during a notable increase in total man hours worked as construction and delivery of the Stage 3 expansion progressed.

Field level risk assessments, hazard identification and safety observations have significantly increased over the past 2 years, which are positive leading indicators for safety. As the operation expands, we have continued to increase the capacity and capabilities of our occupational health and safety team and also the training team.

Systems continue to be enhanced, safety technologies were introduced and additional technologies are planned to be introduced in the near future. Safety always is one of K92's core values, and I'd like to reiterate that K92 relentlessly pursues our goal of achieving zero harm among our workforce.

We're extremely pleased to have released our 2024 sustainability report in June. The report builds on previous versions, maintaining alignment with the SASB Metals and Mining Standard for the sixth consecutive year and demonstrating continued progress towards alignment with the TCFD framework.

The report highlights K92's strong commitment to ESG and to the people and country of Papua New Guinea, including our focus on hiring and developing local content with approximately 92% to 93% of our workforce are PNG nationals, including a majority from our local communities. Our strong commitment to supporting the local economy, including $28 million of expenditure to support our local joint ventures and procurement of $96 million incurred in Papua New Guinea, representing 42% of our total procurement for the mine.

Our delivery of significant benefits to the country with $62.6 million in taxes and royalties paid in 2024. That's a 134% increase over 2023.

I'd also like to highlight that in 2025 year to date has eclipsed 2024 in terms of corporate tax paid with approximately $70 million paid as of the end of July, and this has gained significant positive coverage from the media in Papua New Guinea. $6.6 million was allocated for K92's first PNG infrastructure tax credit scheme project for the 11.7 kilometers Konkua-Bilimoia local road upgrade which will connect many of our communities to the main road network and ultimately lead to significant opportunities for increased trade and business development.

K92's ongoing success with its adult literacy program in partnership with local communities. We expect to enroll over 500 local community members in the program in 2025.

And our commitment to combating climate change with an emission reduction target set for 2030. K92 is extremely proud of the positive impact it is having on the prosperity and development of Papua New Guinea, and we encourage you to read our report, which you can find at www.k92mining.com.

In terms of the operations, during the quarter, the Kainantu Gold Mine produced 34,816 ounces of gold equivalent, a cash cost of $786 per ounce gold all-in sustaining cost of $14.08 per ounce gold. On a co-product basis, cash costs were $907 per ounce gold equivalent, and all-in sustaining cost of $1,489 per ounce gold equivalent.

Gold equivalent production increased 43% from Q2 2024. As annotated on the chart, all-in sustaining costs have been notably higher than cash costs since the beginning of 2023 due to K92's significant investment in that Stage 3 expansion with costs expected to decline considerably after delivering the Stage 3 expansion, which will be discussed later in the presentation.

Mill throughput for Q2 totaled 130,337 tonnes in line with our budget with a head grade of 8.9 grams per tonne gold equivalent. With 82,633 ounces gold equivalent produced in the first 6 months of 2025, we've exceeded budget so far.

And the second half is forecast to be stronger. So we reiterate our 2025 operational production guidance of 160,000 to 185,000 ounces gold equivalent.

In terms of our key operational quarterly physicals, Q2 delivered the second highest total material movement, that's ore plus waste on record. And another solid quarter of mine development with 2,466 meters achieved despite cumulative 5 days of disruption of underground operations from the Stage 3 expansion electrical commissioning activities that we undertook.

The team remains focused on ramping up development rates, completing key projects underground and building out stoping capacity for the Stage 3 expansion. With several projects and initiatives, either recently completed or nearing completion, we expect development and mine physicals to continue to increase as the year progresses.

Mining activities during the quarter took place across 13 levels at Kora and Judd with long-haul stoping executed to design. Process grades were largely in line with the latest independent mineral resource estimate.

The Stage 2A process plant continues to perform well, exceeding the updated DFS recoveries for the fourth consecutive quarter, achieving 93.3% recovery for gold and 94.9% for copper. And that compares with recoveries of 92.6% for gold and 94.2% copper in the updated DFS.

I will now turn the call over to our Chief Financial Officer, Justin Blanchet, to discuss our financial results for the second quarter.

Thank you, John, and hello, everyone. During the second quarter of 2025, K92 had quarterly revenue of $96.3 million an increase of 102% from the same period prior year.

We sold 28,864 gold ounces at an average selling price of $3,166 compared to 19,064 ounces at an average selling price of $2,246 in the prior year. As at June 30, 2025, there were 8,413 gold ounces in inventory including both concentrate and doré, an increase of 3,988 gold ounces when compared to March 31, 2025, due to timing of sales.

During the second quarter of 2025, K92 had quarterly cost of sales of $32.4 million compared to $27.7 million in the prior year or $26.2 million compared to $19.4 million when excluding noncash items. The increase in cost of sales was primarily due to an increase in tonnes mined and processed including an increase in capital development tonnes mined that resulted in an increase to capitalized development costs in property, plant and equipment.

Q2 2025 cash flow from operating activities before changes in working capital was $47 million compared to $17.3 million in the prior year. As at June 30, 2025, K92 had a record $182.9 million in cash and cash equivalents.

We had a record working capital balance of $189.3 million and we had a record net cash balance position of $123.8 million. The company does have a loan balance of $60 million.

Importantly, the Stage 3 and 4 expansion projects are fully funded, and our financial position is strong. We also have access to significant amounts of liquidity through undrawn credit facilities with $60 million available to draw down on demand, plus an additional $30 million of liquidity through an accordion feature.

We would also like to highlight that our commodity price downside is protected through the cost-effective purchase of put option contracts, which extend until the end of 2025, allowing for 15,000 ounces of gold per month at a strike price of $3,000 per ounce. To be clear, this is not a hedge.

We will sell at spot if it is higher than $3,000 per ounce. This is insurance, and we retain full exposure to the upside in commodity prices.

As John mentioned, during the second quarter, the K92 Gold operations produced 32,375 ounces of gold, 1,536,505 pounds of copper and 42,824 ounces of silver or 34,816 ounces of gold equivalent. We sold 28,864 ounces of gold, 1,275,176 pounds of copper and 34,532 ounces of silver.

On a by-product basis, we incurred a cash cost of $786 per ounce, down from $919 in the corresponding period last year and an all-in sustaining cost of $1,408 per ounce down from $1,510 per ounce in the prior year. Our all-in sustaining costs in Q2 was significantly below our realized selling price of $ 3,166 per ounce.

Our second quarter cash cost per ounce of gold, net of byproduct credits decreased to $786 from $919 in Q2 2024. The decrease was due to an increase in gold ounces sold and our fixed costs charged accordingly as well as higher byproduct credits.

It is important to note that we will see downward pressure on costs via economies of scale as operations ramp up and the Stage 3 expansion is complete. I will now turn the call back to John to discuss exploration and growth.

Well, thank you, Justin. So turning to growth and exploration.

We'll begin with an update of the Stage 3 and Stage 4 expansions, which are expected to fundamentally transform K92 into a Tier 1 mid-tier gold producer. The Stage 3 expansion process plant commissioning commenced in June, supporting the planned ramp up to over 300,000 ounces gold equivalent per annum.

Stage 4 is expected to further increase production at a very low capital cost to over 400,000 ounces gold equivalent per annum with commissioning targeted in the second half of 2027. So we'll now provide an update on the construction progress of the Stage 3 expansion.

As of July 31, 2025, 87% of growth capital has been spent or committed and the expansion remains on budget. Progress into major underground infrastructure upgrades, the twin incline is complete, and earlier this month, we marked a major milestone with the first material conveyed down the ore/waste pass, which we also referred to as the material pass.

The video shown is taken on the 1245 level, so at the top of the material pass. It's approximately 350 meters long and connects the main mine with the twin incline.

The material pass enables the truck loaded within the main mine, haul a short distance and then tip the rock down the material pass. The top of the material pass as you'll see, has grizzly installed, which prevents oversize traveling down the pass.

And of course, that mitigates the risk of blockages and improves material handling at the twin-incline truck loading pocket at the bottom. Multiple safety systems have been incorporated in our material pass design, including engineered truck stops, signage, lighting, training, procedures and obviously a grizzly capable of supporting large loads.

The grizzly, as you'll see, is positioned at an angle to encourage oversize to roll off. Not all of that oversize rolls off, as you can see in the video there.

In this instance, secondary breakage of oversize is dealt with by using a rock breaker and loader which is on the other side of the material pass side where we're filming from effectively. So importantly, this means that the bulk of material handling shifts from the existing smaller, more congested incline that has serviced the main mine since we started commercial production as shown on that image on the left, to the highly productive twin incline as shown in the image on the right, and that can run trucks that are 50% larger.

They travel at far faster speeds. And importantly, also by trucking from underground to the plant, we eliminate rehandling at the portal.

So work is well underway for additional passes and to provide even greater efficiencies obviously. On ventilation, puma incline is approximately 120 meters from the breakthrough, and we expect that to occur in early Q4.

a slight revision from late Q3 and in the main part due to the modifications that we've made to the portal breakthrough location, which was based on geotech probe drilling that we carried out last quarter. Shorter development rounds are also required for this final stage as we approach surface to better control that incline breakthrough.

Our company-owned raised bore is currently drilling a two-leg fresh air rise with the first leg completed. The second leg is scheduled for completion in late Q3.

So upon completion of the puma breakthrough and those ventilation raises, each of those 2 are expected to contribute an additional approximately 50 cubic meters per second of air flow to our circuit. And that represents a combined 60% increase to airflow from the current levels to an estimated primary airflow of around 260 cubic meters per second.

Due to the previously conservative model mine resistance factors, we now expect to not need the primary vent fans to meet Stage 3 vent requirements or not be required until work late in the piece. That said, work continues to advance the fan chamber from the Stage 3 expansion.

And as shown in the photo the fan chamber is very substantial. It's capable of delivering airflow up to 4x of our current rate, and we plan to opportunistically complete the project in the first half of 2026.

So in addition to completing the various infrastructure enablers for the expansion, mine development continues to open up 2 new fronts, the twin incline and lower Kora with 4 and 2 new sub levels being opened up, respectively. Both these fronts are planned to be notable contributors to production stoping in 2026.

And currently, we're also introducing technology to maximize our productivities. This video shows our recently commissioned surface operated tele remote loaders being operated from just aside the portal in our office area.

The system was commissioned in late July, leveraging on our underground fiber optic system to continuously operate our production stoping loaders during shift change and a blast entry thereby maximizing the amount of productive hours we get per 24-hour period. Multiple pieces of new equipment are also arriving on site.

This image shows our new Epiroc Easer L raise bore rig, which arrived on site in late July is currently being commissioned. The Easer L rig is capable of drilling blind raises for our stope slots to help with derisk the production blasting and also to accelerate drilling of our pastefill holes.

As part of the ramp-up to Stage 3 and 4 throughput rates, we're also expecting the arrival of several underground mobile mining fleet equipment. That includes new cable bolter, shock reader, [ ADJI ], 4 low-profile underground loaders, 2 of which are replacement, 2 of which are additional and additional trucks and a high-profile loader for the twin incline.

They'll be coming in the next few months. We now move on to the latest drawn footage taken just a few days ago, of the new 1.2 million tonne per annum Stage 3 process plant, which, as we noted, commenced commissioning in late June.

Starting at the ROM stockpile, we're pleased to report that the stockpile build is tracking ahead of schedule, now totaling over 20,000, almost 25,000 tonnes. Commissioning of the crusher is well advanced with a dedicated crusher commissioning stockpile established nearby.

First tonnes have already gone through the crusher as shown in the video with the ore feeder loading it. Going through the rest of the circuit transfer conveyors, stacking conveyors, reclaimer are all complete.

Moving on to the grinding area. Ball mill lining is complete.

SAG mill lining is bit over 50% complete. The mills are supported by a dedicated liner handler as annotated in the video there, first material through the mill is scheduled for early September.

The admin building gold room is substantially complete, gravity circuit is complete. Flotation circuit is practically complete with the team going through final checks ahead of wet commissioning planned for early September.

Both the tailings and the concentrate thickness are complete and the multi-stream analyzer is going through its final checks. Filter press is also complete and going through final checks.

Lastly, all high-voltage MCCs and infrastructure are complete and have been commissioned. We remain on track to complete the commissioning and hand over the process plant to operations in the first half of Q4.

In terms of ancillary buildings, the interim power plant and warehouse are complete. The new Kumian Creek Camp is complete, adding an extra 160 ensuite rooms.

The camp is initially being used for excess capacity during construction and then we repurposed for a combination for our Stage 4 expansion. The primary power plant is nearing completion with commissioning commencing in the coming weeks.

This project will add an immediate 8.8 megawatt generation capacity increasing to 10.6 by, I think, the end of the year, and the next phase of expansion, which will take that up to over 15 megawatts is already underway with orders already placed to complete this stage in 2026. In terms of the new maintenance facilities, all structural steel and buildings are on site.

The main workshop is progressing well with the foundations and footing support as shown in the image. Civil works have also progressed at the tire and weld shop and the mine rebuild center buildings.

Completion of all 3 workshops is targeted for late 2025. Now in Q2, 2025, significant progress was also made with the award of the EPCM contract for the pastefill filtration plant and the EPC contract for the storage facility.

While the underground pastefill package was self-awarded earlier in the quarter. All background pastefill plant long-lead items have been ordered.

Front-end engineering design work is complete, detailed engineering work and design by GR Engineering is complete. And the Quattro Engineering is nearing completion.

Underground development of various large pastefill infrastructure excavation is progressing well. Earthworks are also progressing well for the surface storage area near the portal and the tailings filtration plant near the Stage 3 process plant is complete.

Commissioning of all 3 facilities is expected to commence in Q1 2026 with practical completion and full pastefill circuit remaining on schedule for mid-2026. Now in August 8, we were honored to host the honorable Rainbo Paita, Minister for Mining along with the government delegation for a site visit.

The visit received significant media coverage and also included tourists of the underground, new Stage 3 expansion process plant and a helicopter tour of our exploration areas and our new infrastructure tax credit scheme growth. These visits also underscore our strong commitment to transparent stakeholder engagement and responsible mining.

Moving on to exploration. We are now drilling the Kora-Kora South, Judd-Judd South vein systems from underground, plus drilling the Arakompa vein system from surface.

Earlier-stage exploration work programs are focused on the Mati, Mesoan and also the Wira Henke prospects. In June, we reported 19 diamond drill holes from Kora-Kora South, Judd-Judd South with the results further reinforcing the significant potential for high-grade resource growth.

The K2 vein drilling expanded the dilatant zone recording 12.8 meters at 31.89 gram per tonne gold equivalent and also 16.29 gold equivalent. The results are especially significant as they are near mine infrastructure located only 100 meters from existing mine workings.

And that provides the potential for near-term bulk mining to support Stage 3 expansion ramp-up once our pastefill system is complete. Results also continued to extend high-grade mineralization up-dip at K1 and K2, as shown on the right black ellipses and delineated a substantial high-grade copper zone at K2 as shown in the left black ellipse.

Importantly, the drilling has also commenced at Kora Deeps targeting over the next 12 months, a substantial area, 400 meters below the twin incline down to around 500-meter RL as shown in the shaded light green rectangle. After multiple years of focusing on infill drilling ahead of Stage 3 expansion, we're fairly excited to now be targeting this area for some of our step-out drilling.

As noted earlier, the results have delineated a substantial high-grade copper zone to the south. Magenta represents grades exceeding 4% copper and the consistency of the high-grade copper drilling hit rates is very encouraging as shown in the long section here.

At Judd drill results continue to extend high-grade mineralization up-dip of the main mine, as shown in the top black ellipse and below the main mine workings. Multiple high-grade results outside of the resource have also been recorded.

Like Kora Deeps, Judd Deeps drilling has also commenced initially targeting down to that 500-meter RL very much over the next 12 months and has, again, as shown in the light green shaded rectangle. From the initial Judd Deep results, which have been reported, the structure appears to remain robust at depth with whole KMDD0809, which was located approximately 300 meters below the twin incline recording 12.9 meters at 4.3 grams per tonne gold equivalent from Judd link and 14.15 meters at 3.97 grams per tonne gold equivalent from J1.

And obviously, we're looking forward to providing the next set of results in due course. Exploration activity at the Arakompa vein system located approximately 4.5 kilometers from the process plant is progressing with up to 5 rigs active.

As shown in the image, the deposit is rapidly growing and so is our conviction by adding more rigs. The results reported to date have delineated 2 significant high-grade veins AR1, AR2, which recorded an average true thickness of approximately 3 meters over strike lengths of approximately 675 and 775 meters, respectively.

The veins are also high grade with previously reported drilling results recording a hit rate of plus 5- gram per tonne gold equivalent of 50% AR1 and 42% AR2 and plus 10-gram per tonne gold equivalent of 28% at AR1, 21% at AR2. Arakompa also features a large, lower-grade bulk zone, which is open in multiple directions as shown in the plan view here.

With the addition of the new compact heli-portable rig drilling of the Northern strike extension of Arakompa, as shown in the ellipse on the far right image will be an increased focus. The area is highly prospective featuring strong vectors from artisanal workings.

We plan to announce our next set of drilling results of Arakompa later this quarter, and we're targeting a maiden resource late 2025, early 2026. Lastly, we'd like to highlight the significant pipeline of highly prospective exploration targets that we have.

The colored icons indicate current exploration focus and the black icons indicate where we plan to be drilling within the next 24 months. Upon delivery of the Stage 3 expansion we expect to not only see a major inflection in our production and free cash flow, but also a significant ramp-up in our exploration budget, aiming to target many of these highly prospective targets concurrently.

Two additional surface rigs have been ordered recently, and they will assist with that future ramp-up. So in summary, Q2 2025 was another strong quarter for K92 from an operational, financial, safety perspective.

We're fully funded through the expansion via a record net cash balance and mine cash flow. And we're tracking well to our 2025 operational guidance and continue to execute on a number of key Stage 3 expansion projects, including achieving the major milestone, the start-up commissioning of the new 1.2 million tonne per annum process plant during the quarter.

We're confident that we will continue this positive momentum into the second half of the year, and we expect to see the benefit to mine physicals from the delivery of a number of key underground infrastructure and operational improvement projects, including the material pass. With that, operator, we'd like to now commence the Q&A session.

Thank you.

Congratulations on a good quarter, K92 team. One question from my end.

Could you talk about your confidence and comfort level on progress made in the underground development to reach the run rates required for Stage 3? I imagine more progress will be made with the material pass system up and running and the additional ventilation, but is there anything else we should be thinking about here is kind of the 2,500 meters what you expected for the quarter?

Or were there any challenges that came up?

Thanks, Harrison, for the question. In relation to the development meters, I would say, it's one area within the quarter that we didn't really achieve what we wanted.

We were certainly looking for higher than that 2,700 or 2,800. What we did have that we hadn't really factored in was that if we look at our underground development of infrastructure, we had about a 5-, 6-day delay where because of the installation of electrical infrastructure underground, we basically had 5, 6 days of delays in development.

And if you look at that in the context of achieving around 30 to 40 meters a day that basically drops you a couple of 150 to 200 meters. And so we did drop that during the quarter.

You're correct in that the commissioning of the ore pass is quite -- not quite, is a very significant contributor to enable us to achieve the meters that we're looking to do. As you know, as it currently stands, we've got more activity, I think, than we actually recognize we would have in the construction period.

So that's adding to the congestion that we see in our single incline. So we've got the one right up until the end of the quarter.

We've been running basically all of our waste, all of our ore coming in -- sorry, going out on that one existing incline. But in addition to that, we've got, for instance, multiple concrete loads moving up for the construction of our underground infrastructure.

So the ore pass itself, all the work that we've been doing on the vent chamber or the concrete that comes in, all the steel work that's come in for those and continues to come in from those. All of that, I think, had more impact than perhaps we realized it would.

There's a huge amount of work being done there. And obviously, we've also got the work that we're doing on the pastefill underground, the excavations for the pastefill underground, which also add to that.

So certainly, the ore pass and ore/waste pass, and our view is going to be a very significant contributor to improving our performance in terms of development meters. I think the other point you will have seen is that we do have additional equipment that will be coming in.

I think the first loader is due in September, October, our first new loader. So there are also additional pieces of equipment that will be coming in, which will be able to also utilize that improved access.

Congrats on getting everything coming and moving along nicely. It's good to see both the underground and the mill progressing well.

A question on that. You noted first half Q4 to complete commissioning.

I'm just trying to understand, or make sure I understand kind of how you're defining that. Is that coincident with declaring commercial production as well?

Or what kind of metrics are you looking for to complete commissioning?

Okay. Well, I guess, first off, commercial production per se, we don't really use simply because we're already in commercial production.

So would be declaring something we're already doing.

Yes -- no, sure, good point.

Yes. No, no.

It's a discussion we've had internally actually. So it's not an incorrect question, and I understand what you mean.

So what we anticipate is that by the end of the quarter, we will effectively have the plant able to operate at its design capacity. Now we'd also expect that we should be able to achieve our design recoveries by that point.

So we're really looking at the plant is effectively operating at its design.

That's helpful. And then another question on grades, obviously, in the past, I guess, even 3 or 4 quarters, you guys have been mining some pretty good grades above plan.

How should we think about grades for the next couple of quarters. Q2 obviously came down but still was probably, I think, a little bit higher than long term.

But what do you -- any guidance you can kind of give us to prepare for the next couple of quarters and what to expect?

In terms of grade, you should expect pretty much what is the long term. If anything, grades in Q4, I would expect to be lower simply because we will be commissioning with lower grade material into the plant, so it will have a bias towards lower grade.

Yes, that makes sense. Okay.

And then the last question, maybe just on your balance sheet. Obviously, very strong, $183 million.

Free cash flow is obviously going to start to pick up even more next year. What's your plan?

You've got $60 million in debt outstanding, I would assume that gets kind of the easy one to repay first? Or I'm just trying to understand -- make sure I understand that your plans for your good free cash flow you're going to be generating next year?

So certainly, the repayment of debt is something that will be prioritized. However, it will fit into an overall picture of what we're doing as a company.

We don't have a high level of debt as I think was noted. And I think we're certainly not in a position where we need to repay that debt in order to meet any requirements or anything else.

As you say, depending on gold price, which we'd obviously like to see sitting where it is for some time going into the future, we will be generating a large amount of free cash flow going forward basically, as you say, all of next year and going beyond that. But the whole thing of dividends, buybacks, et cetera, et cetera, which is something that as a company, we are in the process of discussing internally.

John, congrats on the -- you and the team on the massive progress here towards Stage 3. There's already been a lot of detail given in the Q&A about ramp-up rates and development rates.

Any sense that you could comment on how Q3 is going so far, like or maybe where you would like to see Q3 exit, maybe I think the market is probably watching development meters, but maybe also even kind of annualized tonnes per day?

Okay. Andrew, I mean, we're obviously early in -- well, actually, we're not early, I guess we're almost halfway through Q3.

So it's not that early in Q3. I think it'd be fair to say that Q3 is fairly much on budget for us in relation to our production.

We are developing reasonable stockpile. I think we're in excess of 24,000 to 25,000 tonnes.

So stockpile wise, we're probably marginally ahead actually of where we anticipated being. So from the context of the stockpile, I think we're in a fairly good position.

In terms of the enablers, we really only just commissioned those now. So I think in meters, we would expect to see an improvement from second quarter, not perhaps as high as we want in terms of we want to get to by the end of the year.

So if that answers your question.

And just overall, the trajectory and the time line is preserved to be blunt to fill the Stage 3 once this thing is turned on?

Yes. I mean if you look at -- I'm trying to think we're -- I think the sign the IDP has something like 1 million tonnes being mined in process next year.

And at this point in time, we're comfortable with the numbers that are in the IDP.

It's exciting Kora Deeps is going to be tested below the twin incline. John, you said 450 meters below.

Can you give us a little bit of color on scope of drilling, spacing and drilling at this point, if you can?

Mike, thanks for that. Yes, look, this is -- it's obviously early days at this point in time.

So we're at the first stage of that, which is drilling very much from existing development. We do intend longer term to put a couple of development drives further out from where we are, so we can get a better angle into Kora and Judd at depths.

So we're limited to those 2 sort of boxes as the area that we can reasonably access without coming in to acute an angle. Generally speaking, when we've been looking at these areas, we've been drilling in the 50 to 100-meter centers.

And that would be the intent of its initial drilling that we're doing. We've got one rig currently drilling there.

I don't see us getting heavily into that -- more heavily focused into that until next year. We can't do any -- we don't really want to do any additional development to set up better drill cuddies for that area.

At this point in time because all of our focus on that -- on the development meters is obviously in the upper part of the mine, opening the mine. It will really be, I would say, second half of next year before we see that program pick up to where I personally would like to see it.

I'm pretty excited by what we've seen, for instance, in that Judd Deep hole. So that I think, for me, is fairly exciting.

Okay. Congratulations on the progress this quarter.

Thanks for that, Chris. Well, thanks, everyone, for joining us for this conference call.

It's approaching 11:15 here. I'm in Papua New Guinea, as some would have seen, I was hosting the Mining Minister on site on Friday.

We made the local news and media here including video from underground with our Minister, Mining Minister. one of the things that we got from the Minister was that he was excited by not only the -- what he was -- what the project is and the production that we have, the fact that we've paid PGK 300 million in tax this year, but the sheer scale of what he saw underground, for instance, in the vent fan chamber.

The new plant, especially when he could compare it to the old plant and realize that, that old plant had produced 150,000 ounces a year. In fact, you may comment surely, John, if that little plant could make 150, you're going to make a lot more than 300 with this plant, which, of course, directed into our Stage 4.

The other thing that impressed him was that we took him up in the chopper and took him around showing in our exploration activities and direct exploration areas. And again, being the largest explorer in the country, we were commended for our investment in the future of not only K92, but as he saw it PNG.

And I think those thoughts and those statements are reflective of where we're sitting at this point in time. We have a relatively old smallish plant, which last year did 150,000 ounces.

And we've got this phenomenal new plant, which is going to take us to an entirely different level. Underground, you can see the massive amount of work that's gone in both in the context of the infrastructure.

They were impressed, for instance, that you could be underground at the fan chamber and you could connect with your office in Vancouver and receive an e-mail, send a photograph, et cetera, et cetera. And that you could operate equipment from the surface while there was effectively no one underground.

All of those things have happened in the last 12 months and a lot of them are now coming to an incredible culmination towards the end of this year. And as I think many of you would be aware, in watching K92, it's also coming to a culmination just as the country itself is celebrating its 50th anniversary of Independence next month.

So this really is incredibly transformative. I mean it is a statement we use on our slides on the first page of the slides.

But I continue to see that as one -- is how things are happening right now, every time that I go to site. So this is an exciting time for K92.

It's not without its challenges. Anybody who's ever built a mine, commissioned a plant or whatever else will obviously attest to the fact that it is also a challenging time but with challenges come opportunities.

We'll be having an Analyst-Investor tour early in Q4. And so some of you at least will have an opportunity to see things on the ground.

And I think especially, I know that we've got some people who've been out before I think you're going to be incredibly impressed with the changes that occurred both on the surface and underground. So with that, I'd just like to say thank you all for attending early in the morning in your case, later in the evening in mine.

And thank you for your continued interest in the company and what we're trying to achieve. Thanks, everyone.