K92 Mining has concluded a power supply agreement (PSA) with Papua New Guinea state utility company PNG Power (PPL) for the supply of power to the Kainantu mine site in the country’s Eastern Highlands.
The PSA is in place for an initial period of five years and is renewable for a further five years upon the agreement of both parties.
Power is to be supplied at a competitive rate and is locked in for the initial five year period. PPL has agreed to fund a Kina 500,000 capital program aimed at increasing the reliability of power to K92’s site.
K92 has installed a new main process plant switch board on site, ensuring limited disruption to operations during any switchovers to standby power, which is available at site, should PPL power be interrupted.
K92 chief executive officer Ian Stalker said: “This power supply agreement is an important milestone for K92. It locks in an attractive rate, ensures long term stability of supply and eliminates many of the risks associated with future potential increases in the price of oil.
“This agreement enables K92 to continue the momentum towards reaching state operations at the mine and mill. In addition to being economically superior to diesel generated power, hydro-electric power is also more environmentally friendly.”
Meantime, K92 has received a two year renewal from the Mineral Resources Authority of PNG on an exploration licence near its mining lease in PNG. The renewal is valid until June 20, 2018 and covers a total area of 146.8sqkm to the south of the mining lease.
Earlier this year, K92 completed a helicopter reconnaissance survey of the exploration area with a goal of identifying and photographing various slips, alteration zones, areas of old and current workings, and other features of geologic interest.
This survey identified up to 50 targets for follow up work and including the above targets which showed evidence of substantial historical or current workings.