K92 Mining (TSX-V: KNT) Advisor Bryan Slusarchuk on the Updated Resource for Kora North Deposit

June 27, 2018

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Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Special Capital Markets Advisor for K92 Mining (TSX-V: KNT)(OTC: KNTNF), Mr. Bryan Slusarchuk. Bryan, how are you this afternoon?

Bryan Slusarchuk: Gerardo, doing really well today on the back of this new, updated resource at Kora North that K92 has just put out.

Gerardo Del Real: I feel like this is our weekly call where I congratulate you, and you come on the air and talk about all the good stuff you're doing. But there's some quality exploration work going on in this space, K92 is a part of that. On the production side, you're firing on all cylinders. And you've executed beautifully as I have said before. Now with this resource estimate, I think it really puts you in the enviable position of having nearly two decades worth of tonnage there. Can you go over the details for us, Bryan?

Bryan Slusarchuk: Absolutely. I think it's important to remember, Gerardo, that this updated resource has been defined after just 8 months of underground grade control drilling plus 3 months of exploration drilling. At the current design production levels of 45,000 to 50,000 ounces per annum, this is almost 17 years of production. Now, of course, as investors know, we're undergoing an evaluation to expand that production quite dramatically in the coming months. This really sets the stage nicely for this.

The Kora North mineral resource that was just put out today is an updated resource. It's an interim resource, remember that the drills continue to turn. We're drilling as we speak, but this interim Kora North resource, we had total measured and indicated 320,500 ounces gold equivalent at 14.5 grams per tonne. We have an additional 571,000 ounces gold equivalent at 15.2 grams per tonne in the inferred category.

As John Lewins, the K92 CEO, points out in the news release, this resource covers just 10% of the total area that we plan to drill out from underground over the coming 12 months. When you look at today's news that discusses 891,500 ounces at exceptionally high grades, remember, that's spectacular in its own right, but this resource covers just 10% of that total area we plan to drill out from underground in the coming 12 months. I really want to hammer that home, because it's so important, and I think it illustrates the enormous size and grade potential there.

Gerardo Del Real: Let me ask you this, Bryan. A good portion of this new resource, of course, is in the inferred category, because you just had one recently. With the drills still turning, is there a view or a plan to get that inferred resource into the more confident category of measured or indicated?

Bryan Slusarchuk: I think that you'll see that over time. But remember, this resource update today in the measured and indicated category represents a five-fold increase. The increase, of course, in the inferred is even larger than that five-fold increase that we've seen in the M&I category.

The other thing that I point out, remember that a lot of this is drilling done at grade control spacings, so 25 meter centers. In terms of confidence, you don't get better than grade control spacing. This is the type of work that you have to do in order to keep your mineable inventory ahead of the actual production that's going on. A whole lot of this material is at a very high confidence level.

Now, the drills continue to turn, and the program on site really consists of a two-fold or two-pronged approach. Number one; continue to drill at grade control spacing, building up mineable inventory, building up inventory within the M&I category. Number two; the other drill will continue to drill longer holes, take bigger step-outs in order to start to put arms around the size potential here. Again, this 800,000 ounces plus of high grade that we discuss in the news release today comes from just 10% of the area that we're going to drill over the next 12 months.

Gerardo Del Real: That's a lot of upside. It's a tough resource market right now for juniors, but again, congrats, Bryan. You're doing spectacular work. You and the team deserve a big congratulations.

Bryan Slusarchuk: Thanks, Gerardo. The guys on site are doing a fabulous job. It's my pleasure to get to talk to you with these periodic updates as they continue to produce news like this. We've got production ongoing in the high-grade Kora North area. We've got two drills turning. A third will be added in short order. There will be a lot of news flow from K92 to come in the weeks ahead.

Gerardo Del Real: I got to believe K92's starting to look really attractive to potential suitors.

Bryan Slusarchuk: You know, Gerardo, I think there are only a few places in the world that possess the potential for this type of grade and size combination. There's no doubt this is getting on a lot of radar screens all over in terms of institutional investors, in terms of corporates, majors included.

Gerardo Del Real: Well, I know the last time we spoke, we talked about the $2.50 price target that was put on this stock by one of the more well-respected firms in this space. The stock is trading at $0.93. Again, you're well-funded, drills are turning, and you're exploring for more, so lots of upside. It's interesting.

Bryan Slusarchuk: That's right, and you've got great coverage now out of Macquarie, who you mentioned, also out of Clarus Securities, and PI Financial. The price targets on those research reports really indicate just how big the upside in the short term is. Of course, the bigger potential here, Gerardo, we believe this is an absolutely world-class setting with, as Macquarie mentioned, tier one size potential.

Gerardo Del Real: Well put, Bryan. I get the feeling we'll be chatting again soon.

Bryan Slusarchuk: Great. Thanks, Gerardo.

Gerardo Del Real: Thank you.

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