New NIA Gold Stock Suggestion: K92 Mining (TSXV: KNT)
NIA has just made a major new gold stock discovery that has even higher gold grades than MXL and is about to commence production even sooner than MXL! The company is K92 Mining (TSXV: KNT) and it is currently trading for $2.02 per share! KNT’s Kainantu Gold Mine in Papua New Guinea was developed by the world’s largest gold miner Barrick Gold (ABX). Unfortunately for ABX, but awesome for KNT and NIA members who are learning about the company in this alert, ABX took out too much debt in 2011 – right before gold reached its medium-term peak of $1,895 per oz, which was followed by a medium-term decline of 44.5%.
In February 2015, under tremendous pressure from shareholders, ABX unveiled an asset sale/debt reduction plan – where it would sell its non-core assets under development to strengthen its balance sheet and focus on its portfolio of producing core assets with positive free cash flow. Although this seemed like a good strategy at the time, ABX sold off many of its non-core assets for only a small fraction of its initial purchase price. If you include the money that ABX spent exploring and developing each of these world class assets, ABX practically gave many of them away.
The highest quality asset sold by ABX last year was its Kainantu Gold Mine in Papua New Guinea. ABX acquired the 2,900 square kilometer Kainantu Gold Mine in October 2007 for CAD$184.52 million. From 2008 through 2014, ABX spent $100 million on the development of Kainantu – drilling 78,935 metres from 767 drill holes to define a 1.84 million oz gold equivalent resource. In addition to Kainantu’s extensive underground infrastructure, it has a modern processing plant capable of handling ore throughput of 200,000 tonnes per day! In addition, it has a licensed tailings pond, staff housing. office space, mine store, workshops, reliable hydropower with dedicated power line, and paved access roads.
On March 11, 2015, KNT acquired Kainantu from ABX for next to nothing when mining stocks were near their lows. KNT is getting ready to commence production at the beginning of September and NIA estimates that the company will produce 50,000 oz of gold in the first 12 months of production!
Past performance is not an indicator of future returns. NIA is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This message is not a solicitation or recommendation to buy, sell, or hold securities. NIA has been compensated by KNT $40,000 cash and expects to be compensated an additional $50,000 cash for a total of $90,000 cash for a two-month investor relations contract. NIA has been compensated by MXL $40,000 cash for a two-month investor relations contract. Never make investment decisions based on anything NIA says. This message is meant for informational and educational purposes only and does not provide investment advice.