Record December-quarter output helped it reclaim lost production time in the underground operation while the company worked to double capacity to 400,000tpa.

The Vancouver, Canada-based company said gold-equivalent output for 2019 exceeded the increased 72,000-80,000oz guidance (from 68,000-75,000oz guided previously) by 2,256oz, or 2.8%, to reach 82,256oz Au-equivalent.

During the last quarter of 2019, mining continued to focus on the Kora North deposit, comprising cut-and-fill stope mining from the K1 vein, supplemented with development tonnes from the K2 vein.

The blend of mainly K1 material provided an average head grade to the process plant in the quarter of 25.22g/t gold and 0.35% copper, slightly above and below the long-term average grades, respectively.

Significantly, the above-budget production was achieved despite several interruptions to underground mine operations due to upgrading underground infrastructure, including commissioning of the new underground power grid and the new main ventilation fans. The plant was also impacted by stoppages to install the new larger secondary crusher as well as other crusher upgrades.

CEO John Lewis attributed the strong performance to "the quality of not only the Kora North deposit but also the entire team at Kainantu".

"Importantly, underground development has significantly ramped up over the course of the year, with total tonnes mined, increasing from under 60,000tin Q1 to 120,000t in Q4. The initial focus of the expanded underground activity has been in waste development necessary to establish increased access to the deposit to allow the ramp-up to 400,000tpa by the end of 2020."

The company continued to work on the expansion of the Kora/Kora North resource model, with a further 26 holes completed during the latest quarter.

Among the best results were one the highest-grade drill intersections at Kora to date of 13m at 288.73g.t gold, 104g/t silver and 0.77% copper, for 291.34g/t Au-eq (calculated using a copper price of US$2.90/lb, silver price of $16.5/oz and gold price of $1,300/oz).

K92 expects to produce 115,000-125,000oz Au-eq in 2020 at AISC lower than US$700/oz.

K92 shares trading in Toronto (TSXV:KNT) gained more than 8% on Tuesday to a new 12-month high at C$3.37, giving it a market capitalisation of more than $703 million (US$541 million).