Papau New Guinea Miner Takes a Dip After Barrick Lease Worries
K92's stock swung markedly lower after Papua New Guinea said it wants to retain at least 30% of the gold it currently exports.
Papua New Guinea's minister of commerce made the comments over the weekend in Sydney. Barrick Gold and Zijin Mining Group could be affected since they jointly operate the Progera Gold Mine, which needs to renew its mining lease that is coming due shortly.
K92 (CVE:KNT), which operates the Kainantu Mine in Papua New Guinea, dropped as low as $1.95 on Monday after trading upwards of $2.50 the week prior.
"K92 is aware of various media reports on recent negotiations between Barrick Gold Corporation and the Government of Papua New Guinea relating to the renewal of the special mining lease for the Porgera Mine," said K92 in a statement today."While K92 is not a party to those negotiations and has no affiliations with the Porgera Mine, K92 believes that some of these reports may have inadvertently caused some confusion and contributed to recent volatility in the company’s share price."
K92 said its mining is not up for lease until 2024. It said the mine is operating as normal, and the company has "...not approached nor discussed amendments to our mining leases" with authorities.
As of publishing, K92 stock has recovered to $2.22 a share.
Last week, K92 said in its 2Q financials that it produced 19,652 gold ounces equivalent for the quarter and had revenues of $23 million.
Reuters said Barrick has not yet commented on negotiations with Papua New Guinea.