NEWS RELEASE
KIRKLAND LAKE GOLD
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TORONTO - Kirkland Lake Gold Ltd. ("Kirkland Lake Gold" or the "Company") (TSX:KL)(OTCQX:KLGDF) is pleased to announce operating results for the three months ended Mar. 31, 2017. All dollar amounts in this news release are expressed in U.S. dollars, unless otherwise noted.
2017 First Quarter Highlights
- Consolidated production of 130,425 ounces of gold, on track to meet 2017 production guidance of 500,000 - 525,000 ounces of gold.
- Strong gold production of 48,723 ounces at the Macassa Mine, based on mill grade of 17.1 g/t Au and recovery of 97.1 per cent.
- Record gold production of 46,083 ounces at the Fosterville Mine, based on mill grade of 11.1 g/t Au and recovery of 93.7 per cent.
- Increased cash balance at March 31, 2017 by $45 million to $280 million.
Tony Makuch, president and chief executive officer of Kirkland Lake Gold stated: "Consolidated first quarter production of 130,425 ounces of gold reflects a solid start to the year and supports our 2017 production target of 500,000 - 525,000 ounces. During the quarter, we substantially increased our cash position by $45 million to $280 million, underpinned by solid operational results from our Fosterville & Macassa Mines. These operations accounted for approximately 73 per cent of total production for the quarter. The Company's strong cash position and confidence in the outlook for 2017 support the Board's decision to initiate a dividend policy to our shareholders."
"The Fosterville Mine delivered exceptional first quarter operating results, marking a number of records including production of 46,083 ounces of gold, mill grade of 11.1 g/t Au and recovery of 93.7 per cent. The Macassa Mine also continued to deliver solid operating results during the quarter with gold production totaling 48,723 ounces driven by record mill grade of 17.1 g/t Au and recovery of 97.1 per cent."
"We will continue to focus on operational efficiencies and productivity to utilize milling capacity at all four mills. As our aggressive exploration budget implies, we have significant potential within our district scale land packages to discover new zones and expand our resources. Additionally, at the end of March, we announced a considerable increase in Mineral Reserves at Fosterville by 66 per cent and Macassa by 37 per cent."
2017 First Quarter Operational Results (Canadian Operations)
Macassa
The Macassa Mine continued to deliver solid operating results during Q1 2017 with gold production of 48,723 ounces, representing a 19% increase from Q1 2016 of 41,054 ounces. The increased production reflects a 6% increase in mill throughput and a 12 per cent increase in grade as compared to Q1 2016.
During Q1 2017, the mill processed 91,460 tonnes at an average grade of 17.1 g/t Au with a mill recovery of 97.1 per cent. Mill throughput during Q1 2017 was 11 per cent lower than the 102,289 tonnes processed in Q4 2016 due to the additional processing of 27,500 tonnes of low grade material in Q4.
Mine production during Q1 2017 totaled 89,177 tonnes at an average run of mine grade of 17.4 g/t Au compared to 95,168 tonnes at a grade of 15.0 g/t Au for Q1 2016 and 84,229 tonnes at a grade of 21.6 g/t Au for Q4 2016.
Development of the 5600' Level and 5700' Level in the lower South Mine Complex ("SMC") continue to be advanced. The main decline development is ongoing, although the focus in Q1 was development of the 5700' Level east and west from the main ramp. The 5712 Decline towards the Lower D North (LDN) zone is now below the 5700' Level and infrastructure is currently being developed in order to commence production in 2017.
Holt
During Q1 2017, the Holt Mine delivered 105,629 tonnes of ore at an average grade of 4.8 g/t Au to the Holt Mill. After mill recoveries of 94.9 per cent, gold production totaled 15,318 ounces, a 13% increase over Q1 2016 production. Q1 2017 mined tonnes were 7 per cent lower than Q4 2016 due to planned access development to the new U-100 and C-104 zones.
Development of Upper Zone 4 East and U-100 commenced in Q1 2017, on schedule to commence production during Q2 2017.
Taylor
The Taylor Mine produced 10,942 ounces of gold, representing a 18% increase over Q1 2016. The increased production reflects an increase in throughput of approximately 21,000 tonnes, as compared to Q1 2016.
The Taylor Mine delivered 63,289 tonnes of ore, averaging 5.6 g/t Au as compared to 41,950 tonnes averaging 7.2 g/t Au in Q1 2016. Mining is currently underway in the WPZ deposit on the 1004 Zone. Q1 2017 grades are lower due to stope sequencing. An increase in daily mine throughput is planned for the second half of the year by adding additional stopes to the schedule. Diamond drilling is on-going on the 100 level, defining the 1008 Zone and on the 430 level, targeting near-term definition drilling and exploration of the 1003 Zone.
Holloway
The Holloway Mine was placed into temporary suspension at the end of Q4 2016. During Q1 2017, 2,676 tonnes of stockpiled ore grading 3.5 g/t Au were processed in the Holt Mill. After mill recoveries of approximately 90 epr cent, gold production for Q1 2017 totaled 267 ounces.
A diamond drill program focusing on Lightning east both up dip and down dip is scheduled to commence in Q2 2017.
Cash Balance
Kirkland Lake Gold ended the first quarter at Mar. 31, 2017 with a cash balance of approximately $280 million, an increase of $45 million from the Dec. 31, 2016 cash balance of $234.9 million. The increase largely reflects positive cash flow from operations generated during the quarter.
2017 First Quarter Financial Results and Conference Call Details
Full financial results for the three months ended Mar. 31, 2017, will be released before market open on May 4, 2017.
A conference call to discuss the results will be held by senior management on Thursday, May 4, 2017, at 10 a.m. ET. The call will be webcast and accessible on the Company website, in the Investor - Events section.
Annual General and Special Meeting of Shareholders Details
Kirkland Lake Gold will hold its Annual General Meeting of Shareholders on Thursday, May 4, 2017 at the offices of Cassels Brock & Blackwell LLP located at 40 King Street West, Suite 2100, Toronto ON, M5H 3C2 at 4:30 p.m. ET (the "AGM").
Following the AGM, an audio webcast of the AGM including the corporate update slide presentation will be accessible through the Company's website. Full event details will be posted in the Investor - Events section on www.klgold.com.
About Kirkland Lake Gold Ltd.
Kirkland Lake Gold Ltd. is a mid-tier gold producer targeting 500,000 to 525,000 ounces in Tier 1 mining jurisdictions of Canada and Australia. The production profile of the company is anchored from two high-grade, low-cost operations, including the Macassa Mine located in Northeastern Ontario and the Fosterville Mine located in the state of Victoria, Australia.
Kirkland Lake Gold's solid base of quality assets is complemented by district scale exploration potential, supported by a strong financial position with extensive management and operational expertise.
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