Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Minimized environmental disturbance during exploration.
• Designed underground mine, processing plant, and tailings facility with minimal environmental footprint.
• No cyanide used on site.
• Waste rock backfilled underground or repurposed.
• Waste separated for biodegradation, hazard management, reuse, or recycling.
• K92 nursery grows seedlings for land rehabilitation and community programs.
• Quarterly and annual environmental performance reports submitted to PNG Conservation and Environment Protection Authority.

Social Achievements

• 96% of employees were PNG nationals in 2019, many in senior management.
• Operations and construction continued during the COVID-19 pandemic.
• Agreement in principle reached on a revised five-year Memorandum of Agreement (MOA) with local landowners and PNG governments.
• First and second corporate tax payments totaling PGK17.6 million ($5.0 million) and PGK7.6 million ($2.2 million) respectively.
• Ongoing royalty payments (2019: PGK10 million) and levy payments (2019: PGK2.5 million).

Governance Achievements

• Board of Directors accountable for sustainability approach and performance.
• Board’s Health and Safety Committee oversees health, safety, and environmental matters.
• Code of Business Conduct and Ethics applies to all employees and contractors.
• Whistleblower Policy in place.
• Compliance with Canadian Extractive Sector Transparency Measures Act (ESTMA).
• MOA requires reporting of payments in compliance with Extractive Industries Transparency Initiative (EITI) standards.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacted operations and required adaptation.
• Water scarcity in PNG despite high rainfall.
• Maintaining communication and collaboration with diverse stakeholder groups.

Mitigation Strategies

• Implemented stringent COVID-19 protocols, including quarantine and testing.
• Created a PGK1.5 million ($440,000) COVID-19 assistance fund.
• Prioritized bringing fresh water to impacted communities (PGK120,000 ($35,000) spent in 2019).
• Regular engagement with communities, governments, employees, contractors, shareholders, and industry peers.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Prioritization of local suppliers
• Joint ventures with local landowners

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: SASB Metals and Mining Standard

Certifications: ISO 14001, ISO 45001 (based on OHSAS 18001 standards)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 2 (Zero Hunger)
• SDG 3 (Good Health and Well-being)
• SDG 4 (Quality Education)
• SDG 5 (Gender Equality)
• SDG 6 (Clean Water and Sanitation)
• SDG 8 (Decent Work and Economic Growth)
• SDG 9 (Industry, Innovation, and Infrastructure)

K92's initiatives contribute to these goals through community development programs, health initiatives, education support, women's empowerment programs, water projects, job creation, and infrastructure development.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Community Relations
• Environmental Stewardship
• Talent Management
• Governance

Environmental Achievements

• Plans to commence underground paste fill with the Stage 3 expansion in order to mitigate tailings at the surface
• Investment in water projects to help host communities gain access to clean water
• Building and repairing of roads and bridges

Social Achievements

• 85% increase in community investment ($654,643 to $1,187,409)
• Creation of a $433,500 COVID-19 Assistance Fund
• Sustainable Agricultural Livelihoods program empowering women and providing skills and resources to local people
• Tertiary scholarships to 50 students
• Assistance with primary school enrolment fees

Governance Achievements

• First payment of corporate tax in July 2020
• Agreement in principle on a revised Memorandum of Agreement
• Compliance with the Canadian Extractive Sector Transparency Measures Act (ESTMA)
• Alignment with the Voluntary Principles on Security and Human Rights (VPs)

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic causing delays and disruptions
• Community unrest (unrelated to operations)
• Artisanal and small-scale mining
• Delays in finalizing the Memorandum of Agreement (MOA)

Mitigation Strategies

• Implemented hygiene and distancing practices, quarantine procedures, and contact tracing
• Heightened security measures
• Ongoing training to raise awareness about the safety implications of illegal mining
• Working with local-level government and authorities to address conflicts and build trust

Supply Chain Management

Responsible Procurement

• Prioritizing local suppliers
• Facilitating the creation of local landowner businesses through joint ventures

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SASB Metals and Mining Standard

Certifications: ISO 14001, ISO 45001

UN Sustainable Development Goals

• SDG 2
• SDG 3
• SDG 4
• SDG 5
• SDG 6
• SDG 8
• SDG 9

K92 community projects and activities improve quality of life and lead to residents acquiring valuable skills for long-term resiliency.

Awards & Recognition

• OTCQX Best 50 Company
• Thayer Lindsley Award for Best Global Discovery from PDAC

Environmental Metrics

ESG Focus Areas

• Socially Responsible Mining
• Climate Change
• Community Development
• Environmental Stewardship
• Health and Safety
• Governance

Environmental Achievements

• ~50% lower carbon intensity per gold equivalent ounce produced compared to global average
• Zero reportable environmental incidents since 2015
• Consistent tailings and treated wastewater discharge monitoring within permissible range

Social Achievements

• 14% year-over-year LTI frequency reduction
• $0.9 million in community investments
• 14% year-over-year increase in corporate tax (second-highest taxpayer in PNG mining industry)
• Adult literacy program with 96 graduates
• Sustainable Agriculture Livelihoods program with 100 farmers (80% women)

Governance Achievements

• Formalization of Anti-Bribery and Anti-Corruption Policy, Human Rights Policy, and Supplier Code of Conduct
• Establishment of the Environment, Health, Safety, Social and Sustainability Committee (ESG Committee)
• 33% female representation on the Board

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting community outreach and operations
• Inter-tribal disagreements causing project interruptions
• Delays in signing the Memorandum of Agreement (MOA)
• Artisanal and small-scale mining (ASM) posing safety risks

Mitigation Strategies

• $450,000 COVID-19 Assistance Fund
• $300,000 for Goroka COVID-19 Isolation Centre
• COVID-19 awareness, testing, and vaccination programs
• Strong logistics and quarantine measures for exploration work
• Engagement with local and national government to address ASM

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• Prioritization of local suppliers
• Joint ventures (JVs) with local landowners

Climate-Related Risks & Opportunities

Physical Risks

• High heat
• Heavy precipitation

Transition Risks

• Carbon pricing
• Market shifts

Opportunities

• Energy efficiency
• Market opportunities for copper
• Reduced emissions

Reporting Standards

Frameworks Used: SASB Metals and Mining Standard, TCFD recommendations

Certifications: ISO 45001, ISO 14001

UN Sustainable Development Goals

• SDG 2
• SDG 3
• SDG 4
• SDG 5
• SDG 6
• SDG 8
• SDG 9

Community projects improving quality of life and skill development

Environmental Metrics

ESG Focus Areas

• Responsible Governance
• Empowering Our Workforce
• Socially Responsible Mining
• Environmental Stewardship

Environmental Achievements

• 25% GHG reduction target set against business-as-usual forecast by 2030
• 66% lower carbon intensity compared to global average
• $1M investment in partnership with PNG Power Limited to upgrade power infrastructure, increasing power reliability and reducing greenhouse gas emissions
• Approximately 70% of the water from our TSF is recycled for re-use in the processing plant.
• Repurposed over 436,000 tonnes of waste rock for construction materials

Social Achievements

• Record annual production with over 122,000 gold-equivalent ounces produced
• Impressive safety record, with a lost-time injury frequency rate of 0.31
• $19.3M in salaries and benefits paid in Papua New Guinea
• $81.3M in procurement in PNG
• $21.3M in Joint Venture payments in PNG
• 1,477 full-time employees and contractors, approximately 94% of whom were Papua New Guinean nationals
• $1.1M in direct community investments
• 38 tertiary scholarships and 200 graduates from our adult literacy program (90% women)
• Implementation of a three-year Health, Safety, Environment, and Security Strategy
• Launched a leadership and compliance training program for 100 K92 leaders

Governance Achievements

• Established a new, standalone Sustainability Committee at the Board of Directors level
• Surpassed the target of 30% female representation on the Board of Directors (33% achieved)
• Updates of its Board mandate as well as position descriptions for the Chair of the Board and the Company’s CEO
• Executive compensation linked to ESG performance (10% of total KPIs linked to environmental performance and ESG disclosure, and 20% KPI measurement linked to safety performance)

Climate Goals & Targets

Environmental Challenges

• Delays in signing the Memorandum of Agreement (MOA) due to electoral focus and COVID-19
• Artisanal and small-scale mining (ASM) posing safety risks
• Potential establishment of a carbon tax

Mitigation Strategies

• Working to have the MOA ratified by the government by 2024
• Actively engaging with relevant government agencies in relation to ASM and conducting ongoing training
• Developing a multi-year roadmap for minimizing climate risk and maximizing climate-related opportunities
• Investing in grid electricity access to reduce reliance on diesel-powered generation

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Prioritizing local suppliers (59% of total procurement expenditures in PNG)
• Facilitating the creation of local landowner businesses through Joint Ventures

Climate-Related Risks & Opportunities

Physical Risks

• Extreme high temperatures
• Increased maximum daily precipitation

Transition Risks

• Potential establishment of a carbon tax

Opportunities

• Enhancing access to grid electricity
• Increased demand for copper

Reporting Standards

Frameworks Used: SASB Metals and Mining Sustainability Accounting Standard

Certifications: null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 2
• SDG 3
• SDG 4
• SDG 5
• SDG 6
• SDG 8
• SDG 9

K92 community initiatives enhance quality of life and equip residents with essential skills.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed