Kirkland Lake Gold Sets Record Production During the First Quarter of 2015

Kirkland Lake Gold Inc. (TSX:KGI), today announced that the company has produced 41,482 ounces of gold during their first quarter (May 1 to July 31) of their shortened year or stub year that runs from May 1 to December 31 2015.

Earlier this Kirkland Lake Gold announced that their year-end would be coordinated to the actual year end December 31, 2015.

The Company intends to release its first quarter results for the Stub Year 2015 on Monday September 14, 2015, at 7:00 am EDT and will hold a conference call to discuss these results at 11:00 am EDT, the same day.

Over the first quarter KLG Milled 94,437 tons of ore at a head grade of 0.45 ounces per ton ("opt") or 15.4 grams per tonne ("g/t") at a recovery rate of 96.6% and recovered 41,482 ounces of gold.

From that KLG poured 41,252 ounces of gold and sold 41,204 ounces during the quarter. The company had cash and cash equivalents of $81.1 million as at July 31, 2015.

"We are very pleased to start this year off with a record quarter of production which is a direct result of our teams continued commitment to executing the plan,” said. George Ogilvie, President and Chief Executive Officer of Kirkland Lake Gold.

 The grade of the gold produced by Kirkland Lake Grade improved by 7% to 0.45 opt (1.4 g/t) over the previous quarter and was 3% higher than the guided grade of 0.43 opt (14.7 g/t).

Kirkland Lake’s the production rate started off on the lower end, but reached an average of 1,076 tpd in the last two months of the quarter. As more stopes are brought online in the South Mine Comples, and with the additional equipment planned over the next two quarters, the company expects the rate to continue to increase.

“We continue to look for ways to optimize the operations and reduce costs with continuous improvement initiatives which will allow Kirkland Lake Gold to not just remain profitable, but improve margins especially in light of the depressed gold price,” Oglivie added."

During the first quarter, development at the South Mine Complex continued with the main ramp development approaching the 5600 foot level. Access development to the 5600 level is expected to commence during the second quarter. Production from the 5400 level remained strong with a fifth stope brought into production during the quarter. Development remains on track to increase the number of production stopes on the 5400 level with a sixth stope planned for production during the second quarter; and development of stopes on the 5600 level expected to commence in the second quarter of 2016.

The average production rate in Q1 2015 was 1,026 tons per day ("tpd"), however during the months of June and July, ore production averaged 1,089 tpd. The average head grade for the quarter trended higher at 0.45 opt (15.4 g/t) with a favourable recovery at 96.9%. The increase in the number of stopes in the SMC and a focus on operational improvements should support a more sustainable rate of production going forward.

Operational improvements conducted during Q1 2015 include modifications to the power line between Shaft#3 and #2 Shaft and mill area which should reduce power costs. During the quarter, the Company also invested in various mobile and stationary equipment to improve the efficiency of both the underground and surface operations.

For the eight month period of  the stub year 2015 Kirkland Lake Gold anticipates spending between $28 - $30 million on the mineral properties (sustaining capital), and between $13 - $18 million in property plant and equipment ("PP&E"). The additional capital outlay for PP&E includes new battery operated equipment (two 20 ton haulage trucks and three scoop trams, including all ancillary equipment). Depending on delivery of the equipment, some of this capital may be deferred to 2016.

Kirkland Lake Gold Inc. is a gold producer with assets in Kirkland Lake, northeastern Ontario. Current gold production is in excess of 150,000 ounces per year and is expected to grow to over 180,000 ounces per year in the next three years as exploration and development work continue. The exploration program is aimed at maintaining a property wide reserve and resource base sufficient to sustain a mine life of more than ten years, with the current mine life estimated at between ten to fourteen years of production in a high grade gold camp.

The Company is committed to building a sustainable mining company that is recognized as a safe and responsible gold producer. Kirkland Lake Gold plans to evolve into an intermediate gold mining company centred in the historically robust Kirkland Lake gold camp, while evaluating opportunities for growth in other safe mining jurisdictions.