Mr. Tony Makuch reports

KIRKLAND LAKE GOLD TARGETS STRONG PRODUCTION GROWTH IN 2019, FOSTERVILLE TO REACH OVER 500,000 OUNCES PER YEAR BY 2020

Kirkland Lake Gold Ltd. has released its full-year guidance for 2019, which includes strong production growth, improved unit costs, and a continued strong commitment to exploration and growth. The company also announced today three-year production guidance, which includes the Fosterville mine achieving over 500,000 ounces of production by 2020 and demonstrates the potential for consolidated production to reach one million ounces by 2021. All dollar amounts are expressed in U.S. dollars unless otherwise noted.

Highlights of 2019 guidance include:

• Production growth to 740,000 to 800,000 ounces, driven largely by significantly higher production at Fosterville, as well as increased production at Macassa;
• Operating cash costs per ounce sold to improve to $360 to $380;
• All-in sustaining costs (AISC) per ounce sold to achieve significant improvement to $630 to $680;
• Exploration expenditures estimated at $100-million to $120-million, including capitalized exploration expenditures, with $85-million to $100-million targeted for Fosterville and the Northern Territory in Australia;
• Sustaining capital expenditures of $150-million to $170-million, with sustaining capital expenditures on a per-ounce-of-gold-sold basis expected to improve significantly from 2018 levels;
• Growth capital expenditures of $155-million to $165-million in 2019, largely reflecting expenditures for the Macassa No. 4 shaft project and growth projects at Fosterville.

Highlights of three-year production guidance include:

• Consolidated: Kirkland Lake Gold targeting consolidated production growth of 10 to 15 per cent per year over the next three years, with production of 740,000 to 800,000 ounces in 2019 to be followed by production of 850,000 to 910,000 ounces in 2020 and 945,000 to 1,005,000 ounces in 2021;
• Fosterville: production to increase to over 500,000 ounces in 2020 and reach over 570,000 ounces by 2021 driven by higher grades and increased throughput in 2021;
• Macassa: production to reach 245,000 to 255,000 ounces in 2021, with output to increase substantially in 2022 with the commencement of production from the new No. 4 shaft;
• Holt complex: production, including output from the Taylor and Holt mines using the Holt mill, to total over 120,000 ounces in both 2019 and 2020, increasing to over 130,000 ounces in 2021 (additional production potential at Holloway mine, where advanced exploration work is commencing ahead of possible resumption of operations);
• Northern Territory: work at Cosmo mine and Union Reefs moving to advanced exploration phase with focus on evaluating potential restart of operations as early as second half of 2019 (no ounces from Northern Territory included in 2019 or three-year production guidance).

Tony Makuch, president and chief executive officer, commented: "Kirkland Lake Gold is poised to achieve substantial production growth and improved unit costs in 2019. We will also continue to invest in exploration and additional production growth, with our plan being to reach one million ounces of annual gold production as early as 2021. While achieving one million ounces of production will be a significant milestone, it is more important that the growth we achieve continues to drive down unit costs, increases margins and positions us to generate substantial amounts of free cash flow going forward.

"Not surprisingly, the key driver of our three-year growth is Fosterville, where we expect to achieve over half a million ounces of annual gold production by 2020 and close to 600,000 ounces in 2021. As demonstrated from recent drilling and production results, the Swan zone is a truly unique, high-grade zone that we are continuing to grow. We continue to explore for more zones like Swan at Fosterville and are encouraged by the fact that similar mineralization has been intersected in multiple locations. At Macassa, we expect to achieve incremental growth in production, with guidance for 2021 of 245,000 to 255,000 ounces, to be followed by a large step up in output in 2022 with production commencing from the new No. 4 shaft. Elsewhere, we are transitioning both the Holloway mine and Northern Territory assets from care and maintenance to advanced exploration with a focus on evaluating the potential to resume operations at both locations.

"Finally, turning to capital, based on our current growth plans we will see the peak level of growth capital expenditures in 2019, with these expenditures to be reduced starting in 2020. The Macassa No. 4 shaft project is advancing very well, with full-face shaft sinking set to commence in the second quarter of 2019. At Fosterville, our three key projects, new ventilation, a paste fill plant and water treatment plant, will be completed during 2019, as will additional initiatives that have been included in our 2019 plan, such as a new power transformer, new refinery and gold room and a thiocyanate destruction plant. We have also included in our guidance growth capital expenditures for the first half of the year related to the Northern Territory and Holloway mine as we continue to assess these assets."

                                         2019 GUIDANCE
  
                             Macassa    Taylor        Holt    Fosterville    Consolidated

Gold production (koz)        230-240     50-55       70-75        390-430         740-800
Op. cash costs ($/oz)      $440-$460 $690-$710   $620-$640      $200-$220       $360-$380
AISC/ounce sold ($/oz)                                                          $630-$680
Operating cash costs ($M)                                                       $270-$280
Royalty costs ($M)                                                                $25-$30
Sustaining capital ($M)                                                         $150-$170
Growth capital ($M)                                                             $155-$165
Exploration ($M)                                                                $100-$120
Corporate G&A ($M)                                                                $26-$28
 

Review of 2019 guidance:

• Consolidated gold production in 2019 is targeted at approximately 740,000 to 800,000 ounces, a substantial increase from target production of over 670,000 ounces in 2018 (492,484 ounces for the first nine months (YTD) of 2018). Production growth in 2019 will be driven by Fosterville, mainly reflecting higher average grades compared with 2018. Production is also expected to increase at Macassa in 2019, mainly driven by higher tonnage, while production at Holt and Taylor is expected to be similar to the comparable 2018 levels. The company's guidance for 2019 does not include any production from the Northern Territory or the Holloway mine.
• Operating cash costs per ounce sold are expected to average $360 to $380, which compares with current full-year 2018 guidance of $385 to $410 and the average for YTD 2018 of $397. Improvement in operating cash costs per ounce sold in 2019 is expected to be driven by Fosterville, the company's lowest-cost mine, which will account for a higher proportion of consolidated production compared with 2018 and will benefit from higher average grades in the coming year. Operating cash costs per ounce sold in 2019 at Macassa, Holt and Taylor are expected to be similar to comparable 2018 levels.
• All-in sustaining costs (AISC) per ounce sold are targeted to achieve substantial improvement in 2019, with guidance of $630 to $680, which compares with current 2018 guidance of $735 to $760 and YTD 2018 AISC per ounce sold of $738. The improvement is largely expected to result from higher sales volumes, with sustaining capital expenditures expected to remain similar to comparable 2018 levels.
• Operating cash costs for 2019 are estimated at $270-million to $280-million, which compares with the current guidance for full year 2018 of $260-million to $270-million and YTD 2018 operating cash costs of $197.2-million.
• Royalty costs in 2019 are estimated at $25-million to $30-million compared with current guidance for 2018 of $22-million to $27-million and total royalty costs of $18.8-million for YTD 2018.
• Sustaining capital expenditures in 2019 are targeted at $150-million to $170-million, unchanged from current guidance for 2018 and compared with YTD 2018 sustaining capital expenditures of $127.6-million. Sustaining capital expenditures are expected to be similar to comparable 2018 levels as lower sustaining capital expenditures at Macassa, largely reflecting reduced capital development requirements, are offset by an increase in sustaining capital expenditures at Fosterville. The expected increase in sustaining capital expenditures at Fosterville mainly relates to increased capital development and higher expenditures for mobile equipment procurement as the mine continues to ramp up production from the Swan zone and other areas.
• Growth capital expenditures are estimated at $155-million to $165-million in 2019, which compares with current guidance for 2018 of $110-million to $115-million and YTD 2018 growth capital expenditures of $48.9-million. Of planned growth capital expenditures in 2019, Macassa is expected to account for approximately $80-million, with $50-million to $55-million relating to the No. 4 shaft project and the remainder largely financing a thickened tails project and the construction of a new tailings impoundment area. Capital expenditures for the No. 4 shaft project are expected to decline following the end of 2019. Growth capital expenditures at Fosterville in 2019 are estimated at approximately $55-million, including approximately $35-million to complete the mine's three key projects, including the new ventilation system, the paste fill plant and a new water treatment plant. The remaining growth capital expenditures at Fosterville relate to a number of smaller projects, including a new power transformer, new refinery and gold room, and a thiocyanate destruction plant, all of which are scheduled for completion during 2019. Approximately $15-million and $8-million of growth capital expenditures are included in the company's 2019 guidance for the Northern Territory and Holloway, respectively, representing planned expenditures during the first half of 2019.
• Exploration expenditures in 2019 are estimated at $100-million to $120-million, including capital exploration expenditures. Of total exploration expenditures, approximately $85-million to $100-million are targeted for the company's Australian operations, with $15-million to $20-million of exploration expenditures estimated for the company's Canadian operations. Key areas of focus for exploration work in 2019 at Fosterville include the Lower Phoenix and Harrier systems, Robbin's Hill, as well as a number of regional targets. In the Northern Territory, exploration expenditures will focus on mineral resource growth and definition at the Lantern deposit and the continued evaluation of targets at Union Reefs. In Canada, exploration expenditures will be largely focused on the continued growth and conversion of mineral resources at Macassa and Taylor.
• Corporate G&A (general and administrative) expense in 2019 is targeted at $26-million to $28-million, slightly higher than the current target for full year 2018 of $25-million ($18.3-million for YTD 2018).

               THREE-YEAR PRODUCTION GUIDANCE (1)
 
               Macassa  Holt complex   Fosterville   Consolidated

2019 (koz)     230-240       120-130       390-430        740-800
2020 (koz)     230-240       120-130       500-540        850-910
2021 (koz)     245-255       130-140       570-610      945-1,005

(1) Three-year production guidance does not include any 
production from the Northern Territory or Holloway mine.

Macassa

Production at Macassa in 2019 is expected to increase from the target range for 2018 of 220,000 to 225,000 ounces, primarily due to increased mill throughput in 2019. Production in 2020 is targeted to be similar to 2019 before increasing to 245,000 to 255,000 ounces in 2021. Grades in 2021 are expected to average approximately 20.0 grams per tonne with mill throughput reaching close to 1,100 tonnes per day.

Holt complex

Production from the Holt mill (including mine production from the Holt and Taylor mines) is expected to remain largely unchanged during the next two years, with the anticipation of some production growth at Taylor in 2021. The potential to restart operations at Holloway mine could lead to higher levels of production from the Holt complex, with advanced exploration work being undertaken at Holloway in 2019.

Fosterville

Production at Fosterville is expected to grow significantly over the next three years from the current target for 2018 of over 330,000 ounces. Fosterville's production is targeted to increase in 2019, to 390,000 to 430,000 ounces, driven primarily by a higher average grade in the coming year. Production at Fosterville is then targeted to grow to 500,000 to 540,000 ounces in 2020 and 570,000 to 610,000 ounces in 2021, with grades over this two-year period expected to average approximately 30 grams per tonne and throughput to increase in 2021 to approximately 1,700 tonnes per day.

Northern Territory

During the first half of 2019, the company is moving forward with advanced exploration work to evaluate the potential of resuming operations in the Northern Territory of Australia. A decision on resuming operations in the Northern Territory is expected during 2019.

Qualified persons

Pierre Rocque, PEng, vice-president, technical services, is a qualified person as defined in National Instrument 43-101 and has reviewed and approved disclosure of the technical information and data in this news release.

About Kirkland Lake Gold Ltd.

Kirkland Lake Gold is a mid-tier gold producer with 2018 production targeted at over 670,000 ounces of gold from mines in Canada and Australia. The production profile of the company is anchored by 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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