Q2 2021 NovaGold Resources Inc Earnings Call
1 on your telephone keypad shooting.
Should you need assistance during the conference call you may see going on and operate there by pressing star and zero.
I would now like to turn the conference over to Melanie Hennessey, Vice President Corporate Communications. Please go ahead.
Thank you Claudia and good morning, everyone. We are pleased that you have joined US for Nova goal for 2021 second quarter financial results and also for an update on the Donlin Gold project on today's call. We have Dr. Thomas Kaplan <unk> Chairman.
And David <unk>, Vice President and CFO.
At the end of the webcast, we will take questions both by phone and by text. Additionally, we will respond to questions received by email.
I would like to remind our webcast on call participants that as stated on slide 3 any statements made today may contain forward looking information such as projections and goals, which are likely to involve risks detailed in our various Edgar and SEDAR filings and forward looking disclaimers included in this presentation.
I now have the pleasure of turning the presentation over to our chairman Dr. Thomas Kaplan Tom.
Thank you Melanie and good morning, everyone. Greg sends his regrets as you've had a family emergency to attend to.
And we'll be back in the office in several days.
That is in the west.
<unk> data book, that's shown on slide 4.
The joint venture partnership with Barrick.
The strip price that mining is an important part of the Alaskan economy, and becoming even more important to state revenues and employment as shown on the map there are 6 producing mines and numerous ex.
<unk> development since the state mining industry employees can be found in most communities large or small.
In terms of scale quality and exploration potential donlin gold's attributes far exceed any other gold development project globally, when combined with our longstanding Native corporation partnerships the exponential for us.
Gold price a strong cash position with key federal and state permits in hand, and experienced management team on board as well.
Supportive share holder for <unk>.
<unk> is in an enviable amongst all gold development projects.
No for gold is committed to responsible mining stewardship of the environment and adding value to the communities in which we operate we believe that mines can be developed in collaboration with people who have had the local knowledge to help minimize environmental impacts while per.
Providing maximum benefits to all stakeholders, Nova gold has approached the disclosure of our environment, social and governance ESG performance pragmatically as a development stage company disclosing benchmarks that we believe for the most relevant measure.
From settlements.
You shouldn't have our inaugural sustainability summary reports earlier this year was the latest step in our progression a selection of the measurements of performance can be on.
Bye bye.
And although.
Liquids biased possible standards through our work force performance actions and conduct at Donlin Gold. These principles are passed on to our workforce as they receive training and experience to develop skills that will help them today as well as in the future.
1 drill program at Donlin Gold has direct hires of 70% Alaska Native employees from 20 different villages in the Y K region as presented by the Blue dots on the slide 6 map.
Okay.
For ship is integral to our corporate culture <unk> supports the donlin gold team and their outreach on site work to make a positive difference in the Alaskan communities in the Y K region Slide 7 shows net debt activities like the Rainbow smelt largest studies.
The growth buckets to improve hygiene.
Material sales for <unk>.
Providing protective.
The COVID-19 pandemic.
Careful collaboration with our native partners, <unk> and Teekay C as well as other tribal groups in the Y K region. Since 2020 has been key to successfully operating at sites with zero Coke.
Zero, while the COVID-19 pandemic has a lower risk than a year ago Novo Golden Donlin Gold's have continued adhering to policies to reduce risk and ensure the safety and well being of all employees and contractors.
<unk> bold stringent measures as outlined on slide 8 allowed donlin gold to safely operate for the 2020 drill program, which we are continuing for the 2021 drilled season.
Underlining Nova golds in barrick's commitment for the object.
Partners at approximately $2 million at 2.
2 year periods, and a leading bold project site, including a larger kitchen facility upgrades to electrical supply a new warehouse and upgrades to the core logging and cutting facilities and equipment. Some of this investment can be seen in the photos on slide 9.
The Donlin Gold project camp was reopened in March and for drill rigs were deployed for the 2021 drill program slide 10 shows drilling as well as cord cutting and inspection that occurred earlier. This month you can also see on the bottom left an aerial photo of the project.
Site.
As of June 26.
Polls for.
For planned this represents over 40% of the 20000.
100 metres planned in this campaign initial assay results are expected theaters per.
As you can see on the map on slide 11 is targeted in the <unk> and Lewis pit areas and is being performed to verify geologic modeling concepts and further test ore body continuity and structural control and test for extensions of high grade zones in both intrusive and sedimentary rocks. Once we have completed the 2000.
'twenty, 1 drill program and geologic model updates incorporating all the latest drill data optimization work and trade off studies. Since 2011. This will provide the necessary information to support a decision to move to the upcoming feasibility study subject to a formal decision by the Donlin Board LLC.
With all federal in most key state.
Donlin Gold continued to successfully advance remaining state permits, including water rights and the natural gas pipeline right way to right of way with the support of Alaska Native partners <unk> Teekay SEC.
Alaska depart the net.
As a respected.
Through water rights applications for Donlin gold related to local surface water and groundwater sources. This year. Additionally, <unk> division of oil and gas is also expected to reissue the state right of way agreements and lease authorization this year.
On May 27th the Alaska Department of Environmental Conservation Commissioner upheld the state of Alaska's section 401 certification under the clean water Act that had been granted to Donlin gold and 2018 after a thorough diligence and transparent review by state and federal agencies of the proposed <unk>.
<unk> development plan and its relationship with the surrounding environment. This is a permit that donlin gold has held since August 2018 on June 28 first Jeff.
Francisco This law firm on behalf of O N C. The tribal council for vessel a village in the Yukon Kuskokwim region.
Gil Superior court.
<unk> strong debt.
The Commission's decision to uphold the 401 certification validates the project stakeholders commitment to advance the Donlin gold project in a safe and environmentally responsible manner for the benefit of all alaskans.
All great ore bodies go through Appeals and litigation there is never been 1 without 1 over a 6 year period Donlin gold conducted an extensive transparent and independently reviewed scientific evaluation that included significant community participation and scrutiny and consistently demonstrate.
Is that the project fully complies with the clean water Act, the Alaska water quality standards and patient analysis.
For both state and federal laws the process culminated with the issuance of the 401 certification.
2018, the 401 certification clearly demonstrates that the project.
<unk>.
In periods of environment and imposed by the state of Alaska, and the appropriate agencies of the federal government of the United States.
We remain entirely enthusiastic about the future of Donlin gold of tier 1 gold well over <unk> and.
And look forward to continuing our constructive engagement.
With all the appropriate federal and state agencies in Alaska.
Welcomes responsible resource development that enriches the lives of all its residents.
To meet reporting requirements <unk> retained wood, Canada Ltd. In 2020 to perform a detailed review of costs and other assumptions used in the previously filed 2011 technical report the.
For 2021 technical report utilizes the existing mineral resources model and the same technical information from the previous Donlin Gold 2011 Technical report with 2020 cost and adjusted Gold price. This report results in no material change to the mineral resources or mineral reserves.
As stated earlier in the presentation for 2021 Donlin Gold Technical report is separate from the upcoming feasibility study that we expect will commence once we've completed the 2021 drill program in the geologic model update subject Donlin Gold LLC Board approval.
Donlin gold is committed to support the needs of its community partners and second quarter community engagement highlights can be seen on slide 14.
In April Donlin Gold was a major sponsor of the lower Kuskokwim School districts annual College and career fair held virtually more vendors participated this year in approximately 100 students attended.
<unk> and Donlin gold made significant contributions for the Thomas Lodge and Crooked Creek. After a fire funds were used to repair this critical asset prior to the busy summer season.
To date Donlin Gold LLC has signed 7 shared value statements with villages in the Yukon Kuskokwim region that formalized current engagement with local communities. These engagements expand upon the long term relationships already established with these communities and address specific community needs such as water sewer.
<unk> and landfill projects Simon studies and suicide prevention programs <unk> also sponsored and participated in the mining Inc.
I'd throw in May a fundraising events in support of the BC Children's hospital located in Vancouver, British Columbia as you can see from the photo on the bottom right, our very own Greg Lang for Pi for this worthy cause.
Thank you Greg.
Donlin gold operated pursuant to the terms of our sub surface minerals and surface land lease with Calista Corporation and a surface land use agreement with the Kuskokwim Corporation Teekay SEC. The Donlin Gold project is being developed.
That was selected by <unk> and Teekay C. At the direction of wide reach and elders in the 19 seventies when land considered valuable for resource potential with selected and resource development companies were invited by the native corporations to explore we support for Lister in Teekay see mandates through the.
$19.71, Alaska Native claims settlement Act.
As highlighted on slide 15 to help them develop their land for the economic benefit of the region and all stakeholders involved we are thankful for the long term support and commitment for the project by the Alaska Native corporations. They play a key role in its continued success.
In the second quarter. The first subsistence community Advisory Committee was launched.
S. C. AC is a subcommittee of the Donlin.
We'll review committee.
Solicitor, Teekay <unk> and Donlin gold initiated planning to establish this committee in 2018. The committees objective is to establish and maintain a well defined process for communication dialogue and problem solving needed. Among the partners. The committee is made up of diverse people from the region to.
Good information about local subsistence activities and traditional knowledge as it relates to the Donlin Gold project.
The FC AC Committee provides a forum for stakeholders to discuss issues of concern related to Donlin, Gold's plans operations or monitoring activities and their potential impact on subsistence activities wildlife habitat recommendations related to subsistence will be made for the committee.
And to assist them in developing and periodically updating of subsistence plan for lens on waters effected by the Donlin Gold project. These.
These partnerships activities and programs demonstrates Nova golds in barrick's loans, extending and deep rooted commitment to sustainable and responsible development for the benefit of all stakeholders in the Y K region.
I will now pass it over to David <unk>, our CFO, who will cover the financial results for the second quarter Dave.
Thank you Tom.
On slide 17 highlights our second quarter operating performance.
We reported a net loss of $10.5 million in the quarter, an increase of $3.3 million from the prior year quarter, primarily due to foreign exchange movements resulted from a strength for the Canadian dollar and low interest income earned on cash coupon on deposits.
Also contributing to the increase were higher share based compensation and legal costs.
On a full quarter of activity at the Donlin camp this year compared to last year's temporarily paused due to Covid precautions.
Second quarter cash flows are highlighted on slide 18.
We spent $6.6 million in the second quarter slightly higher than the prior year quarter.
Higher Donlin gold funding in G&A spending was offset by foreign exchange movements on Canadian dollar denominated cash and a reduction in working capital.
We ended the quarter with cash and term deposits of $176 million.
On slide 19, we note our robust treasury.
In addition to our cash and term deposits.
Also had 75 million for Newmont ex month with an additional $25 million due in July 2023.
We continue to anticipate spending $31 million to $35 million a share.
Including $18 million to $22 million.
And our share of Donlin and $13 million for corporate G&A costs.
I will now turn the call back over to our Chairman Thomas capital.
Thank you very much day.
We all recognize that donlin gold already enjoys an incredible foundation of attributes to build upon and that is the project's expected mine life may already be measured in decades, we have a great responsibility to all stakeholders to do things.
Right from the start and not cut any corners with approximately 39 million ounces of gold in measured and indicated mineral resources when compared to the 15 comparable large gold projects in the Americas as shown on slide 20, Donlin gold is the largest in its category with a resource that is 4 times greater than the average.
<unk>.
The scale of Donlin gold combined with its quality its grade at 224 grams, a tonne as shown on slide 21 at twice the global average.
Large open pit.
Exceptional.
As currently envisioned the project would average 1.1 million ounces per year for the life of mine as shown on slide 22 follow.
Donlin golds production profile far exceeds the average of north and South American peers on this slide.
Global Gold production continues to decrease for most of the major producers further illustrating that the industry desperately needs projects with scale grades and longevity.
And then of course, there is more than debt Donlin gold is indeed unique in its combination of all of the attributes that we've cited and then some particularly given the scarcity of new major gold discoveries over the past decade, and the safe jure.
Fiction, and which is located on <unk>.
<unk> got a tier 1 jurisdiction.
Only 3 mining operations produced more than 1 million ounces in 2020 as shown in appeal and slide 23, looking at comparable scale mining operations around the world both in production and in development Donlin would rank among the top operations. If it was in production today.
The slide also shows the top 5 largest development stage gold projects in dark Blue Donlin is in both.
Looking globally Theres only 1 development project that is both scale and a desirable mining jurisdiction.
Donlin.
While we're focused on the drill program permitting and modeling work, we haven't lost sight of 1 of the projects most important attributes donlin gold's truly exceptional exploration potential the project's bold endowment is contained within only 3 kilometers of an 8 kilometer mineralized.
Felt as shown by the <unk> and Lewis pits shown and goals on slide 24, and the mineralized belt represents only 5% of the total property.
And let's not forget that in all the past drill programs at Donlin gold we've been counted amongst the best assay results for an open pit gold project in the industry anywhere in the world.
Slide 25 represents the life of mine diagram for Donlin gold as 1 of the world's largest.
Mining and development.
After years of exploration and resource enhancement technical studies for receipt of our federal record of decision and several state permits Donlin gold has been substantially derisked and methodically brought up the value chain, It's a solid foundation from which to advance this rare and unique deposit the time inverse.
It upfront to develop responsibly and sustainably is critical for the project's success. We believe this day.
We'll be amply rewarded.
In 2021, we will complete the 2021 drill program and geologic model update incorporating all the latest drill data optimization work and trade off studies since 2011.
Then subject to a formal decision by the Donlin Gold board shift our focus for the upcoming feasibility study.
Deposits that both Donlin golds special combination of incredible attributes are unusual and highly coveted and.
And not just by investors given recent examples of governments around the world either physically or through legislation or other means effectively seizing assets. We are grateful that bundling bold is located in Alaska with there is a time tested culture of respect for responsible and sustainable mine development and the rule of law.
We are confident that Nova gold with Barrick to listen Teekay seeing will advance to the <unk>.
It's about net.
Particularly it's safe and for.
On.
So on that.
<unk> this thankful for the dedication engagement knowledge sharing and encouragement of our shareholders many of whom have been holders for a decade and are shown on slide 26, we are appreciative and humbled by the trust you put in our team and we take this responsibility very seriously.
We remain focused on maximizing returns and a measured safe and socially responsible manner. It's extremely important for all of US that you are proud of your investments as well as make money.
The attributes of Donlin are summarized again on slide 27, the uniqueness of the project its balance its robustness in key categories size grade jurisdiction partnerships exploration potential balance sheet.
Advanced stage of permitting a management team that has built and operated similar scale operations.
And Mr aligns with our strategy as we move Donlin gold up the value chain.
Thank you operator, we will now take questions from the participants.
Thank you Sir.
We will now begin the question and answer session to.
To join the question queue you May Press Star then 1 on your telephone keypad.
We will hear a tone on knowledge and your request.
If youre using a speakerphone please pick up your handset before pressing any Keith.
Throwing a question. Please press Star then 2.
We will pause for a moment as callers join the queue.
Our first question is from Lucas pipes with B Riley Securities. Please go ahead.
Thank you very much and good morning, Tom and team Thomas It's Pedro here.
Hear your voice.
I wanted to.
First ask a higher level question.
Then.
Turn it over to the project.
Specifics, but.
Tom It feels like the gold market is looking a bit for direction here on.
Would appreciate your thoughts as to what is what is your outlook on where do you see the next catalyst.
Yes.
Really appreciate your insights thank you.
Thank you Lucas great hearing your voice as well.
I don't really think its really something of the gold market looking for direction I think it's more a function of gold doing.
We always say, which is the gold does with the least expected to do.
When you least expect it to do it.
I think that what we're dealing with is.
On a correction that 1.
Out of the way is going to lead to new highs.
Ingalls I think that we will see those go right through 2000.
Essentially what we're seeing not only in the gold market and some other markets as well.
Youre seeing pullback.
That are accompanied by.
Some fulfill <unk>.
But if I had for fresh dollars.
To put into the.
The market today.
It's into gold and silver.
And particularly the equities that give you the maximum exposure. So to me. This is part and parcel of what we're seeing overall in the market.
Which is that.
People are having to come to terms with the fact that some things have changed and we are in unchartered waters..1 of the assets that you always want to have exposure to when we're in such a sea change.
Are the precious metals and the equities are as cheap.
As they've ever been so they are a great value.
Very helpful. Thanks, Thank you Tom.
On the feasibility study you mentioned you would.
Commence.
Commenced that work for them.
<unk> program is completed.
I wondered if you can provide an update on.
Kind of how long it would take from there for the study to be completed.
Yes.
And then obviously from there.
What what the timeline could look like towards development. Thank you very much.
That brilliant thank you so much Lucas.
Question.
I'd, rather I'd, rather pivoted to Richard Williams.
Who is our <unk>.
Project.
Manager.
<unk> to say that Greg would normally be fielding that part of the question.
But my understanding is that once we have the the.
The drill data and the modeling done and.
Once the decision by the Donlin boards.
We would go into updating the feasibility study.
And.
The logic.
On the logical way for me to answer this debt at that time.
Both we and Barrick.
We'd give you the timeline that we're looking for.
Got that Bob and weave sufficiently for someone who's not trying to avoid the question, but wants to make sure that you get an accurate answer.
As a as a pinch hitter.
Yes.
That's helpful. I'll wait a minute wait a minute wait a minute go ahead wait a minute.
Tom you're right did a brilliant Richard Williams.
North America look like.
<unk>, yes.
I'll just add Lukas, it's hard to put a timeline and Tom said it perfectly.
I guess this drilling done we're going to do the the analysis make sure. We've covered all of the risks and gaps or at least have a mitigation plan and remember all the optimization on all the tradeoffs for we've been doing.
We'll go through all those what survives what doesn't and then we have to develop a scope of work of what that updated feasibility our final feasibility their detailed whatever definition, we wanted to put it.
<unk> is in front of that feasibility because thats. The key document as a stage gate for that next decision to try to get to a construction.
Ultimate construction decision so as Tom said, we're going to pull all that together as a group.
<unk> put on.
Putting everything on the table once we have that scope defined than your scope defined your timeline and as Tom said, we would be happy to roll that out once we have all day.
All the pieces lined up.
Really really appreciate that.
I'll ask 1.1 other.
Slightly related question.
It's a bit higher level again, but.
Tommy you speak to the declining production profile in the industry.
I wondered.
If you are able to provide an update as it relates to the sense of urgency debt.
Youre seeing more sensing among.
On the majors to replenish their production and development pipeline.
I appreciate your thoughts on that.
Well.
I think.
I can.
Hubert.
Yes.
Got it.
We're right in what's going on with gold that sense of urgency will become.
I think closer to panic, but it is not simply that.
<unk>.
It's what's happening in terms of the jurisdictional risks is really I hate I hate to say it because that debt a certain point I became the pied Piper.
Jurisdictional risks, but every week that goes by Youre looking at new jurisdictions, which are becoming on investable.
It's very hard if you're an investor in gold for copper.
To look at countries, which are already talking about windfall profit taxes.
And when you see that kind of thing happening in copper not just by the way in Africa, but also in the Americas amongst some of the senior producers and you see movement.
In these countries towards outright socialist governments.
You realize that the mantra of location location location is there you have investors those investors don't want to see you putting new fresh cash.
In <unk>.
Countries that are going to cap their earnings potential.
And when you see things through that prism.
A natural concern that these mining companies have to replace their reserves and remember not just replace reserves, but also to do so in a way that is not dilutive to their overall grades because average grade is collapsed by half over the previous decade.
Well now you're up to superimposed on that that all the other countries that you might have been thinking of assuming that you werent listening to me and a few other <unk> out there.
They are off limits.
And the implications that that has for gold copper for.
Copper gold projects et cetera.
<unk> aren't going to put fresh dollars into jurisdictions that are basically saying.
If you build it we will come out.
And take it from you.
The field of Dreams, just doesn't work that way and if I'm right. There on what Youre seeing in copper is definitely going to be shown to be in both I think I think gold.
For sure is going to be declared a strategic asset in many jurisdictions.
And.
You really just want to be in those handful of places where the rule of law still matters.
And again.
Does that mean that means a project like donlin, which does not suffer from those issues of <unk>.
Being accretive in reserves to everybody.
It is accretive in terms of grade to practically everyone open pit profile, but more than that it's in a jurisdiction that when you really want the fruits of the leverage instead of a legislature or.
Auto credit government coming in and capping year gains. This 1 will allow you to keep the fruits of that leverage so came through that prism, how many stores do you have.
Kudos to Barrick they understand it.
They've seen what goes on all over the world They know that donlin.
Is unique I mean, we call it the new Nevada, because in terms of its size and its quality.
Alaska, which is already the second largest gold producing state in the United States. After Nevada will Donlin is a flagship gold asset for the entire industry the amount of Av.
Gold assets that will produce over 1 million ounces around the world.
It's a unicorn, but the most important thing is that the unicorn is got to be in a place zentai poaching legislation otherwise the unicorn ends up on someone's wall.
So I've completely mix my metaphors, but youre going to allow me to indulge for myself, because I cannot exhort people enough and I am not talking my own book, it's because I've been there I know these places I've actually done really well in those places it over over the E. R.
Who wants to be in places, where an investor a portfolio manager can tellers IC that when I go to sleep at night, I know that what I thought I was going to wake up to is still there I still own it and there are no surprises.
That means the United States, Canada, Mexico, Australia.
And in a couple of other outliers Youre, Finland.
Thanks.
Sure.
There.
Youre going to have the worst of all problems for an investor getting the macro right.
And because you are right not just getting it right, but because youre right someone else comes along and says thank you very much for building instrument.
Other than that.
Wildly enthusiastic about the emerging markets.
That's my that's my summary comments for its always great. It's always great to hear your thoughts.
I really appreciated tend to you on the entire team continued best of luck.
Thank you very much Lucas. Thank you for all of your great questions and firm support.
Really appreciate it.
Our next question is from Trevor Turnbull with Scotiabank. Please go ahead.
Yes. Thank you.
Thank you for providing an opportunity to discuss the project update I'm, sorry to hear about Craig's newest I certainly wish him the best.
I appreciate youre going to have an updated technical report that will be forthcoming with all the details of the re costing exercise. However, I did also want to ask a couple of high level questions just on the operating and capital costs.
With respect to the reassessing the cost at Donlin I was wondering if there were any major surprises or if you could comment perhaps on some of the big items like labor rate trends.
If there were any material changes in the re costing for say fuel price assumptions.
Richard.
Yes on we take that Tom I will think some flow.
Further alignment.
Yes.
Yes.
It was a good exercise has been 10 years sales.
The 2011.
The technical report.
So it was a good opportunity to 1 look at a lot of the permitting.
Activity and see if there was any major changes, which their work, but we were able to.
Bring in new costs, which now we arent estimate for as much as real now as we're getting permits but no no material change, it's just more surety.
And then you touched on some good points.
When we looked at.
Sure.
Particularly with diesel and oil prices have changed since we.
Months, we've been working on this update but.
On the 2011 for instance, we had $85 barrel oil and we use 65 than there is in the us.
Update the numbers, which isn't far off where we are today.
And so actually we saw a day.
Decrease in power.
Cost because natural gas is also counting on.
Tied to be for the oil price.
And so something like processing on the call.
<unk> actually for slightly better.
Due to that energy reduction.
Labor costs that you touched on the good 1 probably 1 of the steady things we did see throughout.
The past 10 years and.
And throughout all our costs for labor, It's gone now for I don't think that that's a surprise.
But again nothing that Earth shattering I think Trevor you can take from these numbers is although they have gone up so has the gold price.
And so.
1 other things we're trying to check on the same thing we check back in 2008, when we're doing projects is when does the gold price have a steeper incline then the rising.
Rising commodity for building and.
So what we saw.
So youll see it in the detailed report as well.
We track well, alright, and so with the higher gold price offset some of those higher labor costs on some of the other commodity costs I think overall.
So on a show about a 10% capital increase on the project this size.
That was a pleasant.
Pleasant surprises.
They Werent war.
And again, we use for CPI index is in some places, but we did go out for Croakers a lot of the major equipment to.
To make sure that.
We didn't lead into sales.
Tula. So so overall there was no step change and as we reported.
The really good news is when we look at these new operating cost per Gram is from optimized pits.
Within the cornea 11 pit switches.
<unk>, we're comfortable signing on to no material change so.
I think it kind of supports the robustness and again just highlights.
The magnitude and the value of this asset.
Alright.
No that helps a lot. Thank you.
On a similar question.
About the initial capital cost. So I'm just wondering again, if there were any large swings in the estimates are surprises.
That just were unexpected to you and then also if you could talk a little bit about if there was a difference between say the initial costs on the mine versus the utilities and the.
Pipeline project.
1 showed more or less.
Change relative to because you provided an overall number but but didn't break it down on I was just curious if if 1 element has had more of a change than the other.
Yes.
That's a fair question a good question and something we were trying to watch to see where the trend is growing which we also would relate back to some of the optimization work, we've been doing but we didn't really see any 1.
Aerie grossly.
Grossly spike kind of control, which was good again good news.
You had some pluses some minuses.
There were a few pieces of the mining equipment that.
For that little bit chocolate on how they had maybe double that price, but then other other mining equipment and most of the.
Not just large capacity equipment with the large number of equipment did not so overall, we didn't see a substantial rise, but yes. It was a little curious on on just a few pieces of equipment and then when you got into the process I think.
Again, nothing mills and so on.
Location of equipment on an auto claims and all of that seem to be.
Pretty pretty well all in line.
So no major spike in 1 area and then other which again that was a good trend is for.
1 thing we've tried to do drivers and make sure. We did not because we are on the front end of Q1.2020, we're on the front end we didn't work.
On any COVID-19 related costs.
Good or bad impact for 1 or more of the.
On neutral thing and so there were some areas where we.
We could have used a lot lower prices say on piping material that we opted not to at this time.
But the time comes that we're ready to actually purchase.
We'll take advantage of those things, but again, we wanted to be fair.
Fair level as we could with persist exercise knowing that this is just the launching pad.
Into the into the final feasibility update so yes, I would say overall Trevor we did not see any 1 area that just locked our high value.
So overall.
I think that's a good trend as debt.
Yes.
You've seen the ups and downs.
<unk> 2 is all about the sales throughout all the disciplines, even like I say even in the.
And the infrastructure.
We've seen growth.
Pretty good pretty good ground there so we're pretty pleased on assets.
That's great yes.
Looking at kind of the overall numbers on both Opex and Capex it didn't seem like that big a change on that.
Certainly would make you think that there are no big outline elements within it I appreciate the color and look forward to finding out.
When you guys are looking at the feasibility study when that decision comes but thank you very much.
You bet. Thank you Kurt.
Thank you Trevor our next question.
And our next question is from John Tumazos with John Tumazos very independent research. Please go ahead.
Thank you.
In regards to Greg on well wishes.
Yeah.
Lost share there was some really nice trolls.
For confirmatory drill holes.
Does no material change in the reserves and resources.
I mean, you might've had a 1 or 2 million ounce improvement that's immaterial because share.
So well on so many ounces of gold.
Or were those holes just training other good holes or were there some.
So we're below average mix. So there is non material change.
Tom I can address that 1.
Great.
So John.
Yes, that's good.
Good observation, so with witnessed verification of no material change we did not go into obviously, all the new data and we're on a whole new resource with these Q piece, what we did though is take the 2020 and the.
2017 drill holes.
And looked at those peer shamed into the old 2011 geologic and resource model.
And look.
Spot check that there wasn't a major.
Material change or variation so you are right.
When we get this last on drilling dominantly and when we do a another full update on that resource.
Yes.
Its not I don't think youre going to see anything material right.
Again, we're just spot checking at this stage, we will have a better handle on that when we finish the work.
<unk>.
As we said last year those are all good news.
Holes, but they were targeted holes and it was a small population to be overall.
And we just got to finish the work that could give you the what the big picture looks like.
We lost share as holes.
You're getting what is likely to be the first.
Several years of the mining sequences comment.
For lenders for equity investors to ask about the first few years.
Good day diligence on a project and often the twin goals for the year over years.
Alright, so Joe on the targeted holes, where we're more looking at the concepts and the extensions.
Could we.
Looking for some continuity and piece them together, we have a high grade up here can we tie that high grade we have down there together and do that.
Does it fill in between so it wasn't necessarily.
Designed to look at just the early pits, but what I will comment is we keep track of ones that do peers say that first 10 million ounce pit versus day the.
The big at the time 1200 dollar resource pit.
Just to see how we're tracking.
And I think.
It's pretty clear that.
With.
The positive and the drilling.
<unk> done over the last.
10, 12, whatever 20 years.
That net I'll call it the starter pit if you will.
Is obviously more densely drilled.
<unk>.
More.
Understanding of it than we do the some of the outer areas and so that that can be used as you said for that due diligence to make sure that.
You always.
You've heard other say.
30 year project, but we wanted to make sure those first 10 years for.
Pretty rock solid because that should payback.
That is what youre moving to.
Thank you very much.
This concludes the question and answer session I would like to turn the conference back over to Thomas Kaplan for any closing remarks.
Thank you very much Claudia.
First of all.
In Q.
2 Lucas Treasurer, John for your questions.
And your well wishes to Greg, which obviously will be conveyed.
I want to also thank Dave <unk>.
For his contribution.
We've got a robust balance sheet and he's doing a great job with it.
And.
Richard Williams for stepping in.
And making sure that.
Im not too far over my own skis in talking about things, where we're fortunate to have.
Joined right after building the very successful Pueblo Viejo mine.
Which is pretty similar in scale.
Scale.
2 to Donlin and.
And I remember when Richard joined Us in <unk>.
Flores, then at pulse and asked.
Richard why did you come to <unk> and Richard said.
Because I want to be part of building the greatest gold mine in the world.
For reasons, which I think that we've <unk>.
To convey.
We really believed that donlin is.
Sure.
A unicorn.
Whatever superlative you want to put on something.
Each day.
Per view.
<unk> size and safety.
And costs and all those other things really is unique.
And in a world in which almost every week and other.
Jurisdiction goes by the wayside and location location location becomes the primary gating point for an investor.
I think it's fair to say that.
<unk> is a pure play on.
<unk>.
The new Nevada. The next Carlin, However, you want to look at it.
Is a really great investor vehicle and I also want to take a moment to thank our partners at Barrick.
Because this is truly a joint venture.
We are 50.50, but more than that.
We're really briefly.
Once again.
Thanks Mark.
And cash for the.
On the North America.
Setting that.
Tone as.
I would like to remark who's been a dear Dear friends for many many years I would say the reason why we get along so well with Barrick is because <unk> is more Eric DNA and it's in Barrick.
And it's.
It's a joke, but it's also a testament to the fact that our teams worked very seamlessly because pretty much everyone has known each other and to the extent that randgold has come into the story, which of course is a very big extent.
It's been hugely accretive to the process.
What they've brought their own vision to the enhanced modeling income.
I think it's fair to say that both the Barrick Novo bolt teams for Donlin gold team as the synthesis.
Are really excited by what they see.
The new models are obviously.
<unk> exciting if you were to look at those drill results from last year, they would be amongst the very best drill results in the entire gold industry. The fact that they are located in the place that is really allowing us to.
The all in is really fabulous.
And as most of my career has been built on the drill bit I can tell you.
We're at up to me on have 10 drill rigs on.
On the thing for years, but that's another story suffice to say that.
There's a lot of gold there that's going to be a lot more global debt.
On the parts.
Hearts.
And even the 8 kilometers altogether.
Or 5% of the land package.
All credit to Mark Bristow is a geologist.
The site will continue to be up to site.
Mark wants to know what every single ounce is going to look like.
In those early years.
And all credit to him because the projects.
Only getting better.
So as the Big Love letter and thank you to <unk> team.
But as.
As investors.
Needed.
Also I think really straightforward investors on our side I think we can look forward to.
Really having 1 of the only go to stocks in the global development space and I want to thank all of our investors shareholders Big and small.
For for this.
The support we never take it for granted not for a moment. Thank you.
This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.