Q3 2021 Kinross Gold Corp Earnings Call
While this may be caused by a lingering concerns around tasiast.
Today, we hope to alleviate those concerns.
The restart of Tasiast.
Combined with the La Coipa project and strong performance from our broader portfolio puts us in an excellent position to grow production and free cash flow over the coming years.
Turning to the third quarter results were in line with our expectations and I am encouraged to see signs of a continued return to normal across our operations.
Including a return to the Toronto office.
Before turning the call over to Andrea for a financial review and Paul for some operating highlights.
I'll discuss some additional detail on tasiast.
The results from our studies on the <unk> projects.
And some highlights from the quarter.
At Tasiast.
Thanks to the excellent work by our team.
The mill repairs were completed at a lower.
At a cost lower than earlier estimates and.
And we are on schedule to ramp up and reach throughput of 21000 tonnes per day by the end of Q1 'twenty two.
Over the next few weeks, we will be focused on getting mill throughput back to levels comparable to the first half of the year.
Moving on to our projects.
Yesterday, we released study results for two of our key growth projects, which.
Which in both cases largely confirmed our previous views.
The pre feasibility study for your desk reaffirms. This is a low risk high return project.
Extending our presence in Russia.
We are now working on a feasibility study, which we plan to complete next year after.
After which we expect to make a formal construction decision.
We continue to think we continue to expect that <unk> will be the first mine on our backend land package and we are targeting first production in late 2025.
Turning now to logo Martin.
The feasibility study reaffirms all of the project key parameters.
Global market continues to offer long term growth optionality as our potential next mine in Chile after la coipa.
Moving now to third quarter results.
Our operations tracked well against our expectations notwithstanding the challenging environment as the world works to come out of the pandemic.
We remain on plan to meet our 2021 guidance.
And we are well positioned to deliver our production and cash flow growth over the coming years.
While our production growth and related cost efficiencies are expected to drive our cash flow higher.
We are also facing inflationary pressures, which will offset some of this <unk>.
Andrea will provide more detail on this in a few moments.
On capital returns last quarter, we announced our share buyback program with the intention of spending roughly $150 million over the following 12 months.
I am pleased to report that to date, we have spent $50 million repurchasing our stock and are well on track with our plan.
We continue to view our shares as an extremely attractive.
And are pleased to be able to repurchase at these levels.
Finally, I would like to provide an update on the progress we've made with respect to ESG.
We established an ESG Executive Committee that will report to our board on a quarterly basis.
To further enhance our initiatives.
In addition, we are working to develop a roadmap that will support.
Our greenhouse gas reduction targets for 2030, we expect to complete this assessment.
And provide detail around our targets with our year end results.
I'll now turn the call over to Andrea for a more detailed review of financial results.
Thanks, Paul.
I will summarize our financial results from the quarter provide some comments on inflation and how we expect it may impact our business and then provide an update on our balance sheet.
Production during the quarter was approximately 483000 ounces was down slightly lower at 478000 ounces.
The decrease in production from last quarter was expected and was mainly due to tasiast being down as a result of repairs to the model.
Cost of sales of $890 per ounce in Q3, it was up from the previous quarter due to lower production and increasing inflationary pressure.
All in sustaining cost of $1225 per ounce with app compared to the previous quarter due to higher cost of sales and higher sustaining capex.
The increase in both cost metric was expected and we remain on track to meet our revised guidance for the year.
Attributable operating margins remained strong in Q3 at 51% driven largely by strong gold prices. However, as previously indicated inflation is impacting our results.
We're currently seeing inflation in the range of 3% to 5% in the second half of this year, which we incorporated into our revised cost guidance last quarter.
Looking ahead as the price of key endpoints remains elevated we expect inflationary pressure on our operating costs in the range of 5% to 7% going forward.
Having said that our per ounce cost metric next year are still expected to benefit from higher production.
Higher commodity prices combined with tightening labor market.
Typically in specialized contract labor such as engineering services and increased global demand for mining equipment are also expected to contribute to higher Capex next year.
We're going through our budgeting process now and we will be in a position to provide more specific cost guidance with our annual results in February.
Moving to our balance sheet, our cash position decreased slightly from the previous quarter as expected and we finished the quarter with $586 million of cash.
We generated free cash flow of $39 million during the quarter, which was a decrease from the previous quarter due largely to the absence of production at <unk>, while still spending on mining and repaired.
Looking ahead to the next quarter Q4, Capex is expected to be the highest of the year and we expect to be within our guidance range for the year.
Also during the fourth quarter, we expect to make a onetime payment of $50 million relate.
Related to our normal course settlement of prior year taxes.
Our net debt at the end of the quarter was $860 million and our trailing 12 month net debt to EBITDA ratio increased slightly and is just under <unk> five time.
As Paul mentioned to date, we spent approximately $50 million on share repurchases $32 million of which was during the quarter.
This puts us on track to return approximately $300 million through dividends and buybacks for mid 2021 came in 2022.
Finally, we are well positioned to further strengthen our balance sheet next year as our production and free cash flow ramp up.
I'll now turn the call over to Paul for morning. Thank you Andrea today, rather than a detailed review of each operation and wanted to discuss a few key highlights and we'll be happy to take questions.
Tasiast as Paul mentioned, the mill is up and running neutral screens and other key items arrived onsite as scheduled and were installed last month.
<unk> periodically achieving pre fire throughput rates as planned and we are in the process of ramping up and expect to achieve these levels on a sustained basis.
The goal of achieving full production rates throughput rates in December.
While the middle well the mill is being fed or ahead of schedule, we've elected to use lower grade ore during the ramp up period. So the initial production will be modest.
Furthermore, during this initial period, we're replenishing inventory on carbon following its depletion in the weeks after the fire.
All told we expect to produce approximately 15000 ounces during the fourth quarter and most importantly exit the year with throughput rates of around 18000 tons per day.
We are on track initially with the project to hit 21000 tonnes per day by the end of the first quarter.
I'm also pleased to say that the mill repair costs of approximately $20 million were considerably lower.
Our initial estimates.
Mining activities that Doug has continued through the quarter and as Paul mentioned by the end of the year, we expect to have built high grade stockpiles.
Mining rates during the quarter for lower than initially anticipated as a result of challenges in drilling and blasting.
However, these issues are being addressed and we remain on track to achieve strong production Tasiast next year in line with our technical report in our studies.
The 2014 project is also progressing as planned with completion expected in mid 'twenty three.
Moving to Ramon the optimization study, which includes phases is on schedule and we expect it to be completed in the first half of next year.
The geotechnical work is advancing well and we will provide the data needed to make conclusive decisions right. The ultimate slope angle as well as any immediate step outs or berms.
And to date the study is not presenting any significant surprises.
In the quarter. We also completed the relocation of the waste from the top of the pit to further stabilize the wall.
Moving to the results that you Didnt PFS. This study confirms the project is expected stronger terms the conclusion of the PFS in combination with more than 65000 meters of infill and Geo type drilling has allowed us to convert approximately 3 million ounces from resources to reserves.
Most of the study outcomes are in line with the assumptions at the time of the acquisition with some improvements in recovery and production.
Capex, However has increased by approximately $150 million.
Broken down roughly as follows in thirds.
First third approximately from an inflation.
Another third is from value add decisions that have improved the NPV become with them.
Capital costs for example, a finer crushed for better recovery and finally, a third from scope changes, including earthworks and camp facilities, which are more costly than initially anticipated.
As Paul mentioned, we also completed the <unk> and lower marketing.
The study confirmed the project key parameters.
Pit optimization work and infill drilling completed over the past two years resulted in an increase of a little more these reserves by approximately 300000 ounces into its resources.
600000 ounces compared to the PFS.
The estimate for initial capital increased by approximately 8% compared to the previous study, but mostly due to the reclassification of certain plant elements from sustaining two initial.
Such the MTV isn't alone.
We completed the study with key environmental and community considerations as part of the project design and continue to advance the EIA submission.
Lower market will now enter a lengthy permitting phase, which we expect will take three years.
Structural decision will not be made until after that with construction beginning no earlier than 2025.
Mining at local market will not begin until permitting is concluded and we've completed mining at la coipa as the two sides currently plan to use the same water source.
We continue to see further potential to extend look like but we are bringing satellite deposits into the mine plan and we've made significant progress on that.
Therefore, we may ultimately push out local monthly to accommodate more production at la coipa.
Which would allow us to further leverage our capital investments in Chile.
To extend our overall production profile in the country.
And with that I'll turn it back to Paul.
Thanks, Paul.
I'll, just wrap up by reiterating that <unk>.
Production at Tasiast has resumed and our operations are in excellent shape going into next year.
Our balance sheet is strong and we continue returning capital to shareholders through dividends and buybacks.
In our production pipeline continues to grow as we advance our projects and position our company for long term success.
With that operator I.
I would now like to open up the call to questions.
At this time I would like to remind everyone. If you would like to ask a question. Please press Star then the number one on your telephone keypad.
I'll pause for just a moment to compile the Q&A roster.
Your first question comes from the line of Tyler Langton with JP Morgan.
Good morning, Thanks for taking my questions.
I guess just to start for the for the Danskin level. Marty studies can you just provide some detail on the sort of the level of costs are using.
For both Capex and operating costs that are using more sort of current prices and those estimates are some sort of sort of historical average or sort of normalized range.
We are using current prices. So in the case of capital estimates that are based on submissions from contractors and equipment suppliers in the case of <unk> those are clearly.
We are in time.
As for operating costs, we are using current costs.
In other words, the inflationary impacts that have been seen over the last year have been incorporated into that.
Okay perfect. So it's sort of been safe and this is more temporary then we definitely see a reduction potentially in those items.
Certainly hope you are right on that but as I said at a.
Full third of the capital cost increase was due to inflation and so if inflation goes abate.
Abates and prices drop then, yes, we could see that but I don't anticipate that.
Alright, and I guess the same is true.
And then for operating costs too if sort of in place rent absolutely okay.
Operating costs.
You are correct.
Okay, Perfect and then just the Tasiast.
I know you mentioned youre on track to reach the 24 K by mid 2023 could you just remind us sort of.
Key milestones between now and then and if Theres a cat.
Capital left to be spent sort of details along those lines.
So we're looking at.
$30 million to $40 million of capital in that program to get from 'twenty, one to 'twenty four and it's a lot of incremental debottlenecking.
So we're looking at the additions to the screening capacity on the downstream side of the Sag mill itself.
A fair amount of work in the Leach train with launders in Interstate screens. The addition of tanks. So so a lot of incremental little Debottlenecking type work.
And as you said, we're ramping up to 24 and the plan in the middle of 'twenty three.
Got it perfect. That's it for me thanks, so much thank.
Thank you.
And comes from.
Your next question comes from the line of <unk> with Credit Suisse.
Hi, good morning, Thanks for taking my questions, maybe first on 2022 cash cost. So you mentioned that.
On the inflation side, maybe 5% to 7%.
But then.
Maybe some offsets from the higher production. So I'm, just trying to get a sense of.
Like how should we be thinking about next year's cost relative to the.
$830, an ounce cash cost guidance for this year.
Well thanks.
I will just remind we have we're still in our budgeting cycle.
We do provide our cost guidance explicitly when we get in to mid February with recording the year end.
But it is a numerator denominator effect with higher production, we do expect the cost to go down.
But Andrea do you want to just.
And you can make a comment there sure so.
We we did I guess going back we did telegraph that nextgen costs will be coming down.
There is a tailwind and headwind is obviously inflation.
I think retail dealer expect that caution for 2020, it will be lower than 2021 by just not as long as we previously announced.
As Paul said coming from the growth in production and that growth coming mostly from Tasiast im quite that which are lower lower cost operation and I would just remind we do for our revenue assumptions. He has 500.
Obviously, we are trying to that's below where we've been recently with spot, but it's closer in terms of anticipating taxes and royalties.
Okay, Great and then maybe just switching gears on <unk>. There was some commentary in the MD&A about temporary grade variability.
A little bit about what happened during the quarter because of the grades were a quite a bit lower than I was expecting at least and maybe how to think about Q4.
Yes, so imperative to if you look at the long run I'm talking over years, depending on where we are in the mine sequence certain parts of the pit behave better than others and in this past quarter, we were mining at edges of the pit, which historically are more difficult to predict predict.
The grade as we head into the last quarter, but particularly next year, we're going to get into the more reliable 0.4.
Great scenario, so it's a temporary effect, which is not out of line with what we've seen over long run.
Sure.
Performance I'm going to turn to.
Okay, great. That's it for me thanks.
Your next question comes from the line of Anita Soni with CIBC World markets.
Yes.
Thank you good morning, Thanks for taking my call.
I just have a question with respect to.
The mining rates at Tasiast can you give us an update on how youre doing on that on the stripping I think you had mentioned previously that you'd have to catch up on that.
The <unk> for 2020.
Yeah. Thanks, <unk>. So we still expect to hit the grades for next year. Most importantly, we have had challenges in the mining rate, we accumulated prior to 35 million ton shortfall over the last two years.
You will remember the story was more acute last year due to COVID-19 restrictions and corn teams. So we fell about $27 8 million tons behind last year. This year, we struggled to ramp up to the full run rate, but it's not as bad as it was last year, we've lost about six or 7 million tonnes. This year. However, those are both.
Ruth within.
The buffer we have on access to the higher grade material in West branch for so by the end of this year, we will be stockpiling higher grades and we don't anticipate an impact to next year's production, we will be in line with the technical report.
So potentially slightly beating it.
Okay.
And then in terms of round mountain could you remind me.
But the costs.
So I guess the constant were excluded this quarter were a little higher than I was expecting so could you remind me where are we on them.
The ultimate number that you thought that you were going to exclude for this year net of your car.
And how much more vertical in Q4.
And I'll describe the holder to remind me of the treatment of it next year.
Total.
But a lot of stuff.
Out of this quarter.
Anita I'll describe the physical situations and Andrew will talk about the cost treatment.
We successfully so we've we've completed a lot of geotechnical work, which includes the installation of dewatering wells some pretty detailed analysis on our.
Modeling the pit walls, and we've come up with a pretty confident number one lineup here well, so we've been able to steepen them a little bit from the last time, we talked.
We have moved that waste dump that was on that wall that needs to be laid back and we're now mining waste.
Below that as we saw from the slopes and our total estimate for.
Net mining over and above what had been anticipated is still in that $50 million to $60 million I'm, sorry, 60 million ton range.
And we're working on that plan of ethic cost treatment Andrea over to you. So.
Yeah.
We get you'll see I think about 43 million of costs related to round mountain.
I guess it out at that normal cod.
There is.
A little bit more coming in Q4, but I think we guided around $50 million for that and we will be within that number.
Okay. Thank you that's it for my questions.
Your next question comes from the line of Kerry Macquarie with Canaccord.
Hey, good morning, everyone. Just a question on 2022, just given all the moving parts in 2021 can you just remind us of.
Sort of where the growth is coming from in 2022 outside obviously a topic.
So.
Tasiast ramping up to that $6 to $6 50 range as I said in line with Tiara Thats, a big one and we're still targeting about 200 from liquidity by next year, That's obviously production where there wasn't production before those are the two.
Key components, but we're also seeing.
A nice number at Fort Knox, and the 300 plus range.
And so those are the principal contributors to us.
Liquidity, but I'm, a little bit of Fort Knox.
And the timing on when the court again.
Mid year.
We are the project is going really well.
We're ahead of <unk>.
Plan on stripping the.
The mill refurbishment is going well and happy to say that our capital costs. There have been trending under budget. So we're in good shape at La Coipa, and I will be targeting mid year.
On first production.
And then maybe just fantastic So you mentioned the.
Exit rate of about 18000 tons a day, whereas the mill currently.
We have been achieving 80% to 90% of what we like we just need to get that on a sustained basis.
And the target is to exit the year that 18, 19, but we've been doing say $14 $15 16.
So less than initially anticipated as of the mill.
We ended up being in better.
Condition.
And then we had initially feared and that of course translates into good operating performances were back up and running.
Alright. Thanks.
Your next question comes from the line of Mike Parkin with National Bank financial.
Thanks, guys for taking my question and congrats on a good quarter and looking forward to 2022.
Just a couple of questions from me most have been answered.
Erika too.
Costs have been a bit elevated for power because of the water situation. There and sources can you just give us an update on.
Where that kind of stands now.
So in Brazil, we do we do own power plants, which generate which serve most of our needs. However, there is a market stabilization mechanism imperative to that even when you own your own power you contribute to the overall grid. So you do take a hit when.
When theres drought, so what's happening in Brazil has been brought drought conditions that have led to shortages in hydroelectric power in.
In fact, it's the worst year since the 19 thirties and so as a result of that we're paying higher power cost in that and we expect that to continue in the near term, but the important point here is that our power costs would have been much higher.
If it werent for the fact that we own these hydro dams. So we are really happy that we have these.
And I should also add that.
This drought, which is impacting hydroelectricity across country is not impacting us in munis, Youre rice, where site water balances remain healthy.
Okay, that's great.
And then with your guidance.
The exploration potential.
Indicated in the past it was quite interesting and compelling.
Alright, great structure going through the pit.
Principal Stephanie.
Pit shell and checking for continuation of that trend in <unk>.
When we can expect kind of color and update on our program.
Yes, so the.
The focus as you know over the last year has been on the infill program.
We're really happy to report that the resources in good shape, we've begun over the last.
A few months the first full season.
What we're doing is we're looking at targets along strike on the toolbox on salt there as well as depth extensions.
Principally.
Northeast and southwest so what I would what I would guide you towards is with our exploration update that we typically do in February you'll be seeing a little bit more detail on the results of these.
These programs that are really focused on areas outside that principle, you do reserves.
Okay. That's great. Thanks, very much guys.
Your next question comes from the line of Greg Barnes with TD Securities.
Okay. Thank you seem to be hedging your bets a little bit.
Turning to the permitting issues or just.
Sure.
The project scope.
Since the pipeline ahead of us.
Why are you a little bit cautious around that.
Well I think the key.
Point there.
Okay.
The results have been reaffirmed.
The study came out.
I don't know that we're hedging our bets, where we're really just again looking at first of all.
Ill linear transition.
Over to low vol.
We do we do have in front of us.
The permitting process.
We just.
So just wanted to take the time to make sure we do the very best we can.
But we're not in a rush to try to get <unk> up and running in fact.
There's a there's a reasonable chance we continue to extend.
La coipa.
And global May get pushed out.
Perhaps a year or two.
Yes.
And Greg the debt hedging that you are talking about really relates to let me just compare your density in local market in the case of you're doing a lot of the permitting work can be done concurrently to engineering.
Thanks.
And we anticipate having those permits in hand, when we make a construction decision in fact that you did in score we're even looking at potentially.
Doing some early work on capital investment next year in the case of local marketing.
We have to get the engineering to quite an advanced level in order to even begin the permitting process so whereas.
You didn't get the parallel process at local market is very much a serial process, where we have to have advanced the engineering.
And then we go into.
A very involved process, which will take two years, followed by sectorial permits so it's.
The bed hedging is really about the complexity.
Long about the water issues in the area and.
So I'm, hoping you could kind of water in Chile historically.
Well I think water is a sensitive topic in Chile in region training on the <unk> account.
<unk>.
But again I would remind that way.
Ready to go.
They are pumping today at La Coipa, and part of our strategy here.
And then a couple of maps in different slides.
Interestingly the water wells are physically located closer to <unk>.
So.
Part of our strategy here is to look at.
Pumping water in the other direction.
The water we have dedicated to.
Currently till it coipa turning around in <unk>.
Pumping at the other direction.
Two level, which is closer.
Okay.
So we're not concerned on that front.
You don't see that as a potential hurdle in Tennessee.
Look I think.
Permitting is always it's important very important.
It's something we take very seriously.
<unk>.
And particularly in region through we understood. We know water is a sensitive topic, Greg water is foremost on our list of things to look at through the.
Permitting process Kinross.
Kinross, we look at our Chilean assets with.
Long term our long term view, we have a big resource still on our books with American media, we have a very large reserve here at lower Martha.
And we see increasing potential.
Well look like if all of these are subs.
Subject to difficult permitting environment.
But if there is one.
We started to look at.
What does a bigger strategy potentially it looks like for Chile. There are commercial options. For example on desalination would we ever take the lead on B cell Nation project. If we had larger inventories. These are all conceptual things will go well situation overall.
Looking at conceptual other studies for.
Options that may serve not only logo, but also some of our other assets and potentially even further afield.
There there is a parallel track.
Got you that's great. Thank you.
Your next question comes from the line of Tyler <unk> with Scotia Bank.
Great. Good morning, everyone. Thank you for taking my question just.
Just wanted to come back let's call Tomorrow.
This back to Tasiast and La Coipa.
Can you remind me just on the stockpile at Tasiast, what are we going to have by year end and lock rate just so that we know what sort of Dr. Charlie.
Yes, we're targeting 60 to 70000 ounces stockpile two five.
Okay. Thanks.
Thank you for that and then when you were down with the now is.
Is there any buffer time that you've gained timewise for.
Thinking in some of your other.
Questions that the now that we can we have a bit of a desktop or a mid 23 timeline. The priority right now has been the 20 <unk> and the rebuild of the Sag mill.
Our engineering teams continue to look for those opportunities, but we're not yet ready to move off that mid 23 date.
No.
It was a bit of a buffer in that.
If we had a buffer in the system. It was on the ramp up time into 'twenty one so.
So you might ask.
We've moved our Q our time on 'twenty, one can you ramp up to the end of Q1, and we haven't adjusted our numbers.
We probably have okay.
And then maybe.
Yes. Thank you, maybe just coming back to La Quinta.
Just reading just listening to it too.
So we're finding that that.
Continue then to my reserve and resource question.
It appears that.
Paul had mentioned that maybe we are.
To gain another one or two years.
Great of additional mine life before so flushing out local market that that amount of time is there anything else that you're finding in the region that would make you think it would be beyond one or two years, yes definitely so we are there is four or five.
Deposits or phases of deposits that we're looking at bringing into the final over and above what's in the current plan. The first step is a joint venture agreement with Codelco and Thats, a multi phased deposit and.
We've got to an agreement with Codelco and the first phase of that it's not 100% inked, but we anticipate having an agreement with <unk> signed in the upcoming months VAT.
I would add one to two years to it.
Potential beyond that and then also on our books are two other little satellite pits called <unk>, which.
But again a year or so.
If all our dreams came true at La Coipa.
We could see.
Several years talking four or five years.
Here's to the initial look wave of mine life estimate and as Paul said, it would push out a global market and we would actually want that that would be a good outcome. These are low capital expansions.
Mccoy, but these are pretty high quality pits.
And to the extent that we are able to push out lower margin as a result of new production that locally, but we would welcome that as an outcome.
So if all the stars align.
We wouldn't see local market and until we announce.
Definitely is that where that would be a good outcome for us and we are working towards that and what we are.
As we bring these satellite pits.
Because the plant we will announce those as we come up so one of the things that will drive slightly higher capital for US next year is we're going to be doing some stripping work.
Per M, which is at the <unk> JV deposit.
Okay.
And staying on to the reserve and resources.
I wanted to see how year end 2021 is shaping up excluding the addition that you have in Russia reserves, but I just want to talk about the mine how do we feel about the resorts category and just confirming that you are not changing cutoff grades and OEM.
Pricing for your reserve and resources.
Yeah. So you took my freebie away from you there on you doing so that would be <unk>.
Okay.
There are potential add so as I mentioned in my prepared remarks, we are working on a phase I study at round mountain it'll be closer to whether we get that into a year and thats a pretty big.
Inventory, there thats going to be.
Between 601 million ounces.
We also just added 300 at logo Marty I know you are front of me give me credit for that and then we're going to have a little dribs and drabs.
The other mine sites, we are still using <unk>.
200 for a reserve optimization.
Number.
And we don't have any plans to move off that with this year end.
Okay. So.
I think we're probably not going to have a replacement. If you don't give us credit for you didn't see little Martha.
Which together are $3 $3 million of reserves, we're likely not going to have a full offset.
In the rest of the portfolio.
Okay fair enough.
And then my last question as far as Andrew I, just wanted to come back to that slide nine when you talk about inflationary pressures and thank you for that slide just trying to understand.
If we were to assume that the first half of 2021.
We didn't see inflationary pressures would it be safe to assume and again all things being equal.
That 5% increase would be if we were to benchmark maybe dollar Opex 2021, I'm just trying to see.
Directionally, what I should put the 5% and 10% on like I need a base.
Like it's not only a great 2021, because you've got some inflation for the second half and now with benchmarking it.
And to 'twenty first half of 2021 on a dollar per ton be correct Sir.
How should I think about that.
Yes.
Maybe we wanted to come back to you on that one China, we can drill into it and a little bit more detail.
The numbers in front of us.
Okay I appreciate that on the capital side too.
Thank you.
I think on the capital side you can.
We had we had.
Last year, given the $800 million.
For Capex for 2022, so that's kind of where you can apply that.
The inflationary.
Okay.
That 800 million number was based on project approved at that time and a little bit for you again.
Half of that so there's other things that are coming that will come into Iraq to capex on top of that.
In addition to great. It can extend its not inflation related.
Decision, where we decided to thinking about reinvesting into our business. Okay. So 10% on the 800 plus other approved products.
Right.
Thank you you've picked up on the inflation note, obviously on commentary on us and other companies.
It's still there and in some cases still increasing so it's not like inflation hit.
<unk> got to a new level and stabilize.
Some key commodities, we continue to see price increases.
Okay, just trying to make a stab at what we think we could see in 2022.
Some sort of a stabilized level and appreciate that it is moving.
Yes.
Okay.
So I'll wait for some more on that thank you.
Sure.
Once again, if you would like to ask a question. Please press Star then the number one on your telephone keypad.
Our next question comes from the line of Matthew Murphy with Barclays.
Hi, Yes, I was going to ask about the Capex outlook.
What what do you think the chances are that.
So to decline.
Declining I know you had.
The part that's upon your last guidance of.
The sustaining level sort of sustained production long term and so you tack on inflation.
We're still in a pretty healthy gold price environment I'm, just wondering directionally, how we should think about it.
I think I think we just covered it a little bit.
Matthew it's.
I think we're guiding up.
Both from inflation and from from.
We expect I think.
Directional sort of rule of thumbs.
We've said it will get you under the right zone, if youre thinking about capital in terms of say 300 Bucks an ounce.
Inflation effect that.
Just that to sort of <unk> 30 per ounce.
Directionally.
Bob.
Yes, okay. Thank you.
Okay.
Your next question comes from the line of Anita Soni with CIBC World markets.
Hi, just to follow up on that.
Other expense line item.
I'm, just I'm trying to get some color on what we're seeing.
Could you then that for next year would there be any more.
<unk> casualty is done and then round mountain will there be any costs there still.
I mean, it's difficult it's difficult to project just by the nature of other operating costs, but yes, I mean, obviously, we had some bigger bigger ticket items.
Specific to this year so.
Don't really expect any more of those two items.
Going forward and covered cost, which were part of it historically are coming down yes, I mean corporate costs for the quarter were about $5 million and they have been trending.
Hi.
From last year throughout this year so.
As far as as far as worth the same we expect them to continue to go down, but well come back and we'll continue to watch.
Okay. Thank you.
And at this time there are no further questions are there any closing remarks.
No. Thank you all for joining us today.
And we look forward to catching thanks, everyone. Thank you operator.
Today's conference you may now disconnect.
Okay.
Okay.
Yes.
Yes.
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