Q2 2022 Golden Minerals Co Earnings Call
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Speaker 1: I So.
Greetings and welcome to the Golden Minerals Company second quarter, 2022 quarterly conference call and webcast. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.
Speaker 2: Greetings. Welcome to the Golden Minerals Company, second quarter 2022, quarterly conference call and webinar.
Speaker 2: At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation.
Speaker 2: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. Please note. This conference is being recorded.
Now I'll turn the conference over to your host Karen Winkler directly with the director of Investor Relations you may begin.
Speaker 2: Karen Winkler, Director of Interest Relations, you may begin.
Thanks, Operator, welcome to the Golden Minerals Company second quarter 2022 earnings call on today's call are our president and CEO <unk>, Wang our Chief Financial Officer, Julie Wiedeman, and our Chief operating Officer, John Gavin Sydney following their prepared remarks, they will be available to answer your question.
Speaker 3: Thanks, operator. Welcome to Golden Minerals Company's second quarter 2022 earnings call. On today's call are our president and CEO Warren Wren, our chief financial officer Julie Weidman, and our chief operating officer John Galassini. Following their prepared remarks, they will be available to answer questions.
Before we get started please note that certain statements made by management today will be forward looking within the meaning of applicable securities laws.
Speaker 3: Before we get started, please note that certain statements made by management today will be forward looking within the meaning of applicable securities laws. Forward looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to be materially different from those expressed or implied by such statements.
Forward looking statements involve known and unknown risks uncertainties and other factors that may cause actual results or performance to be materially different from those expressed or implied by such statements.
Speaker 3: Please refer to our most recently filed form 10Q for details of risks and other important factors that could cause actual results to differ materially from those in our forward-looking statements. I will now turn the call.
Please refer to our most recently filed Form 10-Q for detailed the risks and other important factors that could cause actual results to differ materially from those in our forward looking statements I will now turn the call over to Warren.
Speaker 4: Thank you, Karen. Good morning to all, and thanks for joining us.
Thank you Karen.
Morning to all and thanks for joining us.
Speaker 4: I'll begin today's call by providing a brief overview of the company's second quarter performance, followed by our 2022 guidance and several project updates.
I'll begin today's call by providing a brief overview of the company's second quarter performance, followed by our 'twenty to 'twenty two guidance and several project updates.
Then hand, the call over to John who will take you through the quarters operating highlights followed by Julie who will discuss second quarter financial results.
Speaker 4: Afterward, we'll open up the call to questions from our analysts and anyone else who has sent in questions.
Afterward, we'll open up the call to questions from our analysts and anyone else who has sent in questions.
Speaker 4: As you all know, the US and Mexico are facing macroeconomic headwinds, including decades high inflation rates and continued supply chain challenges. These headwinds have affected our operations to some degree, driving up the cost of production.
As you all know the U S and Mexico are facing macroeconomic headwinds, including decades high inflation rates and continued supply chain challenges and these headwinds have affected our operations to some degree.
Moving up the cost of production.
Or where do you mind produced approximately 3000 payable ounces of gold and 12800 payable ounces of silver in the second quarter 2022.
Generating approximately $1 3 million in net operating margin.
Speaker 4: Higher cash costs at rodeo are due in part to the inflationary pressures on basic materials, but also in primarily due to the lower head grade from mine material that we encountered at rodeo this past quarter, as we near the bottom of the phase one pit.
Higher cash costs at radio are due in part to the inflationary pressures on basic materials, but also and primarily due to the lower head grades from mine material that we encountered that road here this past quarter as we near the bottom of the phase one pit.
Speaker 4: Grades in the remaining phase one pit and the current phase two pit are higher than what we encountered this last quarter.
Grades and the remaining phase one pit and the current phase two pit are higher than what we encountered this last quarter.
Speaker 4: Expenditures for exploration at Yokivo and our new discovery at Cerrita Estes, as well as costs of test mining at Velardeña, have also increased our net loss for the quarter to just under two cents per share.
Expenditures for exploration at El Cubo, and our new discovery sure U S T as well as cost of test mining at Butler Dania have also increased our net loss for the quarter to just under <unk> <unk> per share.
Speaker 4: Our full year 2022 production guidance for Rodeo remains unchanged. Cable production for 2022 is estimated at 12,000 to 14,000 ounces of gold and 42,000 to 47,000 ounces of silver, with estimated average grades of 2.9 grams per ton gold and 9.4 grams per ton silver.
Our full year 2022 production guidance for radio remains unchanged.
Production for 2022 is estimated at 12000 to 14000 ounces of gold.
<unk> thousand to 47000 ounces of silver with estimated average grades of two nine grams per tonne gold and four grams per ton silver.
Speaker 4: Our plans to start mining at Veledania have been once again delayed while we work through a modified mine plan and mining methods to counteract excess dilution we observed from some of the veins in our recent test mining.
Our plans to start mining at Vela Dania has been once again delayed while we work through a modified mine plan and mining methods to contract excess dilution, we observed from some of the veins in a recent test mining.
Speaker 4: One vein in particular, the stamatayo vein, yielded results exceeding the range of dilution that we anticipated.
One day and in particular, the San Mateo vein yielded results exceeding the range of dilution that we anticipated.
We're looking at the options to modify the mine plan by replacing the San Mateo vein in the plan with other veins that would not have the same characteristics that caused the extra deletion.
Speaker 4: We're looking at options to modify the mine plan by replacing the San Mateo vein in the plan with other veins that would not have the same characteristics that caused the extra deletion.
Speaker 4: We're also looking at the possibility of ore sorting to upgrade the diluted material. Investigating these alternatives.
We're also looking at the possibility of ore sorting to upgrade the diluted material.
Investigating these alternatives will take several months.
Speaker 4: During this time, since silver prices have also dipped and have not yet returned to expected higher long-term values, we are better off not producing until we have reworked our mine plan and mining method.
During this time since silver prices have also dipped and have not yet returned to expected higher long term values.
We are better off not producing until we have reworked our mine plant and mining methods.
Speaker 4: John will provide additional information about the details of our rodeo production and our recent work at Velodania later in the call.
John will provide additional information about the details of our radio production and our recent work at Belo Dania later in the call.
Speaker 4: Moving to the exploration side of our business, last month we completed a third drill program of about 5,700 meters and 24 holes at our Yokevo Gold Silver Project located in Chihuahua, Mexico.
Moving to the exploration side of our business last month, we completed a third drill program of about 5700 meters and 24 holes at our Youll Kilo gold and silver project located in Chihuahua, Mexico.
Speaker 4: The drill program was designed to further delineate vein-hosted, mineralized intervals that were identified during 2021 drilling.
The drill program was designed to further delineate vein hosted mineralized intervals that were identified during 2021 drilling.
The first nine holes of the 'twenty to 'twenty two program as reported last month showed continued strong gold silver grades and identified multiple new and previously unknown high grade gold silver structures.
Speaker 4: The first nine holes of the 2022 program, as reported last month, showed continued strong gold-silver grades and identified multiple new and previously unknown high-grade gold-silver structures.
Speaker 4: Complete assay results haven't yet been received. However, we expect this third round of drilling will give us sufficient information to estimate a maiden gold-silver resource later this year.
Complete assay results haven't yet been received however, we expect this third round of drilling will give us sufficient information to estimate a maiden gold silver resource later this year.
And our suite to Este prospect in Salta Province, Argentina, We completed the second drill program in June that was designed to offset and delineate and oxide gold interval that we encountered in the initial 2021 drilling program.
Speaker 4: At our Cerrita Este prospect in Salta province, Argentina, we completed a second drill program in June that was designed to offset and delineate an oxide gold interval that we encountered in an initial 2021 drilling program.
Speaker 4: We're very pleased with recently received assay results that point to a potentially economic shallow oxide gold system.
We're very pleased with recently received assay results that point to a potentially economic shallow oxide gold system.
Speaker 4: We are planning further drilling at Cerrita Esto to begin in the current quarter.
We are planning further drilling at St S state to begin in the current quarter.
Speaker 4: In April of 2020, you'll recall we entered into an earning agreement with Barrick Gold at our El Cabar project located also in Salta province, Argentina.
In April 'twenty 'twenty.
Recall, we entered into an earn in agreement with Barrick Gold other Okay Bar project located also in Salta Province, Argentina.
Speaker 4: This past June , Barrett completed a five-hole, 1,300-meter initial diamond drill program to test the highest priority targets on the property.
This past June they're completed a fivefold 1300 meter initial diamond drill program to test the highest priority targets on the property.
Speaker 4: BEREC reported buggy silica alteration, which is commonly associated with high sulfidation epithermal gold-silver deposits in all of the drill holes. Final assay results from the...
Eric reported buggy silica alteration, which is commonly associated with high sulfonation epithem more gold and silver deposits in all of the drill holes.
Final assay results from the program are pending.
Speaker 4: I will now hand the call over to John to talk in more detail about the operation.
I will now hand, the call over to John to talk in more detail about the operation.
Thank you Juan.
Speaker 5: At our Rodeo operations, we produced approximately 3,000 ounces payable gold and 12,800 ounces payable silver during the second quarter ending June 30, 2022.
At our radio operations, we produced approximately 3000 ounces payable gold and 12800 ounces payable silver during the second quarter ending June 30th 2022.
Speaker 5: Year to date we produce over 6,600 payable gold ounces at cash costs per payable gold ounce net of silver credits of $1,200, maybe $2. And since Roday's inception in January 2021, we have produced an excess of 21,000 ounces of gold and 77,000 ounces of silver at cash costs averaging $1,046 per payable gold ounce net of silver credit.
Year to date, we've produced over 6600 payable gold ounces at cash cost per payable gold ounce net of silver credits of $1283 and cents rodale from inception in January 2021, we have produced in excess of 21000 ounces of gold and 70.
7000 ounces of silver at cash cost, averaging $1046 per payable gold ounce net of silver credits.
Speaker 5: We're producing just over 500 metric tons per day and achieving around 75% recovery for gold and 82% for silver levels, which we see is sustainable through 2022.
We're producing just over 500 metric tons per day, and achieving around 75% recoveries for gold and 82% for silver level, which we see are sustainable through 2022.
Speaker 5: Cash cost per payable gold ounce net of silver byproduct credits were higher at $1,426 during the second quarter as a result of several items.
Cash cost per payable gold ounce net of silver byproduct credits were higher at $1426. During the second quarter as a result of several items.
Speaker 5: first lower grade material was mined during the quarter as modeled and as we expected.
First lower grade material was mined during the quarter as model and as we expected.
Speaker 5: as we transition from our initial higher grade phase one material to a mix of high and medium grade and phase two of the test.
Retransmission from our initial higher grade phase one materials to a mix of high and medium grade in phase two of the pit.
Speaker 5: We anticipate about the same grade material for the remainder of the year, as we have seen in the second quarter.
We anticipate about the same grade material for the remainder of the year as we have seen in the second quarter.
Speaker 5: In addition, we saw increased drilling and blasting costs incurred during the second quarter for the benefit of third quarter production, and we saw a spike in the cost of explosives related to the onset of the conflict in Ukraine and related supply chain issues.
In addition, we saw increased drilling and blasting costs incurred during the second quarter for the benefit of third quarter production and we saw a spike in the cost of explosives related to the onset of the conflict in Ukraine and related supply chain issues.
Speaker 5: While we continue to estimate full-year average realize prices of $1825 per ounce gold and silver respectively, we have lowered rodeos
While we continue to estimate full year average realized prices of 1800 and $25 per ounce gold and silver respectively. We have lowered the Roe deals.
Speaker 5: 2022 operating margin estimates of between six and $8 million from between seven and $9 million.
2022, operating margin estimate to between six and $8 million from between seven and $9 million.
Speaker 5: During the third quarter 2022, we intend to begin expanding the tailing capacity of dioxide plants that currently processes rhodium material.
During the third quarter 2022, we intend to begin expanding the tailing capacity at dockside plants that currently processors wrote rodeo material.
Speaker 5: The expansion was originally expected to take place in 2023, but has been moved forward due to higher than initially planned throughput at rodeo in 2022.
The expansion was originally expected to take place in 2023, but it has been move forward due to higher than initially planned and planned through a plant throughput at rodeo in 2022.
Speaker 5: This work is estimated to cost around $2.1 million, most of which is anticipated to be spent in 2022.
This work is estimated to cost around $2 $1 million most of which is anticipated to be spent in 2022.
Speaker 5: We began limited scale mining activities at our Velardeña Underground Silver Gold mines in June 2021.
We we began limited scale mining activities at our Dania underground silver gold mines in June 2021.
Speaker 5: to obtain bulk samples for use in our final optimization of a bio-oxidation or BIOX plant designed for future use in additional flotation studies that would indicate how we can effectively separate the gold-bearing minerals into a pyrite concentrate that is proposed for processing at the BIOX circuit.
To obtain bulk samples for you some of our final optimization of a bio oxidation or buyouts plant design and for future use in additional flotation studies that would indicate how we can effectively separate the gold bearing mineral into a pyrite concentrate that is proposed.
For processing at the buyout circuit.
Test results using the biopsies pre treatment oxidation process continue to fully support the use of the technology and future processing color Dania.
Speaker 5: Test results using the BIOX pre-treatment oxidation process continue to fully support the use of the technology and future processing of Velardeña.
Speaker 5: This past May, we began additional test mining activities using a new contractor to evaluate productivity and dilution of Risou mining on the principal veins that are accessible from the San Mateo decline.
This past May we began additional test mining activities using a new contractor to evaluate productivity and dilution of resume mining on the principal veins that are accessible from the San Mateo decline.
Speaker 5: Although results of the test mining met expected productivity metrics,
Although results of the test mining met expected productive met our productivity metrics.
Speaker 5: They did not meet anticipated dilution metrics on some of the vein's mine.
They did not meet anticipated dilution metrics on some of the veins mined.
Speaker 5: We are therefore electing to continue evaluating modified mine plans and mining techniques and address solution issues.
We are therefore, electing to continue evaluating modified mine plans and mining techniques and address dilution issues.
Speaker 5: During the current downturn in precious metal prices, our plans to restart production at Bellerding are temporarily delayed.
During the current downturn in precious metal prices, our plans to restart production at dollar Dania are temporary were temporarily delayed.
Speaker 5: Before we proceed further with development work, we want to see test mining activity produce results that are consistent with the initial PEA.
Before we proceed further with development work, we want to see test mining activity produced results that are consistent with the initial P. A.
Speaker 5: We'd like to demonstrate the ability to fully achieve our mining dilution targets, given minimal dilution is critical to the ultimate financial success of the project.
We'd like to demonstrate the ability to fully achieve our mining dilution targets given minimal dilution is critical to the ultimate financial success of the project.
In the coming three months, we intend to evaluate the results of the test mining and explore other methods that will maximize the value of dollar dania.
Speaker 5: In the coming three months, we intend to evaluate the results of the test mining and explore other methods that will maximize the value of Velardeña. In addition to test mining techniques, we have also begun evaluation of ore sorting and an additional step in processing to further minimize dilution.
In addition to test mining techniques. We have also begun evaluation of ore sorting and an additional step in processing to further minimize dilution.
Speaker 5: Rock and ore samples have been sent to the ore sorter manufacturer for preliminary testing with detailed testing scheduled for later this quarter.
Rock and the ore samples have been sent to the ore sorter manufacturer for preliminary testing with detailed testing scheduled for later this quarter.
Speaker 5: I will now hand the call over to Julie to present the financial results.
I will now hand, the call over to Julie to present the financial results.
Thank you John .
Speaker 3: For the second quarter 2022, our operating margin at the Rodeo operation was approximately 1.3 million from revenue of 5.9 million received from the sale of approximately 3,060 ounces of gold in Dore.
Second quarter 2022, our operating margin at the Rodeo operation was approximately $1 3 million from revenue of $5 9 million received from the sale of approximately 3060 ounces of gold in Dore.
The plant operated at a rate of just under 525 tons per day and the average gold grade of material processed was two six grams per tonne.
Speaker 3: The plant operated at a rate of just under 525 tons per day, and the average gold grade of material processed was 2.6 grams per tonne.
While the operating margin primarily in the second quarter 2022 was positive we reported negative after tax income of about $2 8 million.
Speaker 3: While the operating margin from Rodeo in the second quarter 2022 was positive, we reported negative after-tax income of about $2.8 million.
Speaker 3: Exploration expenses were approximately $2.8 million, which included $0.8 million on test mining for the potential restart of Valerdenia, $0.6 million on drilling at Yokebo, $0.5 million on drilling at Srita Este, $0.1 million on drilling at Yokebo, $0.5 million on drilling at Srita Este, $0.5 million on drilling at Srita Este, $0.5 million on drilling at Srita Este,
Exploration expenses were approximately $2 8 million, which included zero point $8 million on test mining for the potential restart of valor dania.
$6 million on drilling at El Cubo, <unk> 5 million on drilling at suite of S. J.
<unk> 1 million on drilling at Rockdale.
Speaker 3: and 0.6 million on general exploration. This is higher than the first quarter.
And zero point $6 million on general exploration.
This is higher than the first quarter is $1 7 million.
G&A costs of $1 3 million for the second quarter remain the same as the first quarter of 2022.
Speaker 3: GNA costs of $1.3 million for the second quarter remain the same as the first quarter of 2022.
Expenditures in Q2, 2022 for Al Khobar, where 0.2 million similar to the first quarter of 2022 and are expected to continue at approximately that level going forward.
Speaker 3: Expenditures in Q2 2022 for El Cavaar were $0.2 million, similar to the first quarter of 2022, and are expected to continue at approximately that level going forward.
Speaker 3: Care and maintenance expense at Valeriania was approximately 0.1 million, which was lower than the first quarter of 2022.
They are in maintenance expense.
Dania was approximately 0.1 million.
Which was lower than the first quarter of 2022.
We expect continued positive operating margin from rodeo throughout 2022 and are now estimating an operating margin of between six and $8 million for the full year, which is below the seven to 9 million. We previously estimated due mainly to costs anticipated to be incurred in 2022 to increase the tailing capacity.
Speaker 3: We expect continued positive operating margin from rodeo throughout 2022 and are now estimating an operating margin of between 6 and 8 million for the full year, which is below the 7 to 9 million we previously estimated, do mainly to cost anticipated to be incurred in 2022 to increase the tailing capacity.
Speaker 3: These costs are occurring sooner than anticipated due to the higher than anticipated processing rate at the plant.
These costs are occurring sooner than anticipated due to the higher than anticipated processing rate at the plant.
Speaker 3: This assumes full year 2022 plant throughput levels of around 510 tons per day with lower grades compared to 2021 of approximately 2.9 grams per ton for gold and 9.4 grams per ton for silver.
This assumes full year 2022 plant throughput levels of around 510 tons per day with lower grades compared to 2021 of approximately $2 nine grams per ton gold and nine four grams per tonne for silver.
Speaker 3: This operating margin estimate assumes a future gold price of $1,800 per ounce and a silver price of $25 per ounce.
This operating margin estimate assumes that future gold price of $1800 per ounce and silver price of $25 per ounce.
Speaker 3: We ended the quarter with about $9.5 million of cash.
We ended the quarter with about $9 $5 million of cash net.
Speaker 3: Net cash flow for the quarter was a negative 2.7 million due primarily to cash used in operating activities, partially offset by 1 million received from the exercise of warrants.
Net cash flow for the quarter was a negative $2 7 million due primarily to cash used in operating activities, partially offset by $1 million received from the exercise of warrants.
Speaker 3: Spending on capital items has significantly dropped off compared to last year with only 27,000 spent during the first half of 2022 compared to 1.4 million spent in the first half of 2021. The higher 2021 figure included construction of the second fall mill added to our oxide plant.
Spending on capital items has significantly dropped off compared to last year with only 27000 spent during the first half of 2022 compared to $1 4 million debt in the first half of 2021.
The higher 2021 figure included construction of the second ball mill added to our oxide plant.
Speaker 3: Assuming metals prices average $1,800 per ounce for gold and $25 per ounce for silver, we expect our cash balance to remain around $5 to $6 million over the next 12 months through June 30, 2023, depending on spending on exploration projects and costs associated with the potential restart of the Beller d'Aime mine.
Assuming metal prices averaged $1800 per ounce for gold and $25 per ounce for silver, we expect our cash balance to remain around $5 million to $6 million over the next 12 months through June 30th 2023, depending on spending on exploration projects and cost associated.
With the potential restarted the valor Dania mine.
These projections include the $1 5 million of payments scheduled to be received from stable through June 30th 2023.
Speaker 3: These projections include the 1.5 million of payments scheduled to be received from fabled through June 30th, 2023.
Speaker 3: The cash projection does not assume any other forms of debt or equity finance.
The cash projection does not assume any other forms of debt or equity financing.
Speaker 3: I will now turn the call back over to the operator who will take your question.
I will now turn the call back over to the operator, who will take your questions.
Thank you at this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
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One moment, please while we poll for questions.
Speaker 2: Our first question comes from the line of Jake Zajkowski with Alliance Global Partners. Please proceed with your questions.
Our first question comes from the line of Jay Zukowski with Alliance Global Partners. Please proceed with your question.
Hey, guys. Thanks for taking my question.
Can you can you maybe just touch on the remaining mine life at <unk>.
Speaker 6: Can you maybe just touch a bit on the remaining mind life at Redale? I mean, I know you've extended it already, but you think there's any low hanging fruit there. They're extended by a few more quarters.
Dale I mean, I know you've expanded there already but do you think there's any low hanging fruit there to extend it by a few more quarters.
Yeah. Good morning, Jake This is Juan let me.
Speaker 4: Yeah, good morning, Jake. Yeah, this is Warren. Let me just take that one. Now we see the higher grade material lasting into October of 2023. So that is more or less where we were as of our last updates, I think in March.
Just take that one we see the.
The higher grade material last thing.
And to October of 2023.
So that is more or less where we were.
As of our last update I think in March.
Speaker 4: We do have quite a bit of lower grade material that depending on the gold price could continue the operation profitably. It's fairly distinctly lower than the current average grade that I think it would probably average about one and a half grams which does make money, but just not the same profit margin.
And we do have quite a bit of lower grade material that depending on the gold price could continue the operation profitably.
It's.
Fairly distinctly lower than the current average grade that we think it.
Would probably average about one and a half grams.
Which which does make money, but just not at the same profit margin and that material could last another two years after.
Speaker 4: and that material could last another two years after the 2023 end of the higher grade material. So there is an extended life. We're not seeing the higher grade material expanding much more in the current center of the mineralization, but we do have an opportunity elsewhere in the property to continue exploration which we're looking at.
The 2023.
And of the higher grade material. So there is an extended life, we're not seeing the higher grade material on expanding much more than the current center of the mineralization.
But we do have an opportunity elsewhere in the property to continue exploration, which we're looking at.
Speaker 6: Okay, that's helpful. And then just looking at Vilardina, were the dilution issues specific to the San Mateo vein? Can you just remind us how important that vein is to the mine plan? Is it early in the mine plan or is it a plan to sort of re-sequence to bring in other areas?
Okay. That's helpful.
And then just looking at dealer Danielle where the dilution issue specific to the San Mateo vein can.
Can you can you just remind us how important that that thing is to the mine plan as it was early in the mine plan or the plan to sort of re sequence.
To bring in other areas.
Speaker 4: Yeah, let me carry on with that. The San Mateo is fairly important to the overall resource or it was initially. It's less important now that we...
Speaker 4: gotten through some of the wider parts of the cemetery at the higher levels, but it still makes up about a third or so of the overall resource. And much of the vein is fine. In this particular area where we're doing the test mining, there was jointing in the diorite parallel to the vein structure.
Speaker 4: that tended to fall off as we were mining. So it over-deluded based on that geologic feature. It's not present in that same manner. That characteristic isn't present in that same manner in the San Mateo Bay everywhere. But in those particular stopes on the San Mateo East, I believe it was.
Speaker 4: It was, and maybe John , you want to comment any further on that?
Maybe John you want to comment any further on that.
I think you characterized it really well and it's a as you mentioned just a difference in the rock type and it didn't break as other parts of the mine.
Speaker 5: I think you characterized it really well. And it's, as you mentioned, just a difference in the rock type. And it didn't break as other parts of the mine that we tested did. And so we had higher dilution.
That we tested did and so we had higher dilution.
Okay.
Speaker 6: Got it. Okay. And then just lastly on CapEx for the restart at Rio La Dina, obviously, as you mentioned, Warren, we're seeing cost inflation across the board.
Got it okay.
And then just lastly on the Capex for the restart at real idea, obviously as you mentioned warm we're seeing cost inflation across the board.
Speaker 6: Are you still comfortable with those figures for the BIOX circuit and restart capital? Or is that something that you think you go back and take a look at over the next quarter as tests work continue?
Are you still comfortable with those figures for the biopsy circuit and restart capital or is that something that you think you can go back and take a look at over the next quarter as test work continues.
Speaker 4: Well, we're in the process, Jacob, of completing our detailed bids, so specific bids from specific providers. And we haven't quite completed that. So far, it's in line with the overall $16 million cost of the biox plant that we had in Spain. And so I think that's still gonna be okay. Now, there is a chance that some materials will surprise us as we've all been aware of it.
Well, we're in the process Jacob of completing our detailed bids so specific bids from specific providers and we havent quite completed that so far it's in line with the overall $16 million cost of a biopsy plant that we had anticipated.
And so I think that's still going to be okay.
There is a chance that some materials will surprise us.
As we've all been aware of that.
Speaker 4: costs are going up, not down. But I don't think it's going to be substantial. So that's where I am so far. I really won't have an answer to that until we finish the detailed estimates on the cost, but it's not looking like it's way out of range of what we had planned.
Costs are going up not down.
I don't think it's going to be substantial so that's where I am so far I really won't have an answer to that until we finish the.
Detailed estimates on the cost, but it's not looking like its way out of range of what we had planned.
Speaker 6: That is all for me. Thanks again. Thanks, Jake. Thanks, Jake.
Okay very good that's all for me thanks again.
Thanks Jay.
And again as a reminder, if anyone has any questions you May press star one on the telephone keypad to join the question and answer queue.
Speaker 2: And again, as a reminder, if anyone has any questions, you may press star one on the telephone, keypad to join the question.
Speaker 2: Our next question comes from the line of Sid Rajeev with Fundamental Research Corp. Please proceed with your question. Good morning everyone. Thanks for your time.
Our next question comes from the line of <unk> with fundamental Research group. Please proceed with your question.
Hi, good morning, everyone and thanks for your time.
So we.
So pleased to hear that grades are going to improve from the second half.
Speaker 7: Any guidance for cash costs? It definitely seems like cash costs.
Any guidance for cash cost it definitely seems like gas because my dad ran lower than the second half, but any guidance on what the range might be.
Speaker 7: lower, the second half, but any guidance on what the range
I said, we're not really predicting that level of detail I do expect them to come back down from what we saw in Q in Q2.
Speaker 4: I said, we're not really predicting that level of detail. I do expect them to come back down from what we saw in Q2. You know, we did some additional work in Q2 that's going to benefit production in Q3, some additional blasting and drilling. And so the cost accrued to Q2, but they benefit Q3, which will drive that.
And we did some additional work in Q2, that's going to benefit production in Q3.
Some additional and blasting and drilling.
And so the cost to creep into Q2, but they benefit Q3, which will drive that.
Speaker 4: that cost per ounce down a bit. April was our lowest grade production month. It's still within the average grades that we're seeing at the...
That cost per ounce down a bit in.
April I think was our lowest grade production months.
That's still within the in the average grades that were seeing it.
Speaker 4: 2.6 grams for 10. But, you know, month of April was quite a bit lower, almost as low as around 2 grams for 10. So I think we won't see quite that low grade in the next quarter, this quarter. So we should...
Two six.
Grams per ton.
But the month of April was quite a bit lower almost as low as around two grams per tonne.
We wont see quite that low grade in the next quarter. This quarter. So we should.
Based on that also be seeing the cost per ounce moved down a bit.
Speaker 4: based on that also, the scene, the cospere ounce moved down a bit.
Okay. Thank you everyone.
You too.
Speaker 7: I want to give some color on what percent of the increase in cash costs came from Project Specific versus macro, you know supply chain.
Are you able to give some color on what percent of the increase in cash cost came from you know.
Project specific versus macro.
Supply chain in place and stuff so.
Give me a kind of a segmented.
This increase.
Speaker 3: So we did look at the difference in the cash cost. And it is pretty difficult to split out the exact portion related to inflation, especially a lot of our costs come through contractors. So no, I don't have a specific percentage on what portion of it was related to inflation. And as we mentioned, the bigger contributor to the increase in cash cost of the quarter was below our grade.
So we did look at the difference in the cost cash cost and it is pretty difficult to split out the.
The exact portion related to inflation.
Especially we.
Lot of our costs come through contractors. So no I don't have a specific percentage on what portion of that was related to inflation and as we mentioned the bigger contributor to the increase in cash cost for the quarter was the lower grade.
Speaker 7: Yes, okay, thank you. And your Kivo, you know, drilling has been done for a resource estimate coming out later this year. Any preliminary guidance estimates on what the FIFE could be? Any lanes we could work with?
Yes, Okay. Thank you and yes keevil.
Drilling has been done for our resource estimates coming out later this year any preliminary guidance estimates on what is the size could be any lanes, we could work with.
Okay.
It sounds like we May have lost Warren.
Yes. Unfortunately, we have of loss were in line maybe a final.
Speaker 2: Yes, unfortunately we have lost one line. Yeah, maybe the final question that you keep on or valedina already goes.
Final question that your Q well.
<unk>.
Already.
You mentioned that things got pushed out a bit any guidance on timelines previously we were expecting some kind of production later in 2000 Twenty's Lee is it fair to say that everything got pushed out by six months ish or would that be too aggressive.
Speaker 7: start a bit, any guidance from timelines. Previously we were expecting some kind of production later.
Speaker 7: to say that everything got pushed out by six months-ish or
Speaker 5: So the test work that we did, there were a lot of bright spots in the test work action.
So the test work that we did there were a lot of bright spots and the test work actually.
Speaker 5: with the Risoo mining technique that we tested. Many of the veins
With a resume mining techniques, we tested many.
Many of the veins.
Speaker 5: met up to the productivity standards to get us to the throughputs that we wanted.
<unk> met up to their productivity standards to get us to the throughput that we we wanted.
Speaker 5: But the dilution factor was still higher, which is, you know, we have mentioned previously, that it is critical for the villa denium mine to have low dilution.
But the dilution factor was still higher which as you know we have mentioned.
Previously that it is critical for the Villa Dania mine to have low dilution. What we're doing right. Now said is taking a look at not only the <unk> method, but also a couple of other methodologies like a modified long haul and even cut and fill.
Speaker 5: What we're doing right now is taking a look at not only the RISU method but also a couple of other methodologies, like a modified long hole and even cut and fill.
Speaker 5: where you can take more tons and have.
Where you can take more tons and and have.
Speaker 5: a higher dilution, but you'll make up for it with your volume. That's going to take another month or so to evaluate. And in addition, we'll be looking at Risu mining in combination with an ore sorter. So with those tests in line, we're probably looking at a three to six month delay and the restart to Velardeña is an estimate.
Higher dilution, but you'll have to make up for it with your your volume that's going to take.
Another month or so to evaluate them.
In addition, we'll be looking at resume mining.
With in combination with an ore sorter, so with what those tests in line, we're probably looking at a three to six months.
A delay in the restart to behler Dania is an estimate.
That's good. Thank you so much I appreciate your time.
Speaker 5: You bet. Thank you.
You bet. Thank you.
Speaker 2: And our next question comes from the line of John Finnick with Finnick Consulting. Please proceed.
And our next question comes from the line of John <unk> with China Consulting. Please proceed with your question.
Speaker 8: Thanks for taking my call. Is Warren back on the line or is he still dropped? I'm back on John . I don't know how to get dropped off.
Thanks for taking my call is one back on the line or is he still dropped.
I'm back on John I don't know, how I got dropped off the warrant.
Speaker 8: Hey, I had a two-bar question, please. First is congratulations on having some activity from Barrett Kid, LK-Bar, and just wanted to find out from you and the team. You could update us on when assays may be expected.
Hey, I had a two part question. Please first is congratulations on <unk>.
Having some activity from Barrick and <unk> and just wanted to find out from you and the team.
Update us on when assays may be expected.
Speaker 4: Yeah, so I expect that Barrick will have their assays in sometime this month. They're not required to report to us until a month after the end of this next quarter, however, we may get that information sooner than that. But, you know, at latest, it would be in October when we get those assays and when we have, you know, a more clear idea of what their plans are going forward.
Yes, I expect that Barrick will have their assays in sometime this month.
They're not required to report to us and so on.
A month after the end of this next quarter. However.
We may get that information sooner than that but you know at latest it would be in October .
When we when we get those assays and when we'd have a more clear idea of what their plans are going forward.
Speaker 4: But my feeling is that they had enough geologic success and potentially assay success to carry on with at least another phase of drilling to see what this looks like.
But my feeling is that they had enough success geologic success.
And potentially as a success to carry on with at least another phase of drilling to see what this what this looks like.
Speaker 8: Okay, great, thanks. Secondly, when you look at your most recent presentation deck online, there's slide number four, which
Okay, great Thanks, and secondly.
When you look at your most recent presentation deck online there is a slide number four which.
Speaker 8: The pie chart discussing different metrics and wanted the value of the different projects specifically.
It was a pie chart discussing different metrics, who wanted the value of the different projects, specifically rodeo ago, or Dania and K bar in terms of NPV net present value. So looking at that it shows 187 billion NPV, yes. The most recent CEO .
Speaker 8: Rodeo, Velordania, and KVAR in terms of NPV and their present value.
Speaker 8: So looking at that, it shows 187 billion NPV.
Speaker 8: yet the most recent Seeking Alpha article out there, written by Taylor Dard, is showing a much considerably lower NPV when looking at those three projects. So could you inform investors a little bit about what you think the value is? Is that value accurate in your deck? Is he pulling information from an old source, etc.?
The article out there written by children Dart is showing a much considerably lower NPV when looking at those three projects. So could you inform investors a little bit about what you think the value is that value accurate in your deck.
As he pulling information from an old source et cetera.
Speaker 4: Yeah, John , let me try to address that. So.
Yes, John let me try to address that so from what I understand of of Darts models.
Speaker 4: From what I understand of Dart's models, no, he's not getting any value at all, for example, to the LK-LAR resource, which is in our NPV value. He hasn't updated any of the NPV values and that present values of the projects for current metals prices. And most of our...
No he's not giving any value at all for example to the <unk> resource which is in our.
NPV value he hasnt updated any of the NPV values net present values of the projects for current metals prices in most of our.
Speaker 4: analyses were done at much lower than current metal prices.
Analyses were done at a much lower than current metal prices. So those are the two main areas, where he is losing value in his analysis compared to what's real.
Speaker 4: So those are the two main areas where he's losing value in his analysis compared to what's real.
Speaker 4: So I agree with you, our company value based on the projects that we have and the published reports that we have is far, far greater than what DART is considering, and that leads to the error in his analysis.
So I agree with you are our company value based on the projects that we have in the published reports that we have is far far greater than what diet is considering and that leads to the air in his analysis.
Okay. Thank you.
Yes, Thank you John .
Speaker 2: And we have reached the end of the question and answer session. I'll now turn the call back over to Karen. Winkler for a closer.
And we have reached the end of the question and answer session I will now turn the call back over to Karen <unk> for closing remarks.
Speaker 3: Thanks operator and thanks to everyone for joining the call today. We look forward to seeing you again next quarter. You all have a good day.
Thanks, operator, and thanks to everyone for joining the call today, we look forward to seeing you again next quarter you all have a good day.
Speaker 2: And this concludes today's conference and you made us connect your lines at this time. Thank you for your participation.
And this concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.
[music].
Speaker 1: tr.