Q4 2022 Kinross Gold Corp Earnings Call
Good morning, My name is Devon, and I will be your conference operator today at this time I would like to welcome everyone to the Kinross Gold fourth quarter 2022 results conference call and webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question. During this time it simply.
Star followed by the number one on your telephone keypad, if you would like to withdraw your question at any time press the pound key.
For Ya patients I'll now turn the call over to Chris Licht handheld device.
As president of Investor Relations you may begin the conference.
Thank you and good morning with US today, we have Paul Rollinson, President and CEO and from the Kinross Senior leadership team Andrea free barrel Quad, Semper, Nashville, and Jeff called for.
For a complete discussion of the risks and uncertainties, which may lead to actual results different from estimates contained in our forward looking information. Please refer to page three of this presentation. Our news release dated February 15, 2023, the MD&A for the period ended December 31, 2022, and our most recently filed Aif all of which are available on our.
Website, I will now turn the call over to Paul.
Thanks, Chris and thank you all for joining us.
Most of you will be aware that we hosted a conference call earlier this week.
Provide an update on great bear if.
If you haven't had the opportunity to listen to our presentation.
We encourage you to access the replay through our website.
Today, we will focus on our fourth quarter and full year results.
And our outlook going forward.
We faced a number of headwinds in 2022, most significantly related to geopolitical events and substantial cost inflation.
I am proud of how we navigated the challenges.
And believe we are well positioned going forward.
I believe we have the right team in place to meet our commitments and deliver strong results from our portfolio.
Looking at the fourth quarter, specifically, we had our strongest quarter of the year in terms of production and cash flow.
We made progress across the portfolio producing just under 600000 ounces in the quarter and approximately 2 million ounces in 2022.
<unk> had an exceptional quarter Cassius had record production in grades in the Kuwait that continued to improve reaching our targeted production levels in the fourth quarter.
Yes.
In today's environment, our business is well positioned to continue generating significant cash flow going forward.
Last year through our regular dividend and our enhanced share buyback program.
We returned approximately $455 million to shareholders.
And on a cumulative basis, we have repurchased approximately 100 million shares.
Since we launched our buyback program in the second half of 2021.
This year, we will continue to pay our quarterly dividend of <unk> <unk> per share.
And continue with our flexible buyback program.
Moving to our outlook Andrea will elaborate on some of the detail.
But we are reaffirming our stable production outlook of $2 1 million ounces in 2023, and 2024, followed by 2 million ounces in 2025.
With our portfolio anchored by parakeet too and Tasiast.
And further complemented by La Coipa.
The Tasiast 20, <unk> project and man show coming online next year.
We are well positioned to maintain our production.
Costs are expected to be slightly higher in 2023 relative to last year may.
Mainly as we have a full year with elevated input costs that.
That we experienced in the second half of 2022.
Looking longer term our portfolio maintains excellent optionality.
In particular, we will continue to evaluate opportunities for expansion in Nevada and.
We remain excited about our underground potential.
Yes.
Before turning it over to Andrea I want to comment on ESG.
We are proud of our consistently strong performance in this area.
In 2022.
We were awarded the Alaska Miners Association.
Fire mental stewardship award for our abandoned mine restoration initiative.
We advanced our commitment to diversity equity and inclusion across the company.
We allocated financial aid humanitarian aid and other contributions in Mauritania.
Help the country manage the impact of extreme weather events.
And we advanced our green energy targets with the construction of the Tasiast solar plant.
Which is expected to come online in the second half of this year.
With that I will now turn the call over to Andrea.
Thanks, Paul This morning, I'll discuss the financial highlights from the quarter provide an overview of our balance sheet and capital allocation program and comment on our guidance and outlook.
As Paul noted we finished the year with production of nearly 2 million ounces and the <unk>.
Fourth quarter, we produced 596000 ounces, which was up by 13% over Q3 and like the highest production quarter for the year as our operations continue to show improvement.
Our Q4 cost of sales was $848 per ounce, which is down from the previous quarter and represented our lowest cost quarter at the year.
For the full year, our production cost of sales was $937 per ounce.
Yeah.
All in sustaining cost was 1200 and $36 per ounce in the fourth quarter, a decrease from the third quarter driven primarily by the increase in production.
For the full year, our all in sustaining cost was $271 per ounce.
Okay.
Our fourth quarter adjusted operating cash flow was $496 million up from $259 million in the third quarter on higher production and lower costs.
For the full year adjusted operating cash flow was over $1 2 billion.
Free cash flow in the quarter with $158 million and with $238 million for the full year.
Capex was $317 million in Q4 full year Capex of $764 million was in line with our revised guidance.
Turning to the balance sheet, our financial position is strong and is expected to remain strong this year and beyond.
We ended the year with $418 million of cash and approximately $1 $8 billion in total liquidity.
Our trailing 12 month net debt to EBITDA ratio was relatively stable as of year end at one seven times.
Our next debt maturity is in 2024, when we have 500 million of senior notes coming due we expect to refinance these notes sometime this year.
Turning now to our capital return program.
We purchased $240 million of shares in the fourth quarter and a total of $300 million in 2022, completing our 2022 buyback commitment.
We've effectively now repurchased the shares issued in the great bear transaction and 97.
Through dividends and share repurchases, we returned $455 million to shareholders in 2022.
As Paul noted this year, we will continue to pay our annual dividend of <unk> 12 per share and continue executing our enhanced buyback program, which now becomes dynamic and based on cash flow generation.
As a reminder, we plan to allocate 75% of excess free cash to share repurchases in 2023 and 2024.
We will evaluate the buyback quarterly based on cash flow generation.
As a reminder, we also have guardrails in place to protect our balance sheet in a downside scenario. For example, the buyback will be paused in the event there are leverage ratio increases above one seven times net debt to EBITDA.
For next year, we're expecting production in the range of $2 1 million ounces cash cost of $970 per ounce and all in sustaining cost of <unk> hundred $20 per ounce.
Capital expenditures are expected to be in the range of $1 billion.
What roughly evenly between sustaining and non sustaining items.
For 2024, and 2025, we would expect cash costs and all in sustaining costs to be in a similar range.
With respect to Capex in these years, we expect a decline each year based on currently approved projects. However in order to sustain our 2 million ounce production profile beyond 2025, we expect to approve additional capital projects, which would likely maintain capex around the $1 billion Mark.
Q1 of this year is expected to be a particularly low production quarter as a result of seasonality at <unk> in the U F heap Leach operation as well as planned operational shutdowns at Tasiast and La Coipa that cloud will elaborate.
Library on the operational shutdown.
Cash flow is also expected to be lower in the first quarter because of the lower production as well as timing of certain cash flows including related to tax payments in Brazil and interest payments.
I'll now turn the call over to Claude.
Thank you Andrea.
This morning, I'll provide a brief update on our operations.
We saw a strong performance out of our two cornerstone assets at Tasiast and <unk>.
<unk> continued to ramp up achieving its highest production quarter, yet imperative to achieving its second highest producing quarter on record.
These two assets provided over half of our ounces companywide and we are confident in their ability to hit production targets and provides significant cash flow in 2023 anchoring our portfolio.
The rest of our portfolio is also performing well with a combination of a full other months hitting the highest production of the year in Q4 <unk>.
And achieving a 35% increase in production in the second half when compared to the first half.
Primarily due to the ramp of the copper and the seasonality of the USC features.
Q4 saw continued strong performance out of the U S assets with the highest production of the year at a 26% increase in production in the second half of the year compared to the first.
Starting with Fort Knox production increased further last quarter, driven by record tonnes and ounces stacked onto the leach in 2022 with.
With 50 million tons and over 300000 ounces stacked on the pad.
At Bald Mountain, we continued to see high production levels in the fourth quarter.
Driven by higher grades stacked earlier in the year.
Resulting in a 37% increase in production during the second half of the year.
Round mountain maintain high production levels throughout the second half of the year and saw an increase in grade stacked, which we expect to contribute to the overall increase in production in 2023.
<unk> had an exceptional results in the fourth quarter, achieving its second highest production quarter on record producing 181000 ounces for the quarter and 577000 ounces for the year.
We continued to see outperformance on both grades and recoveries at both due to the strong performance in both the mine and the mill.
This cornerstone asset continues to deliver high production levels at our lowest cash costs.
With the fourth quarter, providing the lowest cash cost of the year at $711 an ounce.
At Tasiast the operation delivered a quarterly record production of 143000 ounces driven by record processing grade of three two grams a tonne.
And achieved our full year production of 539000 ounces.
Let me expand a bit on what is going on for 2023 and why we expect that we're going to hit a 610000 ounce guidance this year at Tasiast.
The plant is currently undergoing one of the planned shutdowns associated with the 24 K expansion project.
As such through putting the first quarter of this year is expected to average around 17000 tons a day.
And based on the schedule for shutdowns and ramp ups, we are targeting average throughput between 2020 1000 tonnes a day in 2023 to produce a plan 610000 ounces.
We have already accounted for the 20, <unk> expense and shutdowns and the time to ramp up throughput.
Guidance and expect to achieve the 610000 ounces on the back of strong great and oil supply from both stockpiles and in 2023.
We achieved another monthly production record at Tasiast in January with 54000 ounces produced and has already hit our February production target prior to us shutdown.
So as long as 24, K construction is progressing well and.
And the project remains on schedule to initially reach throughput of 24000 tonnes a day by mid 2023.
Followed by a ramp up period before sustaining that level.
That's where we saw substantial progress in the fourth quarter with production of 68000 ounces.
Throughput continues to improve and averaged over 13000 tonnes a day for the last two weeks of December .
However, the goalpost has a plant most shutdown in February for maintenance works aimed at increasing reliability.
We are pleased with our progress at La Coipa that expect to produce 240000 ounces in 2023.
With plant shutdowns is based on the mill achieving average throughput of between 12 and 13000 tonnes a day.
I will now pass the call over to Ned for an update on our projects and exploration.
Thanks, Claude today, I'm going to focus my comments on our reserve and resource update round mountain underground and <unk> projects update before providing an overview of our exploration initiatives.
We have kept our reserve pricing at $200 for the past eight years. However, we have seen gold prices rise several hundred dollars over the past few years and we believe the Fortune 500 reserve price better reflects the current environment.
And is still sufficiently conservative given where gold prices are today.
It is important to note we are not making changes to our mine plans as compared to last year on the back of this change in reserve price.
Looking at our total mineral inventory year over year, excluding our divestments, our combined reserves and resources were stable.
As the significant additions are great, they're offset depletion.
Moving to round mountain, we are focused on progressing our underground opportunities while continuing to mine in phase W. One and phase W. Two open pit.
For phase <unk> underground, we have started to develop our planned portal area in the bottom of the pit and we expect to start underground development of the exploration decline in the first half of this year.
Gold Hill, we're continuing exploration drilling and advancing permitting targeting startup of an exploration drift next year.
Our exploration results of both phase <unk> and gold Hill over the last quarter continue to reaffirm our decision to progress underground opportunities.
We are excited about the potential for higher margin underground production as I will highlight shortly.
We're also continuing to evaluate and optimize the open pit to push backs.
Phases S and W. Three which remain in reserves and our economics, we will study the potential mining of these push backs with sustained improvements in macroeconomic conditions.
Construction at <unk> is progressing on schedule and on budget, we remain on track for first production in the second half of 2024.
The 2022 early works construction program was completed on budget and mill modification to process man show or at Fort Knox are underway.
Permitting is progressing well.
And a public comment period is expected to open in 2023 regarding the company's application.
2022 was a successful year for our exploration team.
And the exploration results at Great beer that we covered in detail on Monday, We also had an active year with exciting results from our brownfields and Greenfields portfolios and I would like to spend a few minutes speaking about these.
We drilled an additional 109 kilometers on the brownfield and Greenfield projects beyond the 225 kilometers drilled a great beer for a total of 334 kilometers of exploration drilling in 2022.
Our brownfields team identified an extended on exciting opportunities across our operating assets.
As you will have seen in our press release.
In Alaska drilling at Fort Knox provided high grade mineralization extends 300 meters outside the current license mine pit, along the Danville or share.
At <unk>, we have begun a brownfield exploration program testing advanced targets with known mineralization and within trucking distance of the mill.
We are particularly excited about the exploration results at our underground targets in Nevada, and our potential for resource expansion at <unk>.
Tom underground drilling at Bald mountain yielded one of our best holes of the year was 24 meters at 19 grams per ton.
And also confirmed that our oxide mineralization extend known mineralization down dip.
We will cover round mountain <unk> in more detail on the next slides.
Im a greenfield perspective, we continued to focus on areas that have potential for high grade gold mineralization in Canada, Nevada and Finland.
During 2022, we completed approximately 49000 meters of drilling on our projects, which returned encouraging results to follow up on this year.
As Carlo exploration drilling resulted in an increase in resources.
With just under 400000 ounces of measured and indicated and.
Over 500000 ounces of inferred both at around six grams per tonne.
We continue to intersect high grade mineralization, confirming continuity and extensions to previously modeled veins and resulting in the discovery of multiple new veins.
With the access from the exploration drift completed in 2022, we expect to continue to expand the resource through our 2023 drilling campaign.
As discussed earlier the exploration drilling at round mountain continues to reinforce our decision to focus on underground opportunities at round mountain.
The drilling over the last quarter confirmed the continuity of Phase X underground with continued results showing wider mineralization in the 4% to six grams per tonne range.
And the gold Hill, our drilling extended two major veins zones and intercepted several new veins reinforcing our view of this as a higher grade opportunity with narrow woods Zen phase X, but still clearly sufficient towards for a mechanized mining.
As discussed last quarter, the combination of the higher productivity, 4% to six grams per tonne mineralization at phase <unk> and narrower high grade mineralization at the Gold Hill is an exciting opportunity that we will continue to pursue.
We are looking forward to getting underground at both targets to better explore the down dip extension of the mineralization.
Now I will turn over the call back to Paul.
Thanks Ned.
In closing.
<unk> on 2022.
We faced several challenges and significant change.
We have now address those challenges.
Confident we're coming into 2023, well positioned to deliver on our commitments.
And produce strong results from our portfolio.
Looking forward, we have a solid production base and.
An attractive return of capital program supported by a strong balance sheet.
Great pipeline of projects.
And promising exploration opportunities.
With that operator, I'd like to open up the line for Q&A.
At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad. Our first question comes from Fahad Tariq with credit Suisse.
Hi, good morning, Thanks for taking my question.
Could you talk a little bit about the puts and takes on the underlying inflation.
Really driving the year over year increase in cost next year I mean production is increasing.
Input costs, presumably are coming down diesel et cetera.
I'm just trying to get a better understand I do appreciate it's a full year of inflation I'm just trying to get a sense of what is still driving from an input cost perspective, the higher the higher overall cash cost and ASIC.
Yes.
Ill hand off to Andrew here I think.
As we narrow window one of the things we've said last year about inflation is why we see it everywhere in the world.
We have actually felt mostly in the U S in Nevada.
And that's a key part of our story here.
As to what's happening in the U S, but maybe Andrew you can elaborate sure maybe.
Some some overall comments on the cost guidance.
Just that.
Part of my answer here so.
We do have a bit of an uplift in production in 2023, and that's coming from Tasiast and La Coipa, which are lower cost.
There is a bit a bit of a tailwind but.
That's being offset by while generally that you asked that we can provide a country by country cost guidance in the appendix to our to our press release.
Paul mentioned in his opening remarks, and then just now that.
We're factoring in inflation basically on reflecting where costs.
We're in the back half of 2022 units that we did see an increase throughout 2022, and we've got a full year impact is as costs at that level.
And we.
Estimated that at around 5%, 5% factor.
You commented on on oil prices, we've used a $90 oil price and our and our cost guidance. So.
We haven't we haven't factored in a benefit beyond beyond $90, an ounce and there is some sensitivities in our press release as well.
The improvements that we continue to see oil prices, where they've been so far this year.
So the increase is really in the U S sites.
And as Paul said, that's where we saw the highest level of inflation.
We also have lower production coming from the U S.
In 2003 as compared to 2022, so we've got a bit of economic date or impact where cost per ounce goes up as a result.
And then the last factor on on costs in the U S.
The way our inventories accounting works on the heap Leach ethylene we added costs of the heap leaches in 2022, and that was where the inflated cost and so we see that coming through.
P&L to our cash costs in 2003 as those loans come off the pad.
Okay, Great and maybe just as a quick follow up to the one element that we didn't really talk about is labor inflation can you just touch on that in the U S is that something that is also a headwind.
Yes quickly.
I can touch a little bit on that so we are still seeing that demand is still high in Nevada. For example, in the U S and labor costs are still.
At high levels compared to.
Early twenties.
Okay, great. Thank you.
Our next question comes from Anita Soni with CIBC World markets.
Hi, good morning, everyone. Thanks for taking my questions. So firstly can I go to the reserve statement and try to understand.
What happened at round mountain and sort of what the path forward is I think one of my questions.
Adding $2 2 million ounces for 2025, and I think thats the annual.
And you won't look like the.
The first time, we're providing guidance and I'm just trying to understand.
Round mountain looks like because I think on the last Q3 call you were saying maybe 60 days.
I have a few things in my model coming off in 2025, which is round mountain.
Okay.
Connection Bald mountain and you can see from the reserves, probably not that much more than two years left at this stage in the reserves.
And then Tasiast I'm wondering how long grades continue.
So those are my three questions are kind of understand that.
The reserve statements.
Rates on round involved and how that translates into 2025.
And similarly on Tasiast.
They're going to do it.
Yes. Thanks.
Thanks for your question.
I'll start with the with a number of points that could help you.
Understand how 2025 it looks like so in terms of Tasiast I think maybe you are comparing back to the TR and what we've done.
We've we've flattened the.
<unk> over the next several years to sustain.
Our high production on task here. So in 2025 for example for Tasiast to we're looking at.
Production of 420 to 450000 ounces.
When it comes to.
To round mountain again, I would like to say on round mountain.
We talked last time that.
We've placed phase <unk> and phase W. Three on hold.
As inflation was still rising gold prices, we're a softening a little bit and we continue to evaluate these push backs because they are part of our reserves.
We just need to understand.
Where the gold price is and understand where inflation is basically the macroeconomic condition confirmed that do a little bit more of an optimization regarding the design of these push backs and potentially at one point.
They could be turned back on but if I don't consider phase W. Three.
Or phase as we look at our production of approximately 70000 ounces from round mountain prior to.
The start of the underground so thats on an round mountain focused on 2025, specifically again that is if we do not turn back phase <unk> phase W. Three if we just finished W. One MW to then start the underground.
Can I pause.
Sorry can I stop you there and ask you then on the 2 million ounces at Youre, saying in 2025.
Does that consider phase <unk> and phase W. <unk> III coming in or does that exclude face does two things.
It excludes phase S and W. Three.
Okay, the 70000 ounces only come.
From the production from <unk>, two that were going to mine over the next two years.
Okay.
Alright, so I continue on with thoughts on I guess.
I think you asked about Bald mountain if im correct. So.
Regarding board, we're looking at a production of 150000 ounces to 170000 ounces for.
Bald mountain.
And then.
Regarding men's show, maybe it's not in your model, but we see <unk> coming in and potentially 220000 ounces to 240000 ounces from man show.
And that with the natural deposits specifically just itself.
That's with man show.
And then.
<unk> would be.
250.
280000 ounces.
250 to 280 at Fort Knox.
And so in Nashville, right now kind of like that that rate is maybe two and a half years right.
On the reserve.
More like.
It's not the same production level. We are seeing is the highest year of production is potentially going to be 2025 with the numbers I. Just told you and then we see production in 2006 and 2007.
<unk> hundred 50000 ounces for those two years.
Okay.
Alright.
Then the other question that I had and I apologize to everyone I was just.
I'm wondering when.
When you look at.
Your.
Sorry, you're right.
Your buybacks.
You said youre looking at 75% threshold on that.
What gold prices I mean are you projecting to have any more buybacks this year.
Yeah, I mean, obviously, it's gold price dependent.
So but at the gold prices, we've seen so far this year, we would be expecting to be to be doing a buyback this year, having said that.
Sort of on a quarterly basis, it will SaaS it and given.
Lower production quarter in Q1, and lower cash flow quarter, it's probably more towards the second half of the year.
Okay. Thank you.
I'll leave it there and let someone else ask questions. Thanks.
Okay.
At this time I would like to remind everyone in order to ask a question press star one on your telephone keypad.
Our next question comes from Lawson Winder with Bank of America Securities.
Great. Thank you operator, and good morning, Paul and team. Thanks for your comments today.
Can I please ask about the.
'twenty four Capex guide would you be able to provide us a breakdown and sorry, if I missed it between between sustaining and growth in the $850 million and then also give us an idea is.
Go to $1 billion that extra $150 million.
Is that going to be just growth or is there a sustaining element there too.
What are kind of some of the key projects that you might see driving that in 2024.
So I mean, I'll start I'll start by saying <unk>.
'twenty three we started sort of rat rapidly split between.
Between sustaining and growth we haven't given we haven't given detail on where the capex is in.
In 2024, but 50 50 is probably a good rule of thumb going forward.
Said that 850 is based on approved projects, though.
My comment about it potentially floating backup to Italian as Jeff looking to maintain that 2 million ounce production.
<unk> 2025.
So.
There is likely room between the 850 Annabel into if we end up coming back to some of the round mountain some of the round mountain open tax.
But TBD on that will roll off.
I'll reflect back on that as we go through the year here.
Yes got it and then so just just to be clear on the sustaining capex is about $510 million that you are expecting this year, plus or minus 5%, obviously and then that would drop to 425 half of the $850 million.
What is it that's driving that expected decline in 2020 for sustaining capex guidance.
I think that that's mantell.
That's really driving that.
The decrease.
Okay. Thanks, Andrea that's super helpful.
I wanted to touch on Nevada, as well too odd question, just regards to inflation, there and perhaps a little bit more color on the labor situation. So there's a lot of robust mining operations that are growing and hiring a new operation.
Anything up.
I'm, just curious if youre seeing any impact on turnover and whether or not you.
Maybe help quantify that and give us an idea of like if you look at 2022.
What would have been your turnover at your Nevada operations versus say 2019.
Yeah.
Yes.
Just very briefly I think.
Two elements one is relatively stable.
That is higher than anywhere else in our organization.
So we do have a lot more programs in terms of recruitment.
We're doing things a little differently were going further afield in no.
<unk>.
To recruit.
But all of the operations as you know if theres a lot of activity.
Under significant pressure.
Two two.
The supply of labor.
On the flip side of that as we're moving to these underground operations in different things.
It's a different skill set and.
And so we are doing some more.
A higher level of contracting work than we normally would.
That's providing us with the stability to be able to execute these projects.
Okay. Thanks for the comments and if I could actually follow up on the on the buyback question Andrew.
Andrew Thanks for your comments on that that it is going to be driven by the gold price I mean, thats abundantly clear. There was also like a net debt to EBITDA element to that too and if and if I just look at where your net debt to EBITDA was at the end of the year I mean, it was it was kind of around that 1.7 times threshold.
Which which is great and implies that I mean, you certainly have the.
The room on the balance sheet to be active in the.
And the buyback and I was just curious how that factors in to.
So youre thinking or if it still does.
Yeah that is.
Sort of one of our as we call them guardrail, so as long as we're as long as we don't get above that one seven and then we would be executing on the buyback so.
As he said gold price dependent, but we wouldn't expect that to be an issue at least in the second half of the year, but as I said Q1 is going to be a little bit later.
And is that is that just a free cash flow calculation like I guess, just looking at expected free cash flow and if it is not going to be positive then you're very unlikely to be active in the buyback.
While it is free cash flow.
So operating cash flow after the needs of the business after interest and after dividend.
Take our free cash flow and then after interest and dividend.
And that's what we're calling excess cash and then to 75% factors in to that.
I've mentioned that Q1 is a lower production quarter as well as some.
Sorry seasonal cash outflows that we always have in Q1, so that's why I'm kind of pointing to the second half of the year.
Super helpful. Thanks, very much.
Our next question comes from Carey <unk> with Canaccord Genuity.
Hey, good morning, everyone.
You mentioned Q1 being the low quarter from a production standpoint, just wondering how low should we be thinking in the quarterly profile going to sort of strengthen through the year kind of like it did in 2022.
Okay.
Yes.
I think Kerry if you look at Q1.
Probably in the low 20%.
As a proportion of our of our total production guidance for the year.
I don't think its as pronounced going quarter to quarter Q3 for ourselves.
Then think about the second half of the year being in the kind of low like 52% ish.
Is how I would guess is how I would look at it.
Yes, I'll comment that it's not as extreme as it was last year.
Right.
The two major pieces being the <unk> of February .
And then we pick it up again and that's what's driving the low first quarter otherwise the rest of the quarters a pretty average.
Across the board.
Okay. That's helpful. And then maybe just back on the Capex decline over the next couple of years, you mentioned round mountain, but other than round mountain what are the projects could slop in there before you can get to.
Bear kicking off.
Yes. Thank you very much for the question so.
As you know we have the two corner assets Tasiast and <unk> two and then we have liquidity before at Knox round Mountain Bald Mountain and men's show coming on line with Fort Knox.
So when we look at the future. We're looking at an extension of La Coipa, we're very excited on that the.
The potential there is great. We're also looking at the round mountain underground and like what you mentioned and we mentioned earlier the restart of the open pit pushback either phase as R. W. Three we also have curlew, we have exciting exploration results from <unk>.
So the combination of these projects.
In addition to great bear.
We will put us.
Okay.
Comfortable 2 million ounces towards the end of the decade.
Great. Thanks, and maybe one last one in terms of the U S operations. It sounds like some of the higher costs. This year are really costs that were incurred last year when we can.
About 2020 for should we be assuming a similar level to the guidance this year or should we assume that costs come down a little bit in 2024.
Soon to say.
Hi.
I provided the comments.
That I would think about cautious kind of being similar.
<unk> 23 for 'twenty four.
We will see how we got here and get more precise as we get through 2023, but I would expect the U S in particular round.
Round mountain continue to have higher costs, we've talked about that on previous calls and we see those costs being <unk>.
Similar to the second half of 2022 to higher in.
In 2003, and so that's likely to continue through 224 as well.
Great. Thanks.
Our next question comes from Mike Parkin with Bank, Sorry National Bank financial.
Thanks, so much.
Can you just recently.
Are we going to get.
Any update on the La Coipa life of mine extension or is that something internally that you guys are only.
Reviewing.
Thanks, Thanks, very much Mike for the question.
We're at the early stage of the projects, we actually have an internal project.
Kicked off so in terms of drilling there.
We're almost complete but.
Geological models are being developed and mine plans are being evaluated.
<unk> technical work is advancing metallurgical testing is also advancing.
Again these are not necessarily.
New push backs for us these are extensions of what we know so familiar in the area.
Nevertheless, we will go through our robust.
Gate process cells.
A PFS SaaS.
<unk>.
At the point, where we see there is a material information to release, we would do that in the future.
<unk>.
We do have solid production coming from La Coipa.
Through 2025, and then 2026, so we do have several years ahead of us before we turn envelope expansions.
It's really just getting in front of the permitting and.
Pushing the permitting for the for the stuff that we see around us.
Okay. So we probably arent looking for an update on that this year then.
No.
Okay.
And then with the current lube base unless you've got just shy of 1 million ounces at a pretty good grade.
Can you just walk us through high level, what you're kind of thinking of where you need to kind of get to on resources or if you're already there.
To warrant kind of the.
Kickoff of work for a restart.
Can you just.
Find us where that asset sits with respect to permits it gives it a very straightforward restart or is there a bit of that.
Permit re initiation phase that has.
Be conducted.
Yes, thanks for that like <unk>, we're really excited about the potential.
It's an amazing ore bodies.
Two.
As I understand it very well it keeps giving.
I personally believe the ounces that we just shared with you that's the start of the deposit.
And.
We are now going to kickoff I believe our schedule is April to kickoff a pre feasibility study on.
<unk> is a project.
Again permitting is the next step for us.
And we will update you as we progress.
Okay.
That's it for me thanks, so much.
Our next question comes from Anita Soni with CIBC World markets.
Hi, Thanks.
After taking out some follow ups.
Just in terms of <unk>. So <unk> got good grades this quarter as we go into 2024 and 2025, what should we expect from that.
Thanks Anita.
<unk> 2024, we the great dose dipped a little bit again.
Or in a different location and this is also a different phase that we're in but.
But we see that coming back up to 2025.
Frankly, it going down and the turn back up in 2025 range. Yes. So we expect to be just over 500000 ounces produced in 2008.
But in 2025 it comes back to the same level as what we were experiencing last year than this year.
Okay.
Okay.
And then similarly at Tasiast.
Also good grades in the quarter.
So what should we be looking for it.
In terms of grades between 23, and 2000 and explore.
Again.
Been able to during the significant work on the plant we've been able to add to our stockpiles. So we're balancing the feed.
Do you maintain the as I mentioned earlier on the call the six.
<unk> hundred 10 targets for this year and over 600 again for next year.
We have as Nate alluded to smooth the profile a bit more.
So that we don't drop off dramatically in the previous.
Iterations dropped right down to below 300, which is not really a great position to be so 2024 hours is a bit higher as well.
And then I will go back to the U S and the reserves I apologize.
At Bald mountain.
You added in terms of the additions.
It seems like Theres a lot of tons out of that very low grade can you just walk me what what happened in Gaza.
Escalations in depletion less and then the addition of it seemed like there was almost 12 million tons.
Two gram per tonne material was added.
And I'm, just wondering how that would work given the cost structure, there and what was the reason for that.
Yes, your question Anita specifics to Bald mountain right.
Yes, yes.
Okay. So on Bald mountain.
First of all let's start with reserves so the <unk> material.
Yes, so the main change there would be depletion theres, a little bit of redesign.
Redesign.
That added 100000 ounces approximately.
On the two key material on.
The measured and indicated part of the resource.
I believe we've added around 100000 ounces also.
<unk>.
In terms of additions and.
Then.
Yes.
As for the inferred material I believe it was.
It was a wash between.
Measured and indicated.
Indicated and the inferred so measured and indicated went up by 140000, approximately and the inferred material came down by 140000.
Okay can I, maybe you can take that one offline I was specifically asking about that 100000 that you added and you preserve it seemed like it was a bit low grade. So I was just wondering what the engineering.
Around that line.
More importantly on round mountain, yes, sorry go ahead, or we can take it off no no sorry, I was going to say for sure. We can take it offline I can go back and check.
The tonnes and grade.
And then secondly, I just wanted to understand really the changes.
Round Mountain I know Theres, a lot of phases going on and I'm trying to keep up with phase <unk> phase <unk> phase W. Three in phase whatever but.
And but just looking at the actual reserve resource update.
Essentially we lost about 400000 500000 ounces and it went I assume that went back into the MNI category and I'm, just wondering which states that why that went there you are seeing things as the phase W are still in reserves.
But did which phase went into the resources.
Yeah.
Yes like to simplify it.
<unk>.
The previous phase W.
Is comprised four sub phases <unk> W. Two W. Three and W. Ford.
W. One and W. Two is what we're mining now for the next 10 years.
We're mining WNS to W. Three is the one.
Pause and Thats in reserves and remains economic and then W. Four is the one.
Got moved from <unk>.
Previously being phase W and reserves to now being a resource the gold is in the groundbreaking changes.
Categories.
Okay and that was the one where you would have had to do.
A major layback is Dr.
Got the reasoning and the capital required.
Okay that is.
And the evaluation now is whether or not you want to.
Go from underground online.
Is that what youre asking.
I can I can expand a little bit more on that so you have W. Three that's like I mentioned, it's in reserves and open pit reserves and Thats a decision to start stripping that phase and investing the capital stripping.
When it comes to W. W. Four actually.
Okay.
It would be nice to show you one day, a cross section, but W. Four sits above phase X. That's the underground that we're starting to decline to go towards so yes.
Yes, now to go straight to your question the bottom W toward the higher grade material of the W. Four has the potential to be combined with phase <unk> underground.
Okay.
But again, there is more engineering and drilling that needs to be conducted as we go down we're going to drill this area from underground because now it's only drilled from surface. Then we can define better the underground resource and potentially have.
A chunk of W. Four ounces moving into Phase X underground.
Okay. Thank you that was very clear it's been a while since they've actually understood that.
Very good explanation.
Youre welcome.
Our final question comes from Scott.
Scott to panic.
Scotiabank.
Okay. Good morning, I think Thats me.
Thank you.
That's been call on <unk>, so for any airline.
Yes.
And that's the easier part of nine months.
Okay.
Less.
Just a clarification Paul.
And you mentioned I'm just looking at my notes here that you have opportunities for expansion in Nevada.
Should I take that.
Expansion and what you already own E. All of these underground targets Gold Hill et cetera.
Are you looking for other opportunities in Nevada to grow given the infrastructure at Bald mountain is going to be available very shortly that mine life is short there. So that's my first question.
Sure, it's what we already own and what we're getting at I mean.
The way I would think about it.
Starting with round.
Number one.
We're pretty confident that our that our underground opportunities will be standalone economic.
Driving the decline, but we see the which we see the grades.
And so.
First exercises to satisfy ourselves that we can run those underground as a standalone underground and <unk>.
That makes sense.
When we think about optionality or flexibility, it's really coming back to this business.
Turning back on.
Thanks, We've just passed.
And.
Yes.
<unk>.
We'll continue to study that through the year I think it looks promising.
I think we'll be in a better position to reevaluate that as we get to the middle of the year.
If we if we turn back on the S. W scenario in conjunction.
With the underground it has almost a bit of a multiplier effect with <unk>.
The economics so.
That's really what we're getting at when we see when we talk about Optionality. That's the flexing of the underground and the re starting of those some of those lay backs.
Okay. So then again I would also say there is some greenfield activity.
Data.
But.
We just kind of one of our best hole ever.
And Nevada over at.
At Bald, where we're seeing the oxide.
Extended depth with pretty attractive terms.
The attractive grades in which so again.
Well that may not happen on a timeline that.
Provides for continuous production of ball.
But it's certainly very perspective.
So I was going to ask sorry.
Bald Mountain I mean does that look like it's a noncore asset now, but maybe with this exploration is rethinking that.
Yes, it's always a tough one.
Look I mean for us as we say what constitutes core versus noncore is how does it compete for capital internally.
And when you Paul hauls like that okay.
It's pretty.
It is pretty attractive and we will want to understand it more so.
We're not there yet, but it's a fair question.
Okay, and maybe just moving on to cargo.
Just one myself a reminder, so this pre feasibility that you're kicking off in April is it going to take about a year to do.
Is that about right yes.
Yes, that's a fair estimate.
And then so you've done a you'll do the pre feasibility.
Youll see what the additional drilling you have this year how much more you can add to this but just from not.
And then following up on another question, but just on the permitting side can you remind me is it just do we have to apply for permits to just to reopen the mill.
And then permit to truck the ore to the now or is it more substantial than that I just forget.
Yes, I think.
Part of the pre feasibility study Tanya would be to actually.
Zooming on that and answer that question.
Our strategy. If you ask me today is closer to what you just mentioned so youre thinking close to our thinking basically <unk>.
A restart of the mill.
<unk>.
Dry stacking in terms of tailing and then trucking of the ore from the mine to the mill.
These are the main components.
Okay.
And then I guess my my final question just to finish off the 2025.
Yes.
Should we think of la coipa of running in that 250000 ounce range production.
For 2025.
I would say just over 202025 as we taper downwards, we currently know.
But of course, it will be an objective for us to try to maintain as flat from the $2 40 that we are having this year.
Alright, and then I think we phased that out by 2020 is that a fair comment.
It's a fair comment with the understanding that we are starting the work to have a look at the extensions to try to maintain that.
Different pieces that Ned mentioned, we've done a lot of drilling we've done a lot of work. We're now entering some of the permitting phases.
For those extensive pieces okay.
Okay, So really la coipa and ball that the two that we're facing sort of phasing out in that 'twenty, six 'twenty seven timeframe or thereabout.
And for now unless we have extension and our other that is that this capex.
We're looking to extend la coipa.
Tanya with permitting on stuff, we can see out towards the end of the decade. So that's more of a board question, that's more of a situation with vault and it doesn't look quite bold.
Okay, Okay and.
But do you have do you have that on property and permitted it could be easily brought through.
It's.
As permitting.
And it's it's on our property at an existing mine.
So one would expect that makes it more straightforward, but we've still got a we've got a push it through the system.
Alright, so you do need permit for us.
Yes.
Okay.
Our satellite pits as what we're permitting around an existing infrastructure.
Okay.
Okay, great. Thank you so much for that so just trying to follow up on that need is we know what mines are fading out and sort of the next couple of years.
Great. Thank you yes.
Yes.
There are no further questions at that time with that said concludes today's conference. Thank you for attending today's presentation. You may now disconnect.
Thanks, everyone.
See you.
Hopefully in person in the coming weeks. Thank you.