Q2 2023 Centerra Gold Inc Earnings Call
Yeah.
Thank you for standing by this is the conference operator, welcome to the <unk> Tara Gold's second quarter 2023 conference call. As a reminder, all participants are in listen only mode and the conference is being recorded after the presentation there'll be an opportunity to ask questions to join the question.
You you May Press Star then one on your telephone keypad should you need assistance during the conference call you May signal, an operator by pressing Star then zero I would now like to turn the conference over to Lisa Wilkinson, Vice President Investor Relations and corporate communications with Sentara Gold. Please go ahead.
Thank you operator, and good morning, everyone welcome to send Terricolous second quarter 2023 results conference call.
Joining me on the call today are Paul Tamari, President and Chief Executive Officer, Paul <unk>, Chief operating Officer, and Darren Millman, Chief Financial Officer.
Our release yesterday details our second quarter 2023 results. This should be read in conjunction with our MD&A and financial statements both of which can be found on SEDAR Edgar and our website.
Presentation slides are available on <unk> website to accompany this webcast.
Following the prepared remarks, we will open the call for questions.
All figures are in U S dollars unless otherwise noted.
Before we begin I would like to caution everyone that certain statements made today may be forward looking and are subject to risks, which may cause our actual results to differ from those expressed or implied.
Please refer to the cautionary statements included in the presentation as well as the risk factors set out in our annual information form.
Also certain of the measures we will discuss our non-GAAP measures. Please refer to the description of non-GAAP measures in our news release and MD&A issued yesterday.
Now I'll turn the call over to Paul to worry.
Thank you Lisa and good morning, everyone.
<unk> now had the opportunity to visit our operations and projects and engage with employees and the investment community and other stakeholders and I'm optimistic for the opportunities that lie ahead and the.
The second quarter, we've already achieved several milestones that are sitting center up for strong performance in the second half of the year, most notably at the end of May we received approval.
<unk> mined from the Turkish Ministry of the environment.
We continue to enjoy strong local community support for the project and with all the necessary regulatory approvals in hand, we restarted full operations on June 5th and produced over 20000 ounces of gold in a month.
Looking ahead, we expect to produce between 180 and 190000 ounces.
The 2023, which will make it a significant contributor to our expected stronger second half performance.
Turning to Mount Milligan, we remain on track with our plan to have stronger production in the second half of the year.
Our full year production guidance for both gold and copper are unchanged and including <unk>, our full year consolidated gold production guidance is between 340 and 360000 ounces.
Sharon will speak to our operations in more detail later in the call.
One of my top priorities has been to evaluate all since yours assets with an ultimate goal of developing a comprehensive value maximizing strategic plan.
Key aspects of this will include a view on the molybdenum business unit with an assessment of the potential for a restart of operations at the Thompson Creek mine.
Continuing to drive operational and technical improvements at Mount Milligan.
Repositioning our approach at the Goldfield project to target higher returns and.
And lastly, assessing opportunities for growth in gold production.
In conjunction with their asset level strategy. We're also developing a capital allocation framework focused on optimizing shareholder value.
We're taking a systematic and diligent approach our goal is to direct our capital on three ways returned to shareholders invest in internal projects and for external M&A opportunities.
Stay tuned as we expect to roll out this new strategic vision for the company in the coming months, which will serve as a crucial step in our journey to maximizing value to our shareholders and other stakeholders.
Shifting to Nevada, I'd like to provide an update on the goldfield project.
Paul Chairman and I had the opportunity to visit the project in June and we think it presents a great opportunity and a top mining jurisdiction.
Based on my experience building projects and operating mines in Nevada, and with what we see at Goldfield, we will be pivoting our approach.
Most importantly, we'll focus for now only on the oxide and transition material principally in the gym field and nearby deposits.
This will allow us to reevaluate the project scope of work to achieve a lower capex flow sheet and to maximize returns.
Second we believe the project has upside potential from this large under explored land position.
As a result of this change in focus we will take more time to further explore the property before releasing an initial resource estimate.
Our full year exploration guidance goldfield has been increasing between 16 and $20 million.
From $10 million previously.
This strategic pivot is aligned with our disciplined approach to capital allocation and will allow us more time to target a higher return projects.
We continue to have a positive outlook, but we want to achieve a higher return profile before we proceed with development.
Yeah.
Turning now to the molybdenum business unit as mentioned earlier, we are developing a strategic plan, which is expected to incorporate a number of aspects for value maximization.
First we continue to progress our PFS study on the restart of the Thompson Creek mine.
And we remain on track to release highlights later in the third quarter.
And second we're assessing the strong operating synergies that will exist between the Thompson Creek mine and the Langill off metallurgical plant.
Moving now to slide five so terrorists committed sustainable and responsible mining practices and this is demonstrated through our ESG commitment and accomplishments.
Today I'd like to highlight that we've achieved full conformance with the World Gold Council responsible gold mining principles during our year three assessment.
This accomplishment reflects our commitment to responsible mining practices proactive risk management and continuous improvement and our relationships with stakeholders in local communities.
We understand that ESG is an ongoing journey and we'll continue to work diligently towards our goals and initiatives in the coming year.
I look forward to updating the market on our commitments and achievements going forward.
And with that I'll pass the call over to Paul Charron to walk through our operational performance in the quarter.
Thank you Paul.
On slide seven we show the operating highlights at Mount Milligan for the quarter.
The Mount Milligan mine produced over 40000 ounces of gold in the second quarter, a 24% increase from last quarter and produced $13 8 million pounds of copper.
As we mentioned in the previous releases, we always expected the production at Mount Milligan in 2023 to be weighted towards the second half of the year. However production in the quarter was impacted by lower than planned recoveries due to mine sequencing, which resulted in more oxide ore than plan and an or waste transition zone in phase.
Nine.
We are now deeper in phase nine and have mostly mine through the ore waste transition zone.
Copper grades are expected to improve in the second half of the year as the mine progresses deeper which is expected to improve metal recoveries compared to the first half of the year.
Mill throughput in the second quarter was $5 6 million tonnes with the site achieving record tonnes processed in both May and June .
Gold and copper sales at Mount Milligan were lower than production in the second quarter, mainly due to timing of bulk shipments.
In July concentrate shipments from Mount Milligan were not materially impacted by the Union strike at the port of Vancouver.
We expect to have for concentrate shipments in the third quarter and are targeting another four shipments in the fourth quarter.
The timing of shipments and associated sales between quarters may be affected by logistical delays from union strikes at the port.
Our Mount Milligan production guidance is unchanged for gold and copper and is back half weighted for the year.
We expect 2023 gold production to be near the low end of guidance of $1 60 to 170000 ounces.
While copper production is tracking towards the midpoint of guidance of between 60 to 70 million pounds.
Gold production costs were $255 per ounce in the second quarter and all in sustaining cost on a byproduct basis were $599 per ounce.
All in sustaining costs were impacted by higher mining costs.
Including general inflation on labor and consumable costs lower gold ounces sold partially offset by lower sustaining capex. We have increased our Mount Milligan full year 2023, all in sustaining cost guidance to 1100, and 25 to 1100 $75 per ounce as we are seeing lower amounts capitalized.
As to the Tsi higher maintenance costs higher re handling costs and consumables.
This year, the wildfires have been quite severe across Canada and continues to be active in British Columbia.
We have been fortunate at Mount Milligan and have not been impacted by the wildfires. So far this year.
And finally, we congratulate our Mount Milligan mine rescue team for placing first in the extrication of that at the BC provincial mine rescue competitions.
On slide eight is an operations update for oxy.
Following the receipt of the updated EIA at the end of May crushing stacking and ADR activities resumed in early June .
Second quarter production was just over 20000 ounces at.
At the end of June there was approximately 80000 recoverable ounces in the stored golden carbon inventory and approximately 200000 recoverable ounces of gold in the ore stockpiles and on the heap Leach pad.
Full year 2023 production guidance at Oxy is 180 to 190000 ounces of gold.
As production levels are expected to continue to ramp up in the second half of the year with.
With gold production of approximately split 45%, 55% in the third and fourth quarters, respectively.
Gold production costs were $404 per ounce in the second quarter and all in sustaining cost on a byproduct basis were 1100 $43 per ounce.
The all in sustaining costs in the second quarter reflects only a partial month of production lower sales ounces standby costs and a full quarter of sustaining capital expenditures.
As we ramp up production and achieve a more uniform spend on sustaining capital expenditures, we expect costs at oxy to decrease in the second half of the year as a result, our full year 2023, all in sustaining cost guidance at oxy.
650 to $700 per ounce.
To wrap up I'd like to commend the OXXO team for achieving 1 million work hours without a lost time injury. This is a true testament to the safety leadership and culture at our operations in Turkey.
And now I'll pass on to Darren to walk through our financial highlights for the quarter.
Thanks, Paul.
Slide 10 details our second quarter financial results.
Net loss from continuing operations was $40 million or a loss of <unk> 18 per share.
There were two adjusting items in the second quarter first 8 million of reclamation provision revaluation recovery at sites on care and maintenance primarily attributable to a decrease in the risk free interest rate applies to discounts the estimated future reclamation cash flows and second 6 million of deferred income to.
<unk>, resulting from the effects of foreign exchange rates monetary assets and liabilities and termination of taxable income related to the Oxford at Mount Milligan mines.
As a result of these two items adjusted net loss from continuing operations was $42 million or a loss of <unk> 20 per share.
<unk> recorded 185 million in net revenue during this quarter with contributions from our two operating mines, Matt Milligan in Oxford as well as our molybdenum business unit.
In the second quarter sales were 48155 ounces of gold and $12 8 million pounds of copper.
<unk> sales were lower than production in the quarter by 22%, mainly due to Turkish national holidays, but delayed gold sales at the end of June .
The average realized price was 15 $132 per ounce of gold and $2 56 per pound of copper, which incorporates the existing streaming arrangements at the Mount Milligan mine.
At the molybdenum business unit in the second quarter, approximately 3 million pounds of moly was sold generating revenue of $76 million with an average market price of $21 23 per pound.
Consolidated all in sustaining cost on a byproduct basis for the quarter were 17 $111 per ounce consolidated all in sustaining costs for the full year is expected to be in the range of one to 1050 per ounce.
As noted by Paul Charron early our gold inventory levels remained elevated at Oxford with processing of gold in carbon currently underway.
I'd like to highlight that while our full year all in sustaining cost guidance at Oxford is between $650 to $700 per ounce. The remaining cash processing cost associated with the Golden carbon is expected to be less than $50 per ounce and the remaining cash processing cost associated with.
The 200000 ounce of gold ore stockpiles and on the heap Leach pad are expected to be less than $225 and $100 per ounce respectively.
Capital expenditure in the second quarter were $23 million up from 5 million in the first quarter, mainly driven by timing of spend.
We are lowering our Mount Milligan capital guidance to be 50 to 60 million due to lower capital cost at the TSS and deferring some about project to next year.
Consolidated capital guidance for the full year is expected to be between 90, and $115 million, which includes $35 million to $45 million at Oxford.
On July 15, the Turkish government increased the corporate income tax rate from 20% to 25%.
This is a retroactive earnings starting January one 2023 and subsequent tax periods.
We estimate this change will result in incremental $9 million in cash taxes to be paid with respect to the income earned in the first half of 2023 at Oxford.
Slide 11, Lisa financial results for the quarter.
Cash provided by operating activities was 33 million in the second quarter and free cash flow was $11 million.
At the molybdenum business unit, approximately 35 million of the investment in working capital from the first quarter was released during the second quarter.
As expected the additional releases from working capital will occur during the remaining six months of 2023 provided molybdenum prices and inventory levels remain at the current levels.
Molybdenum business unit generated 31 million in cash in the second quarter.
At Mount Milligan cash provided by mine operations and free cash flow were 22 million and diamine, respectively in the second quarter.
At Oxford with the partial month of operation in the second quarter demand Gen <unk> and cash from operations and for me and free cash flow.
In the second quarter to manage gold price risk associated with the expected high sales at Oxford in the short term we entered into gold hedges, we purchased gold put option contracts for 75000 ounces at an average strike price of $942 per ounce.
Options allow full participation to the upside gold price movements, while protecting against downward movements for a selection of gold sales in the period from July to October 2023.
We don't plan on increasing this gold hedging position in the near term.
Under <unk> normal course issuer bid in the second quarter. The company purchased and canceled 127 million common shares for total consideration of $7 3 million, we continue to make purchases via an automatic share purchase plan in July .
Tara ended the second quarter with a cash balance of $402 million and 398 million available under our corporate credit facility.
This provides us with total liquidity of 800 million.
Given our strong financial position the board declared a quarterly dividend of seven cents per share.
I'll now pass it back to Paul for closing remarks.
Thank you Darren after achieving several milestones in the second quarter, we are well positioned for strong performance in the second half of the year.
In the meantime, we continue to work diligently on delivering safe and sustainable production and developing since Youre, a strategic vision, which will clearly articulate our path to value realization for each asset in the portfolio.
We look forward to updating the market in the coming months.
And with that operator, I'll stop and open the call for questions.
Thank you.
We will now begin the question and answer session to join the question queue. You May Press Star then one on your telephone keypad.
We'll hear a tone acknowledging your request.
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We'll pause for a moment as callers join the queue.
Our first question comes from Fahad Tariq of Credit Suisse. Please go ahead.
Hi, Good morning, Thanks for taking my question in the press release, you mentioned in.
The paragraphs talking about evaluating all of the assets.
Youre assessing opportunities for growth in gold production can you talk a little bit about how.
How are you thinking about organic versus inorganic growth.
If it's organic growth.
Specifically what type of opportunities may exist at OXXO Mount Milligan Goldfield.
Yeah.
Yeah. Thanks, so hard.
Our overall strategy right. Now is look is focused on looking at our current assets. What is the value that we think is in is in those assets and as you've seen we were repositioning the way we look at goldfield as an example at Milligan and we continue to drive the technical and operating improvements.
And most importantly, we think that there's value in the molybdenum business, which will be daylighting over the course of the coming months, but in terms of your specific question on <unk>.
Growth in gold production, we will from time to time as opportunities become available assess potential bolt on type acquisitions.
Things that makes sense, given our our skill set and where we think we can add value and thats something we do as a normal part of businesses assessing external opportunities.
Given that it's an M&A point I won't speculate much further on it but it's just a general statement that we are open to M&A, where it makes sense.
Okay that makes sense and then just switching gears to Mount Milligan on the cost side it.
Like the majority of the cost increase in the quarter. It was really the sequencing and the transition kind of material.
Can you talk a little bit about the inflationary pressures are they as expected.
And then my understanding that correctly that it's really the.
It's really the grades in the quarter that drove the cost higher.
Yes, I'll make a general comment on inflation, and then hand, it over to Paul on the specifics Mount Milligan saw significant inflation through 'twenty, one 2021, and the first call it three or four.
Sorry, two to three quarters of 2022.
That inflation has abated and it is now more what I would call normal inflation, but experienced significant inflation in 'twenty one 'twenty two.
And to comment specifically on this year this quarter, Paul will talk about that.
Yes.
On the costs were I mean, we are seeing some increases pretty much comparable in benchmarking with the other.
Operators in the industry, we do have a little bit of pressure with a competitive labor market in D. C.
But as you mentioned the main reason for the increase in guidance on the on the all in sustaining cost as the denominator.
We are guiding towards the low end of guidance on our gold production and Thats really what is affecting.
The increase in ASIC.
And the main reason for that is the recovery and so we did intercept some so a little bit more oxide than we had planned and then the replacement for that what's the stockpile and then as a result, we did get an impact on our gold recovery and Thats. The main reason.
Okay, great. Thank you.
Our next question comes from Dalton Barreto of Canaccord. Please go ahead.
Yes. Thank you I want to start by wishing you Paul all the best in this new Ralph.
I also want to.
I also want to continue on this kind of vein of strategy, but I wanted to ask you at a higher level than some of the tactical things you have alluded to in your prepared comments, yes somewhere.
From what I said I mean, arguably your portfolio has too many non producing assets to <unk>.
<unk> metals have it you've got this Illinois stream at Milligan.
Cash balance is down 58% since the end of 2021.
I guess three questions from me number one do you still want to be a gold company and if so how much.
Base metal value are you willing to talk to tolerate in the portfolio.
Secondly, how are you thinking about restructuring the portfolio had a pretty high level and then third what are some of the more immediate strategic milestones. We can look forward to you. Thank you.
Yes, Theres a lot in there and I think you've identified some of the attributes that we're dealing with youre at Sentara.
Your first question on gold Yeah, we our Sentara gold ink and we intend to remain a.
Primarily a gold producer we do like the angle on base metals strong copper production and reserve at Mount Milligan, and even an openness to molybdenum here, but we will we are and will remain principally.
A gold mining company.
Yeah.
My first three months.
As I said in my prepared remarks, I've been out to all the sites and that there's really no substitute for seeing and meeting and getting a sense for the attributes of each.
Asset in the portfolio.
And.
Sentara, we'll we'll look at each asset and Thats. The focus right now is as you said more tactical.
One the most concrete example, I can refer to right now is goldfield.
I think previously there was a plan to develop who will field sooner rather than later, but we think that there is an opportunity for a higher return projects. You are taking more time on exploration I'm looking at a different potential flow sheet.
In the case of <unk> as another potential example, there is the the resource in the ground there, but we also acknowledge we have a strategic location in that part of British Columbia, and perhaps that lends itself to opportunities.
And of course molybdenum is the biggest one where we think that theres a lot of unrealized potential and the molybdenum business. We have to walk that forward carefully given that we are sentara gold, but we do believe that there is value to be realized in the molybdenum business and we will be advancing the thinking on restarting Thompson Creek.
And we'll be providing more detail on the third quarter on that I've tried to touch on all your questions I've been somewhat general, but if you want a little more specific on any of them, let me know.
No I think Thats helpful and then just.
Immediately speaking outside from the.
The potential restart of Thompson Creek are you planning to update us with.
That overall strategic plan or is it going to continue to be more tactical at each of the assets until you can execute on some of these.
Higher level. Thanks.
Yes, I think that in the third quarter, we will probably.
We will paint a broader picture on strategy, meaning what do we want to be where do we see value where our strengths. How do we look at capital allocation, but of course, the main components of that will be tactical plans at each of the assets principally like I said, molybdenum and goldfield and to a lesser extent the other ones, but it will be.
A more overarching view on what we want to be as we look forward 234 years.
That's helpful. Thank you Paul.
Thank you.
Our next question comes from obese Habib of Scotiabank. Please go ahead.
Okay.
Hi, Paul and team just a couple of questions have already been answered. So just two questions from me.
Starting off with the Goldfields.
In regards to the resource estimate or.
Update I'm guessing youre seeing a lot more potential to add additional amortization and that's why you've kind of increased exploration budget.
Can you kind of just walk us through where you will see upside and you talked a little bit about the foreshadows, perhaps maybe a little bit color there as well.
Yes, thanks for that.
Just a quick highlight on what goldfield is it's principally two deposits there are other smaller ones, but it's principally got two deposits one which is.
The sulfide potential sulfide resource and the other one is a potential oxide resource.
At this stage, we don't think that the sulfide resource is of sufficient scale to pursue and that has the <unk>.
The beneficial corollary of greatly simplifying the flow sheet, so rather than requiring a much finer grind to achieve the recoveries, we're going to look at whether we can tackle the oxide material through a run of mine ore a simplified our crushing circuit that would greatly greatly simplified the flow sheet reduce the.
Capital and target higher returns to your question are we seeing exploration potential. The answer is yes. As you can see we've ramped up our spending are our planned spending in exploration and we are focused on oxide targets. So we are delaying what we had previously communicated the timing for a resource estimate, but that's principally associated.
<unk> with our shift in strategy to focus on oxide and transitional material.
That will be associated with a much leaner capital profile.
So what we're going to be doing in the near term is more focused metallurgical test work on oxides, only our and transition material and specifically targeting oxide material.
To add to the potential resource.
Okay. Thanks, Thanks for the color on that.
Just switching gears to the <unk>.
<unk> business I think Dalton touched upon it a little bit with you as well.
The study in progress expected in Q3 are you kind of how are you.
Leaning more towards selling the multi business.
How should we look at the restart of bumps and Creek mines.
Yes.
That's a great question and it will underpin the way we talk about this in the coming quarters, but let me give you a high level view on it.
Right now the fundamentals for molybdenum are very strong the market is very constructive both on the supply and the demand side.
Part of what's.
Driving strong demand in molybdenum is in part energy transition our molybdenum is used for stainless steel production and its applications are significant in things like offshore wind the retooling of Europe .
Gas infrastructure, but also things like hydrogen.
It has very strong properties in alloy steel for corrosion resistance and hydrogen applications. So that's a note on what we believe to be very strong fundamentals in the market and we're confident in those fundamentals to be advancing this.
Our.
Our principal initial phase of work on molybdenum is to demonstrate value to show the market short of shareholders and other participants that there is significant value in this business.
And Thats, what we intend to do as a first phase of activity is to demonstrate value there will be some early work spending as we advance.
This project over the coming months and quarters, but that will be relatively modest.
In advance of what would be a more.
A bigger notice to proceed on the asset.
Are we open to <unk>.
M&A on this front the answer is yes, I mean, we always have to look at what surfaces. The greatest amount of value for our shareholders, but a first step.
Prior to that is demonstration of value.
And a.
And a well articulated and thoughtful strategy and execution plan for that and molybdenum business.
Okay.
Thanks for the color of ball and that's it for me. Thanks for taking my questions. Thank you.
Our next question comes from Michael <unk> of RBC capital markets. Please go ahead.
Yes, thanks, very much flipping back to <unk>, if we could for a second I know you've provided some measures of cash costs already incurred to produce the ounces in inventory and the remaining.
Cash operating costs, but is there a reconciliation that you can provide to the forward ASIC guidance that reflects the actual cash outflow associated with the gold you expect to produce over the balance of the year.
Yes.
So yes.
We can't provide that.
Referred to what it's going to cost from a cash perspective on processing, the golden carbon which will be under $50 an ounce.
Cash cost.
And similarly for the.
The code on the heap Leach stockpiles ranging between 100 to 250. So we've historically guided that what was on the heap and what was on stockpile of approximately $100 an ounce each saw it. So so that's the ballpark that you need more color more details. We can we can keep the Av block well.
Yeah, I mean, I guess I'm asking.
At a high level, even if you don't want to provide the number it's fair to say that if your <unk> guidance for Oxford over the rest of our over 2023 is $650 to 700, only a subset of that will actually be incurred and cost whether that's $505 50, whatever the number is that the right way to look at it.
Correct.
Right.
We historically also.
France.
100000 ounces that was on our <unk> was a.
Recorded all in sustaining.
Approximately between 42 to 500, so that was what was already incurred but putting on our balance sheet.
Alright.
Okay. Okay. Thank you and then maybe on the sequencing into 2024 as you work through the inventory can you give some some high level guidance on how long we should be expecting elevated levels of production beyond the inventory answers you currently have out of the pit.
As you, presumably continue to mine and stack new ounces is there some idea of when the volume starts to slow down as you catch up with that backlog.
Yes, we expect to have elevated levels well into the first half and then as we move towards the midpoint of next year it'll start to transition into normal state.
So youre expecting normal state in the second half or is that a transition down to more that'll be that'll be a transition down okay, starting approximately mid year.
Great. So then I guess safe to assume you would reach normal state by 2025 is that the way to think about it yes, I would say that's a reasonable.
A reasonable estimate.
Okay.
And then last one maybe maybe for.
Maybe on strategy.
Realizing youre doing this portfolio review looking forward to that but can you talk in particular about how you view the buyback as a use of cash and maybe how aggressive you think youll be over the rest of the year and what your thinking is around that.
Well, we certainly believe that buying our shares is a good value and has been over the last couple of months and shareholder returns whether through dividends or buybacks remains a cornerstone of our capital allocation framework.
Darren you can provide some more detail on what we've been doing.
So firstly just on the I mean as being.
Ah returned or repurchased to date, our board continues to support the program.
As recent as yesterday, we had the board meeting where we continue.
Continue to be active in July so.
I don't see it.
In the short term.
Can you maybe talk is there a is there a trigger youre looking at as to when you'd be active is it a function of.
You are now versus the share price or anything along those lines.
We're not going to put a number out there, but we see good value in our shares.
Okay.
Thanks very much.
Thank you.
Our next question comes from Anita Soni of CIBC World markets. Please go ahead.
Hi, just to follow up with Mikes question, there about oxy.
So I guess when we're talking about elevated levels basically the Q4 run rate is kind of what we should be thinking about going into Q1 and Q2 of next year.
Sorry could taper down.
Yes, that's a reasonable estimate I mean, we will issue our guidance.
And outlined what we expect to do for production because some of that depending on how much success, we have now and how much of the inventory we can run through and we're still wrapping up right now, but I think a reasonable estimate is elevated levels through the mid year. It will start to taper down and then by 2025 it will be normal state.
No no.
We're not operating right now I think one of the forgotten, one, which I guess I don't forget about because I actually covered murky, but 20 years ago now.
And given all the activity up in that region could you talk about how youre thinking about that data.
Yes, thanks Neil.
It's a very prospective region of BC there are a lot of it.
Deposits that are in that area, including ours at this stage were not advancing our chems project, but we are looking at opportunities, which might leverage our infrastructure, we have an asset up there and the asset is as much in the ground as it is in the property plant and equipment the access to power in the water and we're looking at.
Whether they are creative opportunities for.
Some sort of value realization fine. It's early stage right now, but conceptually you can use your imagination, there might be some interesting ideas there, but we're early in the game on that.
Would you consider opening it up from there.
Meanwhile, I can out right now.
Anything is on the table.
Any of those could be options.
Okay I'll leave it there thank you.
Thanks.
Once again, if you have a question. Please press Star then one.
Our next question comes from Mike Parkin of National Bank. Please go ahead.
Hey, guys. Thanks for taking my questions a couple of follow ups.
With Oct.
Stacking all on the same pad are high there.
At any point over the course of the next year will be transitioning to a new pad.
We're stacking on a new pad right now and then as as time moves on we will be going onto new pads, we have.
Approximately 50 meters and it goes down a hill so as.
As we start to fill up that space, we stack on new pads.
Okay.
This supports the stronger production to kind of.
Elevated.
And Alex with the Newpage.
I would say similar leach kinetics as before on a new pad and then what we're doing is we have an elevated.
Great on the Pls right now we're processing the loaded carbon and then once we have completed that it'll be the elevated pls and then slowly taper down into a normal state.
That's great and that'll be on the existing pads and we're stacking on new pads now.
Yes.
We heard from one of your peers in Turkey about significant rain.
Specifically impacted upon concentration that their key fleets do you have a similar.
Impacts at Oxford, or the dose range kind of misuse and cancer. Given maybe you are not close to where the rains came through.
We did have an elevated wet spring.
The Pls grade wasn't impacted.
Materially, but what we were concerned about for a period of time was that we would start to run out upon space.
We certainly had plenty of mitigation, but at some point that could have been an impact, but it's starting to dry up in our overall water inventory on site is declining.
And we're going to be creating additional pond space going forward as is normal course.
Okay.
With respect to your cost assumptions can you just give us an idea and I may have missed it in the release, but whats your assumption for the Turkish lira for the second half.
Can you help me there.
Yes.
And just shifting over 28 right now.
Yes.
28.
I think it's something around 28, where you can get back to you, yes, we'll have to get back to you on that okay.
Okay.
And then switching gears over to Goldfields.
Can you just give me.
A recap on how big the land packages, there and with respect to exploring more oxides, where are you in that kind of.
Is it.
You have good target again to buy and it's just mobilization of rigs or your.
We're needing to do more earlier stage.
Studies to identify those targets.
I can't tell you exactly how big the mine packages, but I can tell you. It's big in other words there are enough there are enough targets on our land packages to justify elevated spending I'll just reiterate what I said to invasive question is that we're going to focus on oxides here. It's just a leaner capex flow sheet higher returns and on the land package. We do have a number of oxide targets that we have.
Our currently drilling and where we are encountering gold. So the strategy is I'll, just reiterate focus on oxide material, only which lends itself to a much lower capex much more simple simplified flow sheet and we do see targets on that mine package.
And so we have a combination of both established targets ones that we are drilling as well as targets that are earlier stage based on surface expressions of Geo Chem, which are going to work through the system as the months go by the main reason to delay.
Resource estimate is two fold we're.
We're not going to focus on the sulfide and to allow more time for oxides to come into that estimate so that we can come up with a.
Hey, tighter scope of potential works.
And Mike just going back to your earlier question we're using.
One USW 20, Turkish lira, so or be conservative Enel and albums.
Sorry, I didn't catch that.
So for the Turkish Lira exchange rate reviews for our going forward guidance. It's one U S. Dollar 20, Turkish lira, so we're being a bit conservative.
Okay.
Alright, that's.
That's it for me. Thank you. Thanks.
Thanks, Mike.
This concludes the question and answer session as well as today's conference call. You may disconnect. Your lines. Thank you for participating and have a pleasant day.
Okay.
Yes.
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Yes.
Yeah.
Yes.