Q3 2023 Alamos Gold Inc Earnings Call
[music].
Speaker 1: transcript
Speaker 1: This conference is being recorded. This conference is being recorded. All participants, please stand by. Your conference is ready to begin. Good morning. I will now turn the call over to Scott Sparsons, Alamo Senior Vice President of Investor Relations. Please go ahead.
This conference is being recorded.
Of course, the homes that don't have as you see.
All participants please standby your conference is ready to begin.
Good morning, I will now turn the call over to Scott Parsons, Although most senior Vice President of Investor Relations. Please go ahead.
Speaker 2: transcript
Speaker 2: Thank you, operator, and thanks to everybody for attending the Alamos's third quarter, 2023 conference call. In addition to myself, we have on the line today, John McCluskey, President and Chief Executive Officer, Greg Fisher, Chief Financial Officer, Luke Gimond, Chief Operating Officer, and Scott R.G. Parsons, Vice President and the next break.
Thank you operator, and thanks to everybody for attending almost as third quarter 2023 conference call.
In addition to myself, we have on the line today, John Mccluskey, President and Chief Executive Officer, Craig Fischer, Chief Financial Officer, Luke Chemo.
<unk> operating officer, and Scott RG, Parsons, Vice President of exploration.
Speaker 2: transcript
Speaker 2: We will be referring to a presentation during the conference call that is available through the webcast and on our website. I would also like to remind everyone that our presentation will be followed by a Q&A session.
We will be referring to a presentation. During the conference call that is available through the webcast and on our website.
I would also like to remind everyone that our presentation will be followed by a Q&A session.
Speaker 2: transcript
Speaker 2: As we will be making forward looking statements during the call, please refer to our cautionary notes included in the presentation, news release, and MDNA, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Boswick, our senior vice president, technical services, and a qualified person.
So we'll be making forward looking statements during the call. Please refer to our cautionary notes included in the presentation news release and MD&A as well as the risk factors set out in our annual information form.
Technical information in this presentation has been reviewed and approved by Chris Bostwick, Our senior Vice President Technical services and a qualified person.
Speaker 2: transcript
Speaker 2: Also, please bear in mind that all of the dollar amounts mentioned in this conference call are in US dollars unless otherwise noted. Now, John will provide you with an overview.
Also please bear in mind that all the dollar amounts mentioned in this conference call are in U S dollars unless otherwise noted now John will provide you with an overview.
Thank you Scott.
Yes.
Starting with slide three.
Speaker 3: transcript
Speaker 3: We delivered another strong quarter with production of 135,400 ounces, exceeding quarterly guidance at cost near the low end of annual guidance.
We delivered another strong quarter with production of 134.
35400 ounces exceeding quarterly guidance.
Cost near the low end of annual guidance.
Speaker 3: transcript
Speaker 3: is reflected a solid quarter from island gold and another excellent quarter from Miyaki Grande.
This reflected a solid quarter from island gold and another excellent quarter for Lee Aki Grande.
Speaker 3: transcript
Speaker 3: With year-to-day production of 400,000 ounces, we are on pace to achieve a new annual record driven by an outstanding year from the Milados District.
With year to date production of 400000 ounces, we are on pace to achieve a new annual record driven by an outstanding gear from them allowed Us district.
Speaker 3: transcript
Speaker 3: Given the strong performance, we are increasing our production guidance by 5% to a new range of 515,000 to 530.
Given the strong performance, we are increasing our production guidance by 5% to a new range of 515000 530000 ounces.
Speaker 3: transcript
Speaker 3: We are also on track to achieve our cost guidance for the year, with total cash costs and all in sustaining costs both below the midpoint of guidance here today.
We're also on track to achieve our cost guidance for the year with total cash costs and all in sustaining costs well below the midpoint of guidance year to date.
It was also a solid quarter financially.
Speaker 3: transcript
Speaker 3: putting us on pace for a record year across a number of metrics, including revenue and cash flow from operations.
Putting us on pace for a record year across a number of metrics, including revenue and cash flow from operations.
Speaker 3: transcript
This is giving us the capacity to both grow as a company and generate solid free cash flow, including 37 million in the quarter at $109 million year to date.
I'm looking at slide four.
Speaker 3: transcript
Speaker 3: We continue to create value from within our growth projects. In August , we released an updated feasibility study on the Lynn Lake project with a 44% increase in reserves, supporting a larger, longer life low cost operation with the tract of ECONOM.
We continued to create value from within our growth projects in August we released an updated feasibility study on the Lynn Lake project with a 44% increase in reserves supporting a larger longer my longer life low cost operation with attractive economics.
Speaker 3: transcript
Speaker 3: As part of our balanced approach to growth, our current focus is on the phase 3-plus expansion at Island Gold. But Lind Lake remains a key part of our longer-term growth plans as another long-life low-cost project in Canada with significant exploration upside, which we expect will further enhance the economics of the project.
As part of our balanced approach to growth. Our current focus is on the phase III plus expansion at island gold, but literally remains a key part of our longer term growth plans. That's another long life low cost project in Canada with significant exploration upside, which we expect will further enhance the economics of the project.
Speaker 3: transcript
Speaker 3: In September , we provided another exploration update from a lot of us where we continue to extend high-grade mentalization at PDA.
In September we provided another exploration update from <unk>, where we continue to extend high grade mineralization at P. D. A.
Speaker 3: transcript
Speaker 3: We expect this exploration success will drive a further increase in higher grade reserves and resources as the deposit, at the deposit, beyond the million ounces to find at the end of last year.
Expect this exploration success will drive a further increase in higher grade reserves and resources as the deposits.
That's a pause it beyond the 1 million ounces defined at the end of last year.
Speaker 3: transcript
Speaker 3: This growth is being incorporated into a development plan to be completed later this year.
This growth is being incorporated into a development plan to be completed later this year.
Speaker 3: transcript
Speaker 3: which we expect will outline another attractive project and significant mind-life extension of the latter.
Which we expect will outline another attractive project and significant mine life extension of a lot of us.
Speaker 3: transcript
Speaker 3: Construction of a Phase 3 expansion at Island Gold is advancing well with the headframes substantially complete and shafts thinking on track to start by year end.
Construction of the phase III expansion at island gold is advancing well with the head frame is substantially complete and shafts sinking on track to start by year end the.
Speaker 3: transcript
Speaker 3: The project remains on schedule and on budget, and we expect to be operating from the shaft an expanded mill in the first quarter of 2026.
The project remains on schedule and on budget and we expect to be operating from the shaft and expanded mill in the first quarter of 2026.
Speaker 3: transcript
Speaker 3: These projects are key drivers of our strong outlook, supporting growing production, declining costs, and increased profitability.
These projects are key drivers of our strong outlook supporting growing production.
Mining costs and increased profitability.
Speaker 3: transcript
Speaker 3: I'll now turn the call over to our CFO Greg Fisher to review our financial performance. Great.
I'll now turn the call over to our CFO, Greg Fisher to review our financial performance correct.
Speaker 4: transcript
Speaker 4: Thank you, John . On slide five, during the third quarter, we sold 133,000 ounces gold, and an average realized price of $1,932 per ounce, $4 above the London PM fix for revenues of $256 million.
Thank you John on slide five during the third quarter, we sold 133000 ounces of gold at an average realized price of $1932 per ounce $4 above the London PM fix for revenues of $256 million.
Speaker 4: transcript
Speaker 4: Total cash cost of $835 per ounce and all in sustaining costs of $1,121 per ounce for both towards the low end of full year guidance. We are on track once again and she's
Total cash cost of $835 per ounce and all in sustaining costs of $1121 per ounce were both towards the low end of full year guidance.
We are on track to once again achieve full year cost guidance.
Our reported net earnings of 39 million in the third quarter or 10 cents per share included unrealized foreign exchange losses of $12 million recorded within deferred taxes, and other noncash losses of $3 million.
Speaker 4: transcript
Speaker 4: Our reported net earnings of 39 million in the third quarter, or 10 cents per share, including unrealized foreign exchange losses of 12 million recorded within deferred taxes, and other non-catch losses of 3 million.
Excluding these items, our adjusted net earnings were 55 million or <unk> 14 per share.
Speaker 4: transcript
Speaker 4: Excluding these items, our adjusted net earnings were 55 million or 14 cents per share.
Speaker 4: transcript
Speaker 4: Operating cashflow before changes in non-cash working capital was $133 million or $34 cents per share.
Operating cash flow before changes in noncash working capital was 133 million or 34 cents per share.
Speaker 4: transcript
Speaker 4: Given our stolen production growth and margin expansion this year, we're on pace for a record year in terms of revenue, earnings, and capital from operations.
Given our solid production growth and margin expansion. This year, we're on pace for a record year in terms of revenue earnings and cash flow from operations.
Speaker 4: transcript
Speaker 4: This is driving strong free cash flow generation at a time that we are also investing in growth.
This is driving strong free cash flow generation at the time that we're also investing growth.
Speaker 4: transcript
Speaker 4: This includes 37 million of free cash in the quarter and 109 million year to date.
This includes 37 million of free cash flow in the quarter and 109 billion year to date.
Speaker 4: transcript
Speaker 4: We expect the strong free-castle generation to continue while funding the Phase 3 Plus expand.
We expect the strong free cash flow generation to continue while funding the phase III plus expansion.
Capital spending totaled $75 million in the quarter and included 27 million of sustaining capital $42 million of growth capital and $6 million of capitalized exploration through.
Speaker 4: transcript
Speaker 4: Capital spending totaled 75 million in the quarter and included 27 million of sustaining capital, 42 million of gross capital, and 6 million of capitalized exploration.
Speaker 4: transcript
Speaker 4: Through the first nine months of the year, capital spending total 239 million consistent with our annual guidance.
Through the first nine months of the year capital spending totaled $239 million consistent with our annual guidance.
Speaker 4: transcript
Speaker 4: We paid cash taxes of 3 million in the quarter at Molotos, with a similar payment anticipated in the fourth quarter. We expect significantly higher cash tax payments in Mexico in 2024, reflecting the strong profitability of Molotos in 2023, with 115 million of free cash will generated from the operation year to-
We paid cash taxes of $3 million in the quarter at <unk> with a similar payment anticipated in the fourth quarter, we expect significantly higher cash tax payments in Mexico in 2024, reflecting the strong profitability of them allowed us in 2023, the 115 million of free cash flow generated from the operation year to date.
Our balance sheet continues to improve with our cash balance growing to 216, million% to 14% increase from the previous quarter and a 66% increase in the start of the year, we remain debt free and well positioned to fund our growth initiatives I will now turn the call over to our C. O O P mall to provide an overview of our operator.
Speaker 4: transcript
Speaker 4: Our balance sheet continues to improve with our cash balance growing to 216 million, a 14% increase in the previous quarter, and a 66% increase in the start of the year. We remain debt-free and well positioned to fund our growth initiative.
Speaker 4: transcript
Speaker 4: I will now turn the call over to our COLO, Luke Kimon, to provide an overview of our operation.
Yeah.
Thank you Greg moving to slide six young Davidson produced 45100 ounces in the quarter consistent with the previous few quarters with record milling rates of 8200 tonnes per day offsetting slightly lower grades.
Speaker 4: transcript
Speaker 4: Thank you, Greg. Moving to slide six, young Davidson produced 45,100 ounces in the quarter. Consistent with previous few quarters, with record milling rates of 8,200 tons per day, offsetting slightly lower degrees.
Speaker 4: transcript
Speaker 4: Costs are in line with annual guidance both in the quarter and your to-deaf.
Costs were in line with annual guidance, both in the quarter and year to date.
Speaker 4: transcript
Speaker 4: Grades are expected to increase in the fourth quarter as you mine higher grade stopes that have been deferred from the third quarter.
Grades are expected to increase in the fourth quarter as mining higher grade stopes that had been deferred from the third quarter.
Speaker 4: transcript
Speaker 4: This is expected to drive production higher in the fourth quarter, putting the operation on track to achieve full-year production and cost guidance.
This is expected to drive production higher in the fourth quarter, putting the operation on track to achieve full year production and cost guidance.
Speaker 4: transcript
Speaker 4: The operation continues to be a consistent performer with mind-side pre-cash flow of 31 million in a quarter and 83 million year-to-date.
The operation continues to be a consistent performer with mine site free cash flow of $31 million in the quarter and 83 million year to date.
Speaker 4: transcript
Speaker 4: For the third consecutive year, young Davidson is on track to deliver more than 100 million in free cash flow.
For the third consecutive year young Davidson is on track to deliver more than 100 million in free cash flow.
Over to slide seven.
Speaker 4: transcript
Speaker 4: Over to slide seven, Island Gold produced 36,400 ounces in the quarter. A 19% increase over the second quarter, reflecting both higher grades and tons process.
Island Gold produced 36400 ounces in the quarter, a 19% increase over the second quarter, reflecting both higher grades and tonnes processed.
Speaker 4: transcript
Speaker 4: It was a strong quarter operation with mining and milling rates, both increasing to exceed annual guidance of 1200 tons per day.
It was a strong quarter operationally with mining and milling rates, both increasing to exceed annual guidance of 200 tonnes per day.
Speaker 4: transcript
Speaker 4: This help guide cost down from the second quarter towards the low end of annual guide.
This helped drive costs down from the second quarter towards the low end of annual guidance.
Speaker 4: transcript
Speaker 4: Given the strong U2D performance, including production of 100,000 ounces, the operation is well positioned to achieve full-year production and cost guide.
Given the strong year to date performance, including production of 100000 ounces. The operation is well positioned to achieve full year production and cost guidance.
Speaker 4: transcript
Speaker 4: Over to slide eight. Work on the Phase Three Plus expansion continues to progress with the focus on completion of the remaining shaft site surface infrastructure.
Over to slide eight.
Work on the Phase III plus expansion continues to progress with a focus on completion of the remaining shop site surface infrastructure.
Construction of the head frame is substantially complete.
Speaker 4: transcript
Speaker 4: construction of the head frame is substantially complete as is construction of the shaft area substrate.
Construction of the shaft area substation.
Speaker 4: transcript
Speaker 4: Pre-commissioning tests on the e-house electrical systems that commence and construction of the warehouse is well underway.
Pre commissioning tests on the Ehealth electrical systems have commenced and.
And construction of the warehouse is well underway.
Speaker 4: transcript
Speaker 4: I was sitting in the gallow way to be used in the shaft sinking is over 50% complete, putting the shaft sink on track to start by your end.
Oh fitting of the gallery to be used in the shaft sinking is over 50% complete putting the shaft sink on track to start by year end.
Over to slide nine.
Speaker 4: transcript
Speaker 4: Total of 35 million of capital related to the Phase 3 POTS expansion and capital development was spent in the quarter.
Total of 35 million of capital related to the phase III plus expansion and capital development was spent in the quarter.
Speaker 4: transcript
Speaker 4: The expansion remains on budget with 45% of the total initial capital of 756 million spent and committed to the end of September .
Expansion remains on budget with 45% of the total initial capital of 756 million spent and committed to the end of September.
Speaker 4: transcript
Speaker 4: With the shaft site, with the shaft site, surface infrastructure nearing completion, spending will shift towards the shaft sinking later this year. And the mill expansion and paste plant into next.
With the shaft site with a shop site surface infrastructure nearing completion.
Spending will shift towards the shaft sinking later this year.
And the mill expansion and paste plant into next year.
Speaker 4: transcript
Speaker 4: The overall expansion remains on track to be completed in 2026.
The overall expansion remains on track to be completed in 2026.
Speaker 4: transcript
Speaker 4: transforming island goal into one of the largest lowest cost and most profitable mines in Canada.
That's forming island gold and its one of the largest lowest cost and most profitable mines in Canada.
Moving to slide 10.
Speaker 4: transcript
Speaker 4: Moving to slide 10, at Milados, production of 53,900 ounces was down from the second quarter as guided.
<unk> production of 53900 ounces was down from the second quarter as guided.
Speaker 4: transcript
Speaker 4: reflecting the return to design mining rates of Leake Grande and end up mining within the main Milados pit.
Reflecting the return to design mining rates of La Yaqui Grande and then the binding within the main mulatto pit.
Well Yaqui Grande continued to outperform with grades exceeding guidance due to a positive grade reconciliation.
Speaker 4: transcript
Speaker 4: Liyaki Grande continued to outperform with grades exceeding guidance due to positive grade reconsolation.
Speaker 4: transcript
Speaker 4: Mindside free cash flow was 31 million in the quarter and an impressive 115 million year to date.
Mine site free cash flow was $31 million in the quarter and an impressive $115 million year to date.
As previously guided production is expected to decrease in the fourth quarter, reflecting the end of a whole lot of pet and a decrease in grades guided to guided levels at La Yaqui Grande.
Speaker 4: transcript
Speaker 4: As previously guided, production is expected to decrease in the fourth quarter, reflecting the end of the ballados pit, and a decrease in grades to guided levels at La Yorkie Grande.
Speaker 4: transcript
Speaker 4: With your today production of 164,700 ounces, Melados is on track to exceed its full-year guidance driven by the strong outperformance from a Yaku-Gran.
With year to date production of 164700 ounces, while all of this is on track to exceed its full year guidance driven by the strong performance from La Yaqui Grande.
Speaker 4: transcript
Speaker 4: Coss are expected to increase in the fourth quarter, but remain with indigidence for the full year.
Costs are expected to increase in the fourth quarter, but remain within guidance for the full year.
Speaker 4: transcript
Speaker 4: Moving to slide 11, as John noted, the updated feasibility study on the little link project has outlined a bigger, longer life, and more attractive operation relative to the 2017 study.
Moving to slide 11, as John noted the updated feasibility study on a little Lake project is outline a bigger longer life and more attractive operation relative to the 2017 study.
Speaker 4: transcript
Speaker 4: The updated study incorporates 44% larger mineral reserve and a 14% larger mill at 8,000 tons per day.
The updated study incorporates a 44% larger mineral reserve and a 14% larger mill at 8000 tonnes per day.
Speaker 4: transcript
Speaker 4: Production over the first 10 years is expected to average 176,000 ounces per year, up 23% from 2017.
Production over the first 10 years is expected to average 176000 ounces per year up 23% from 2017.
Speaker 4: transcript
Speaker 4: At lower all in sustaining costs of $699 per ounce.
At lower all in sustaining costs of $699 per ounce.
Speaker 4: transcript
Speaker 4: Over the last several years, we have completed an extensive amount of additional engineering, geotechnical and other work, including obtaining approval of the environmental impact statement back in March.
Over the last several years, we have completed an extensive amount of additional engineering geotechnical and other work, including obtaining approval of the environmental impact statement back in March.
Speaker 4: transcript
Speaker 4: This work has significantly de-risked the project that provides us with a high degree of confidence in the capital and operating cost-ess.
This work has significantly Derisked. The project provides us with a high degree of confidence in the capital and operating cost estimates.
These estimates support attractive base case economics for the project and at current gold prices represent a 22% after tax internal rate of return.
Speaker 4: transcript
Speaker 4: These estimates support attractive base case economics for the project. In that current gold prices represent a 22 percent after tax internal rate of return.
Speaker 4: transcript
Speaker 4: We also see significant upside potential given several near-mind and regional exploration opportunities that could be incorporated into the project.
We also see significant upside potential given several near mine and regional exploration opportunities that could be incorporated into the project.
Under the current mine plan, the Mcallen and Gordon deposits will be mined over the first 11 years for.
Speaker 4: transcript
Speaker 4: Under the current mine plan, the McCollod and Gordon deposits will be mined over the first 11 years.
Speaker 4: transcript
Speaker 4: For the remaining six years, we will be processing lower grade stockpile.
For the remaining six years, we will be processing lower grade stockpiles.
With our fleet of mining equipment available from Yours 11 onward, we are evaluating several nearby targets such as birth timber and liquid as additional sources of mill feed.
Speaker 4: transcript
Speaker 4: With our fleet of mining equipment available from years 11 onward, we are evaluating several nearby targets, such as Burnt Timber and Linkwood, as additional sources of milk.
Speaker 4: transcript
Speaker 4: He is the positive representative upside to the feasibility study, as they would help sustain higher rates of production well beyond the first ten years.
These deposits represent upside to the feasibility study is they would help sustain higher rates of production well beyond the first 10 years.
Speaker 4: transcript
Speaker 4: To review that upside in more detail, I will turn the call over to our VP of expiration, Scott RGPERS.
To review that upside in more detail I will turn the call over to our VP of exploration Scott RG Parsons.
Speaker 5: transcript
Speaker 5: Thank you. Over to slide 12. You know, if we provided an expiration update of Lim Lake highlighting this significant outside potential across a number of near-mind and regional targets.
Luke over to slide 12.
August we provided an exploration update at Lynn Lake highlighting the significant upside potential across a number of near mine and regional targets.
Speaker 5: transcript
Speaker 5: This includes burnt timber and linkwood, two deposits and brocks and meter of the plant milled McQuellen that could potentially be incorporated into the mine plan.
It includes Berg Timberland Lakewood two deposits in proximity to the planned mill at Mcclelland that could potentially be incorporated into the mine plan.
Speaker 5: transcript
Speaker 5: They're located approximately 28 kilometers away from McLelland site and are connected by an all, they're by existing all season road.
They're located approximately 28 kilometers away from Maclellan site interconnected by at all by existing all season Road.
Speaker 5: transcript
Speaker 5: The two deposits contain 1.6 million ounces of inferred resources that were not factored into the feasibility study.
The two deposits because they had one 6 million ounces of inferred resources that were not factored into the feasibility study.
Updated geological models have been completed on both deposits demonstrating the potential for a smaller higher quality of mineral resource.
Speaker 5: transcript
Speaker 5: Update the geological models of the MNCF in both deposits, demonstrating the potential for a smaller, higher quality, mineral resource.
Speaker 5: transcript
Speaker 5: We see excellent potential to truck this to McClellan Million structure after the McClellan deposit has been mined.
We see excellent potential the truck this though mcclellan bill infrastructure after the Mcallen deposit has been mined.
Speaker 5: transcript
Speaker 5: This would not only help sustain higher rates of production well beyond the first 10 years, but also in my life and enhance the project economic.
This would not only helps sustain higher rates of production well beyond the first 10 years, but also extend the mine life and enhance the project economics.
Speaker 5: transcript
Speaker 5: Main earth is a similar staged target with similar potential as another satellite deposit located 20 km by roads from the planned mill.
It is a similar stage target with similar potential is another satellite deposit located 20 kilometers by road from the planned mill.
All 15 holes and automated to date have intersected gold mineralization over 700 meter strike length.
Speaker 5: transcript
Speaker 5: All 15 holes in the main air to date have intersected gold mineralization over 700 meters dry quank and to depth of 280 meters. This includes higher grader intercepts that just 5.9 grams per ton over 12 meters.
The 280 meters. This.
This includes higher grade intercepts, there just five nine grams per tonne over 12 meters.
Speaker 5: transcript
Speaker 5: These are just a few examples of the potential that we see across the Linley Greenstone Dulles, a large, under-explored district.
These are just a few examples of the potential that we see across the Lynn Lake Greenstone belt, a large under explored district.
Speaker 5: transcript
Speaker 5: We'll be starting with a 17-year reserve life based on the updated study. However, given the opportunities we see across our 58,000 Hector land package, we fully expect the mining in the district will be on that.
He will be starting with a 17 year reserve life based on the updated study however, given the opportunities we see across our 58000 hectare land package, we fully expect to be mining in the district well beyond that.
Over to slide 13.
Speaker 5: transcript
Speaker 5: In September , we announced a second expiration that's updated this year in Molatos, where we continue to have success, both regionally and in your mind.
In September we announced a second exploration update this your them a lot of us where we continued to have success, both regionally and in your mind.
P. A step out drilling has further extended high grade mineralization beyond reserves and resources, which will support additional growth beyond the currently defined 1 million ounces.
Speaker 5: transcript
Speaker 5: The PDA, step out drilling is further extended high grade mineralization beyond reserves and resources, which will support additional growth beyond the currently defined 1 million hours.
We are currently working on an updated reserve based on drilling to the end of July there'll be incorporating that into an updated development plan to be completed towards the end of the year.
Speaker 5: transcript
Speaker 5: We are currently working in an updated reserve based on drilling to Venda to Y. You know, be incorporating that in an updated development plan to be completed towards the end of the year.
Speaker 5: transcript
Speaker 5: We thank as well, one another significant mind-life extension of a lot of
We expect this will outline another significant mine life extension them a lot of.
Speaker 5: transcript
Speaker 5: It's not a success of the program today. We've increased our expiration budget and models for the second time this year to $25 million.
Based on the success of the program to date, we've increased our exploration budget of models for the second time this year to $25 million.
Speaker 5: transcript
Speaker 5: This includes drilling a pd8 to the rest of this year with 50,000 meters planned up from the original budget of 15,000 meters.
This includes drilling a PDA through the rest of this year with 50000 meters planned up from the original budget of 16000 meters.
We are still in the early stages of testing with potential within our broader PTA area.
Speaker 5: transcript
Speaker 5: We were still in the early stages of testing the potential within the broader PDA area.
Speaker 5: transcript
Speaker 5: We need some success to date, and with the deposit open in multiple directions, we see excellent potential for PD-A to continue to grow in the years ahead.
Based on success to date and with the deposit open in multiple directions, we see excellent potential for PTA to continue to grow in the years ahead.
Speaker 5: transcript
Speaker 5: We also released additional results from the Kaplan Regional Target Target, located four kilometers east of the modest pit.
We also released additional results from the Caf one regional target target located four kilometers east of the modest pet.
Speaker 5: transcript
Speaker 5: Devo Jolene continues to intersect wide intervals with significant oxide and solid-fied mineralization within a breccia along the Kaplan's pole.
Drilling continues to intersect wide intervals of significant oxide and sulfide mineralization within a breccia along the Kaplin fault.
Speaker 5: transcript
Speaker 5: This included 2.7 grams per tonne over 120-meter core length, the best hole drilled to data capelin, highlighting the significant potential in the area and within the broader model's districts. With that, I'll send a call back to John .
Included two seven grams per tonne over 121 meter correlate the best hole drilled the data Kaplan.
Writing a significant potential in this area and within the broader models district.
With that I'll turn the call back to John.
Thank you Scott.
So that concludes the formal presentation.
Speaker 3: transcript
Speaker 3: I'm now asked the operator to open the call sprayer, to open the line spray question.
I'll now ask the operator to open the call spirit to open the lines for your questions.
Speaker 1: transcript
Speaker 1: Thank you. We will now take questions on the telephone line.
Thank you we will now take questions from the telephone lines.
Speaker 1: transcript
Speaker 1: If you have a question and you're using a speaker phone, please lift your hands up before making your selection. If you have a question, please press star one on your device's keypad. You may cancel your question at any time by pressing star two.
You have a question and you're using a speaker phone. Please lift your handset before making your selection.
If you have a question. Please press star one on your devices Keypad you may cancel your question at any time by pressing star two.
Speaker 1: transcript
Speaker 1: Please press star one at this time if you have a question. There will be a brief pause for the participants for just a few questions. Thank you for your patience.
Press Star one at this time, if you have a question there will be a brief pause while the participants make just two quick questions. Thank you for your patience.
Okay.
Speaker 1: transcript
Speaker 1: Our first question is, Ram Cosmos, true? Please go ahead. Her line is open.
Our first question is from Cosmos Xu. Please go ahead.
Line is open.
Speaker 6: transcript
Speaker 6: Thank you, John . Great. Duke, Scott, Scott. Congrats on a very strong Q3 and good to see you, Dai. You're way much of an English.
Thank you John Greg.
Look Scott Scott.
Congrats on a very strong Q3, and it's good to see.
Sure.
Production about costs.
Speaker 6: transcript
Speaker 6: Maybe first off in Mexico. As you mentioned, you know, the Yaki Grande has done really well on your to date, positive, great reconciliation.
Maybe first off in Mexico.
As you mentioned you know yeah like Yaqui Grande has done really well year to date are positive grade reconciliation.
Speaker 6: transcript
Speaker 6: But at the same time you say, you know, that's the grade where likely you know trend back to more normal levels. So I just want to know, you know, what happened to you? Why were you able to have the positive grade of consolidation? Is there potential for it to to continue?
But at the same time, you say you know that's a great trend back.
To more normal levels.
No you know what happened there why would you able to have been positive grade reconciliation.
Potential for it to.
Continued.
Alright, Hi, Cosmos look here.
Speaker 4: transcript
Speaker 4: Yeah, our expectation is that we will be more in line with our grades as we move forward. We won't necessarily see that over performance. What's really happening is we get deeper into the benches of Voyakar Gandhi. The drill density gets tighter, so we expect to see more consistent performance actual versus our model moving forward.
Yeah, our expectation is that we will will be more in line with our grades.
As we move forward, we won't necessarily see that over performance whats really happening as we get deeper into the benches of La Yaqui Grande.
The drill density gets tighter so we expect to see more consistent performance.
Performance, our actual versus R.
Our model moving forward.
Understood.
Speaker 6: transcript
Speaker 6: And then maybe signal as Mexico, you know, quite a bit of noise these days and the country in Mexico, either the security issues for some of your peers or the ongoing potential changes to mining law. Could you maybe talk about, is there any potential impact or has there been any potential impact to Adam?
And then maybe sticking with Mexico.
Quite a bit of noise. These days and the country of Mexico, either the security issues or some of your peers or you know the.
Ongoing potential changes to the mining law could you maybe talk about is there any potential impact to or has there been any potential impact of animals.
Speaker 3: transcript
Speaker 3: I cause most John . I would say that you can never rule anything out, just given it could happen in Canada. I think everybody recalls we had a big gold heist at our airport here at Pearson. So I don't think you could ever rule anything out from that point of view. But I would say that.
Hi, Cosmos, John and John I would say that.
Never rule anything out just given you know it could happening in Canada, I think everybody or call.
We had a big old hoist at our airport here in person. So I don't think you could ever real rule anything out from that point of view, but I would say that.
Speaker 3: transcript
Speaker 3: You know, we've been operating in Maloutos for a long, long time. We've significantly increased the security over the last five years. And on top of that, the Mexican government has stepped up security in the region quite significantly. There's a lot of mining operations in this part of Mexico, and I would say the Mexican government.
Been operating and allowed us for a long long time.
We've we significantly increased our security over the last five years and on top of that the the Mexican government has stepped up security in the region quite significantly there. There's a lot of of mining operations in this part of Mexico, and and I would say the Mexican government carries a great deal about that.
Speaker 3: transcript
Speaker 3: cares a great deal about that. So I don't see anything...
So I don't see I don't see anything in.
Speaker 3: transcript
Speaker 3: particularly unusual about where we're operating. I think it's...
Particularly unusual about about where we're operating I think it's.
Speaker 3: transcript
Speaker 3: It's as secure as it's ever been. We've been operating there for, but we've been there 22 years now. We've been in production for 19 of those years and we've only ever had one real incident.
It's.
It is secure as it's ever been and we've we've we've been operating there for but we've been there 22 years now we've been in production for 19 of those years and.
We've only ever had one really incident.
Speaker 3: transcript
Speaker 3: So I would say looking forward we're pretty confident that our site can continue to operate without any...
So I would say looking forward, where we're pretty confident that are there.
That our site continue to can continue.
Continued to operate without.
Any unusual impacts.
Speaker 6: transcript
Speaker 6: Sounds good. Maybe switching gears a little bit to the island gold. It sounds like the space repel expansion is going well. Sounds like other surface infrastructures, almost complete. Now comes the shaft sinking. Sounds like the space repel expansion is going well.
Okay sounds good.
Maybe switching gears, a little bit of island gold.
It sounds like.
Phase III expansion is going well it sounds like all the surface infrastructure is almost complete now.
Shops as.
As we moved into shops.
Speaker 6: transcript
Speaker 6: Maybe could you talk about some of the key deliverables, even key risk in terms of what the next sort of...
You know maybe could you talk about some of the key deliverable, even Q risk in terms of you know what the next sort of.
Hum stage of the project entails clearly, it's all your personal audio John Sunday shops thinking.
Speaker 6: transcript
Speaker 6: stage of the project entails. Clearly it's all your personal deal. John , you know, you've done the shop sink and bring it down to the end of the past. Does that help? I guess that was raised more and this is a bit different, but does that help? You know, can you talk about what we should expect with the next stage of shop sinking that's the stance in some of the key factors.
So in the past does that help I guess that would raise boring because it's a bit different but you know does that help you know can you talk about what we should expect over the next stage of our shops.
The expansion or some other factor.
Speaker 4: transcript
Speaker 4: Yeah, Cosmo Luke here. So we're in the final stages of actually getting, you know, the
Yes, Cosmo look here. So we're in the final stages of actually getting the.
Speaker 4: transcript
Speaker 4: the requirements for gearing up of the shop to be able to start the thinking. Our expectations that we will start that to near the end of Q4 and get in the shop on a consistent basis, obviously. And...
The requirements for a gearing up of the shop to be able to start the syncing. Our expectation is that we will start that too.
The end of Q4 and get into shop on a consistent basis, obviously in.
Speaker 4: transcript
Speaker 4: and continue with the benching aspect. I mean, we're using a reputable contractor, Red Pass mining have done shafts all over the world. Certainly in Canada, but all over the world. So we're not obviously concerned with them being able to deliver on what their expectations are. Once they get the setup completed and they get the cycle going, our expectation is that we would be sinking at about three meters per day.
Continue with debenture aspect I mean, we're using a reputable contractor redpath mining have done shops, all over the world are certainly in Canada, but all over the world. So you know, we're not obviously concerned with them being able to deliver on what their expectations are.
Once they get the.
The setup completed and they get the cycle going over our expectation is that we would be thinking at about three meters per day.
Speaker 4: transcript
Speaker 4: over the next couple of years until the the shaft is completed late 2025.
Over the next couple of years until the shaft was completed late 2025.
Great and then maybe one last question Greg.
Speaker 6: transcript
Speaker 6: And then maybe one last question, great as you mentioned.
Greg as you mentioned.
Speaker 6: transcript
Speaker 6: very profitable in Mexico this year, which also means a larger tax bill next year. Could you remind me when does that large payment come out? When would it come out? And how can we potentially estimate what that...
Profitable in Mexico. This year, which also means a bug attached to build next year could you remind me when does that come.
When would it come out.
You know, how how can we potentially asking me what that payment.
Yeah Cosmos, it's Greg here, so yeah. The yearend tax filing is due in March so the.
Speaker 7: transcript
Speaker 7: Yeah, cause I was a bit straight here. So yeah, the, um, your intact filing is doing in March. So the,
Speaker 7: transcript
Speaker 7: Payments for the 2023 tax bill would be due in the first quarter of 2024, and that would relate to both income taxes and mining taxes. We have paid about 3 million this year. We're going to have in the third quarter and about 3 million in the fourth quarter, but given our profitability, there will be a pretty significant catch up when we file that final tax bill in March of 2024.
Payments to for the 2023 tax Bill would be due in the first quarter of 2024 and that would relate to both income taxes in mining taxes, we have.
Paid about $3 million. This year, we're gonna start in the third quarter and about $3 million in the fourth quarter, but given our profitability, though there will be a pretty significant catch up when we filed our final taxable in the March of 'twenty 'twenty four.
Speaker 6: transcript
Speaker 6: Great. Thank you. Those are all the questions I have. Congrats again on a very strong Q3.
Great. Thank you those are all the questions and.
Congrats again on a very strong too.
Okay.
Thank you.
Speaker 1: transcript
Speaker 1: Our next question is from Mark Parking. Please go ahead.
Our next question is from Mike Parkin. Please go ahead.
Thanks, guys and congrats on the great quarter could you just speak to.
Speaker 5: transcript
Speaker 5: Thanks guys, and you can graph something a great quarter.
Speaker 5: transcript
Speaker 5: I speak to the island project. What is the critical path and you know what kind of budgeted in there for it in the enemy kind of flexibility to other added a net shift geared up if it did prove to show any signs of falling behind
The Island project what is the critical path.
You know what kind of budget did in there.
Sure.
And do you have any kind of flexibility to weather.
Whether at a night shift gear it up it did prove to show any signs of falling behind schedule.
Speaker 4: transcript
Speaker 4: I might look here. As I mentioned earlier with the previous question, right now all of our main focus has been around the the shop setup and the shop thinking and preparation for that. And certainly the head frame and everything is well, well advanced and we're in the final stages of preparing to commission for the shop thinking. So our expectation is
Hey, Mike look here as I mentioned earlier with the previous question right now all of our main focus has been around the shop set up on the shaft sinking in preparation for that.
And are you know certainly they had pretty much everything is well well advanced and we're in the final stages of preparing to commission for the shaft sinking so our expectation is.
Speaker 4: Lead Q4 will start that process. As I mentioned, we've got a reputable contractor that's got a lot of...
But late Q4, we will start that process as I mentioned, we've got a reputable contractor Thats you know got a lot of.
Speaker 4: a lot of expertise and skill set to complete that on time and on budget. We fully expect them to be able to do that. The other components that we've been certainly working on, which regards to the Phase 3-Post expansion, is the detail engineering for the mill expansion, as well as the paste plant. So those have been on-going over the course of this year. And we'll start to get into...
A lot of expertise and skill set to complete that on time and on budget.
We fully expect them to be able to do that.
Other components that we've been certainly working on with regards to the phase III plus expansion is the detailed engineering for the mill expansion as well as the baseline. So those have been ongoing over the course of this year and you know we'll start to.
It gets into more serious aspects of the construction into next year and into 2025 with regards to both of those components on the other components that are required for US is obviously an upgrade to our.
Speaker 4: aspects of the construction into next year and into 2025 with regards to both of those components. And the other component that's required for us is obviously an upgrade to our existing power distribution to the site. We will be basically doubling our load from where we are today. And we are certainly currently working on that as well to have a construction timeline to have that all in place as well.
Existing power distribution to the site, we will be basically doubling doubling our load from where we are today.
And we are certainly currently working on that as well to have a construction timeline to have that all in place as well.
Speaker 4: Once all the other components of the Phase 3-Push expansion are completed to start up in Q1 and of Q1-20.
Once all the other components of the phase II plus expansion or completed to start up in Q1 end of Q1 2026.
Right.
Speaker 5: transcript
Speaker 5: Great. I follow up for Greg. Can you just remind me what with the budgeted Canadian dollar and are you guys looking to take advantage of the current weaker Iowa to assume weaker Canadian dollar versus budget to just help give you a bit of additional tailwind on that project?
A follow up for Greg.
Can you just remind me what was the budget did Canadian dollar and are you guys.
Looking to take advantage of the current weaker I would assume weaker Canadian dollar versus budget to just help.
Give you a bit of additional tailwind on that project.
Speaker 7: transcript
Speaker 7: Yeah, we had budgeted at 75 cents, so the weaker Canadian dollar will help from a CapEx perspective, but also on our operating cost through our existing operations.
Yeah, we had budgeted at 75 cents. So the the weaker Canadian dollar will help from a capex perspective, but also on our operating costs through.
Our existing operations.
And can you just remind me roughly what percentage of the Capex would be Canadian I guess, probably all your labor and contractor would mostly be Todd.
Speaker 5: transcript
Speaker 5: And can you just remind me roughly like what percentage of the cat-x would be Canadian? I guess probably all your labor and contractor would mostly be CAD.
I imagine it's pretty high.
Mike I'll have to get back to you on that I don't have the details right now, but I'll I'll take that offline alright.
Speaker 7: transcript
Speaker 7: Mike, I'll have to get back here on that. I don't have the details right now, but I'll take that off one. All right. Thanks.
Alright, Thanks, and then.
Speaker 5: transcript
Speaker 5: Obviously, some pretty exciting news coming out later this quarter with PDA.
Oh I see.
Some pretty exciting news coming out later this quarter with P. D. A.
Speaker 5: transcript
Speaker 5: And just give me, is there any ability to talk about, like you already had a million ounces?
Can you just give me is there any ability to talk to about like you've you're already at a million ounces. A total resource you bumped up the budget on the drilling a couple of times already this year recognizing that you've got the July cut off.
Speaker 5: transcript
Speaker 5: bumped up the budget on the drilling a couple times already this year, recognizing that you got the July cut off. But teams like things are...
But it seems like things are going really well there.
Speaker 5: transcript
Speaker 5: Do we have an idea of what we should be kind of thinking of in terms of scale? Like it seems like it's getting bigger and bigger and bigger. Is it going to be possibly a project that you would phase? Like you'll phase one and then as it opens up, add in a second processing line in the mill. What is there anything you can kind of talk about?
Do we have an idea what we should be kind of thinking of in terms of scale. It seems like it's getting bigger and bigger and bigger or is it going to be costly a project that you would like.
Phase one and then as it opens up.
And a second processing line in the mill what is there anything you can kind of talk to you.
Speaker 4: transcript
Speaker 4: Mike here, it's Luke here again. Yeah, so I mean still kind of early stages. I mean, we've just recently completed some of the geotech drilling required for the mine design aspect of the operation. And in that mine design, we'll put a mine plan together. We've also in conjunction in parallel been working to some technical studies with regards to the metallurgy and the mill design.
Yeah, Mike It slipped here again, yeah. So I mean, it's still kind of early stages. I mean, we've just recently completed some of the Geo Tech drilling required for the mine design aspects of the operation and in that mine design, we'll we'll put a mine plan together.
We've also in conjunction in parallel been working through some technical studies with regards to the metallurgy and the mill Mill design.
Speaker 4: transcript
Speaker 4: So our expectation is we will have a development study completed by the end of the year with some preliminary numbers which regards to mining rates and supporting milling rates. I mean high level at this point I mean we've been kind of targeting 2,000 tons per day based on what we've seen so far which regards to the success we've had with the the expiration and some early review of what we've been seeing with regards to the mine design and mill design.
So our expectation is we will have a development study completed by the end of the year, but some preliminary numbers with regards to mining rates and.
And supporting milling rates I mean high level at this point I mean, we've been kind of targeting 2000 tonnes per day based on what we've seen so far with regards to the success we've had with the the exploration and some early review of what we've been seeing with regards to the mine design and building right.
Speaker 4: transcript
Speaker 4: But I mean, there's always opportunity for expansion. I mean, you know, we can serve and start on that basis with the mining rates, but mining rates can certainly increase over time if it's supported based on the geometry of the ore body and the strike length of the ore body. And obviously with regards to expanding the milk to support a higher mining rate, that opportunity also still exists. I mean, we can always add components to that milk circuit to be able to expand to a higher milling rate if required.
But I mean, there's always opportunity for expansion I mean, we can certainly start on that basis with the mining waste, but mining waste can certainly increase overtime. If it's supported based on the geometry of the ore body and the strike thinks of the ore body.
And obviously with regards to expanding the mill to support a higher mining rate that opportunity also still exists I mean, we can always add components to that mill circuit to be able to expand to a higher milling rate if required.
Speaker 4: transcript
Speaker 4: And you, have you guys have power to site now, or you would have by the time you would build PDA? We're currently still on diesel generation, but we're in the process of doing a conversion from diesel generation power to the site to grid power. And the expectation on that would be by the end of this year. So that will provide, obviously, further upside for the longer term with Bayaki, but also with PDA and any other opportunities in our Volados district. Okay, so the PDA study would.
And you do you guys have power to site now or you would have by the sudden he was still T D.
We're currently still on diesel generation, but there were in the process of doing a conversion from diesel generation power to the site to grid power and the expectation of that would be by by the end of this year. So that'll provide obviously further upside for the longer term with la Yaqui, but also with P. D. A.
Any other opportunities to develop within our of a lot of district.
Okay. So the PGA study would assume grid power connection correct.
Speaker 8: transcript
Speaker 8: Greg. That's it.
That's it for me guys. Thanks, so much.
Okay.
Thank you.
Speaker 1: transcript
Speaker 1: Once again, please press star one at this time. If you have a question or next question is from OVA-BEB, please go ahead.
Once again, please press star one at this time if you have a question. Our next question is from Ov. Please.
Operator: [inaudible] In addition to myself, we have on the line today John McCluskey, President and Chief Executive Officer, Greg Fisher, Chief Financial Officer, Luc Guimond, Chief Operating Officer, and Scott RG Parsons, Vice President and Exploration. We will be referring to a presentation during the conference call that is available through the webcast and on our website.
Please go ahead.
Speaker 9: transcript
Speaker 9: Hi John , and Alamo's team, from that on the key point of the week and in create production guidance. Just a couple of questions for me. Number one, in regards to the parallel structures that was discovered at Island Goal, you know, at the site trip in mid summer, you mentioned that you had already started to mind some of these structures. Now, are we expecting to see some of these ounces from the structures in Q4 and going in 2024? Yeah, you know, you know, you eventually want to try to ask is,
Hi, John and Alamos team that's on the.
And increased production guidance.
Just a couple of questions from me number one in regards to the parallel structures that was discovered at island gold.
You know at the site in mid Summer you mentioned that you had already started to mind. Some of these structures now are we likely to see some of these ounces from construction in Q4 and going into 'twenty 'twenty four yeah, essentially what I'm trying to ask is.
Speaker 9: transcript
Speaker 9: Are these ounces expected to come into the island gold mine plant in the future?
These ounces are expected to come into the island Gold mine plan in the future.
Speaker 4: transcript
Speaker 4: Hi, yeah, it's look here again. Yes, I mean, we have started mining some of those, certainly some parallel zones in the nerve cell zones that we've talked about previously. So we started some of that late in Q3. There's opportunities certainly to bring some more that into Q4, but as we further, you know,
Yeah, Yeah, Yeah, it's Luke here again, yes, I mean, we have started mining some of those certainly sub parallel zones in the north south zones that we've talked about previously so.
So we've we started some of that late in Q3, there is opportunity certainly to bring some more of that into Q4, but as we further are you now.
Operator: We would also like to remind everyone that our presentation will be followed by a Q&A session. As we will be making forward looking statements during the call, please refer to our cautionary notes included in the presentation, news release, and MVNA, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Boswick, our Senior Vice President, Technical Services, and a qualified person. Also, please bear in mind that all of the dollar amounts mentioned in this conference call are in US dollars unless otherwise noted.
Speaker 4: transcript
Speaker 4: Understand it and develop it will actually start to us incorporate that into the mind plan over the longer term.
Understand it and develop it will actually start to incorporate that into the mine plan over the longer term.
Speaker 9: transcript
Speaker 9: Okay, sounds good. So there's, there's, eventually in terms of what you see in drug-review fireless structures, they're close to existing and fragile. So it's not like you'd have to do a lot more development or accesses zones.
Okay sounds good.
Eventually in terms of what you see in WV Fabulous structures both of those.
The existing yards breakfast.
It's not like you would have to do a lot more development do active diesel.
Speaker 4: transcript
Speaker 4: No, because I mean, you know, these are kind of running off of the east-west striking zones that we're currently mining. And from a sequence perspective, actually, it makes more sense to incorporate these into the mine plan as we're in those areas.
No because I mean.
These are kind of running off of the east West.
Striking zones that were currently mining and from a sequence perspective actually it makes more sense to incorporate these into the mine plan as we are in those areas.
John McCluskey: Now, John, we will provide you with an overview. Thank you Scott. Starting with slide three, we delivered another strong quarter with production of 135,400 ounces exceeding quarterly guidance at cost near the low end of annual guidance. This reflected a solid quarter from island gold and another excellent quarter from Miyaki Grande. With year-to-day production of 400,000 ounces, we are on pace to achieve a new annual record driven by an outstanding year from the Melados District.
Speaker 4: transcript
Speaker 4: just from a point of view of just following a proper sequence and being able to basically extract the zones and retreat in those areas based on our launch tool and retreat mining methods.
Just from a point of view of just falling of a proper sequencing being able to basically extract the this the zones and retreat in those areas based on our lunch tool a retreat mining method.
Okay. Thanks, Thanks for the color on that Luke.
Speaker 9: transcript
Speaker 9: Thanks, thanks for the color on that look. Just switching gears to PDA, just a follow up call on to Mike's question. I believe the expectation is to release a new mind plan in Q1 next year. So in regards to the advancement of PDA, what kind of permits would be required and do C&E risk those permits?
Just switching gears to P D a.
All off to Mike Mike question, I believe the expectation is to release a new mine plan in Q1 next year.
So in regards to the advancement of <unk>, what kind of what I mentioned would be required and do you see any risk that those formats.
John McCluskey: Given the strong performance, we are increasing our production guidance by 5% to a new range of 550,000 to 530,000 ounces. We are also on track to achieve our cost guidance for the year with total cash costs in all and sustaining costs both below the midpoint of guidance here today. We're also a solid quarter financially, putting us on pace for a record year across a number of metrics, including revenue and cash flow from operations. This is giving us the capacity to both grow as a company and generate solid pre-cash flow, including 37 million in the quarter and 109 million here today.
Speaker 4: transcript
Speaker 4: Sorry, that one's in relation to PDA. That's correct. Yeah. So as I mentioned there, we're looking to have a development study by the end of the year.
Sorry that was in relation to P. D. Eight that's correct, yes. So as I mentioned there were looking to have a development studies by the end of the year.
End of Q4 into Q1 at the latest.
Speaker 4: transcript
Speaker 4: and of Q4 or to Q1 at the latest. With regards to permits, we've basically within our, all of this, the mining and the milling operations will be all within our existing concession.
With regards to permits.
Well basically within all of this.
The mining and milling operations will be all within our existing concessions. So it would be just a question of getting and amended our EMEA basically which is what is referred to in Mexico.
Speaker 4: transcript
Speaker 4: So it would be just a question of getting an amended mea, basically, which is what it's referred to in Mexico. Because of the fact it's not new processes. We've done underground mining there in the past. So it's not new to the district. We had a milling process as well, a conventional milling process in the past as well. So that's not new to the district. And as a result of that, we would just be looking to get amendments to our existing needs to be able to...
Because of the fact, it's it's it's not new processes, we've done underground mining there in the past so it's not new to the district, we had a milling processes wallet conventional milling process in the past as well so that's not new to our to the district and as a result of that we would just be looking to get amendments to our existing he is to be able to construct.
John McCluskey: Now looking at slide four, we continue to create value from within our growth projects.
John McCluskey: In August, we released an updated feasibility study on the Lynn Lake project with a 44% increase in reserves supporting a larger, longer-life low-cost operation with attractive economics. As part of our balanced approach to growth, our current focus is on the phase three plus expansion of island gold. But Lynn Lake remains a key part of our longer-term growth plans as another long-life low-cost project in Canada with significant exploration upside, which we expect will further enhance the economics of the project.
Speaker 4: transcript
Speaker 4: Construct the new requirements for the mine in milling operations for PDU.
The new requirements for the mining milling operations for PTA.
Perfect. Thanks, thankful for that and that's it for me and thanks for taking my questions.
Speaker 10: transcript
Speaker 10: Perfect. Thanks. Thanks for that. And that's it for me. And thanks for taking my questions.
Thank you.
Our next question is from Man Kerry Smith. Please go ahead.
Speaker 1: transcript
Speaker 1: Our next question is from Carrie Smith. So please go ahead.
Thanks, operator.
Speaker 11: transcript
Speaker 11: Thanks, operator. Luke, for the face spirit at ILE.
Look for for the phase three it at all.
You have 106 2 million for development.
Speaker 11: transcript
Speaker 11: You have 162 million for development underground. Karen, you've completed 64 million. Can you just remind me how many meters of development is included in that $162 million number?
Underground and you've completed 64 million can you just remind me how many years of development is included in that $62 million number.
John McCluskey: Correct. In September, we provided another exploration update from Alados, where we continue to extend high-grade mentalization at PDA. We expect this exploration success will drive a further increase in higher-grade reserves and resources, as the deposit, at the deposit, beyond the million ounces defined at the end of last year. This growth is being incorporated into a development plan to be completed later this year, which we expect will outline another attractive project and significant mind-life extension of Alados.
Yeah.
Speaker 4: transcript
Speaker 4: Oh, um, it says at least a couple of kilometers.
Oh I'm sorry.
It's at least a couple of kilometers plus Oh, not one carrier I have to get back to you to get a more firm number but you know that's in relation to all of the shop access development altogether development, that's required to establish that infrastructure as far as crushing rock breakers loading pocket everything associated with all of that infrastructure.
Speaker 4: transcript
Speaker 4: Plus, on that one carry, I have to get back to you to get a more firm number, but that's in relation to all of the shaft access development, all the other developments that's required to establish that infrastructure as far as crushing rock rakers, loading pocket, everything associated with all of that infrastructure for the underground. But I have to get back to you with a firm number on that.
Trucks for the underground, but I'd have to get back to you with a firm number on that okay.
Speaker 11: transcript
Speaker 11: Okay, okay, and that and you're doing that development with your own crews, correct?
Okay, Okay, and that and Youre doing that development with your own crews correct.
John McCluskey: Construction of a Phase III expansion at Island Gold is advancing well with the headframes substantially complete and shafts sinking on track to start by year end. The project remains on schedule and on budget, and we expect to be operating from the shaft and expended mail in the first quarter of 2026. These projects are key drivers of our strong outlook, supporting growing production, declining costs, and increased profitability.
Speaker 11: transcript
Speaker 11: Correct for the most part. I mean we do still have red top doing some of the development Shop the shop ramp access development, but starting next year will it'll be a hundred percent Alamos development cruise Yeah, okay, and so those costs should be pretty much in line because you're doing you're using your own guys Okay, thank you and then maybe for us other yours Scott the
Correct for the most part I mean, we do still have Red pass doing some of the development the shop the shop ramp access development, but starting next year, we'll it'll be 100% Alamos development crews and so those costs should be pretty much in line because you're using your own guys. Okay. Thanks.
Okay, and then maybe for either you or Scott D.
Greg Fisher: I'll now turn the call over to our CFO, Greg Fisher, to review our financial performance. Great. Thank you, John. On slide 5, during the third quarter, we sold 133,000 ounces of gold at an average realized price of $1,932 per ounce, $4 above the London PM fix, for revenues of $256 million. Total cost costs of $835 per ounce, and all in sustaining costs of $1,121 per ounce, are both towards the low end of full-year guidance.
Speaker 11: transcript
Speaker 11: 444 meters of underground drifting that you had planned for the expiration underground at Island. Is that drifting all complete now or is there still some more of that too complete this year?
444 meters of underground drifting that you had planned for the exploration underground at island is that drifting all complete now or is there still some more of that to complete this year.
Speaker 7: transcript
Speaker 7: Yeah, it's a very, it's a, it's a, it's a, it's ongoing obviously throughout the year and in sequence into the development schedule. I mean, we were advancing laterally at the West, we started the deposit, so multiple levels and then also on our annual expiration drift and 9.45. So we'll do it kind of systematically as we get, I would get to establish a drill bay, drill off the targets from that, that drill bay will advance the development as required. So it's kind of ongoing throughout the year.
Yeah. This is Terry.
Scott, It's it's ongoing all this throughout the year and and sequenced into the development schedule I mean, we were advancing.
Literally it out in the west and east side of the deposit so multiple levels and then also R&R hanging wall exploration drift at 945, so what we'll do it kind of systematically as we go out go to establish a drill baby drill off the targets from that.
Greg Fisher: We are on track to once again achieve full-year cost guidance. Our reported net earnings of $39 million in the third quarter, or $0.10 per share, including unrealized foreign exchange losses of $12 million, recorded within deferred taxes, and other non-cash losses of $3 million. Excluding these items, our adjusted net earnings were $55 million, or $0.14 per share. Operating cash flow before changes in non-cash work and cap rope was $133 million, or $0.34 per share.
That drove able are well advanced the development of as required so it's kind of a ongoing throughout the year.
Speaker 11: transcript
Speaker 11: Okay, I got you. And then Greg just just so I'm clear the
Okay I got you and then Greg just just so I'm clear the.
Speaker 11: transcript
Speaker 11: The 2.7 million of cash tax as you paid at Milado's in Q3 and then you're forecasting a similar amount in Q4. Those will be prepayments against the taxes due in March or next year, correct? Correct. Those are installment payments with respect to our 2023 tax bill. Right. Okay. Okay. Perfect. Thanks very much.
The 2.7 million of cash taxes, you paid at mulatto seen Q3, and then you're forecasting a similar amount in Q4, those will be prepayments against the taxes due in March of next year correct. Correct. Those are those are installment payments with respect to our 2023 textbook.
Greg Fisher: Given our solid production growth and margin expansion this year, we are on pace for a record year, in terms of revenue, earnings, and cash flow from operations. This is driving strong free cash flow generation at the time that we are also investing in growth. This includes $37 million of free cash flow in the quarter, and $109 million year-to-date. We expect the strong free cash flow generation to continue, while funding the Phase 3-plus expansion.
Right, Okay, Okay perfect. Thanks very much.
Okay.
Thank you.
Okay.
Speaker 1: transcript
Speaker 1: There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416-368-9932. You may now disconnect.
There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered please feel free to contact Mr. Scott Parsons at four Wednesday.
68993.
Greg Fisher: Capital spending totaled $75 million in the quarter, and included $27 million in the sustaining capital, 42 million of growth capital, and 6 million of capitalized expiration. Through the first nine months of the year, capital spending totaled $239 million consistent with our annual guidance. We paid cash taxes of $3 million in the quarter at Melados, with a similar payment anticipated in the fourth quarter. We expect significantly higher cash tax payments in Mexico in 2024, reflecting the strong profitability of Melados in 2023, with $15 million of free cash flow generated from the operation year-to-date. Our balance sheet continues to improve, with our cash balance growing to $216 million, a 14% increase in the previous quarter, and a 66% increase in the start of the year.
You may now disconnect.
[noise].
Okay.
Yeah.
Greg Fisher: We remain debt-free and well-positioned to fund our growth conditions.
Luc Guimond: I will now turn the call over to our COLO, Luc Guimond, to provide an overview of our operations. Thank you, Greg. Moving to slide six, young Davidson produced 45,100 ounces in the quarter, consistent with the previous few quarters, with record milling rates of 8,200 tons per day, offsetting slightly lower grades. Costs were in line with annual guidance, both in the quarter and year to date. Grades are expected to increase in the fourth quarter, as mine higher grade stoves that had been deferred from the third quarter.
Luc Guimond: This is expected to drive production higher in the fourth quarter, putting the operation on track to achieve full year production and cost guidance. The operation continues to be a consistent performer with mind-side free cash flow of 31 million in the quarter, and 83 million year to date. For the third consecutive year, young Davidson is on track to deliver more than 100 million in free cash flow.
Luc Guimond: Over to slide seven, violin goal produced 36,400 ounces in the quarter, a 19 percent increase over the second quarter, reflecting both higher grades and tons processed. It was a strong quarter operation with mining and milling rates, both increasing to exceed annual guidance of 1,200 tons per day. This helped guide costs down from the second quarter towards the low end of annual guidance. Given the strong year to date performance, including production of 100,000 ounces, the operation is well positioned to achieve full year production and cost guidance.
Luc Guimond: Over to slide eight, work on the phase three plus expansion continues to progress with the focus on completion of the remaining shaft site surface infrastructure. Construction of the headframe is substantially complete, as is construction of the shaft area substation. Pre-commissioning tests on the e-house electrical systems have commenced, and construction of the warehouse is well underway. Outfitting of the galloway to be used in the shaft sinking is over 50 percent complete, putting the shaft sink on track to start by year end.
Luc Guimond: Over to slide nine, a total of 35 million of capital related to the phase three plus expansion and capital development was spent in the quarter. The expansion remains on budget with 45 percent of the total initial capital of 756 million spent and committed to the end of September. With the shaft site, with the shaft site surface infrastructure nearing completion, spending will shift towards the shaft sinking later this year, and the mill expansion and paste plant into next year. The overall expansion remains on track to be completed in 2026, transforming island goal into one of the largest, lowest cost and most profitable mines in Canada.
Luc Guimond: Moving to slide ten, at Milautos, production of 53,900 ounces was down from the second quarter as guided, reflecting the return to design mining rates of Liyaki Grande, and end of mining within the main Milautos pit. Liyaki Grande continued to outperform with grades exceeding guidance due to positive grade reconciliation. Minesite free cash flow was 31 million in the quarter and an impressive 115 million year to date. As previously guided, production is expected to decrease in the fourth quarter, reflecting the end of the Milautos pit, and a decrease in grades guided to guided levels at Liyaki Grande, with your today production of 164,700 ounces. Alamos is on track to exceed its full-year guidance driven by the strong outperformance from the Yaku Grande. Costs are expected to increase in the fourth quarter but remain within guidance for the full year.
John McCluskey: Moving to slide 11, as John noted, the updated feasibility study on the little link project has outlined a bigger, longer life and more attractive operation relative to the 2017 study. The updated study incorporates a 44% larger mineral reserve and a 14% larger mill at 8,000 tons per day. Production over the first 10 years is expected to average 176,000 ounces per year, up 23% from 2017, at lower all in sustaining costs of $699 per ounce.
John McCluskey: Over the last several years we have completed an extensive amount of additional engineering, geotechnical and other work, including obtaining approval of the environmental impact statement back in March. This work has significantly de-risked the project and provides us with a high degree of confidence in the capital and operating cost estimates. These estimates support attractive base case economics for the project and at current gold prices represent a 22% after tax internal rate of return.
John McCluskey: We also see significant upside potential given several near-mine and regional exploration opportunities that could be incorporated into the project. Under the current mine plan, the McClellan and Gordon deposits will be mined over the first 11 years. For the remaining six years, we will be processing lower grade stockpiles. With our fleet of mining equipment available from years 11 onward, we are evaluating several nearby targets such as burnt timber and liquid as additional sources of mill feed. These deposits represent upside to the feasibility study, as they would help sustain higher rates of production well beyond the first 10 years.
Scott Parsons: To review that upside in more detail, I will turn the call over to our VP of exploration, Scott Argy Parsons. Thank you. Luke, over to slide 12. You know, obviously we provided an exploration update of Lim Lake, highlighting the significant upside potential across the number of near-mine and regional targets. This includes burnt timber and liquid. Two deposits and trucks emitted to the plan mill of McClellan that could potentially be incorporated into the mine plan.
Scott Parsons: They are located approximately 28 kilometers away from McClellan site and are connected by an all existing all season road. The two deposits contain 1.6 million ounces of inferred resources that were not factored into the feasibility study. Updated geological models have been completed in both deposits, demonstrating the potential for a smaller, higher-quality mineral resource. We see excellent potential to truck this to McClellan mill infrastructure after the McClellan deposit has been mined. This would not only help sustain higher rates of production well beyond the first 10 years, but also stand in my life and enhance the project economics.
Scott Parsons: Maynard is a similar stage target with similar potential as another satellite deposit located 20 kilometers by road from the plan mill. All 15 holes in the Maynard to date have intersected gold mineralization over 700 meters strike length and to a depth of 280 meters. This includes higher grader intercepts that just 5.9 grams per ton over 12 meters. These are just a few examples of the potential that we see across the limelight greenstone belt, a large, under-explored district.
Scott Parsons: We started with a 17-year reserve life based on the updated study. However, given the opportunities we see across our 58,000-hectrel land package, we fully expect the mining in the district well beyond that. Over to slide 13.
Scott Parsons: In September, we announced a second expiration that's updated this year in Molatos, where we continue to have success. Both regionally and in your mind, at PDA, step out drilling is further extended high-grade mineralization beyond reserves and resources, which will support additional growth beyond the currently defined 1 million ounces. We are currently working in an updated reserve based on drilling to Venda, July. We'll be incorporating that in an updated development plan to be completed towards the end of the year.
Scott Parsons: We expect to outline another significant mine-life extension of Molatos. Based on the success of the program to date, we've increased our expiration budget in Molatos for the second time this year to $25 million. This includes drilling at PDA to the rest of this year, with 50,000 meters planned up from the original budget of 15,000 meters. We are still in the early stages of testing the potential within a broader PDA area. Based on success to date, and with the deposit open in multiple directions, we see excellent potential for PDA to continue to grow in the years ahead.
Scott Parsons: We also released additional results from the Kaplan Regional Target, located 4 kilometers east of the Molatos pit. Step out drilling continues to intersect wide intervals of significant oxide and fault-fied mineralization within a breccia along the Kaplan vault. This included 2.7 grams per tonne over 120-meter core length, the best hole drilled to date a Kaplan. Highlighting a significant potential in the area and within the broader Molatos district.
John McCluskey: With that, I'll send a call back to John. Thank you, Scott.
Operator: So that concludes the formal presentation. I'll ask the operator to open the calls for you to open the lines for your questions. Thank you. We'll now take questions from the telephone lines. If you have a question and you're using a speaker phone, please lift your hands up before making your selection. If you have a question, please press star one on your device's keypad. You may cancel your question at any time by pressing star two. Please press star one at this time. If you have a question, there will be a brief pause for the participants for just a few questions. Thank you for your patience.
Cosmos Chiu: Our first question is random cosmos true. Please go ahead.
Cosmos Chiu: The headline is open. Thank you, John. Great. Luke, Scott, Scott. Congrats on a very strong Q3 and good to see that you weren't able to share guidance for the year on production. Not cost introduction.
Cosmos Chiu: Maybe first off in Mexico. As you mentioned, you know, you know, Yaki Grande has done really well here to date. Positive grade reconciliation. But at the same time you say, you know, that grade will likely, you know, trend back to, to more normal levels. So I just want to know, you know, what happened to you? Why were you able to have the positive grade reconciliation? Is there potential for to, to continue?
Luc Guimond: Hi, hi, Cosmo. It's Luke here. Hello. Yeah, our expectation is that we will be more in line with our grades as we move forward. We won't necessarily see that over performance.
Luc Guimond: What's really happening is we get deeper into the benches of Voyacogandhi. The drill density gets tighter, so we expect to see more consistent performance actual versus our model moving forward.
Cosmos Chiu: And that may be sticking with Mexico, you know, quite a bit of noise these days in the country in Mexico, either of these security issues for some of your peers, or, you know, the ongoing potential changes to a mining law.
John McCluskey: Could you maybe talk about, is there any potential impact to, or has there been any potential impact to Alamos? Hi, Cosmos, John. Hi, John. I would say that, you know, you can never rule anything out, just given, you know, it could happen in Canada, I think everybody recalls we had a big gold heist at our airport here, Pearson. So I don't think you could ever rule anything out from that point of view.
John McCluskey: But I would say that, you know, we've been operating in Maloutas for a long, long time. We've significantly increased the security over the last five years. And on top of that, the Mexican government has stepped up security in the region quite significantly. There's a lot of mining operations in this part of Mexico, and I would say the Mexican government cares a great deal about that. So I don't see anything particularly unusual about where we're operating.
John McCluskey: I think it's, it's as secure as it's ever been. We've been operating there for, but we've been there 22 years now. We've been in production for 19 of those years, and we've only ever had one real incident. So I would say looking forward, we're pretty confident that our site can continue to operate without any unusual impacts. Of course, sounds good.
Cosmos Chiu: Maybe switching gears a little bit at an gold, it sounds like the phase 3-plus expansion is going well. Sounds like other surface infrastructures almost complete. Now comes the shaft sinking.
Cosmos Chiu: As we moved into shaft sinking, maybe could you talk about some of the key deliverables, even key risk in terms of what the next sort of stage of the project entails. Clearly, it's not your first module. John, you've done the shaft sinking thing right down to the end of the past. Does that help? I guess that was raised more, and this is a bit different, but does that help?
Luc Guimond: Can you talk about what we should expect with the next stage of shaft sinking, the expansion and some of the key factors you look at. Yeah, Cosmo Luke here. So we're in the final stages of actually getting the requirements for gearing up of the shaft to be able to start the sinking. Our expectation is that we will start that to near the end of Q4 and get in the shaft on a consistent basis, obviously, and continue with the benching aspect.
Luc Guimond: I mean, we're using a reputable contractor, Red Pass mining, have done shafts all over the world. It's certainly in Canada, but all over the world. So we're not obviously concerned with them being able to deliver on what their expectations are. Once they get the setup completed and they get the cycle going, our expectation is that we would be sinking at about three meters per day. Over the next couple of years, until the shaft is completed late to 2025. Great.
Greg Fisher: And then maybe one last question. Greg, as you mentioned, very profitable in Mexico this year, which also means a larger tax bill next year. Could you remind me, when does that large payment come out? When would it come out? And, you know, how can we potentially estimate what that payment is going to be? Yeah, it's a big spread here. So yeah, the year-end tax filing is doing in March. So the payments for the 2023 tax bill would be doing in the first quarter of 2024, and that would relate to both income taxes and mining taxes. We have paid about 3 million this year. We're going to, in the third quarter and about 3 million.
Cosmos Chiu: In the fourth quarter, but given our profitability, there will be a pretty significant catch-up when we file that final tax bill in March of 2024. Great. Thank you. Those are all the questions I have. Congrats again on a very strong QC. Thank you.
Mark Parkin: Our next question is from Mark Parkin. Please go ahead. Thanks, guys, and you can graph them in a great quarter.
Mark Parkin: Could you just speak to the island project? What is the critical path? And, you know, what's kind of budgeted in there for it in the avenue kind of flexibility to whether or not I added an HIF gear it up if it did prove to show any signs of falling behind schedule? I might look here. As I mentioned earlier with the previous question, right now all of our main focus has been around the shop setup and the shop thinking and preparation for that.
Mark Parkin: And, you know, certainly the head frame and everything is well, well advanced, and we're in the final stages of preparing to commission for the shop thinking. So our expectation is a late Q4 will start that process. As I mentioned, we've got a reputable contractor that's, you know, got a lot of expertise and skillsets to complete that on time and on budget, and we fully expect them to be able to do that.
Mark Parkin: The other components that we've been certainly working on with regards to the Phase 3-plus expansion is the detail engineering for the mill expansion as well as the paste plant. So those have been ongoing over the course of this year, and you know, we'll start to get into more serious aspects of the construction into next year and into 2025 with regards to both of those components. And the other component that's required for us is obviously an upgrade to our existing power distribution to the site.
Mark Parkin: We'll be basically doubling our load from where we are today, and we are certainly currently working on that as well to have a construction timeline to have that all in place as well. What's all the other components of the Phase 3-plus expansion are completed to start up in Q1 and of Q1, 2026. Great.
Greg Fisher: I follow up for Greg. Can you just remind me what was the budgeted Canadian dollar, and are you guys looking to take advantage of the current weaker Iowa to assume weaker Canadian dollar versus budget to just help give you a bit of additional tailwind on that project? Yeah, we had budgeted at 75 cents, so the weaker Canadian dollar will help from a CapEx perspective, but also on our operating cost through our existing operations.
Greg Fisher: And can you just remind me roughly what percentage of the CAPEX would be Canadian? I guess probably all your labor and contractor would mostly be CAD, since I imagine it's pretty high.
Greg Fisher: Mike, I'll have to get back to you on that, but I don't have the details right now, but I'll take that off one.
Mark Parkin: All right, thanks.
Mark Parkin: And then obviously some pretty exciting news coming out later this quarter with PDA. Can you just give me, is there any ability to talk about like you already had a million ounces of total resource, you bumped up the budget on the drilling a couple of times already this year, recognizing that you've got the July cut off, but seems like things are going really well there. Are we? Do we have an idea of what we should be kind of thinking of in terms of scale, like it seems like it's getting bigger and bigger and bigger.
Mark Parkin: There's going to be possibly a project that you would face like the phase one and then as it opens up, adding a second processing line in the mill, what is there anything you can kind of talk to? Yeah, Mike here, it's looked here again. Yeah, so I mean still kind of early stages. I mean, we've just recently completed some of the geotech drilling required for the mine design aspect of the operation.
Mark Parkin: And in that mine design, we'll put a mine plan together. We've also in conjunction in parallel been working to some technical studies with regards to the metallurgy and the mill design. So our expectation is we will have a development study completed by the end of the year with some preliminary numbers, which regards to mining rates and and milling and supporting milling rates. I mean, high level at this point, I mean, we've been kind of targeting 2000 tons per day based on what we've seen so far, which regards to the success we've had with the the expiration and some early review of what we've been seeing with regards to the mine design and mill design.
Mark Parkin: But I mean, there's always opportunity for expansion. I mean, you know, we can serve and start on that basis with the mining rates, but mining rates can certainly increase over time if it's supported based on the geometry of the ore body and the strike thinks of the ore body. And obviously with regards to expanding the mill to support a higher mining rate, that opportunity also still exists. I mean, you can always add components to that mill circuit to be able to expand to a higher milling rate of required.
Mark Parkin: And you, do you guys have power to site now, or you would have by the time you would do a PDA? We're currently still on diesel generation, but we're in the process of doing a conversion from diesel generation power to the site to grid power and the expectation on that would be by the end of this year. So that will provide, obviously, further upside for the longer term, but also with PDA and any other opportunities to develop within our volatos district. Okay. So the PDA study would assume grid power connection. Correct. Okay.
Operator: That's it from me, guys. Thanks so much. Thank you. Once again, please press star one at this time.
Ovais Habib: If you have a question or next question is from OVABEB. Please go ahead. Hi, John and Alamo, same thing. That's on the secret date and increased production guidance. Just a couple of questions for me. Number one, in regards to the parallel structures that was discovered at Allen Gore. You know, at the site trip in mid summer, you mentioned that you had already started mining some of these structures. Now, are we expecting some of these ounces from the structures in Q4 and going in 2024?
Ovais Habib: Yeah, you know, you essentially want to try to ask, are these ounces expected to come into the Allen Gore mine plan in the future? Hi, yeah, it's Luke here again. Yes, I mean, we have started minding some of those, certainly some parallel zones on the nerve cell zones that we've talked about previously. So we started some of that late in Q3. There's opportunities certainly to bring some more than in the Q4, but as we further understand it and develop it, we'll actually start to yes incorporate that into the mind plan over the longer term.
Ovais Habib: Okay, sounds good. So there's eventually in terms of what you see in drug-review violence structures, they're close to existing areas of practice, so it's not like you'd have to do a lot more development in the accesses zones. No, because I mean, you know, these are kind of running off of the east-west striking zones that we're currently mining and from a sequence perspective, actually, it makes more sense to incorporate these into the mind plan as we're in those areas, just from a point of view of just following a proper sequence and being able to basically extract the zones and retreat in those areas based on our launch tool and the retreat mining method. Thanks, thanks for the call on that, Luke.
Ovais Habib: Just switching gears to PDA, just a follow-up call on to Mike's question. I believe the expectation is to release a new mind plan in Q1 next year, you know, so in regards to the advancement of PDA, what kind of permits would be required and do you see any risk of those permits? Sorry, that was in relation to PDA. That's correct. Yeah, so as I mentioned there, we're looking to have a development study out by the end of the year, end of Q4 or Q1 at the latest.
Ovais Habib: With regards to permits, we've, basically, within our, all of this, the mining and the milling operations will be all within our existing concessions. So it would be just a question of getting an amended me, basically, which is what it's referred to in Mexico. Because of the fact, it's not new processes. We've done underground mining there in the past, so it's not new to the district. We had a milling process as well, a conventional milling process in the past as well, so that's not new to the district. And as a result of that, we would just be looking to get amendments to our existing needs to be able to construct the new requirements for the mining and milling operations for PDA.
Ovais Habib: Perfect. Thanks for that. And that's it for me, and thanks for taking my questions. Thank you.
Kerry Smith: Our next question is from Carrie Smith. Please go ahead. Thanks, Operated. Luke, for the phase three at Ireland, you have 162 million per development underground. Karen, you've completed 64 million. Can you just remind me how many meters of development is included in that $162 million number? I'd say it's at least a couple of kilometers plus on that one, Carrie. I have to get back to you a more firm number, but that's in relation to all of the shaft access development, all the other developments that's required to establish that infrastructure as far as crushing rock rakers, loading pocket, everything associated with all of that infrastructure for the underground.
Luc Guimond: But I'd have to get back to you with a firm number on that. Okay. And you're doing that development with your own crews, correct? Correct. For the most part, I mean, we do still have red top doing some of the development. The shop, the shop ramp access development, but starting next year, it'll be 100% Alamos development boost. Yeah, okay. And so those costs should be pretty much in line because you're using your own guys. Okay.
Luc Guimond: Thank you. And then maybe for us, either you or Scott, the 444 meters of underground drifting that you had planned for the exploration underground at Island, is that drifting all complete now, or is there still some more of that to complete this year? Yeah, I'm going obviously throughout the year and sequenced into the development schedule. I mean, we were advancing laterally at the West East side of the deposit, so multiple levels.
Luc Guimond: And then also on our annual exploration drift and 945. So we'll do it kind of systematically as we get, I would get to establish a drill bay drill off the targets from that drill bay. We'll advance the development as required. So it's kind of ongoing throughout the year. Okay. I got you. And then Greg, just just so I'm clear, the 2.7 million of cash tax as you paid at Milado in Q3.
Luc Guimond: And then you're forecasting a similar amount in Q4. Those will be prepayments against the taxes due in March or next year, correct? Correct. Those are installment payments with respect to our 2023 tax bill. Right. Okay. Perfect. Thanks very much. Thank you.
Operator: There are no further questions at this time.
Operator: This concludes this morning's call.
Operator: If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416-368-9932.
Operator: You may now disconnect.