Q1 2024 Kinross Gold Corp Earnings Call
Sean: Thank you for standing by. My name is Sean, and I will be your conference operator today. At this time, I would like to welcome everyone to Kinross Gold's first quarter 2024 results conference call and webcast.
Thank you for standing by my name is Sean and I'll be your conference operator today at this time I would like to welcome everyone to the Kinross Gold first quarter 2024 results conference call and webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.
Sean: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press star one again. Thank you. I would now like to turn the call over to Chris Lichtenheldt, Vice President of Investor Relations. Please go ahead.
If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question. Please press star one again. Thank you I would now like to turn the call over the Chris liquid help Vice President of Investor Relations. Please go ahead.
Chris Lichtenheldt: Thank you and good morning. With us today are Paul Rawlinson, CEO, and from the Kinross Senior Leadership Team, Andrea Freeborough, Claude Schimper, William Dunford, and Jeff Gold. For a complete discussion of the risks and uncertainties which may lead to actual results differing from estimates contained in our forward-looking information, please refer to page 2 of this presentation, the MD&A for the period ended March 31, 2024, and our most recently filed AIF, all of which are available on our website. I will now turn the call over to Paul.
Chris: Thank you and good morning with US today, we have all Royalton CEO and from the Kinross Senior leadership team Andrea <unk>, Paul Jennifer Williams on for Doug.
Chris: For a complete discussion of the risks and uncertainties, which may lead to actual results different from estimates contained in our forward looking information. Please refer to page two of this presentation. Our news release dated May seven 2024 MD&A for the period ended March 31, 2024, and our most recently filed yeah, yeah, all of which are available on our website I will now.
Chris: I'll turn the call over to Paul.
Paul Rawlinson: Thanks, Chris, and thank you all for joining us. Today, I will discuss our first quarter results and provide high-level updates across our portfolio. I will like to highlight some of our ESG achievements and confirm our outlook. I will then hand the call over to Andrea, Claude, and Will to provide more details. Following our strong performance in 2023, our operations continue to perform very well, and we are generating significant cash. These strong gold prices so far this year are providing a tailwind for our business, which continues to be underpinned by a focus on cost, discipline, and margin. Our production in the first quarter was on plan, delivering 527,000 ounces. Asnius, Perikachu, and Lekoipa contributed just over two-thirds of our production at strong margins, with an AFIC below $1,000 per ounce.
Paul: Thanks, Chris Thank you all for joining us.
Paul: Today, I will discuss our first quarter results.
Paul: Provide high level updates across our portfolio.
Paul: Unlike some of our ESG achievements and confirm our Iowa.
Paul: I will then hand, the call over to Andrea Claude and will provide more detail.
Andrea Susan Freeborough: Following our strong performance in 2023, our operations continued to perform very well and we are generating significant cash flow.
Andrea Susan Freeborough: The strong gold prices, so far this year and providing a tailwind for our business, which continues to be underpinned by our focus on cost discipline and margins.
Andrea Susan Freeborough: Our production in the first quarter was on plan delivering 527000 ounces.
Speaker Change: Yes Erika.
Speaker Change: <unk> and <unk> contributed just over two thirds of our production at strong margins with an Asia below $1000 per ounce.
Paul Rawlinson: Our U.S. operations also performed well in the first quarter, delivering on plan and remaining on track for their full year target. Turning now to our development activities in the first quarter. At Round Mountain, the Life of Mine Extension Strategy that we announced last year is advancing well. We are making significant progress at Phase S and with our underground opportunities at Phase X and Cold Hill. I was recently at Round Mountain and was very impressed by the progress at Phase X, where we have completed approximately 1.8 kilometers of Underground Development. In Alaska, the MANCHO project is proceeding well and is on schedule to contribute to production in early Q3. Transportation to Fort Knox continues to ramp up, and the mill modifications remain on track.
Speaker Change: Our U S operations also performed well in the first quarter delivering on plan and remain on track for their full year targets.
Speaker Change: Turning now to our development activities in the first quarter.
Speaker Change: At round mountain the life of mine extension strategy, we announced last year is advancing well.
Speaker Change: We are making significant progress.
Speaker Change: And with the underground opportunity at <unk> and coal Hill.
Speaker Change: I was recently at round Mountain and was very impressed by the Progressive Zacks, where we have completed approximately one eight kilometers.
Speaker Change: Of underground development.
Speaker Change: In Alaska <unk> project is proceeding well.
It is on schedule to contribute to production in early Q3.
Speaker Change: Transportation or Fort Knox continues to ramp up.
Speaker Change: And the mill modifications remain on track.
Paul Rawlinson: At Great Bear, we continue to make excellent progress across several work streams. We had a highly productive few months with nearly 38,000 meters of drilling completed, as outlined in yesterday's press release. Drilling continues to return significant results extending beyond our year-end resource update. In addition to drilling, other areas of the project, such as permitting and engineering for the advanced exploration decline, are progressing well, as are our technical studies, permitting, and engineering work on the main project.
Speaker Change: And Greg Baer, It continued to make excellent progress across several work streams.
Speaker Change: We had a highly productive few months with nearly 38000 meters of drilling completed.
Speaker Change: As outlined in yesterday's press release.
Speaker Change: Drilling continues to return significant results extending beyond our year end resource update.
Speaker Change: In addition to drilling other areas of the project permitting.
Speaker Change: Engineering for the advanced exploration decline are progressing well.
Speaker Change: As our technical studies permitting and engineering work on the main project.
Paul Rawlinson: We are on track to release our results from the ongoing work in the form of a PEA in the second half of the year. I want to provide some additional context around the level of study we plan to release. The PEA will provide a more fulsome view of the project, including both the open pit and underground resources. Publishing a PEA allows us to include some of the underground inferred resources.
Speaker Change: We are on track to release our results from the ongoing work in the form of a P. A.
Speaker Change: Half of the year.
Speaker Change: I want to provide some additional context around the level of study we plan to release.
Speaker Change: <unk> will provide a more fulsome view of the project.
Speaker Change: Including both the open pit and underground resource.
Publishing on Pega allows us to include some of the underground inferred resources.
Paul Rawlinson: This will provide better visibility into our anticipated path forward for both underground and open pit mining. While it will be a PEA-level study, we are putting substantial effort into our capital and operating cost estimates to provide additional confidence on the ASIC and margin. It is also important to note that our PEA will incorporate a subset of the ounces in our measured, indicated, and inferred resources. It will not include the deeper mineralization that we will not yet have drilled sufficiently to bring into the inferred resource. Deep drilling has shown that the mineralization continues to dip well below the current resource in attractive widths and grades.
Speaker Change: This will provide better visibility into our anticipated path forward for both underground and open pit mining.
Speaker Change: Well it will be a pea level study, we are pretty substantial effort into our capital and operating cost estimates to provide additional confidence on the Asia margins.
Speaker Change: It is also important to note that our P. A will incorporate a subset of the ounces in our measured indicated and inferred resources.
Speaker Change: It will not include the deeper mineralization that we will not yet have drilled sufficiently to bring into the inferred resources.
Speaker Change: Our deep drilling has shown that the mineralization continues to them well below the current resource.
Speaker Change: To with some grades.
Speaker Change: As we continue drilling underground and commenced underground drilling from the AVX decline.
Paul Rawlinson: As we continue drilling out the underground and commence underground drilling from the AEX decline, we expect the ounces in the mine plan to continue to grow. I'm obtaining permits for the main project. The detailed project description was submitted to the Impact Assessment Agency of Canada in Q1.
Speaker Change: We expect the ounces in the mine plan continue to grow.
Speaker Change: On permitting for the main project.
Speaker Change: A detailed project description was submitted to the impact assessment agency of Canada in Q1.
Paul Rawlinson: The federal impact assessment is underway, and we expect to file our impact statement in the first half of next year. Turning to sustainability, our longstanding annual sustainability report will be published later this month. This report, which is in its 16th edition, will provide a comprehensive update on the progress we made in 2023 and what we aim to accomplish this year and beyond.
Speaker Change: Federal impact assessment is underway and we expect to file our impact statement in the first half of next year.
Speaker Change: Turning to sustainability.
Speaker Change: Our long standing annual sustainability report will be published later this month.
Speaker Change: This report, which isn't it 16 tradition.
Speaker Change: Provide a comprehensive update on the progress we made in 2023.
Speaker Change: What we aim to accomplish this year and beyond.
Speaker Change: Turning to our outlook.
Paul Rawlinson: Following a strong first quarter, we are on track to achieve our 2.1 million ounce production and our cost guidance for this year. In light of the recent high gold prices, we will continue to maintain our financial discipline and prioritize margins. With respect to capital allocation, our plan is to use excess cash flow to repay debt. Our first quarter is setting up 2024 to be another strong year. We believe that delivering on our guidance, coupled with our strong free cash flow, should continue to support strong share price performance. With that, I will now turn the call over to Andrea.
Speaker Change: Following a strong first quarter, we are on track to achieve our $2 1 million ounce production and our cost guidance for this year.
Speaker Change: In light of the recent strong gold prices, we will continue to maintain our financial discipline and prioritize margins.
Speaker Change: With respect to capital allocation.
Speaker Change: Our plan is to use excess cash flow to repay debt.
Speaker Change: Our first quarter is setting up 2024 to be another strong year.
Speaker Change: We believe that delivering on our guidance coupled with our strong free cash flow should continue to support strong share price performance.
Speaker Change: With that I will now turn the call over to Andrea.
Andrea Susan Freeborough: Thanks, Paul. This morning, I will review our financial highlights from the quarter, provide an overview of our balance sheet, and comment on our guidance and outlook. As Paul noted, we had a strong start to the year. We produced 527,000 ounces of gold, with gold sales of 522,000 ounces. We held our cost of sales in line with the prior quarter at $982 per ounce. With an average realized gold price of $2,070 per ounce, we delivered strong margins of $1,088 per ounce. ASIC of $13.10 per ounce was slightly lower compared to the prior quarter on the basis of comparable cost of sales and lower sustaining capital.
Andrea Susan Freeborough: Thanks, Paul This morning, I will review our financial highlights from the quarter provide an overview of our balance sheet and comment on our guidance and outlook.
Andrea Susan Freeborough: As Paul noted, we had a strong start to the year.
Andrea Susan Freeborough: 527000 ounces with gold sales of 522000 ounces.
Andrea Susan Freeborough: We held our cost of sales in line with the prior quarter up $982 per annum with an average realized gold price $2070 per ounce, we delivered strong margin at $1088 per ounce.
Andrea Susan Freeborough: APAC 13, 10 per ounce slightly lower compared to the prior quarter and comparable cost of sales and lower sustaining capital.
Andrea Susan Freeborough: Average realized gold prices since Q1 have been notably higher, driving strong ongoing margins and free cash flow. In Q1, our adjusted earnings were $0.10 per share, and adjusted operating cash flow was $425 million. We generated $145 million of attributable free cash flow in Q1, or $194 million, excluding changes in working capital. Turning to the balance sheet, our financial position remains strong. We ended the quarter with $407 million in cash and approximately $2 billion of total liquidity.
Andrea Susan Freeborough: Average realized gold price in Q1 have been notably higher driving strong ongoing margin free cash flow.
Andrea Susan Freeborough: In Q1, our adjusted earnings were 10 cents per share and adjusted operating cash flow was $425 million.
Andrea Susan Freeborough: We generated $145 million of attributable free cash flow in Q1 or $194 million, excluding changes in working capital.
Andrea Susan Freeborough: Turning to the balance sheet, our financial position remains strong.
Andrea Susan Freeborough: We ended the quarter with $407 million in cash and approximately $2 billion of total liquidity.
Andrea Susan Freeborough: Our trailing 12-month net debt-to-EBITDA ratio also improved as a quarter ended to just below one ton. At current gold prices, we expect our debt metrics to continue to improve throughout the year. As Paul mentioned, we plan to allocate excess free cash against the term loan due in 2025 and expect to start debt repayments in the fifth quarter. Turning to our guidance, Following Q1, we remain solidly on track to meet our guidance and produce 2.1 million ounces at a cost of sales of $1,020 per ounce and ASIC of $1,360 per ounce.
Andrea Susan Freeborough: Trailing 12 month net debt to EBITDA ratio also improved as the quarter at suggest below one time.
Andrea Susan Freeborough: At current gold prices, we expect our debt metrics continue to improve throughout the year.
Andrea Susan Freeborough: As Paul mentioned, we plan to allocate excess free cash against the term loan due in 2025 and expect to start that repayments this quarter.
Andrea Susan Freeborough: Turning to our guidance.
Andrea Susan Freeborough: Following Q1, we remain solidly on track to meet our guidance and produced $2 1 million ounces at a cost of sales.
Andrea Susan Freeborough: $1020 per ounce and APAC 13 16 correct.
Andrea Susan Freeborough: Capital expenditures are on track for our full year guidance of $1.05 billion, split roughly evenly between sustaining and non-sustaining capital. Cash flow is expected to be stronger in the second half as a result of the timing of tax payments made earlier in the year. I'll now turn the call over to Claude.
Andrea Susan Freeborough: Capital expenditures are on track for our full year guidance of one 5 billion split roughly evenly between sustaining and non sustaining capital.
Andrea Susan Freeborough: Cash flow is expected to be stronger in the second half as a result of timing of tax payment made earlier in the year.
Andrea Susan Freeborough: I'll now turn the call over to Todd.
Claude J. S. Schimper: Thank you, Andrea. We have achieved significant progress with the implementation of our Safety Excellence Program, which has reached over 50% of employees and business partners globally. This year, as part of our health and safety blueprint, we are taking additional steps to further improve engagement across the global team with a focus on human and organizational performance and operational learning teams. We will continue rolling out this program globally and look forward to providing further updates over the coming quarters.
Todd: Thank you Andrea we haven't seen significant progress with the implementation of a safety excellence program.
Todd: Which reached over 50% of employees and business partners.
Todd: This year as part of our health and safety Blueprint, we're taking additional steps.
Todd: Engagement across the global team.
Todd: Focus on human and organizational performance and operational lending teams.
Todd: We will continue rolling out this program globally and look forward to providing further updates.
In the coming quarters.
Claude J. S. Schimper: Moving to our operations, we saw a strong performance in Q1, with our minds delivering the planned production for the court. At Tassian, production of 159,000 ounces was in line with a prior quarter, with a cost of sales of $660 per ounce being the lowest in the portfolio. At the Tanzia solar plant, commissioning is now complete, and the plant is generating power at full capacity.
Todd: Moving to operations we.
Todd: We saw strong performance in Q1, with our months' delivery and production.
Todd: And Tasiast.
Todd: Reduction of 169000 ounces.
Todd: In line with the prior quarter.
Todd: Cost of sales of $660 bonds being the lowest in our portfolio.
Todd: It depends a solar plant commissioning is now complete and the block is generating power full capacity.
Claude J. S. Schimper: Nasius remains on track to meet its 2024 production guidance of 610,000 albums. The Paraka 2, production of 128,000 ounces, and a cost of sales of $1,059 pounds, were both in line with a prior court decision. Production at Parrot 2 this year is expected to be lower and cost higher compared to last year as mine sequencing continues to transition through the lower grade portions of the pit before moving back into higher grades next year. Barrack 2 remains on track to meet its 2024 production guidance of 510,000 hours.
Todd: As this remains on track to meet its 2020 full production guidance of 610000 ounces.
Todd: The path to production of 128000 ounces.
Todd: Cost of sales of 1050, non those bonds were both in line with the prior quarter.
Todd: So that's an impact to this year is expected to be lower and costs higher compared to last year as mine sequencing continues to transition through the lower grade portions of the pit.
Todd: Before moving back into higher grades next year.
Todd: Back to remains on track to meet its 2020 full production guidance of 510 powerhouse.
Todd: As a quick Buck.
Claude J. S. Schimper: [inaudible] Q1 production of 71,000 ounces was flat. The mine delivered strong free cash flow, driven by high-margin production from a cost of sales of $733 per ounce, which is the second lowest in our portfolio. Production is tracking well against our plans, a strong performance on grazing and recoveries, offset by lower throughput. In light of the strong current grades and recoveries, we took the opportunity to perform maintenance to improve the long-term reliability of the mill, while maintaining our production target of 250,000 ounces. At our U.S. operations, first quarter performance was on plan.
Todd: Q1 production of 71000 ounces was unplanned.
Todd: The mine delivered strong free cash flow driven by high margin production from our cost of sales of $733 per ounce.
Todd: Second lowest in our portfolio.
Todd: Production is tracking well against our plans our strong performance on grades and recoveries offset lower throughput.
Todd: In light of strong current grades and recoveries.
Todd: We took the opportunity to perform maintenance to improve the long term reliability of milk.
Todd: While maintaining our production target of 260000.
Todd: Yes.
Todd: And our U S operations first quarter performance was on plan.
Claude J. S. Schimper: Total production of 169,000 ounces, at a cost of sales of $1,312 per hour, beginning with Fort Knox, in part due to a significant weather event in Alaska at the beginning of the year. Q1 production of 53,000 ounces with lower quarter-over-quarter due to lower mulch throughput, grades, and recoveries, and lower ounces recovered from the leaf leach pad. The cost of sales of $1,466 was higher over the prior quarter primarily due to lower production.
Todd: Total production of 169000 ounces.
Todd: Cost of sales of $1312 paths.
Todd: Beginning with Fort Knox in part due to a significant weather event at Alaska at the beginning of the year Q.
Todd: Q1 production of 53000 ounces with lower quarter over quarter due to lower mill throughput.
Todd: And recoveries.
Todd: Lower ounces recovered from the heap Leach pads.
Todd: Cost of sales of $1466 per ounce was higher over the prior quarter, primarily due to the lower production.
Claude J. S. Schimper: At Mancho, mining activities, including home mining and stockpiling, have commenced. The transportation of the ore to Fort Knox continues to ramp up. At Fort Knox, mold modifications and site preparation are progressing on plan. First production from Man Show is on track for early Q3.
Todd: As mento mining activities, including all mining and stockpiling has commenced.
Todd: And transportation of the ore to Fort Knox continues to ramp up.
Todd: At Fort Knox modifications and site preparation is progressing on plan.
Todd: First production from <unk> is on track for early Q3.
Claude J. S. Schimper: At Bald Mountain, production of 47,000 ounces improved over the prior quarter, to whom my high answers recoat from the past. The cost of sales of $1,103 per ounce was lower quarter over quarter on higher production and a higher proportion of capitalized development. At Round Mountain, production of 68,000 ounces was higher quarter-over-quarter on stronger mole grade throughput and recovery. Cost of sales of $1,329 per ounce improved over the prior quarter on higher production and a higher proportion of capitalized mining activity related to the ongoing stripping at Phase S. Also, at Phase S, procurement and construction activities for the Heatbeach pad expansion remain on track, and first production remains on schedule to begin in the second half With that, I'll now pass the call over to William.
Todd: At Bald mountain production of 47000 ounces improved over the prior quarter.
Todd: Driven by higher ounces recovered from the pads.
Todd: Cost of sales of $1103 per ounce was lower quarter over quarter on higher production and a higher proportion of capitalized.
Todd: At round mountain production of 68000 ounces was higher quarter over quarter on stronger moat grade throughput and recoveries.
Todd: Cost of sales with $1349 per ounce improved over the prior quarter.
Todd: On a higher production and a higher proportion of capitalized mining activity.
Speaker Change: Thanks Tobey.
Speaker Change: Yeah.
Speaker Change: Also had phases procurement and construction activities for the heap Leach pad expansion remain on track and first production remains on schedule to beginning in the second half next year.
Speaker Change: With that I'll now pass the call over to William.
William Dunford: Thanks, Claude. I'll start by continuing on Round Mountain and then provide a few updates on progress at Curlew and Great Bear. At Round Mountain Phase X, as Paul mentioned, the underground decline has progressed well, with over 1,800 metres developed thus far. The decline has now reached the point where we can begin drilling off the target mineralization from underground, and we will be doing so in Q2. As we progressed to decline in Q1, we took the opportunity to drill in between the open pit and the underground target.
William: Thanks, Claude ill start by continuing on round Mountain and then provide a few updates on progress with <unk> and Greg there.
William: At round Mountain Phase acts as Paul mentioned, the underground decline has progressed well with over 1800 meters developed thus far.
William: The decline has now reached the point, where we can begin drilling off the target mineralization from underground and we will be doing so in Q2.
William: As we progressed to the decline in Q1, we took the opportunity to drill in between the open pit and the underground targets.
William Dunford: As you can see on the slide, this drilling hit multiple higher-grade intercepts, including 9.9 grams per ton over 21 meters and 16.6 grams per ton over 8 meters in an area where we had not previously modeled mineralization. We remain excited by the potential for higher margin production from the underground at Phase X and are pleased to see these higher-grade drill results supporting that potential. We look forward to updating you with additional drill results from the main target later in. At Gold Hill, we are progressing infill drilling of the underground targets from the bottom of the open pit, and we are also continuing surface exploration, targeting extensions at depth and along strike. Moving to Curlew Basin, underground drilling continued at the recently discovered Roadrunner Beam. Multiple zones of stalkwork veins were intersected while testing strike and dip extents over a broad area.
William: As you can see on the slide that's drilling multiple higher grade intercepts, including nine nine grams per tonne over 21 meters and $16 six grams per tonne over eight theaters and an area, where we had not previously modeled mineralization.
William: We remain excited by the potential for higher margin production from the underground at <unk> and are pleased to see these higher great drill results supporting that potential.
William: We look forward to updating you with additional drill results from the main target later this year.
William: Our golf Hell, we are progressing infill drilling of the underground targets from the bottom of the open pit and we are.
William: We're also continuing surface exploration targeting extensions at depth and along strike.
William: Moving to currently basin underground drilling continued at the recently discovered Roadrunner Batesville.
William: <unk> zones of stock work bidding for intersected, while testing strike and dip expense over a broad area.
William Dunford: Assays from this drilling are still pending, but the team has also been working on optimizing the potential mine designs to improve margins, and we are encouraged by the results to date. As Paul mentioned, we had a very productive first quarter of drilling at Great Bear, completing approximately 38 of the planned 120 kilometers of drilling budgeted for the full year. Our drilling at Great Bear continues to focus on finding zones of inferred mineralization at greater depths at LP Central, Discovery, and Vigo.
Assays from drilling are still pending.
William: Humans also been working on optimizing the potential mine designs to improve margins and we are encouraged by the results to date.
William Dunford: In Q1, we saw further high-grade intercepts around 1,000 meters vertical depth at Yuma, building on the resource we already have in that area, including 18.6 grams per ton over 10 meters. Our drilling also showed good grades and widths at depths well beyond our current resource at Discovery, Yarrow, and Oro, as you can see on the slide. These zones continue to grow at depth, similar to what we saw with resource growth through deeper drilling at Yuma.
William: As Paul mentioned, we had a very productive first quarter of drilling at great Bear completing approximately 38 of the planned 102000 kilometers of drilling budgeted for the full year.
William: Our drilling a great bear continues to focus on defining zones of mineralization at greater depths adult <unk> central discovery in vivo.
William: In Q1, we saw further high grade intercepts around 1000 meters vertical about at Yuma building on the resource they already have in that area, including 18, six grams per tonne over 10 meters.
William: Our drilling also showed good grades and web at depths well beyond our current resource discovery Euro and Oreo as you can see on the slide.
William: These loans continue to grow at that similar to what we saw with resource growth through deeper drilling at humor.
William Dunford: Although the PEA will be limited to MINI resources, this drilling continues to demonstrate our thesis that this orogenic deposit extends at significant depths with strong continuity, providing the potential for a long-life, high-grade mining complex. As with many undergrounds, the long-term potential will become more visible as we progress deeper with development and provide efficient drill access to the deeper mineralization, which is why we are now focused on progressing a YAC. As a reminder, we are advancing Great Bear through two key projects.
William: Although the PPA will be limited to M. Ini resources as drilling continues to demonstrate our thesis that this orogenic deposit extends at significant steps are strong continuity, providing the potential for a long life high grade mining complex.
William: As with many underground long term potential will become more visible as we progress deeper with development.
William: Quite efficient drill access to the deeper mineralization, which is why we are now focused on progressing AVX.
William: As a reminder, we are investing great bear across two key project streams.
William Dunford: The AEX underground decline, through which we plan to obtain a bulk sample and perform definition drilling and infill drilling, and the main project, which includes the mine, mill, and related infrastructure required for production. For the AX decline, subject to receipt of permits, we are targeting a start of surface construction in the second half of the year and a start of the underground decline in mid-2025. Detailed engineering, execution planning, and procurement for AEX continue to progress well.
William: Underground decline through which we plan to obtain a bulk sample and perform definition drilling and infill drilling in the main project, which includes the mine mill and related infrastructure required for production.
William: <unk> decline subject to receipt of permits were targeting a startup surface construction in the second half of the year and started the underground decline mid 2025.
William: Detailed engineering execution planning and procurement for <unk> continue to progress well.
William Dunford: Infrastructure such as the camp and water treatment plant has now been purchased, and we are planning to contract major civil works in QT. For the main project, we continue to advance technical studies, fieldwork, and comprehensive baseline studies. Work on the PEA is progressing well, and we look forward to releasing it in the second half of 2020. In Q1, we also conducted substantial geotechnical work to help inform project studies and to de-risk the project build. We look forward to continuing to provide updates as we progress all work streams towards advancing AEX and the main project. Now, we'll turn it back to Paul.
William: Infrastructure, such as the camp and water treatment plant has now been purchased and we were planning to contract major civil works in Q2.
William: For the main project, we continue to advance technical studies field work and comprehensive baseline studies.
William: Work on the PPA is progressing well and we look forward to releasing it in the second half of 2024.
William: In Q1, we also conducted substantial geotechnical work help inform project studies and Derisk the project built.
William: We look forward to continuing to provide updates as we progress all work streams towards advancing AVX in the main project I will now turn it back to Paul.
Paul: Thanks will.
Paul Rawlinson: Our business is off to a strong start this year, and there's plenty to look forward to this year.
Paul: Our business is off to a strong start this year.
Paul: There's plenty to look forward to this year and beyond that we remain excited about our future.
Paul Rawlinson: And beyond that, we remain excited about our future. We have a strong production profile that is generating significant cash flow. We have investment grade knowledge. We have a competitive dividend. We have an exciting pipeline of exploration and development opportunities. And we are very proud of our commitment to responsible mining that continues to make us a leader in ESG performance. With that, operator, I'd like to open up the line for questions.
Paul: We have a strong production profile.
Paul: We're generating significant cash flow.
Paul: We have an investment grade balance sheet, we have a competitive dividend.
We have an exciting pipeline of exploration and development opportunities.
Paul: And we are very proud of our commitment to responsible mining the continues to make us a leader in ESG performance.
Speaker Change: With that operator, I'd like to open up the line for questions.
Operator: Thank you. We will now begin our question and answer session. At this time, if you would like to ask a question, please press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, simply press star one again. As a reminder... We'll pause for a moment to compile the Q&A roster. Thank you. The first question comes from the line of Mike Parkin from National Bank. Please go ahead. Thanks guys.
Speaker Change: Thank you we will now begin our question and answer session. At this time, if you'd like to ask a question. Please press star followed by the number one on your telephone keypad. If you would like to withdraw your question Senior Press Star one again.
Speaker Change: As a reminder.
Speaker Change: We'll pause for a moment to compile the Q&A roster. Thank you.
Speaker Change: Yeah.
Speaker Change: The first question comes from the line of Mike Parkin from National Bank. Please go ahead.
Michael Parkin: Thanks guys and congrats on a solid quarter. First question, on the solar planet test, can you give us a sense of like, it's at full capacity now, but how did that kind of benefit Q1? kind of running at 60% for Q1 and now we can assume at 100%, you know, further improvement, or was it close to 100% for Q1?
Michael Parkin: Thanks, guys and congrats on a solid quarter.
Michael Parkin: First question on the older Planet task.
Michael Parkin: Give us a sense of like it is at full capacity now, but how does that kind of benefit Q1 was it.
Michael Parkin: Kind of running at 60% for Q1.
Speaker Change: Now we can assume at 100% further improvement or did it well.
Speaker Change: Is it close to a 100% for Q1.
Speaker Change: Okay.
Unnamed Kinross Gold Representative: Yeah, Mike, when we start commissioning those parts, you really start very low, at like two megawatts a day, and then it ramps up slowly, then you suddenly do the next step change, which is 10. And by the end of the first quarter, we got to 34 megawatts, so we... I would say it's a graduated path but not a linear line; it's sort of parabolic.
Speaker Change: Yes.
Speaker Change: When we start commissioning those bonds do you really start very low, but two megawatts a day and then it ramps up slowly then you suddenly do the next step change versus 10.
Speaker Change: By the end of the first quarter, we got to <unk>.
Speaker Change: Full megawatts.
Speaker Change: Yes.
Speaker Change: I would say, it's a graduated path, but not a linear line.
Speaker Change: Parabolic.
Unnamed Kinross Gold Representative: The real benefit is going to come in from now on.
Speaker Change: The real benefit is going to come in.
Speaker Change: Now for it.
Speaker Change: Okay.
Speaker Change: That's great.
Speaker Change: And then the.
Michael Parkin: That's great, and then the timeline on Round Mountain Underground. Just can you walk us through? Again, you've got some really good illustrations there, but
Speaker Change: Timeline on round Mountain underground just can you walk us through.
Speaker Change: Again, whether you've got like some really good illustrations there but.
Michael Parkin: Just trying to think about timing in terms of like, what do you need to get in terms of permits, equipment ordering, that kind of thing. Just how does that all kind of fall together over the next few years?
Speaker Change: Just trying to think about timing in terms of like what do you need to get in terms of permits.
Speaker Change: Equipment ordering that kind of thing just how does that all kind of fall together.
Speaker Change: Two years.
Unnamed Kinross Gold Representative: Yeah, I mean, as we've pointed out, the main focus right now is on starting to drill the main exploration target that we're there for. So we're starting to do that now.
Speaker Change: Yes.
Speaker Change: As you pointed out the main focus right now is on starting to trail. The main exploration target, where the air force that we're starting to do that now.
Speaker Change: In terms of permitting it's actually already from a historic permitting action that's already permitted at the federal level. There is some state permitting that we're going through this year and some final operational permits.
Unnamed Kinross Gold Representative: In terms of permitting, it's actually already, from a historic permitting action point of view, it's already permitted at the federal level. There is some state permitting that we're going through this year, and some final operational permits. But we're progressing those as we go, and we don't see permitting as the critical path. As you can see, our exploration decline is relatively close to the actual exploration targets. Once we get it drilled up, it's really just a matter of drifting across, putting the ramps in place, and starting to access the ore body.
Speaker Change: But we're progressing those as we go and we don't we don't see permitting is the critical path.
Speaker Change: You can see our exploration decline is relatively close to the actual exploration targets once we get it drilled up.
Speaker Change: Really just a matter of drifting across putting the ramps in place and starting to access the ore body. So it's a pretty pretty simple grab up in this case already got a mill onsite and we're kind of got to go there. So it's just a couple of years.
Unnamed Kinross Gold Representative: So it's a pretty simple ramp-up. In this case, we've already got a mill on site, and we're kind of good to go there. So it's just a couple of years of making sure we get the drilling in place, get the studies right so that we can move forward with the right mine plan.
Speaker Change: Making sure we got the drilling in place get the studies right.
Speaker Change: Move forward with the right mindset.
Speaker Change: Okay.
Michael Parkin: And you've had quite a bit of success. Like every quarter, you give us another update, and it just continues to show that it is getting bigger and bigger.
Speaker Change: You've had quite a success like every quarter you give us another update just continues to show to be getting bigger and bigger some of the grades are really impressive is there any internal thoughts changed in terms of potential grade is or what your potential tons per day might actually be or are you.
Michael Parkin: Some of the grades are really impressive. Is there any internal thought change in terms of what the potential grade is or what your potential tons per day might actually be? Or are you kind of committed based on what you're designing it with? Or is there room for making it bigger and better if it continues to grow like it is?
Speaker Change: Dr committed based off what you are designing it or is there room for that.
Speaker Change: Bigger and better yes. It continues to grow like it is.
Unnamed Kinross Gold Representative: That's why we're doing the drilling. So that's why we've done this exploration decline, and we need to drill this in a lot more detail so that we can, again, put the right mining method around it. Obviously, you can tell it's going to be some form of bulk mining method, but we have to drill it before we can get more granular on the total size of the resource, etc.
Speaker Change: That's why we're doing the drilling side of it. So that's why we've done this exploration decline that we need to drill a lot more details. So that we can again with the right mining method around obviously you can tell it's going to be some form of bulk mining method.
Speaker Change: But before we can.
Speaker Change: Drilling before we can get more granular on the total size of the resource et cetera.
Unnamed Kinross Gold Representative: Okay, but it does seem like it surprised me positively in terms of where the mineralization is in the volume of water.
Speaker Change: Okay.
Speaker Change: It does seem like it surprising you positively in terms of where the mineralization is and the volume.
Unnamed Kinross Gold Representative: We're obviously excited by some of the results and, you know, in particular this one, what's exciting about it is it's actually outside of the area that we were targeting for mineralization, so that shows us some potential for upside versus our initial vision on this, and to keep everyone with the work.
Speaker Change: We're obviously excited by some of the results and in particular this one order what's exciting about it is it's actually outbound of the area that we were targeting for mineralization. So that that shows us some potential for upside versus our initial issue.
Speaker Change: Yes.
Speaker Change: Could you keep it along with the work.
Michael Parkin: And then switching over to Curlew, you know, another exploration project that just keeps, you know, putting up pretty solid results. What are your thoughts there in terms of, I think I asked you last year, but has that changed?
Speaker Change: And then.
Speaker Change: And over the curlew.
Speaker Change: Another exploration projects that just keeps.
Speaker Change: Putting up pretty solid results.
Speaker Change: Is your thoughts there in terms of I think I've asked you last year, but.
Michael Parkin: You know, there's obviously an inflationary environment. Is there kind of an internal target that you're able to share with us in terms of how big you'd want to get it? You're sitting at over a million ounces of total resource at year-end 2023. I'm just kind of wondering... How big do you want to get it before you pull the trigger on a restart?
Speaker Change: Has that changed.
Speaker Change: Seeing an inflationary environment.
Speaker Change: Is there kind of an internal target that youre able to share with us in terms of how big you'd want to get it.
Speaker Change: You're sitting at over a million ounces, a total resource at year end 2023, and just kind of wondering.
Speaker Change: How big do you want to get it before you pull the trigger on a restart.
Paul Rawlinson: Yeah, Mike. It's Paul here. I'll take a crack at that one. Yeah, look at it. It's still early exploration slash development. As you've seen, the drilling is going well. We have encountered some new zones. The newer zones tend to be higher grade, and we just want to keep going with that to get a better sense of what those higher grades might do for what could ultimately be a This is a good little line with good grades, and so we're not, we're not rushing it forward. We've been doing some work around mine plan optimization thinking as we continue to drill and try to see if we've got, you know, more extensions on
Speaker Change: Yes, Mike it's Paul here.
Paul: On that one.
Paul: Yes.
Paul: Install exploration slash development.
Paul: As you've seen the drilling is going well, we have encountered some new zones newer zones tend to be higher crane.
Paul: And we just want to keep going with that to get a better sense somewhat.
Paul: Those higher grades might do or what could ultimately be.
Paul: The annual production.
Paul: This is a good little mine.
Paul: Good grades.
Paul: And so we're not we're not rushing it.
Paul: We've been doing strong.
Paul: Work around mine plan optimization thinking as we continued to trail.
Paul: See if we've got it in a more extensions on these high grades.
Paul Rawlinson: So we haven't made a target today. We don't have a target yet. I'm pretty comfortable this will be a mine. It's, we're just not sure yet. We want to drill it some more to get a better idea of what it could ultimately be. And Kim Rohnstein.
Speaker Change: We haven't we don't have a target today.
Speaker Change: Well see as we go.
Speaker Change: Pretty comfortable this will be our mine.
Speaker Change: We're just not sure yet.
Speaker Change: We want to drill it's mark again, a better Samsung.
Speaker Change: Good morning kit.
Speaker Change: Ultimately be.
Paul Rawlinson: And can you remind me again, is everything being drilled from the surface there, or do you have any underground platforms that you're working from? It's underground. So you're speaking to kind of the stealth zone, which is putting up some impressive grades. You've got Roadrunner as a target, and then K-5 in kind of a deeper extension of K-2. That's all kind of on the docket for this year.
Kit: Thank you Ryan again, if everything being drilled from surface there or do you have any underground platforms that youre working for them.
Kit: It's underground.
Kit: Great.
Kit: So and you're speaking to kind of the Delta film, which is putting out some impressive grades you've got road runner as a target and the K five.
Kit: This deeper extension of K, two that's all kind of on the docket for this year.
Paul Rawlinson: Yep, we'll keep going with all that. OK.
Speaker Change: Yes, it will keep going with all of that stuff.
Michael Parkin: Okay, super. Looking forward to more results and congrats again, guys.
Speaker Change: Okay looking forward to more results and congrats again guys.
Speaker Change: Thank you Mike.
Joshua Mark Wolfson: The next question comes from the line of Josh Wolfson from RBC Capital Markets. Please go ahead.
Speaker Change: The next question comes from the line of Josh Wolfson from RBC capital markets. Please go ahead.
Joshua Mark Wolfson: I'd acknowledge good free cash for generation this quarter when gold prices were lower. When you start to think about capital allocation, I know the team has mentioned debt repayment being a focus, but beyond a couple of maturities near-term, the other debt issues are much longer term. What's the company looking to do with this excess free cash generation at NSI? Is there any sort of thought on the buyback reemergence?
Joshua Mark Wolfson: Yes, thanks very much so.
Joshua Mark Wolfson: <unk> good free cash flow generation this quarter.
Joshua Mark Wolfson: Gold prices were lower.
Joshua Mark Wolfson: When you start to think about capital allocation I know that Tim has mentioned debt repayment being a focus but beyond.
Joshua Mark Wolfson: Beyond the couple of maturities near terms the other debt issues are much longer term whats the company looking to do with this excess free cash generation and aside is there any sort of thought on the buyback I re emerging thank you.
Paul Rawlinson: I'll start and maybe hand off to Andrea. Look again, as we said in the call earlier, the focus this year is really around the term loan and paying down the term loan. It's great to see these gold prices where they are today, but again, we have to keep in mind that we just got into it this quarter. Let's see how we go. We're optimistic about the gold price. We see the upside from here.
Speaker Change: Yes, I'll start and maybe hand off to Andrea.
Andrea Susan Freeborough: Look again as we said.
Speaker Change: And in the call earlier.
The focus this year is.
Speaker Change: Really around the term loan and pay down the term loan.
Andrea Susan Freeborough: It's great to see these.
Andrea Susan Freeborough: These gold prices, where they are today.
Andrea Susan Freeborough: But again, we got to keep in mind, we just kind of annual interest corner.
Andrea Susan Freeborough:
Speaker Change: Let's see how we go.
Speaker Change: We're optimistic on the gold price.
Paul Rawlinson: And as you know, Josh, we've got incredible gearing to the gold price, and in the leverage, the deleveraging possibility, in the context of where we're training today, is pretty powerful. So we want to just get through that. And that is our focus as it relates to capital. And, you know, we'll continue the discussion as we go through the course of the year.
Speaker Change: We see upside from here and as you know Josh we've got incredible gearing.
Speaker Change: Two the gold price and.
Speaker Change: And the leverage indeed, leveraging possibility in the context of where we're trading today as is.
Speaker Change: It's pretty powerful so we want to let's just get through that and that is our focus as it were.
Speaker Change: Relates to capital.
Speaker Change: And.
Speaker Change: We will continue the discussion as we go through the course of the year.
Joshua Mark Wolfson: Looking at the production splits over the remainder of the year, I think on the last call there was some discussion about second half production being weighted a bit higher, which I guess is still reasonable given Manchow's ramp-up, but in light of first quarter production being a bit higher, at least than our expectations, how should we think about the first half-second half split?
Speaker Change: Got it thank you.
Speaker Change: Looking at the production splits over the remainder of the year I think on the last call. There was some discussion about second half production being weighted a bit higher.
Speaker Change: Which I guess, it's still reasonable given the <unk> ramp up but.
Speaker Change: <unk> first quarter production being a bit higher at least than that our expectations. How should we think about the first half second half split.
Andrea Susan Freeborough: You know, Josh, it's early in the year. I mean, we're obviously happy with Q1 production. So, you know, at this point, our full-year guidance range still stands.
Speaker Change: Hey, Josh it's early in the year I mean, we're obviously happy with Q1 production.
Joshua Mark Wolfson: At this point, our full year guidance range and then we'll see how it goes for the second quarter, but it was.
Andrea Susan Freeborough: Then, you know, we'll see how we go through the second quarter, but it was, you know, a little bit weighted toward the second half, 49-51%. And we'll see how that evens out as we go through the second quarter.
Joshua Mark Wolfson: A little bit weighted I think 49, 51% for the second half and let's see how that keeping Fedex trade of second quarter.
Andrea Susan Freeborough: But I would also add Andrea, though, and certainly from a production point of view, from a cash flow point of view, the second half will be stronger. Again, you may recall that we have some seasonality to the tax payments, and Q1 tends to be a heavier tax payment recorder. That's when we pay our taxes in Brazil, so all things being equal, we would expect cash flows to be stronger in the second half. Yeah, we had our tax payment. We paid about $80 million in taxes in the first quarter. The bulk of that was more sort of a one-time thing.
Joshua Mark Wolfson: I would also add though that certainly from a production point of view from a cash flow second half will be stronger.
Joshua Mark Wolfson: Again, you may recall that we have some seasonality of tax payments.
Joshua Mark Wolfson: Q1 tends to be a heavier.
Joshua Mark Wolfson: Tax payments in the quarter.
Joshua Mark Wolfson: That's when we pay our taxes in Brazil. So.
Joshua Mark Wolfson: All things being equal we would expect cash flow to be stronger in the second half.
Joshua Mark Wolfson: Yeah, we had our tax payment, we paid about $80 million attack in the first quarter.
Joshua Mark Wolfson: The bulk of that way.
Joshua Mark Wolfson: More sort of one time.
Joshua Mark Wolfson: No.
Joshua Mark Wolfson: Lastly, on Man Show, with some of the noise around the trucking aspects and some of the results we're waiting to hear back in the courts, what's the sort of thoughts there on how the company ramps up trucking efforts? Is there any risk on those timelines or any constraints on what activities are planned?
Speaker Change: Got it. Thank you and then lastly on unmanned show.
Speaker Change: With some of the noise around.
Speaker Change: The trucking aspects and some of the results we're waiting to hear back in the courts.
Speaker Change: What's the sort of thoughts there on how the company wraps up trucking FX is there any risk on those timelines are already constraints on what activities are planned.
Unnamed Kinross Gold Representative: Like, you know, Josh, we're permitted, and we've done everything by the books, according to the Department of Transport in Alaska. We're trucking every day. We're building stockpiles as we complete the mill modification. You know, we're always sensitive to, you know. Some of the local concerns about trucking, but if you really drill into it and get granular, this is a major highway, and we're a very small percentage of the overall daily volume. We're permanent, we're trucking, and we'll continue. Thank you very much.
Speaker Change: Hi, Ken.
Ken: Josh were permanent and we've done everything by the books. According to the department of transport in Alaska, We're tracking every day.
Ken: We are building stockpiles as we complete no modifications.
Ken: Sure.
Ken: Two.
Ken: Some of the local.
Ken: Concerns about tracking but if.
Ken: If you really drill into it and get granular.
Ken: As a major highway it for a very small percentage of the overall daily volumes.
Ken: Our permanent our trucking and will continue.
Joshua Mark Wolfson: Great. Thank you very much.
Speaker Change: Great. Thank you very much.
Speaker Change: Yeah.
Anita Soni: The next question comes from the line of Anita Soni from CIBC World Markets. Please go ahead.
Speaker Change: The next question comes from the line of <unk> from CIBC World markets. Please go ahead.
Anita Soni: Good morning, Paul, Andrea, and Claude, and thanks for taking my question, and firstly, congratulations on a strong quarter. I just wanted to ask about Tassius. I think in my notes I had a five-day mill maintenance shutdown. Did that happen in Q1?
Speaker Change: Good morning, Paul Andrea and Todd and Thanks for taking my question and firstly, congratulations on a strong quarter.
Speaker Change: I just wanted to ask about Tasiast I think in my notes I had a five day mill maintenance shutdown did that happen in Q1.
Unnamed Kinross Gold Representative: Yes, it did. We extended it by a day, but overall, January was a little bit of a lower month, and then we certainly exceeded our expectations in February and March and then to higher production. Okay, and so that, so removing that you did indeed meet and exceed the 24k time per day this quarter. I think the final average was 23, but we balanced it with, like I said, the major shut down in January and then you would... in February and March.
Speaker Change: Yes, it did and we extended it by a day, but <unk>.
Speaker Change: Overall January was a little bit on the lower months then.
Speaker Change: We certainly exceeded our expectations in February and March and then okay.
Speaker Change: Sure.
Speaker Change: Okay, and so that.
Speaker Change: As we're moving that you did indeed meet and exceed the 24 K ton per day. This quarter then.
Speaker Change: I think the final average was 23.
Speaker Change: Got it.
Speaker Change: Balanced.
Speaker Change: Obviously, the major shutdown in January and then you need.
Speaker Change: Uh huh.
Speaker Change: February and March.
Anita Soni: Yeah, that's the other one. Yeah, that's what I'm driving at. So okay, and then just
Speaker Change: Yes, as I mentioned, 25%.
Speaker Change: Okay.
Anita Soni: Yeah, that's what I'm driving at. So, okay. And then I'm just moving to PARIPHATU on grades.
Speaker Change: Yes, that's what I'm driving at so Okay, and then just leaving two parakeets you on grades.
Speaker Change: How do you think that's going to evolve over the course of the year like is it still similar in the first.
Unnamed Kinross Gold Representative: How do you think that's going to evolve over the course of the year? It's like, is it still similar in the first, you know, the next couple of quarters? I think it, I think in my notes, I had Q1 to Q3 around the same levels, and then in Q4, there's an uptick.
Speaker Change: In the next couple of quarters I think it I think in my notes that had a.
Speaker Change: Q1 to Q3 around the same levels in that in Q4, there's an uptick.
Speaker Change: So there's a slight uptick in Q4, because we start to move back in to the other side of it but.
Speaker Change: Sydney.
Unnamed Kinross Gold Representative: relative to last year, that was the greatest over the first three quarters, and then 2014 was slightly higher, and then next year we go back to, similar to 2023.
Speaker Change: Relative to last year that the greatest.
Speaker Change: The first three quarters of this year.
Speaker Change: And then.
Speaker Change: Yeah.
Two we go back into some of the.
Unnamed Kinross Gold Representative: So that would be 0.4 grams, right? For 2025?
Speaker Change: So that four gram rate for 2021 that's right.
Anita Soni: That's right, yes. And then, in terms of the PFS on Great Bear, I'm just wondering what size of plant you're targeting. I just want to reiterate, I guess, the thinking was, was it a 10 K ton per day plant that you guys were looking at?
Speaker Change: That's right.
Speaker Change: And then.
Speaker Change: In terms of the PFS on great there.
Speaker Change: I'm just wondering what size of plant that you're targeting I just wanted to reiterate I guess the thinking like within a 10-K ton per day plant that you guys are looking at.
Unnamed Kinross Gold Representative: Yeah, we haven't changed that paper.
Speaker Change: Yeah, we haven't changed that thinking that's still what we're targeting.
Speaker Change: Yes.
Speaker Change: Okay.
Anita Soni: It is a P-E-A-R-O-P-F-S. Oh, sorry. Sorry. P-E-A-R-O-P-F-S. I'm trying to clarify that on the call here this morning. Yeah, no, that's fine. I... I...
Speaker Change: It is a P. A PFS just oh, sorry, sorry.
Speaker Change: I'm sorry.
Speaker Change: I'm trying to clarify that.
Speaker Change: Here this morning.
Anita Soni: Yeah, no, that's fine. I actually, you know, that's kind of what I expected considering, you know, how much time you guys have to bring us into production. The first step is usually the PEA stuff. Okay, that's it for my question. Thank you.
Speaker Change: Yeah, No that's fine I might actually.
Speaker Change: That's kind of what I expected considering how much how much time, you guys have to bring it into production in the first step is usually the PEO.
Speaker Change: Okay.
Speaker Change: That's it for my question. Thank you.
Speaker Change: Thanks.
Tanya Jakusconek: The next question comes from the line of Tanya Jakusconek from Scotiabank. Please go ahead.
Speaker Change: The next question comes from the line of Danielle to disconnect from Scotiabank. Please go ahead.
Tanya Jakusconek: Good morning everyone, congratulations on that good quarter and thank you for taking my questions. I was just going to follow up on Anita's question on the PEA on Great Bear, and I think, Paul, you mentioned it was going to include some of the MNI and some of the inferred. Um, so, you know, the combination of that is just over 6 million ounces that you've reported. Should we be thinking that 4 to 5 million ounces would be a reasonable assumption to have this PEA support this 10,000 tons of MNI?
Danielle: Good morning, everyone. Congrats on a good quarter and thank you for taking my question I was just going to follow up from <unk> question on the Pega on great. There and I think Paul you mentioned, it was going down and create some.
Danielle: Emma MNI and some of the inferred.
Danielle: So that's.
Danielle: The combination of that is just over 6 million ounces that kids reported should we be thinking that four to 5 million ounces would be a reasonable assumption to have S. P. A support their 10000 ton a day 500000 ounce production profile.
Paul Rawlinson: Yeah, that's right. Maybe I'll start, well, you can jump in if that's correct. The reason we're going again with the PEA is it does allow us to include inferred. The reason we want to include inferred is it allows us to give you some visibility of the underground. So that's the key rationale.
Danielle: Yes.
Danielle: Maybe I'll start with Chuck.
Chuck: Yes, that's correct.
Chuck: And the reason, we're going again with the PPA is it does allow us to include in FERC.
Chuck: The reason, we want incubated hard as it allows us to give you some visibility of the underground.
Chuck: So that's the key rationale but.
Paul Rawlinson: But obviously, on the other side of the equation, where we're limited with what we've been able to drill in the last two years. As you said, the total of all of that, M.I. and I are about six, and with any contained resource, we're going to have, um, you know, a percentage of that that gets put into my planning at this point in time. We, I think on the call, we said a subset, but really it's most of that, and Will, maybe you can elaborate, but I think Tanya is exactly right.
Chuck: Obviously.
Chuck: On the other side of the equation.
Chuck: We're unlimited with what we've been able to drill in the last two years.
Chuck: As you said the total of all of that is about six.
Chuck: With any contained resource we're going to have.
Chuck: You know what percentage of that that gets put into our mine planning at this point in time.
Chuck: Uh huh.
Chuck: I think on the script call, we set a subset, but it really it's most of that well maybe you can elaborate but I think it's.
Speaker Change: Exactly yes.
Speaker Change: We don't know the exact number but clearly based on your question I understand that.
Speaker Change: There's going to be some areas on the periphery of the current drilling and the resource that we need to drill further and expand before it pulls into our mine planning and justifies continuation of the ramp so.
Speaker Change: So it will be that subset as Paul noted that is most of the ounces, we're still doing the work and obviously when we released it.
Paul Rawlinson: idea of exactly how many ounces are going to be in there, but it will be most of what you've seen on the resource table.
Speaker Change: You'll get the idea of exactly how many.
Speaker Change: Allison's aren't going to be in there.
Speaker Change: But it will be box, what you've seen on the resource statement.
Tanya Jakusconek: Okay, now I got that like so probably more than five to support a 10-year mine life at that 500,000 ounces open pit underground.
Speaker Change: Okay, I got that lifestyle, so probably.
Speaker Change: More than five to support a 10 year mine life.
Speaker Change: 500000 ounces open pit underground.
Tanya Jakusconek: Again, I am still doing the work.
Speaker Change: Again, it's still doing the work.
Speaker Change: Got it.
Tanya Jakusconek: Okay great thank you for that and that maybe what I if I could ask Claude to just comment on just the you know you had good costs you know this in Q1 can you just go through your input costs and just remind me you know where you're seeing maybe some easing and inflationary pressures or where things are still sticky through your cost profile so I can try and gauge obviously high ball price in fact your royalties I mean aside from that all of the other inputs labor consumable fuel etc where you're seeing some easing and where you're seeing some in some sticky inflation pressure.
Speaker Change: Okay. Great. Thanks, Thank you for that and that maybe what I, if I could ask Claude to just comment on that.
Claude: You have good cost.
In Q1 can you just go through your input costs and just remind me.
Claude: Where youre seeing maybe some hearings and inflationary pressures of where things are still sticky through your cost profile. So I can try and get a job obviously high book price impact your royalties I mean aside from that all of the other inputs labor consumables et cetera, where youre seeing some easing in radio.
Speaker Change: Thanks, Matt.
Speaker Change: Different sticky inflation pressure.
Claude J. S. Schimper: I think so. I'll start off, Tanya, with labor across the board relatively flat relative to last year. We have some longer-term agreements for the next two to three years, where we're seeing a little bit of pressure. The commodities are kind of split for some strange reason. Lime across the board has... Greg Barnes, Tanya Jakusconek, Andrea Freeborough, Ned Jalil, Claude Schimper, Ralph Profiti So, across the board, our quantities are relatively flat, except for this anomaly of Lyme, and then power costs are relatively flat, other than in Alaska, where we're seeing significant pressure on power costs. Again, because those plants are carbon-generated plants and the state is...
Speaker Change: I think so I'll start off.
Speaker Change: And then with labor.
Speaker Change: Across the board is relatively cheap.
Speaker Change: Flat relative.
Speaker Change: Relative to last year.
Speaker Change: We have some longer term agreements with.
Speaker Change: Employee groups.
So the next two to three years.
Speaker Change: Where we're seeing a little bit of pressure.
Speaker Change: Commodities are kind of split.
Speaker Change: For some strange reason lime across borders.
Speaker Change: Kris.
Speaker Change: But the this mitchell process like a score draw.
Speaker Change: Turning to media.
Speaker Change: Explosives has come back down a little bit which is great.
Speaker Change: Given the challenges.
Speaker Change: But so.
Speaker Change: So over the across the board our quantities are relatively flat except for this anomaly offline.
Speaker Change: And then power costs are relatively flat other than <unk>.
Speaker Change: Alaska, where we're seeing a significant.
Speaker Change: Sure.
Speaker Change: Again, because those plants are.
Speaker Change: Carbon generating plants.
Speaker Change: The state is facing.
Speaker Change: The cost base.
Claude J. S. Schimper: I think overall, I... Overall, Tanya, I would just add, you know, we talked about sort of a 3% to 5% inflation.
Speaker Change: I'd say overall.
Speaker Change: Overall I would just add we talked about just scared about 3% to 5% inflation factor.
Claude J. S. Schimper: and the inflation factor over our average cost for 2023. And that's still standing, as you said, but early in the year.
Speaker Change: However, our average cost for 2023.
But early in the year.
Tanya Jakusconek: Yeah, and maybe just on cyanide, some companies are seeing pressure on cyanide prices. Are you seeing that as well?
Speaker Change: Yeah, and maybe just combine some companies are seeing pressure on cyanide pricing.
Speaker Change: Seeing that as well.
Claude J. S. Schimper: For most of our portfolio, we have some long-term deals that we're really capitalizing on. Other than that, it's relatively flat quarter over quarter.
Speaker Change: So for the most of our portfolio, we have some long term deals that would be really capitalizing on.
Speaker Change: Other than that it's ready to be flat quarter over quarter.
Tanya Jakusconek: Okay, well, that's just to hear that at least we're not going out. And then my final question, if I can, to Paul. Elections in Mauritania are coming up. Can you just talk a little bit about what you're hearing and if there will be any impact on your agreement in place, royalties, taxation, et cetera, that would be helpful given everything else going on around the world.
Speaker Change: Okay.
Speaker Change: We're here.
Speaker Change: We're not going out.
Speaker Change: And then my final question, if I can to call that.
Speaker Change: Actions in Mauritania.
Speaker Change: Coming up can you just talk a little bit about.
Speaker Change: You know, what you're hearing and if any impact to your Ram agreement in place royalties taxation etcetera.
Speaker Change: That would be helpful given everything else going on around the world.
Speaker Change: Sure.
Paul Rawlinson: Sure. Well, I'd start by saying our government relations in Mauritania are outstanding. President Goswami is running for re-election. His platform has been and continues to be around strengthening the economy, increasing foreign investment, and We've had really good interactions with him. So again, given the state of play, I don't want to get into predicting election outcomes, but... I think it should be a relatively straightforward process, and President Goswami garners a lot of support in the country.
Speaker Change: Look I would start by saying our government relations.
Speaker Change: Retaining our outstanding.
Speaker Change: President Goswami is running for reelection.
Speaker Change: His platform previously and continues to be around strengthening the economy is.
Speaker Change: Increasing foreign investment.
Speaker Change: We've had really good interactions with him.
Speaker Change:
Speaker Change: So.
Speaker Change: Again, I think given the state of play.
Speaker Change: I don't want to get into predicting election outcomes, but.
Speaker Change: I think.
Speaker Change: I think it should be a relatively straightforward process.
Speaker Change: President <unk>.
Speaker Change: Garners a lot of support in the country.
Speaker Change: We've had no indications or no.
Paul Rawlinson: We've had no indications or no... No suggestions of changing anything to do with our taxes or royalties. I would say that. You know, we are this year, 2024, are going to be in an income tax payable position, um and I think that's um that's you know ironically I think that's uh I I welcome that I I as a you know being a foreign investor in the company we've had a lot of capital a lot of shelter over the years as we've been expanding but with gold prices where they are today we're we're about to stop paying income tax so things are going really well in Mauritania uh at the mine uh with the government and I believe the election should be relatively straightforward.
Speaker Change: No suggestions on changing anything to do with taxes and royalties.
Speaker Change:
Speaker Change: I would say that.
Speaker Change: No.
Speaker Change: We are this year 2024.
Speaker Change: Going to be in.
Speaker Change: Income tax payable position.
Speaker Change: And I think thats.
Speaker Change: Ironically I think thats.
Speaker Change: I welcome that.
Speaker Change: Uh huh.
Speaker Change: Being a foreign investor in the company, we tried a lot of capital a lot of shorter over the years as we've been expanding but with gold prices, where they are today, where we're about income tax so things are going really well in Mauritania.
Speaker Change: Uh huh.
Speaker Change: At the mine with the government and I believe the election should be relatively straightforward.
Tanya Jakusconek: And I think you have a sliding royalty, right? If I can remember correctly, so they participate on the upside.
Speaker Change: Yeah, and I think given sliding royalty right, Joe if I can remember correctly, so they participate on the outside.
Tanya Jakusconek: Correct, exactly. That's great. Thank you so much.
Speaker Change: Correct exactly.
Speaker Change: Okay. That's great. Thank you so much for it.
Tanya Jakusconek: That's great. Thank you so much for taking my questions and congrats on a good job.
Speaker Change: Questions and congrats on a good quarter.
Yeah.
Speaker Change: Yes.
Operator: As there are no further questions at this time, this concludes our Q&A session. I would like to turn the call over to Paul for a brief closing remark.
Speaker Change: As there are no further questions at this time. This concludes our Q&A session I would like to turn the call over back to Paul for a brief closing remarks.
Paul Rawlinson: Thanks, operator. Thank you, everyone, for calling in, and we look forward to catching up with you in person in the coming weeks and months.
Speaker Change: Thanks, operator.
Paul: Thank you everyone.
Paul: For calling in and we look forward to.
Paul: Catching up with you in person in the coming weeks and months.
Operator: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.
Speaker Change: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
Paul: Okay.
Paul: Okay.
Paul: Okay.
Paul: Okay.