Q1 2024 B2Gold Corp Earnings Call
Operator: Thank you for standing by. This is the conference operator. Welcome to B2Gold Corporation's first quarter 2024 financial results conference call. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity for analysts to ask questions. To join the question queue, you may press star, then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then zero. I would now like to turn the conference over to Clive Johnson, President and CEO of B2Gold. Please go ahead. Thank you, Operator.
Thank you for standing by this is the conference operator welcome to be to go Corporation's first quarter 'twenty 'twenty four financial results Conference call. As a reminder, all participants are in listen only mode and the conference is being recorded after the presentation there will be.
Operator: An opportunity for analysts to ask questions to join the question queue. You May Press Star then one on your telephone keypad should you need assistance during the conference call you May signal, an operator by pressing Star then zero I would now like to turn the conference over to Clive Johnson, President and CEO of B to gold. Please go.
Operator: Ahead.
Clive Thomas Johnson: Thank you, operator. Good morning, ladies and gentlemen.
Clive Thomas Johnson: Thank you operator, good morning, ladies and gentlemen, welcome to our call to discuss our first quarter 2024 operating.
Speaker Change: Nice results.
Clive Thomas Johnson: Okay.
Clive Thomas Johnson: Welcome to our call to discuss our first quarter 2024 operating and financial results and to give you a corporate update as well. Many of you, or all of you, will have seen the news release that's come out. It gives quite a lot of detail.
Clive Thomas Johnson: And if you hold you will see the news that's come out.
Clive Thomas Johnson: A lot of detail.
Clive Thomas Johnson: We're off to a solid start for 2022.
Clive Thomas Johnson: 225000 ounces.
Clive Thomas Johnson: We're off to a solid start for 2024. We produced over 225,000 ounces of production. Clash.
Clive Thomas Johnson: Yeah.
Clive Thomas Johnson: Well sure.
Clive Thomas Johnson: Facilitating the patient's alignment is what we expected, with all three B2Gold operating lines performing well. And importantly, cash operating costs and all sustained costs in the first quarter both came in well below our annual guidance ranges. And Mike will give you a lot more. Mike Cinnamond will be talking shortly to give you a lot more detail, but a very strong quarter, excellent financial position going forward. The mines are operating very well.
Clive Thomas Johnson: And the basis in line with what.
Clive Thomas Johnson: We expect all three.
Clive Thomas Johnson: Well that pretty much performing well.
Clive Thomas Johnson: Importantly, cash operating costs at all shipping costs in first quarter, Volkswagen well below.
Clive Thomas Johnson: Rachel.
Michael Andrew Cinnamond: Michael to give a lot more of it.
Speaker Change: Can you talk about where digital voice.
Clive Thomas Johnson: A very strong quarter in excellent financial position.
Clive Thomas Johnson: Towards the merger are operating very well.
Clive Thomas Johnson: For 2024 and what we have described as a transitional year for B2Gold, we have made strong progress on two of our most important items for the year. Firstly, we've had some encouraging discussions with the Mali government throughout the start of 2024. It's really important to stress
Clive Thomas Johnson: For 2024, and what we have described as a transitional year. Each call. We have made strong progress on two of our most important items for the year.
Clive Thomas Johnson: Fortunately, we've got some encouraging discussions with the rally cartilage, that's really the start of 2024.
Clive Thomas Johnson: It's really important to stress.
Clive Thomas Johnson: Despite some rumors out there and irresponsible journalism out there, in fact, the matter is, as Baird confirmed recently, there's been absolutely zero indications that the government is now considering nationalizing Western-owned gold mines. On the contrary, we have had productive dialogue with the government on how our opportunity in the Golden Regional could fit in the long-term future of the Foucault complex. The government has expressed a desire to fast-track the granting of the concession with an exploitation program. Let's see if the concession decree, This part of the line.
Clive Thomas Johnson: Despite some rumors out there are you responsible journalist smelter.
Clive Thomas Johnson: Matters.
Clive Thomas Johnson: Barrick initially.
Clive Thomas Johnson: I'm sure all indications of the government polished nationalized western Port Colborne.
Clive Thomas Johnson: Entre.
Clive Thomas Johnson: The dialogue with the government so proper.
Clive Thomas Johnson: Our opportunity.
Clive Thomas Johnson: Consider the long term future.
Clive Thomas Johnson: Well accomplish that goal.
Clive Thomas Johnson: Desire.
Clive Thomas Johnson: Sebastian granted but exploration well ship transition to Cree and two.
Clive Thomas Johnson: 2023 mining code.
Clive Thomas Johnson: I've watched you believe over the next few months.
Clive Thomas Johnson: The government moved forward and starting to truck or problem.
Clive Thomas Johnson: From what we call the Anaconda area, that's the north end of the Pocono Valley, the roads are built, we're ready to go, and we need an exploitation permit to do so. We are hoping to secure a strong lead.
Clive Thomas Johnson: Some of them won't be calling out a cognitive area that's the norm.
Clive Thomas Johnson: But on the whole should do well.
Clive Thomas Johnson: We're ready to go.
Clive Thomas Johnson: Exploitation.
Clive Thomas Johnson: So so much robin to secure shortly it's definitely a mutual interest we have with the government we want to be.
Clive Thomas Johnson: It's definitely a mutual interest we have with the government. We want to increase production by potentially 100,000 ounces a year by tracking this good grain material down to the Focola Mill. And the government wants more revenue from gold mining. This is where this is going after illegal artisanal mining are the two best opportunities for the government in Mali to increase revenue and profit. So we'll keep you posted as we move forward, hopefully shortly, as soon as things are going forward with them. Thank you.
Clive Thomas Johnson: Crushed by potentially.
Clive Thomas Johnson: Hereby trucking good grade material.
Clive Thomas Johnson: And the government wants more revenue its a little money.
Clive Thomas Johnson: This concludes after all you got to slow by desktop with Jimmy Choo.
Clive Thomas Johnson: Yes.
Clive Thomas Johnson: <unk> revenue problems.
Clive Thomas Johnson: Well Buddy.
Clive Thomas Johnson: Before it.
Clive Thomas Johnson: Shortly.
Clive Thomas Johnson: Ford.
Clive Thomas Johnson: With me.
Clive Thomas Johnson: Okay.
Clive Thomas Johnson: It's called the regional.
Clive Thomas Johnson: The other most important area of business we are focused on is construction progress at Goose. We've been giving an update on how we're progressing. Very encouraging in the sense that we just closed the ice road. The ice road was extraordinarily successful this year in getting everything up we need. Well, it ended up being the road we needed, 160 kilometers of ice roads, everything up to complete construction. So it was a major year of getting equipment in for construction and, of course, running the operations as well.
Clive Thomas Johnson: You are most important to them.
Clive Thomas Johnson: Okay.
Clive Thomas Johnson: Okay.
Clive Thomas Johnson: I don't want to give me.
Clive Thomas Johnson: And obtain our progression very encouraging of the ships that we just don't see extra extraordinary.
Speaker Change: Sure. They are successful in this year.
Clive Thomas Johnson: If you take everything up with you.
Speaker Change: Got it.
Clive Thomas Johnson: Close relationships.
Clive Thomas Johnson: The construction.
Clive Thomas Johnson: Major Europe.
Clive Thomas Johnson: Hum.
Clive Thomas Johnson: And of course, the operations as well.
Clive Thomas Johnson: That was a great success, and that's a real tribute to our logistical team. Our experience factor of building ice roads, and it's just a great team on set to make all of that happen, has significantly de-risked the project by doing it. He did announce today, or last night, a slight delay in the estimate of first gold at the Goose Project from Q1 2025 to Q2 2025. Bill will give you details on that, but I think it's really important to point out that the construction team has delivered, the B2Gold construction team has delivered, despite picking up a project that was partly, some equipment had been ordered, a lot of things had been done in terms of the previous owner looking to move the mine into a new location.
Clive Thomas Johnson: With that that was a great success.
Clive Thomas Johnson: Turning to our logistics team.
Clive Thomas Johnson: Experience factor.
Bill: Thanks Rose.
Clive Thomas Johnson: Great.
Clive Thomas Johnson: They call that happens.
Clive Thomas Johnson: Significant derisk the project.
Clive Thomas Johnson: Alright.
Clive Thomas Johnson: You did announce today, a slight delay or less I'd, just like to lay out the estimate of the first quarter to cause project from Q1 2025 to Q2 2025.
Clive Thomas Johnson: Sure.
Clive Thomas Johnson: I think it's really important to point out that the construction team. That's delivered to Beachcomber 16 was delivered despite picking up approach there was pardon me.
Clive Thomas Johnson: Some of them and that's in order to have done it forces the previous owner.
Clive Thomas Johnson: To move to bite issue.
Clive Thomas Johnson: Construction. So we inherited some good things, and we inherited some challenges, so we'll talk a bit about what we did. To turn this project into a B2Gold project. The main reason for the shift from the quarter is the fact that the mill could be built on schedule at the end of the first quarter of 2025, but because of some delays in the open field and underground mining schedule, we won't have water to feed through the mill. So that's the driving force behind that.
Clive Thomas Johnson: Construction should we inherited jobs inherited some good things from your parents charges.
Clive Thomas Johnson: Talk a bit about.
Clive Thomas Johnson: What we've done.
Clive Thomas Johnson: Turning to his project century each goal.
Clive Thomas Johnson: Approaches.
Clive Thomas Johnson: The main reason for the shift from corridors.
Clive Thomas Johnson: The bill could be built on schedule or ahead of the first quarter of 2025.
Clive Thomas Johnson: So delays the open.
Clive Thomas Johnson: Underground mining schedule, we wont have all the features are built so that's the driving force behind it.
Clive Thomas Johnson: The construction is actually on track; we expect it to remain so. Transcribed by https://otter.ai. I think it's really important to underline the fact that one of the things that we benefited from in the acquisition of Sabina was they did a very good job in exploration, in permitting, and an excellent job in relationships with the Inuit population and also government, so that part of the team that was involved in this project has remained with the project, and they are very important to the success of the project We were just finishing when we called you to the Capitol a couple of weeks ago for the Dividend Mining Symposium. It was an excellent conference. Very upbeat.
Clive Thomas Johnson: Second quarter construction is actually on track.
Clive Thomas Johnson: Archrock spilling too detailed.
Clive Thomas Johnson: I think it's really important to us.
Clive Thomas Johnson: What are the things that we've gone into the affirmative the acquisition of <unk>.
Clive Thomas Johnson: Exploration.
Clive Thomas Johnson: Excellent job at relationships with a new population and also governance, so that that part of the.
Jim: Jim that was.
Clive Thomas Johnson: This person says we made with the project, they're very important to a successful approach or do you mean, just so let's just talk with clients.
Clive Thomas Johnson: Capital a couple of weeks ago.
Clive Thomas Johnson: Combining symposium so excellent coverage.
Clive Thomas Johnson: We are in the right place at the right time, and the population and the government at every level are very excited about B2Gold completing its mind and looking forward to great success there. Policy exploration is a big part of what we do historically, and there's a reason why half of our large exploration budget for this year is $73 billion. 63 million.
Clive Thomas Johnson: Very upbeat.
Clive Thomas Johnson: Well you are a direct placement rate card.
Clive Thomas Johnson: The population coupled with the entry level is very excited about.
Clive Thomas Johnson: Oh.
Clive Thomas Johnson: Uh huh.
Clive Thomas Johnson: And then looking forward, which suggest it.
Clive Thomas Johnson: Obviously exploration is a big part of what we do historically on this the reason why half of our large exploration budget for this year 73 billion.
Clive Thomas Johnson: Over half of that education budget is focused on background. For a reason, we see extraordinary potential there, and I've had some very good research results so far in our drilling camp. They can answer questions about that.
Clive Thomas Johnson: 66 300 over.
Clive Thomas Johnson: After that its budget this broker backroom it for.
Clive Thomas Johnson: She started a potential there now they've had some very good.
Clive Thomas Johnson: Results so far.
Clive Thomas Johnson: Our in our drilling campaign.
Clive Thomas Johnson: Christian spoke about.
Clive Thomas Johnson: Just in terms of catalysts going forward, and I'll pass over to Mike, I think the catalysts going forward, obviously, as I mentioned, are the resolution in Mali and being able to move forward with Chardy L'Or, looking forward to a very good construction season this year at Goose, and we'll continue to update. Also, I think another exciting potential is looking at Gravel Latte because everyone probably or remembers we had a joint venture with Angelo Gulashanti and was looking to build a big mine to justify that for two companies. Results of a new study for the UGM, and what they're targeting now is something around a 6 million ton a year case, and that could produce 200,000 ounces of gold a year.
Clive Thomas Johnson: Just in terms of cabinets go in Florida, Oh, Gosh, I'm delighted to tell us about the Florida or as soon as I mentioned to see resolution of value being able to move forward with more.
Clive Thomas Johnson: Looking forward to a very exceptional six of this year.
Clive Thomas Johnson: We'll continue to update.
Clive Thomas Johnson: Also I think another exciting potential us looking at there are a lot of it because.
Clive Thomas Johnson: As everyone is probably your leverage when you have a joint venture with Anglogold Ashanti, you're looking to build the big but to justify that puts the company Spiro. It's owned by just by future growth are we looking at a number of different basis, we will come up with.
Clive Thomas Johnson: The results of the study, but before the AGM.
Speaker Change: We're targeting Dallas or.
Clive Thomas Johnson: Something around <unk> 6 billion.
Clive Thomas Johnson: Your adjacent to that could produce 200000 last year.
Clive Thomas Johnson: We're waiting anxiously to look at the economics of that. We're not quite there yet, but we have some encouraging signals from the engineers. We have the potential for 100,000 houses a year to come from trucking oil for coal, as I mentioned. Over 300,000 ounces a year are expected from this. And then if we just move our arms a little bit.
Clive Thomas Johnson: Extra scrip.
Clive Thomas Johnson: Having said that we're not quite there yet.
Clive Thomas Johnson: So encouraging signals from the engineers that we can reduce our footprint.
Clive Thomas Johnson: Your stomach permit, but all of that should be looked at quite up.
Clive Thomas Johnson: Interesting economic opportunity. So if you add it all together and you look at the catalyst in the future oil production potential from this company.
Clive Thomas Johnson: We have the potential for 100 desktops, a year coming from trucking board for course of action.
Clive Thomas Johnson: Over 300000 ounces year as expected from from.
Bruce: For Bruce.
Speaker Change: Corporate interest starting in two.
Clive Thomas Johnson: 2025, as I mentioned.
Clive Thomas Johnson: If we lever up a little bit.
Clive Thomas Johnson: B2Gold Corp. Potentially to the company, subject to our study. The opinions rendered herein are those of the guests, and not necessarily those of Douglas Goldstein, Profile Investment Services, Ltd., or Israel National News, on a yield basis. So we're excited about where we're going. This is a transitional year. It has faced some challenges in the first quarter. We've met them, but it seems to get lost in the shu
Clive Thomas Johnson: Although soon if grandma lucky sitcom executive out another two or personnel some gold production.
Clive Thomas Johnson: The company subject to our study.
Clive Thomas Johnson: It would be possible. So there's 600 cost us some growth from existing assets.
Clive Thomas Johnson: Robust exploration program also our investments are junior companies will contribute so when we look to the future, it's great break where an extraordinary strong financial position.
Clive Thomas Johnson: Industry, leading.
Clive Thomas Johnson: Right.
Clive Thomas Johnson: Oh, the heel basis so.
Clive Thomas Johnson: We're excited about where we're going this.
Clive Thomas Johnson: This is traditionally you're supposed to Charleston to the first quarter, we should get them shipped.
Clive Thomas Johnson: But we've performed yet again. This will be what I'll track for our ninth year of delivery on our tax production or about cost. So with that, I'm going to hand it over to... Mike Cinnamond to give you a note of view on the quarter and a finished point of view. Thank you. Thanks, Collier.
Clive Thomas Johnson: It seems to get lost in the shuffle here, but when you have to get.
Michael Andrew Cinnamond: Another quarter or so credentials.
Michael Andrew Cinnamond: This will be we're on track for our bank tier deliberate on our production costs.
Michael Andrew Cinnamond: With that I'm going to hand, it over to my.
Clive Thomas Johnson: Sure.
Michael Andrew Cinnamond: Florida and for export.
Michael Andrew Cinnamond: Thanks, Clive. So I'll just jump into the operations. Firstly, for Cola, we produced just under 120,000 ounces of gold, which was in line with our guidance. Cash operating costs were well below our annual guidance range, and all in sustaining costs. $1,436 per ounce of gold, so it was at the low end of our guidance range. Also, as a reminder, I think 2024 is a transitional year where we estimate that gold production will be lower than in previous years.
Michael Andrew Cinnamond: Thanks, guys. That's all I'll just jump into the operations Firstly Cola.
Michael Andrew Cinnamond: We produced just under 120000 ounces of gold, which was in line with our guidance.
Michael Andrew Cinnamond: Cash operating costs were well below our annual guidance range and all in sustaining costs.
Michael Andrew Cinnamond: Okay.
Michael Andrew Cinnamond: With crowds also.
Michael Andrew Cinnamond: Low end of our guidance range. So.
Michael Andrew Cinnamond: Also as a reminder for all of 2020 for all is a transitional year.
Michael Andrew Cinnamond: Well, we have submitted the gold production will be lower than prior years, and we got a lot of we have a lot of capital programs like this you'd expect something completely.
Michael Andrew Cinnamond: Completing in the year.
Michael Andrew Cinnamond: We have a lot of capital programs ongoing this year that are expected to complete in the year. And for 2025, this trend should reverse, and 2025 low production should increase, and Owens is getting the best job as captain.
Michael Andrew Cinnamond: In 2025.
Michael Andrew Cinnamond: This trend should reverse in 2025 volt production should increase at all in sustaining cost drop as capital programs.
Michael Andrew Cinnamond: Moving to Misfatii, we had another excellent quarter at Misfatii with a mine producing almost 48,000 ounces of gold. Cash operating costs and all its sustaining costs were both well below our annual target. Thank you very much.
Michael Andrew Cinnamond: Our move into the batting average another excellent quarter of us back into the mine produced at almost 40000 months Oh.
Michael Andrew Cinnamond: Cash operating costs and all in sustaining costs were both well below our annual guidance range.
Michael Andrew Cinnamond: Fuel lower fuel prices definitely construction there at all operations.
Michael Andrew Cinnamond: Uh huh.
Michael Andrew Cinnamond: So, Ms. Batty, this was a very strong operating cash flow, and we anticipate it will continue to be. Finally, last but not least, at Ojikodo, we continued our momentum from a very strong fourth quarter in 2020. In the first quarter of 2004, OJCOTA produced just over 45,000 ounces of gold. And like Mestati, both cash operating costs and all-in-sustaining costs were well below our annual target.
Michael Andrew Cinnamond: No.
Michael Andrew Cinnamond: So his body has led to very strong operating basketball.
Michael Andrew Cinnamond: It continued through the year.
Michael Andrew Cinnamond: Coal prices.
Michael Andrew Cinnamond: Finally last but not least Chicago, we continued our momentum from a very strong.
Michael Andrew Cinnamond: Three.
Michael Andrew Cinnamond: The first quarter of 2004 O Dakota produced just over 45 plus months ago.
Michael Andrew Cinnamond: My body, both cash operating costs all in sustaining costs were well below our annual guidance ranges I'd say first of all we also.
Michael Andrew Cinnamond: I'd say, first of all, we also benefited from a weaker Namibian dollar. As well as higher production, lower fuel prices, we also had a weaker Namibian dollar, which helped or cost you a dollar. And also excitingly, we look forward to continuing to advance envelope discovery, which can then give the potential to extend underground mining in Ojikoto, perhaps into the 2020s. And we remain, as at the end, if you want, in a very strong financial position. Current gold prices, of course, are only helping that and enhancing that.
Michael Andrew Cinnamond: Benefited from a weaker Canadian dollar as well as the higher production lower fuel prices.
Michael Andrew Cinnamond: All of us.
Michael Andrew Cinnamond: Helped our cost U S dollar terms.
Michael Andrew Cinnamond: Finally, we look forward to continuing to advance the Antelope discovery.
Michael Andrew Cinnamond: Asphalt extend underground mining or in Chicago.
Michael Andrew Cinnamond: So the 20 <unk>.
Michael Andrew Cinnamond: And we remain.
Michael Andrew Cinnamond: And you always made it very strong financial position Humboldt prices are for all the help and that enhancing that and you can.
Michael Andrew Cinnamond: You can see those going forward. And as we know, in January, we completed a $500 million pre-payment goal with some of our banks and members, which, when we've fortified our balance sheet for the projects we want to accomplish in the near term and the medium term. And at the end of March, we had a cash balance of $568 million and nothing drawn on our revolver.
Michael Andrew Cinnamond: See those going forward.
Michael Andrew Cinnamond: And as we know.
Michael Andrew Cinnamond: We completed a $500 million prepayment goes to some of our bank syndicate members, which.
Michael Andrew Cinnamond: Well fortified our balance sheet the growth projects, we want to accomplish in the near term in the medium term.
Michael Andrew Cinnamond: And at the end of March the cash balance of 568 billion and nothing drawn on our revolver. So we've got a $700 million facility available.
Michael Andrew Cinnamond: So we've got $700 million in facility available in that revolver, and we do anticipate refreshing that facility a bit later. Based on our existing goods budget that we announced in January, we have just over US $400 million left to bring goods into production. And now that the Winter Ice Trophy has finished successfully, you'll hear more about that from Bill, and we've brought materials to site. We have announced our decision to push back the goose slaughter schedule by three months.
Michael Andrew Cinnamond: And we do anticipate refreshing that so a little bit later in the yards.
Michael Andrew Cinnamond: Based on our existing Booth budget, we announced in January just over USD 100 million left to bring goods into production.
Michael Andrew Cinnamond: Now that the winter is companion finished successfully just know more about that but bill what materials to site.
Michael Andrew Cinnamond: I have announced their decision to push back because just because all of those clients that buy three months, we've undertaken a small theater cost to complete estimates reduced by the end of June I think the second quarter.
Michael Andrew Cinnamond: We've undertaken as well to update our cost to complete estimates for goose by the end of June, I think the end of the second quarter, and we'll come out with those. But I can say that based on where we are today, we're very confident that we have the resources to not only complete goose, but we also have the liquidity for potential organic growth projects in Namibia and Colombia, as well as to continue to pay an industry-leading price.
Michael Andrew Cinnamond: Okay.
Michael Andrew Cinnamond: Basically we are today, we're pretty confident they'll be able to listen to not only complete goods.
Michael Andrew Cinnamond: Absolutely.
Michael Andrew Cinnamond: Growth projects, and then maybe on Colombia.
Michael Andrew Cinnamond: As well as continuing to pay the dividend.
Michael Andrew Cinnamond: Dividends.
Michael Andrew Cinnamond: So not only are we very comfortable with the financial situation, but it's also expected to be further strengthened in 2025 when the goods capital is completed, consolidated gold production is expected to increase, and all of sustained costs and growth capital is expected. So that's a high-level summary. It's Q1. A group order, I would say, operating lines, and so with that, I think I'll pass the call over.
Michael Andrew Cinnamond: Well not only are we very comfortable financial situation.
Michael Andrew Cinnamond: This is expected to be further attracted to 'twenty five.
Speaker Change: The growth capital.
Michael Andrew Cinnamond: Consolidated gold production is expected to increase in all in sustaining cost of growth capital is expected to decrease.
Speaker Change: Plus high levels.
Speaker Change: Q1 it was.
Michael Andrew Cinnamond: A good quarter I would say operating wise and so with that I'll pass the call over to Bill for a discussion on the goose construction progress.
Mike: Yeah. Thanks, Mike.
Unknown Executive: So I'll quickly touch on the goose construction progress. I think we signaled very clearly that this was on a critical path to have success. And I'll tell you that I think the team did a phenomenal job bringing everything down.
Speaker Change: So I'll quickly touch on the goods construction progress.
Unknown Executive: I think we signaled very clearly that this was on a critical path.
Unknown Executive: To have success in all I'll tell you that I think the team did a phenomenal job, bringing everything down despite a high snow year in El Nino year, which was a bit of an anomaly we were able to bring everything dampen the marine lending area. This significantly derisked the remaining construction schedule and now we have everything that we need.
Unknown Executive: Despite a high snow year, an El Nino year, which was a bit of an anomaly, we were able to bring everything down from the marine landing area. This significantly de-risked the remaining construction schedule, and now we have everything that we need, basically, to build out the goose project on site. And just to remind everybody of what we brought down.
Unknown Executive: Basically to build to build out the geese project on site.
Unknown Executive: Just to remind everybody out of out of what we brought down.
Unknown Executive: Some of the key things are: we brought down almost 19 million liters of fuel, all of the modular units necessary to expand the camp to 500, which will allow us to get through construction, all of the stuff necessary to build the mill, all the steel and rebar, all the cement necessary, more than 3000 bags, more than 4000 bags, actually, and all the reagents necessary to commission and operate the mill starting in 2025. So, at the end of the day, as Mike said and Clive alluded to, the mill itself is ready, and would be ready to go in Q1 2025.
Unknown Executive: Some of the key things that we brought down almost 19 million liters of fuel.
Unknown Executive: All of the modular units necessary to expand the camp the 500, which will allow us to get through construction all of the stuff necessary to build the mill all of steel on rebar.
Unknown Executive: Although submit necessary more than 3000 bags more than 4000 bags actually in all of the one of the key things is all the reagents necessary to commission and operate the mill starting in 2020 by so at the end of the day and as Mike said and client alluded to the mill itself is ready would be ready to go in Q1 2025 the construction.
Unknown Executive: Team has done a great job of coming in and grabbing hold of this project and making a be too tight construction the mill construction desert, Maine on schedule.
Unknown Executive: The construction team has done a great job of coming in and grabbing hold of this project and making a B2 type construction. The mill construction does remain on schedule. We have previously told the market that we are, in fact, ahead in some areas. For example, installation of the ball mill is progressing ahead of schedule. All the shell sections are in, the discharge heads, trunnions, pinions, and bearings have all been completed. What really is slightly behind schedule is the open pit and the underground, and that really relates to commissioning the equipment and getting some of the people in during some of these heavy snow days.
Unknown Executive: We had previously.
Unknown Executive: All the market that we are in fact ahead in some areas and installation of the ball mill is progressing ahead of schedule. All the shale sections are in the discharge heads trainees opinions and bearings have all been completed.
Unknown Executive: What really it is slightly behind schedule as the open pit and underground and that really relates to the commissioning of the equipment.
Unknown Executive: And getting some of the people and during some of these heavy snow days.
Unknown Executive: The current schedule indicates that approximately three months must be added, and that really is to allow us to mine out some of the open pit and underground to allow us to get the appropriate amount of material on the stockpile to start the mill. So with that, we're talking about 1st Gold Corp in Q2 2025. And that, of course, does reduce what we're going to produce in 2025. But I do want to point out that it's not like those ounces are lost.
Unknown Executive: Correct.
Unknown Executive: Current schedule indicate that approximately three months must.
Unknown Executive: Must be added and that really is to allow us to mine out some of the open pit and underground to allow us to get the appropriate amount of material on the stockpile to start the mill.
Unknown Executive: So with that we're talking about first Gulfport in Q2 2025.
Unknown Executive:
Unknown Executive: And that of course.
Unknown Executive: Does reduce what we're going to produce in 2025, but I do want to I do want to indicate that it's not like those ounces are lost it just been pushed into into 2026. So instead of having the first five years at plus 300000 and now we're talking in the first five years at 310 plus.
Unknown Executive: Yeah.
Unknown Executive: They've just been pushed into 2026. So instead of having the first five years at plus $300,000, now we're talking the first five years at $310,000 plus. So overall, I guess I'd say I remain very confident in the path forward for Goose, and this is absolutely a world-class operation that will begin production in Q2 2025. With that, I will turn it back to you, Clive, for questions.
Unknown Executive: So overall I guess I'd say I remain very confident in the path forward for Goose and this is absolutely a world class operation that will begin production in Q2 2025.
Clive: With that I will turn it back to you collect the questions could you talk a little bit about that.
Clive Thomas Johnson: Can you talk a little bit about the tradeoffs going forward about capital that there is? Yeah.
Clive: Tradeoffs going forward about.
Clive Thomas Johnson: Capital.
Unknown Executive: Yeah, there was some questions on whether or not we were going to be.., on budget given the new schedule, and I'd say we're working through that right now, but just because the road just closed, you know, I can't tell you exactly where we're at. There's going to be some overs, there's going to be some unders, but remember, right now, the 2024-2025 winter ice road season is opening, so what we're seeing is we're actually anything which would be kind of in that critical spares for 2024-2025, we're ordering right now, so we'll be able to give you actual costs for what our carrying costs are going to be but also, you know, we've done a good job kind of looking at what a B2Gold design would look like.
Clive Thomas Johnson: Yeah.
Clive: There were some questions on whether or not.
Unknown Executive: We were gonna be.
Unknown Executive: On budget, given the new schedule and I say, we're working through that right now, but just because of the road just closed.
Unknown Executive: I can't tell you.
Unknown Executive: Exactly where we're at there's going to be some overdue, they're gonna be some anders but remember right now the 'twenty 'twenty four 'twenty 'twenty five winter ice road to season as opening so what we're seeing is we're actually anything which would be kind of in that critical spares for 2020 for 2025 were ordering right now so we'll be able to give you actual cost for what for what are carried.
Unknown Executive: Certainly, John Rahal has looked at reagent consumption. Can we bring that down? The answer is yes. We've talked about the actual fuel cost that, you know, Mike alluded to already that some of the other operations are under cost, so we're seeing how that impacts the goose projects. Obviously, as a function of what has to be done, given the fact that we're actually ahead of construction in some areas, we feel like we can certainly flatten those costs a little bit to make sure that we remain materially on budget.
Unknown Executive: Costs are going to be but also you know we've done a good job kind of looking at would it be to gold design would look like certainly a genre. How it's looked at reagent consumption can we bring those down the answer is yes.
Unknown Executive: Talk about the actual fuel cost that you know Mike alluded to already to some of the other operations are under cost. So we're seeing how that impacts the the goose projects, we're working with vendors to.
Unknown Executive: See if they can get if they can carry stock as opposed to us ordering it and that's putting it into our critical spare inventory and probably one of the big Big one is the labor so the labor.
Unknown Executive: Obviously as a function of what has to be done given the fact that we're actually ahead of construction in some areas. We feel like we can certainly flat in those costs a little bit to make sure that we remain materially that budget.
Unknown Executive: Thanks, Bill. I think... Sorry.
Speaker Change: Okay. Thanks Bill.
Speaker Change: I think to go.
Operator: Thank you.
Speaker Change: Second question is yes.
Speaker Change: I think the operator will not leave too.
Operator: Q&A.
Operator: We will now begin the analyst question and answer session. To join the question queue, you may press star, then 1 on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star, then 2. The first question comes from Ovais Habib with Scotiabank; please go ahead.
Operator: Okay.
Operator: Me.
Speaker Change: We will now begin the analyst question and answer session to join the question queue. You May Press Star then one on your telephone keypad, you'll hear tone acknowledging your request if youre using a speakerphone. Please pick up your handset before pressing any Keith did withdraw your question. Please press Star then two.
Ovais Habib: Our first question comes from obeys Habib Scotiabank. Please go ahead.
Ovais Habib: Hi Clive and the B2Gold team. Congratulations on completing a successful ice road season at Goose.
Ovais Habib: Hi, Glenn.
Ovais Habib: B to go team congrats on completing a successful ice cold season that goes.
Ovais Habib: Just a couple of questions from me, Clive. Number one, starting off with Mali. In regards to the 2023 Mali mining code, obviously, B2 is having discussions with Mali, Barrick is having their own discussions with Mali on Lulu, and Resolute is likely to have discussions as well. So the question is, are you all asking for the same terms, or are the terms specific to each of your projects? I'm just trying to figure out how Mali is looking to form a new kind of set of terms for the 2023 mining code.
Ovais Habib: Just a couple of questions from me quite a number one starting off with the Mali are in regards to the 23 body mining code, obviously be tools, having discussions with moly Barrick is having their own discussions with the already on Lulu.
Ovais Habib: And Andres route is like like Youre, having discussions as well. So the question is are you all asking for the same guns or all but done specific to each of your projects I'm just trying to figure out you know how is Molly looking to form a new kind of upset about it.
Ovais Habib:
Ovais Habib: For them the 2023 mining Corp.
Clive Thomas Johnson: Sure, yeah, good question, Ovais. Everyone is in a slightly different situation because of the time frame in terms of some of the mining conventions that were signed with the government. So where we are, as you know, the government has acknowledged time and time again that coal is grandfathered by law under the 2012 mining code, and we have a three-thousandth of that. I'm only licensed until 2040, regional opportunities, they're all under an exploration license.
Speaker Change: Sure Yes, good question ever I wouldn't say, that's a slightly different situation because of the.
Clive Thomas Johnson: But the time frame in terms of some of the mining debentures that were signed with the government.
Clive Thomas Johnson: So where you are as you know that the governance of dollars. So again, that's a call up scrap fathered by law, but the 2012 why they call it and we have a police upset.
Clive Thomas Johnson: Well I think license till 2040, <unk> 'twenty 'twenty 444, 44, or so so that's that's very positive from our point of view, what the how the conversations with the government are read around.
Clive Thomas Johnson: So the change of the 23 cold which of course the regional.
Clive Thomas Johnson: So they need to move to an exploitation license, so the regional will be subject to the 2023 planning code yet again. The opinions rendered herein are those of the guests, and not necessarily those of Douglas. Everyone has their own particular license and issues, and others are going to be down there.
Clive Thomas Johnson: The regional opportunity.
Clive Thomas Johnson: They're all under an exploration license so they need to move to a exploitation license. So the Rachel won't be subject to the 'twenty to 'twenty three 'twenty yet.
Clive Thomas Johnson: We feel confident that we've got some pretty robust economics there.
Clive Thomas Johnson: Fortunately ours.
Speaker Change: I can't speak for Barrick or anybody else, but.
Clive Thomas Johnson: Everyone has a difference.
Clive Thomas Johnson:
Clive Thomas Johnson: What else, they're they're all in different particular license or issues there Eric.
Clive Thomas Johnson: Others are going to be down there.
Clive Thomas Johnson: We are the only company in Mali that has something that can quickly turn into more revenue for the company and for our partner, the government of Mali, by trucking the ore. That could be a significant amount of revenue when you look at what we're projecting now and when we look at our numbers. Regional production could be very important to the future of Fokola. Of course, trucking the ore down, the roads are built, we're ready to go. We're in a different situation except for Barrick and Mercer; they're going to speak for themselves.
Clive Thomas Johnson: Because we will be over the next while to try to finalize.
Clive Thomas Johnson: But we are two different situations. So we're the only company.
Clive Thomas Johnson: That has something that could be turned into more revenue for the company and for our partner because of the valley by trucks in New York that could be a significant amount of revenue. When you look at what we're projecting now when we look at our numbers.
Clive Thomas Johnson: The regional production is very.
Clive Thomas Johnson: It can be very important to the future of course of course trucking bjorge out the book to Bill we're ready to go so we're in a different situation with such Barrett commercial versus keep themselves.
Clive Thomas Johnson: We're confident where we sit, and we definitely have a good relationship with the government. We're concerned about the 23 Code, I guess, in terms of future production for Mali. Mali has been... Despite some of the issues and rumors and stuff that we see out there, Mali has been a very good country to invest in gold mining when you look at Rand Gold and Nalbaric and ourselves and others. So the issue there is if the government wants to take too big a piece of the pie in 2023, the big question is who's going to go exploring for the next coca?
Clive Thomas Johnson: We're confident where we sit and we definitely have a good relationship with the government.
Clive Thomas Johnson: We're concerned about the 20th record I guess in terms of future production for from the Alibaba spin.
Clive Thomas Johnson: Despite some of the.
Clive Thomas Johnson: The issues of rumors and stuff that we see out there Molly who's been a very good country to invest in <unk>. When you look at Randgold, and Barrick and ourselves and others. So.
Clive Thomas Johnson: The issue there is the governor wants to take too big of a piece of the pie in 'twenty to 'twenty three the big question is who's going to go to the store for the extra color.
Clive Thomas Johnson: In Mali, if the economic terms are much less attractive than they have been, just a reminder. We built the Facola mine for over $500 million U.S. dollars, 100% at our risk. Today, the government of Mali has realized a little over 50% of the economic benefit of the Falkola mine with no risk. I think that's a deal any of us would take all day, every day. If someone wants to spend all the risk capital, we get 50% plus of the upside.
Clive Thomas Johnson: Holly.
Clive Thomas Johnson: If the year after.
Clive Thomas Johnson: Sure.
Clive Thomas Johnson: Much less attractive than they have been just a reminder.
Clive Thomas Johnson: We built for cole Bryan for over 500 million in U S dollars, a 100% of our risk.
Clive Thomas Johnson: To date, the government of Mali has realized a little over 50% of the economic benefit of this.
Clive Thomas Johnson: So call a mine with bill risk Alright, I think thats, the jewelry business would check all day everyday Super Bowl spend all the risk capital, we get 50% plus of the upside so I worried that the new cordless because it would be.
Clive Thomas Johnson: So I'm worried that the new code is going to change those economics, so it doesn't speak to what we're doing, but it does speak to the future of gold mining in Mali, and I hope the government, over time, will consider whether they want to become one of the less attractive countries to invest in gold mining, as opposed to being one of the ones that's been attractive. So anyway, but our discussions are ongoing, and they've been positive.
Clive Thomas Johnson: It's going to change those economics, so that doesn't speak to what we're doing but it speaks to because of our very robust economics should be trucking opportunity, but it does speak to the future of go by to get volume and I hope the government overtime will consider whether they want to become one of the less attractive to.
Clive Thomas Johnson: To invest in that group I think they're supposed to be one of the websites that are attractive.
Clive Thomas Johnson: Alright.
Clive Thomas Johnson: Artificially drove the window they've been positive because I think we're up shape nature of the government, which is supportive for cola going forward and I'll show the mutual opportunity.
Clive Thomas Johnson: Thanks for the color on that, Clive. And just a follow-up on that in terms of, you know, assuming, you know, the negotiations go well, and all the terms are agreed upon, how fast can you get the exploitation permit once everything is set in motion?
Speaker Change: Thanks for the color on that and just a follow up on that in terms of you know.
Speaker Change: You mean, you know you know.
Clive Thomas Johnson: Negotiate it goes well.
Clive Thomas Johnson: And all the terms are agreed upon how fast can you get the exploitation permit once everything is set in motion.
Clive Thomas Johnson: Well, if we reach agreement in the near term, which we're hoping to do, then the exploitation license is apparently in the government's interest, and they're fast-tracking that, so that could be a matter of, hopefully, a few months, potentially, and then we've got some, basically, some pre-stripping to do, but we're pretty much ready to go. We de-risked the project in the sense that we have built the facilities, we have built the roads, and we're ready to go. So that could be a fairly quick opportunity to build.
Speaker Change: Oh well.
Clive: So if we reach agreement in the near term, which we're hoping to do there the exploitation license severity. The governments interested in fast check enough. So there could be a hopefully a few months potentially and then we've got some basically some pre stripping to do but we're pretty much ready to go with Derisk. The project and necessity. We have built so that she built the roads were ready to go so that could be a will start to kick off.
Clive Thomas Johnson: But let me just shifting to do pretty much to be honest stripping that there won't be a door.
Clive Thomas Johnson: How long is the stripping due for? Three months. Three months of stripping, and then we'll be into work.
Ovais Habib: I got it. Thanks for that! And then just switching gears to the Goose project, as you mentioned, B2 is currently in the midst of an infill drill program in the underground component of Goose. I just wanted to understand, and maybe this is a question for Bill or Vic as well, is the purpose of the drill program to increase confidence in the ore body to include it in the mine plan, kind of going into 2025, or is there a worry about the geological model that was built by the previous owners?
Speaker Change: Got it thanks for that.
Clive Thomas Johnson: And then just switching gears to the group's project as you mentioned B. Two is currently in the midst of an infill drill program.
Ovais Habib: Underground component up goes a.
Ovais Habib: I just wanted to understand and maybe this is a.
Speaker Change: Question for Bill or a break as well.
Ovais Habib: What parts of the drill program to increase confidence in the ore body to include it into the mine plan kind of going into 2025 or is that a worry about the geological model that was built by the previous owners, maybe some color on that please.
Unknown Executive: Maybe some color on that, please?
Unknown Executive: Not at all. The info that we did, that we've done to date, and we did quite a bit last year, has certainly corroborated or supported the Sabina model. The end goal is merely to get the indicated resources to our standards. And that also improves or helps improve the design that the engineers need to do, but there's no question about that, about the model. It's solid, we understand what the controls are, and the results we've got have pretty much confirmed our model.
Unknown Executive: Okay.
Unknown Executive: As a brother tool.
Unknown Executive: You can pull that we did that we've done to date.
Unknown Executive: Quite a bit last year.
Unknown Executive: Sydney a.
Unknown Executive: Corroborated all supported this has been our model.
Unknown Executive: The infill is nearly to get the indicated resources to do all of the standard.
Unknown Executive: And that also improves.
Unknown Executive: <unk> improved the design.
Unknown Executive: But the engineered need to do but there's no question about the.
Unknown Executive: About the model, it's a it's solid.
Unknown Executive: Stand with controls.
Unknown Executive: The results, we've got that pretty much concern.
Unknown Executive: Oh.
Unknown Executive: Thanks for that, Vic. Has the drilling commenced, and what are the results so far?
Speaker Change: Thanks for that and I mean in terms of you know has the drilling commenced and and what are the results have been so far any color on that.
Unknown Executive: Okay, so yeah, we started drilling in April. We have four rigs turning. No results yet from the drilling this year, but we expect them to be pretty much in line with what we saw last year.
Unknown Executive: Okay.
Speaker Change: Started drilling in April.
Unknown Executive: Four rigs to any no results yet from from from the drilling this yet, but we expect them to be pretty much in line with what we saw last year.
Ovais Habib: Thanks for that. And just on remaining at the goose, my last question would be regarding the CapEx update expected in June. Bill, what are you worried about that could take CapEx higher or any opportunities to maintain or even reduce the current CapEx estimates?
Speaker Change: Okay. Thanks for that.
Speaker Change: And I guess on the meeting at the Goose. My next question would be regarding the Capex update expected in June a bill what are you worried about that.
Bill: That could be capex higher or any.
Ovais Habib: <unk> needs to maintain or even reduce the current capex estimate.
Unknown Executive: Well, I went through some of them already, for sure. But, like I say, it's tough to say some of them because we're right now in the process of ordering for 2024 and 2025. So those RFPs are out. You know, we're in the process of shutting down the winter roads. We're in the process of evaluating that. But if you look at, like I said, things like reagents, we think that's going to be an under, for sure.
Bill: Well I I went through some of them already for sure like I say, it's tough to say some of these could work right now in the process of ordering for 'twenty 'twenty four 'twenty going by so those those rfps are out you know we're in the process of shutting down the winter roads. We're in the process of evaluating that but if you look at like I said things like the reagents.
Unknown Executive: We think that's going to be an under for sure I think some of the some of the critical spares and some of the things that we can hold off site I think those are gonna be Anders.
Unknown Executive: I think some of the critical spares, some of the things that we can hold off site, I think those are going to be unders. Remember, in theory, you would have one more shipping season, so anything you wouldn't have to fly in, you know, that could be an unders. But the counter also holds true that if there's something critical we need for the mill, you might fly it in this year. That might be an over, right?
Unknown Executive: Remember we in theory, you would have one more shipping season. So anything you you didn't wouldn't have to fly in.
Unknown Executive: You know that could be an under but this is a counter also holds true that if there's something critical we need for the mill you might fly an issue that might be an over right or maybe on the mills that are on the mining side.
Unknown Executive: Or maybe on the mining side, because we didn't commission the trucks as quickly as we thought, a lot of those operating costs for those trucks are going to be under this point, up to this point, which is not to say it's not going to catch up. So that's why, you know, I can't really tell you exactly, but I certainly feel very good that we are currently on budget or under budget. Okay, thanks for that, Bill.
Unknown Executive: Because we Didnt commission the trucks as quickly as we thought a lot of those operating cost of those trucks that they're going to be an under for this point up to this point, which is not to say, it's not going to catch up. So that's why I you know I can't really tell you exactly but I feel I certainly feel very good that we are currently on budget or under budget at this time.
Ovais Habib: Okay, thanks for that both. And Clive, that's it for me. Thanks for taking my question.
Speaker Change: Okay. Thanks for that.
Speaker Change: And I'm glad that's it for me thanks for taking my questions.
Ovais Habib: Okay.
Ralph M. Profiti: The next question comes from Ralph Profiti with eight capital. Please go ahead.
Speaker Change: The next question comes from Brad <unk> with eight capital. Please go ahead.
Ralph M. Profiti: Thanks, Operator. Good morning, Clive, and maybe a question for Mike.
Ralph M. Profiti: Thanks, operator.
Ralph M. Profiti: Morning, Clive in and maybe a question for Mike and I, just want to ask you know sort of a follow up or in a different way. The goose Capex question. Because you know at the time, we get the update in June you know, we're still sort of six to nine months ahead of first gold production will all of the outstanding spending be committed or are locked in at that time.
Ralph M. Profiti: And I just want to ask, you know, sort of a follow-up or, put another way, the Goose Cap X question, because, you know, at the time we get the update in June, we're still sort of six, nine months ahead of first gold production. Will all of the outstanding spending be committed or locked in at that time? Or, you know, I'm just kind of trying to get a sense of what state of finalization we'll be in when we get that.
Ralph M. Profiti: Or.
Ralph M. Profiti: I'm you know I'm, just kind of trying to get a sense of what state of Finalization will be and when we get that June update.
Unknown Executive: So can you clarify what you mean by like them or committed? We want to start with them.
Speaker Change: Sorry can you clarify what you mean by lock them or maybe it would be more yeah, basically yes sort of yeah. Yeah. Thanks for that Oh, just because the amount of committed capex right in the context of total by by the time, we get to June.
Unknown Executive: That's how it should be spent so far. We've spent like this so far.
Unknown Executive: Or should we expect so far.
Unknown Executive: We've signed, like, so far, cash terms for the... Spent $840,000 on a project that we haven't spent all that much on a project to date. And there's probably another 60-plus payable, so the total cost is $900 in that ballpark. And you've got to compare that to the total that we were talking about for construction of the mill on Affiliate 50. New development, $200 million net working capital, another $205 million, so basically, $1,450,000. Very cool.
Unknown Executive: We've spent so far in cash terms for that.
Unknown Executive: 840 million projected we haven't stopped.
Unknown Executive: Let's say 40, and there's probably another 60 plus payables, so all cost nine.
Unknown Executive: 900 and now.
Unknown Executive: Alright.
Speaker Change: Got it.
Unknown Executive: Oh.
Unknown Executive: For construction.
Speaker Change: Oh, okay.
Unknown Executive: Appliances.
Unknown Executive: Being development 200 dollar had working capital of 205 million, So <unk> got basically okay.
Unknown Executive: https://www.b2gold.com
Unknown Executive: Sure.
Richard: Hey, Richard.
Unknown Executive: That's a good question really about the success of our things have been ordered subsidy on that'd be suggesting to you. Mr. Alright. The amount. We've spent I think a lot of the capitals being ordered certainly like like like Bill said, well I can't give you the number right now.
Unknown Executive: If you're saying what do you have the journey, we've been fully committed but everything that all the stuff that we thought we needed.
Unknown Executive: The MLA has now been driven up the road for construction purposes. So as you get into the latter part of this bill, a lot of the costs are going to be us building up the working capital, right? Then we need to hire a lot of labor going in there and fueling all the consumables as you move forward.
Unknown Executive: They've been ordered it was delivered to the MLA that drove it up the road for construction purposes. So as you get into the latter part of this bill a lot of the costs are going to be building.
Unknown Executive: Building up the working capital that we need to labor labor volume, there and fuel and all the consumables as you move forward, but a lot of those right.
Unknown Executive: Our borders and brought up the I suppose but I mean, we will certainly augurs all man I got to try and give you some guidance on that when we get.
Unknown Executive: Our new cost estimate.
Unknown Executive: That cost.
Speaker Change: Yeah. Okay got you that's exactly what I was looking for thanks.
Ralph M. Profiti: Yeah, okay, gotcha. That's exactly what I was looking for. Thanks. Clive, Finland, can you talk a little bit about, you know, your role in the country given some of the, you know, decisions out there that we're waiting for? Should we think about your approach as sort of more or less or different than what we're seeing now and just sort of how you think about that country as a jurisdiction when you approach exploration and future potential? Yeah, we've uh...
Unknown Executive: Clive Finland can you talk a little bit about you know your your role in the country given some of the you know decisions out there that we're waiting for Ah shall we think about your approach of sort of more or less or different than what we're seeing now and just sort of how you're thinking about that country has the jurisdiction. When you when you approach exploration.
Ralph M. Profiti: And future potential.
Clive Thomas Johnson: Yeah, we've been at it for a while now. We had some exploration success for sure, but we didn't get out of the park and find millions of ounces of gold.
Clive: Yeah, we've had we've been added for a while there we had some exploration success for sure we didn't get out of the park inside billions of ounces goal that doesn't mean, there is a so potential put out obviously our ground is very important.
Clive Thomas Johnson: That doesn't mean there's no potential for that. Obviously, our ground is very important to Rupert in terms of the ultimate development of an open pit and also because of the 600,000 ounces or more potential that we see there. I think it's an elegant deal, and we are happy to be shareholders of Rupert in the soon-to-be closing of that deal. It allows us to recoup our expiration expenditures today, potentially by owning their shares, but also be part of the future. That's a very good deposit.
Clive Thomas Johnson: Per the terms of the ultimate development.
Clive Thomas Johnson: Also because of the shift to the Gulf South shore more protection that we see there.
Clive Thomas Johnson: But I think there's always a deal a week, we are happy to be shows with the closing of the shouldn't be closer to that ideal allows us to recoup our exploration expenditures today potentially violate their shares but also be part of.
Clive Thomas Johnson: The future that's a very good deposit or someone's going to build.
Clive Thomas Johnson: Someone's going to build it at the end of the day. We thought it was a really good way to stay involved in the sense of through the share ownership and the upside potential, but also focus our expiration on some of the things we consider to be higher priorities, such as goose. As we get back into trekking or cola, as we start that, we will be looking at more expiration there as well. There is great potential for this in the region, not only for additional. [inaudible]
Clive Thomas Johnson: So we thought it was a really good way to stay involved with the sensor through shareholder ship, although the upside potential.
Clive Thomas Johnson: But also focus our focus are.
Clive Thomas Johnson: Our exploration, but amongst some of the things we consider the higher priority such as goose, unless we get back into trucking or Colo.
Clive Thomas Johnson: So we start out we will be looking at more exploration there as well great.
Clive Thomas Johnson: Great potential this where the mutual not only for additional.
Clive Thomas Johnson: Oxide.
Clive Thomas Johnson: Whether it's.
Clive Thomas Johnson: Saprolite material, but also the sulfides as well so so that's the rationale I think it was a very good deal.
Clive Thomas Johnson: Good for ourselves and hopefully good for joint venture partner as well.
Ralph M. Profiti: Thanks for your thoughts. I appreciate it.
Clive Thomas Johnson: Okay.
Speaker Change: Thanks for your thoughts appreciate it.
Ralph M. Profiti: Yeah.
Ralph M. Profiti: Excellent.
Anita Soni: The next question comes from Anita Soni with CIBC World Markets. Please go ahead.
Ralph M. Profiti: The next question comes from Anita Soni with CIBC World markets. Please go ahead.
Anita Soni: Good morning Clive, Mike, and Bill. So I just wanted to understand the delay and specifically what's the pinch point. I'm assuming it's a tailings dam, and I just want to sort of understand what the mechanics are there in terms of why the three months was.
Anita Soni: Good morning class, Mike and Bill and so I just wanted to understand them.
Anita Soni: J D M filet, and specifically, what's the pinch point I'm, assuming it's a tailings dam and I just wanted to sort of understand what the mechanics are there and in terms of our wireless and that's about it.
Unknown Executive: Yeah, well, kind of, but not 100%. It's the combination of putting ore on the pad and completing the echo pit, right? So basically, we've got 10 trucks on site. When we took over and were commissioning the trucks, we identified that we didn't have some of the personnel resources that were appropriate for the scope, and they didn't get the trucks commissioned on time, and there were some issues there. So basically, we fell behind mining in both ECO and Umwell Pit, and so I'd say a combination of the two.
Anita Soni: Yeah, well kind of but not 100% it it's the combination of putting ore on the pad and completing the echo pit right. So basically.
Unknown Executive: We've got 10 trucks on site.
Unknown Executive: When we when we were when we took over and we're commissioning the trucks. We identified that we didn't have some of the personnel resources.
Unknown Executive: That were appropriate for the scope and they couldn't they didn't get the trucks commissioned on time and there were some issues. There so basically we fell behind.
Unknown Executive: Mining in both igo and unwell pit and so like I say it a combination of the two I could do one or the other and still make the schedule and I can put on the pad have no tailings or I can do echo pit and have no war, but I couldnt do both given the schedule I've got now so that's the delay.
Unknown Executive: I could do one or the other and still meet the schedule, and I can put them on the pad so I have no tailings, or I can do ECO Pit and have no ore, but I couldn't do both given the schedule I've got now.
Unknown Executive: Okay, sorry. And is the echo pit the one that's the that's where the tailings are going to be deposited? Is that what's happening? That's correct. Okay. And then, long term, when does the Echo Pit tap out on capacity? Do you build another tailings dam after that? Absolutely.
Speaker Change: Okay, sorry, and as the Echo pick the one that's the that's where the tailings that like where the talent is gonna be departure that that that would happen.
Unknown Executive: That's correct that's correct okay.
Unknown Executive: And then long term like when does the echo pet.
Unknown Executive: How about on capacity do you build another tailings dam after that.
Unknown Executive: Absolutely, we do. We start; it's going to go from Umwell, and then I think it goes into Lama eventually.
Unknown Executive: Absolutely we do start.
Unknown Executive: Can it go from Manuel and then I think it goes into Lama eventually.
Unknown Executive: Okay.
Unknown Executive: Okay. And so just in terms of the trucks on site, you said you had 10 originally. How many more do you need to get to get to the full production rate?
Unknown Executive: And so just in terms of the trucks onsite you said you had 10 originally or how many do you need to get to get to the full a full production rate.
Unknown Executive: I think it's – I'm not – I might have to get back to you now. I think it's 15 is where we ultimately end up, but I can't remember exactly. If I'm wrong, I'll come back to you.
Unknown Executive: And I think it's I'm not I might have to get back to you know I think it's 15 is where we ultimately.
Unknown Executive: We get but I can't remember exactly if I'm wrong I'll come back to your share in that and the other question that I would have is the ultimate mining capacity up the entire fleet at 15.
Unknown Executive: Sure, and the other question that I would have is the ultimate mining capacity of the entire fleet at 15 feet.
Unknown Executive: Yeah, I don't have that number right in front of me. Sorry. I'll get back to you on that.
Speaker Change: Yeah, I don't have that number right in front of me.
Unknown Executive: Alright.
Anita Soni: The other question that I had in terms of next year, and I know that Ralph is sort of asked a little bit about this, but I'm just curious about if you've got three months that you didn't anticipate, would there not be standby costs in terms of like G&A and people running the site that would be additional, and what would be the sort of run rate on that? I would assume somewhere in the range of about $5 to $10 million a month, I guess, but that would be what I know from comps in Northern Ontario might be a little bit more costly.
Unknown Executive: Uh huh.
Unknown Executive: Okay.
Anita Soni: The other question that I had in terms of that then.
Anita Soni: Next year, and I know that Ralph has sort of asked a little bit about this but I'm just.
Anita Soni: Curious about you know if you've got three months that you know.
Anita Soni: That you didn't anticipate would there not be standby costs in terms of like G&A and people running the site that would be additional on what would be that sort of a run rate on that I would assume somewhere in the range of about five to 10 million a month I guess, the gist, but that would be what I know from Compton in.
Anita Soni: Northern Ontario might be a little bit more confident there.
Unknown Executive: Yeah, the answer is if we didn't manage it, if we just let everything run wild, then you could see those kind of numbers. That's what we said. We're actually trying to manage that down by making sure that the appropriate staffing is on site, to making sure that the appropriate fuel consumption, all this stuff. Basically, we're just trying to take the construction curve and flatten it out by three months.
Anita Soni: Yeah.
Unknown Executive: The answer is it if if we didn't manage it if we just let everything run wild.
Unknown Executive: And then you can see those kind of numbers. That's what we said, we're actually trying to manage that down by making sure that the appropriate staffing is onsite to making sure that the appropriate fuel consumption. All the stuff basically we're just trying to take the construction curve and flattening out by three months.
Anita Soni: Okay, and then just another thing that I would ask is that, as you get closer to construction, what would you think outside obviously of the critical paths items that we've addressed at this point, is there anything else that we should be thinking about like closing truck shops and things like that? Is that something that you're also watching? What else keeps you up at night?
Speaker Change: Okay, and then just another thing that I would ask is that you know as you get closer to construction what would you think outside of obviously the critical path items that we you know you've addressed at this point is there anything else that we should be thinking about like clothing, you know truck shops and things like that is that something that you are also watching like what else keeps you up at night.
Unknown Executive: Well, a lot of stuff keeps me up at night, but let's start with... No. Let's start with fuel tank construction, right? As you know, we've got to bring in almost a little bit more than 80 million liters of fuel at both the MLA and at the site. Those tanks have to be built. In particular, one of the MLAs, because in September that boat's going to arrive. We've already paid for it.
Speaker Change: Well a lot of stuff keeps me up at night, but let's start with.
Unknown Executive: No.
Unknown Executive: Let's start with that so let's start with a fuel.
Unknown Executive: Fuel tank construction right. We've got it as you know we've got a.
Unknown Executive: Bring in almost a little bit more than 80 million liters of fuel at both the M. L. A and at site those tanks have to be built and in particular, one of the M. L. A because in September that boats gonna right. We've already paid for it and so if there's no. If there's no tankage there we got a problem and so that's probably the next thing on the critical path.
Unknown Executive: And so if there's no tankage there, we've got a problem. All right, so that's probably the next thing on the critical path. Giving us this additional kind of three-month buffer, and I don't ever tell the construction guys I said there was a three-month buffer now, because they're still heading towards the original schedule, but if you look at like the underground and stuff, that really gives us some opportunities to look at various options, and that's what we're going through right now, is how do we really optimize it given this kind of bit of reprieve from an operational And the final question, are you...
Unknown Executive: Giving us, giving us additional kind of three month buffer and I hate I don't ever tell the construction guys. I said there was a three month buffer now because theyre still heading towards your original schedule, but if you look at like the underground and stuff that really gives us some opportunities to look at various options and that's what we're going through right. Now is is how do we really optimize that given this kind of been a repeat.
Unknown Executive: From an operational perspective, but everything else is going quite well, okay and that final question are you guys going to do the site tour again in September and he can recalibrate ourselves there.
Unknown Executive: Okay, and a final question. Are you guys going to do the site tour again in September so we can recalibrate ourselves? Yes. Thank you very much for taking my questions.
Unknown Executive: Yeah.
Unknown Executive: Yes.
Speaker Change: Okay, all right. Thanks.
Speaker Change: Yes. Thank you very much for taking my question.
Anita Soni: Thank you. Thank you.
Unknown Executive: Okay.
Anita Soni: Yeah.
Don DeMarco: The next question comes from Don DeMarco with National Bank Financial. Please go ahead. Thank you, Operator.
Anita Soni: The next question comes from Don Demarco with National Bank Financial. Please go ahead.
Don DeMarco: Thank you operator and.
Don DeMarco: Good morning, Clive and team. Congratulations on a strong start to the year. So let's start off with Goose.
Don DeMarco: Good morning, Clive and team congrats on the strong strong start to the year.
Don DeMarco: So startup what goes so we've seen updates on on budget and schedule do you plan to release any updates on Opex. After the mines in production I think the view is that Asia will increase versus the tech.
Don DeMarco: So we've seen updates on the budget and schedule. Do you plan to release any updates on, say, OpEx after the mine's in production? I think the view is that ASIC will increase versus the tech report, but do you have any on maybe the magnitude of the increase or a more precise estimate at this point?
Don DeMarco: Do you have any color on maybe the magnitude of the increase here or a more precise estimate at this point.
Speaker Change: So [laughter].
Unknown Executive: The answer is yes. As you know, one of the things that we've kind of been waiting on is to update the resource model. And so when that comes up, we certainly want to put together a whole package, I think, and update it.
Speaker Change: The answer is yes, as you know one of the things that we've kind of been waiting on is to update the resource model and so when that comes out we certainly want to put together a whole package, I think and and and update it.
Unknown Executive: Okay, and when do you think that will be?
Unknown Executive: Okay.
Speaker Change: And when do you think that would be.
Unknown Executive: Yeah, we expect to update the resource for modeling in AIF, so the updated resource will come out in AIF next year, so we'll talk to you about that, and we'll follow up on that update.
Unknown Executive: Yes, I mean, we expect to update the resource model or the area to the updated resource will come up next year or so.
Unknown Executive: Okay. So we'll talk to you about how quick follow on that a bit.
Unknown Executive: Douglas Goldstein, CFP®, is the director of Profile Investment Services and the host of When do you expect to realize some of the potential of the underground or make the necessary conversions or reserves that might be needed?
Unknown Executive: Okay.
Speaker Change: Great maybe shifting over to for cooler we saw that there was a tech report filed in March.
Unknown Executive: And in 'twenty, 'twenty system pilot and opportunity for the underground.
Unknown Executive: When do you expect to have a to realize some of the potential of the underground work do the necessary conversion to reserves that might be needed.
Unknown Executive: Yeah, so we're going to reach the pace at the end of this year, and we fully plan to be in mining operationally by kind of late Q1-Q2 next year.
Speaker Change: Yeah, So we're going to reach the base at the end of this year.
Unknown Executive: And we fully plan to begin mining operationally in kind of late Q1 Q2 next year.
Unknown Executive: The regional drilling continues, and once, as we said, when we get the, when we succeed, hopefully, in getting the exploitation permit, then we will accelerate some more drilling up in the regional area to further... Remember, the technical report is a... Thank you. There and elsewhere and turning it into indicated so that the ongoing work there plus additional step-up drilling numerous zones up and down the belt to test the ultimate potential of my life of the trucking board.
Unknown Executive: Okay.
Unknown Executive: Regional drilling continues at once as we said when we get the.
Unknown Executive: Succeed hopefully it gets the expectation perfect then we would accelerate some more drilling.
Unknown Executive: Regional area to further remember the technical report as soon as the regulatory.
Unknown Executive: Requirement. It did not include any inferred and let you guys know that all of them or distribute equally we have a great track record.
Unknown Executive: There and elsewhere, turning it into indicated so there'll be ongoing work there plus additional.
Unknown Executive: Couple of drilling numerous shows up in terms of the built to.
Unknown Executive: It's attached to the ultimate potential a wide base of the trucking award.
Don DeMarco: Okay, thanks. I think my other question has been answered. That's all for me. Good luck with Q2 and the rest.
Speaker Change: Got it okay. Thanks.
Speaker Change: So I think my other question's been answered that's all for me good luck on the rest of the building.
Don DeMarco: Yeah.
Operator: This concludes the question and answer session, and we look forward to continuing to update you on our progress. This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.
Speaker Change: This concludes the question wasn't it.
Speaker Change: Alright. Thank you all for your thank.
Operator: Thank you all for your time, and we look forward to continuing to update.
Speaker Change: You are on a progress thanks, so much.
Operator: Yeah.
Operator: This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.
Operator: [music].
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