Q4 2024 Orla Mining Ltd Earnings Call
Okay.
Operator: Good morning, ladies and gentlemen, and welcome to Orla Mining's conference call for the fourth quarter and year-end 2024 My name is Abby and I will be your conference operator today. All lines have been placed on mute to prevent any background noise.
Speaker Change: Good morning, ladies and gentlemen, and welcome to Orla Mining's conference call for the fourth quarter and year end 'twenty 'twenty four result.
Abby: My name is Abby and I'll be your conference operator today.
Abby: All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.
Operator: And after the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press the star key, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one a second time.
Abby: He would like to ask a question during that time simply press the star key followed by the number one on your telephone keypad if.
Abby: If you would like to withdraw your question Press Star one a second time.
Andrew Bradbury: Please be advised that this call is being recorded and I would like to turn the meeting over to Andrew Bradbury, Vice President, Investor Relations and Corporate Development. Please go ahead, Mr. Bradbury.
Speaker Change: Please be advised that this call is being recorded and I would like to turn the meeting over to Andrew Bradbury, Vice President Investor Relations and corporate development. Please go ahead Mr. Bradbury.
Abby: Yeah.
Andrew Bradbury: Thank you, operator, and welcome to Orla's fourth quarter and year-end 2024 results conference call. We will be making forward-looking statements during today's call, and I would direct you to the second and third slides of the presentation, which contains important cautionary notes regarding these forward-looking statements. All dollar amounts discussed today will refer to U.S. dollars unless otherwise indicated.
Andrew Bradbury: Thank you operator, and welcome to all of its fourth quarter and year end 2024 results conference call.
Andrew Bradbury: We will be making forward looking statements during today's call and I would direct you to the second and third slides of the presentation, which contains important cautionary notes regarding these forward looking statements.
Andrew Bradbury: Dollar amounts discussed today will refer to U S dollars unless otherwise indicated.
Jason Simpson: The Orla Executives team is on the call this morning and I will now pass the call to Jason Simpson, President and CEO. Thanks, Andrew. During the fourth quarter, Camino Rojo had continued strong production at low cost. This production strength and low costs in a record gold price environment drove strong margins in cash flow.
Jason Simpson: The all the executive team is on the call. This morning, and I'll now pass the call to Jason Simpson, President and CEO.
Jason Simpson: Thanks, Andrew during the fourth quarter Camino Rojo.
Jason Simpson: Continued strong production at low cost.
Jason Simpson: This production strength and low cost in a record gold price environment drove strong margins and cash.
Jason Simpson: Notably, we announced the transformational acquisition of the Musselwhite mine in Ontario that will more than double Orla's production profile. We continue to advance our exploration and development portfolio in Mexico, Nevada, and now Canada. Part of our growth investment we'll discuss today is the construction planning for our growth at the South Railroad Project and exploration in Nevada on the broader South Carlin Complex. We have the executive team on the call to provide specific updates.
Jason Simpson: Notably, we announced the transformational acquisition Masa might musselwhite mine in Ontario that will more than double <unk> production profile.
Jason Simpson: We continue to advance our exploration and development portfolio in Mexico, Nevada, and now Canada.
Jason Simpson: Part of our growth investment will discuss today is the construction planning for our growth at the South Railroad project and exploration in Nevada on the broader so Thailand complex.
Jason Simpson: We have the executive team on the call to provide specific updates.
Jason Simpson: Stepping out from the quarter and looking back at the full year 2024 was a transformational period for the company.
Jason Simpson: Stepping out from the quarter and looking back at the full year, 2024 was a transformational period for the company. As Camino Rojo achieved record production, and we expanded into northern Ontario with the acquisition of the Muscle White Mine. By every measure, 2024 was a tremendous success for Orla, and we will build on this momentum as we advance the South Railroad Project in Nevada and the Sulphide Project at Camino Rojo in Mexico. We expect 2025 to be a catalyst-rich year for the company with the integration of muscle weight, an initial underground resource for the Camino Rojo sulfides, and an updated resource for South Railroad.
Jason Simpson: As Camino Rojo achieved record production.
Jason Simpson: And we expanded into northern Ontario, with the acquisition of the Musselwhite mine.
Jason Simpson: By every measure 2024 was a tremendous success for Orla and we will build on this momentum as we advance the South Railroad project in Nevada, and the sulfide project at <unk>.
Jason Simpson: Well in Mexico.
Jason Simpson: We expect 2025 to be a catalyst rich year for the company with the integration of Musselwhite and initial underground resource for the Camino Rojo Sulphides and then updated resource for self railroad.
Jason Simpson: Our preliminary guidance for 2025 at Camino Rojo is 110 to 120,000 ounces of gold produced at an all in sustaining cost of $875 to $975 per ounce gold sold.
Jason Simpson: Our preliminary guidance for 2025 at Camino Rojo is 110 to 120000 ounces of gold produced at an all in sustaining cost of 875 to $975 per ounce gold sold.
Jason Simpson: We intend to provide updated guidance inclusive of muscle weight in the second quarter.
Jason Simpson: We intend to provide updated guidance inclusive of musselwhite in the second quarter.
Andrew Cormier: Our Chief Operating Officer, Andrew Cormier, will now discuss our operating performance. Thank you, Jason. As mentioned, our operating team in Mexico delivered another impressive quarter while remaining committed to the health and safety of all of our employees. During the quarter, we mined over 1.8 million tons of ore at a strip ratio of 1.54. The increased strip ratio in the second half is in line with the mine sequence plan for the year. The average gold grade of ore processed during the fourth quarter was 0.94 grams per ton in line with our plan. We also achieved an average stacking rate of 18,487 tons of ore per day.
Speaker Change: Our Chief operating Officer, Andrew Courtenay will now discuss our operating performance.
Jason Simpson: Thank you Jason.
Speaker Change: As mentioned our operating team in Mexico delivered another impressive quarter, while remaining committed to the health and safety of all of our employees.
Speaker Change: During the quarter, we mined over one 8 million tonnes of ore at a strip ratio of 1.54.
Speaker Change: The increase strip ratio in the second half is in line with the mine sequence plan for the year.
Speaker Change: The average gold grade of ore processed during the fourth quarter was point 94 grams per ton in line with airplane.
Speaker Change: We also achieved an average stacking rate of 18487 tonnes of ore per day.
Speaker Change: Okay.
Andrew Cormier: With a continued strong mining and operating performance in the fourth quarter, we produced nearly 27,000 ounces of gold. As a result, we produced a record 137,000 ounces of gold for the year. meeting the increased 2024 production guidance range of $130,000 to $140,000.
Speaker Change: With a continued strong mining and operating performance in the fourth quarter, we produced nearly 27000 ounces of gold.
Speaker Change: As a result, we produced a record 137000 ounces of gold for the year.
Speaker Change: Meeting the increased 2044 production guidance range of 130000 to 140000.
Speaker Change: Okay.
Andrew Cormier: As Jason mentioned, our preliminary goal production guidance for Camino Rojo in 2025 is 110 to 120,000 ounces. Permitting of our expansion in Mexico continues as we resubmitted the permit applications to the federal government in November, with the full endorsement of the state government. Following productive discussions with the new administration in the fourth quarter and early this year, we anticipate the new administration will be prepared to respond to our permit application this year. In Nevada, permitting for the South Railroad Project continues to progress, and we're anticipating the posting of the Notice of Intent by mid-year. The Supplemental Environmental Reports have been submitted to the Bureau of Land Management, BLM, and are under review with the local office in Elko.
Speaker Change: As Jason mentioned, our preliminary gold production guidance for Camino Rojo in 2025 is 110 to 120000 ounces.
Speaker Change: Permitting of our expansion in Mexico continues as we resubmitted the permit applications to the federal government in November with the full endorsement of the state government.
Speaker Change: Following productive discussions with the new administration in the fourth quarter and early this year, we anticipate the new administration will be prepared to respond to air permit application this year.
Speaker Change: In Nevada permitting for the South Railroad project continues to progress and we are anticipating the posting of the notice of intent by mid year.
Speaker Change: The supplemental environmental reports have been submitted to the Bureau of land management P. L N.
Speaker Change: We are under review with the local office in Elko.
Andrew Cormier: Once finalized, the Notice of Intent will be reviewed by the state and then the federal DLM offices in advance of the final Notice of Intent publishing, expected mid-2025, with the targeted record of decision, the final permitting decision, by mid-2026. Following this approval, Earthworks on the South Railroad project will commence, and the first full production anticipated in the second half of 2027. The EPCM contract was awarded to M3 Engineering and Technology in the first quarter, with basic and detailed engineering proceeding this year and into 2026 to align with construction following the record of decision. Long lead equipment will be identified and purchase orders will potentially be placed in 2025.
Speaker Change: Once finalized the notice of intent will be reviewed by the state and then the federal BLM offices in advance of the final notice of intent publishing expected mid 2025.
Speaker Change: With the targeted record of decision the final remedy the Susan by mid 2016.
Speaker Change: Following this approval earthworks in the South <unk> project with commitments.
Speaker Change: The first gold production anticipated in the second half of 2027.
Speaker Change: The P. C. M contract was awarded to <unk> engineering and technology in the first quarter with basic and detailed engineering preceding this year and into 2026 to align with construction following the record of decision.
Speaker Change: Long lead equipment will be identified and purchase orders will potentially be placed in 2025.
Etienne Morin: Now over to our Chief Financial Officer, Etienne Morin, to discuss the financial results for the quarter. Thanks, Andrew. During the quarter, we sold 33,000 ounces of gold at a realized price of $2,669 per ounce, resulting in $93 million in revenue for the quarter. All in sustaining costs for the fourth quarter was $826 per ounce, lower in part due to the higher gold sales and higher silver byproduct credit. For the full year, all-in sustaining cost was $805 per ounce, and this makes Camino Rojo one of the lowest cost gold mines globally. Our low-cost production, coupled with the higher gold prices, are driving strong earnings and cash flow generation.
Speaker Change: Now over to our Chief Financial Officer.
Speaker Change: Good morning to discuss the financial results for the quarter.
Speaker Change: Okay.
Speaker Change: Thanks, Andrew during the quarter, we sold 33000 ounces of gold at a realized price of 2000 and $669 per ounce, resulting in $93 million in revenue for the quarter.
Speaker Change: All in sustaining costs for the fourth quarter was $826 per ounce lower in part due to the higher gold sales and higher silver byproduct credits.
Speaker Change: For the full year all in sustaining cost was $805 brands and this makes Camino Rojo, one of the lowest cost gold mines globally.
Speaker Change: Our low cost production, coupled with the higher gold prices are driving strong earnings and cash flow generation. Our net earnings for the quarter were $26 $1 million of eight <unk> per share and after adjusting for the gain related to the change in fair value of the gold forwards outstanding at year end related to the gold.
Etienne Morin: Our net earnings for the quarter were $26.1 million, or $0.08 per share. And after adjusting for the gain related to the change in fair value of the gold forwards outstanding at year-end, related to the gold prepay facility on the Musselwhite acquisition, and a few other items, including unrealized foreign exchange gains, adjusted net earnings were $22 million, or $0.07 per share. These Strong's earnings are reflected in a robust operating margin of 64%. During the quarter, exploration and project costs were $12.2 million, of which $2.6 million was capitalized and $9.6 million was expensed. Four-year exploration project costs totaled $47.9 million, of which $13.3 million was capitalized and $34.6 was expensed, in line with our 2024 guidance of $34 million.
Speaker Change: PE facility on the Musselwhite acquisition and a few other items, including unrealized foreign exchange gains adjusted net earnings were $22 million or seven cents per share.
Speaker Change: These strong earnings are reflected in a robust operating margin of 64%.
Speaker Change: During the quarter exploration and project costs were $12 $2 million of which $2 six was capitalized and $9 6 million was expensed.
Speaker Change: Full year exploration project costs totaled $47 9 million of which $13 3 million was capitalized at $34 six was expensed in line with our 2024 guidance of $34 million.
Etienne Morin: Cash flow from operating activities before changes in non-cash working capital was $46 million, or $0.14 per share, for the quarter. Meanwhile, we generated $39 million in free cash flow, or $0.12 per share. During the fourth quarter, total capitalized expenditures was $5.2 million, of which $2.8 million was non-sustaining related to capitalized exploration in Mexico, and $2.4 million was sustaining. During the fourth quarter, we fully repaid our outstanding balance on a revolving credit facility to achieve a debt-free status. As a result, we were able to take advantage of our strong balance sheet and financial flexibility to fund the purchase of the Musselwhite mine while mitigating any needs for upfront equity dilution to shareholders.
Speaker Change: Cash flow from operating activities before changes in noncash noncash working capital was $46 million or <unk> 14 per share for the quarter.
Speaker Change: While we generated $39 million in free cash flow or 12 cents per share.
Speaker Change: During the fourth quarter total capitalized expenditures was $5.2 million of which $2 8 million was non sustaining related to capitalized exploration in Mexico, and $2 4 million was sustaining.
Speaker Change: During the fourth quarter, we fully repaid our outstanding balance on our revolving credit facility to achieve a debt reached that status. As a result, we were able to take advantage of our strong balance sheet and financial flexibility to fund the purchase of the Musselwhite mine, while mitigating any needs for upfront equity dilution to share.
Speaker Change: Holders.
Etienne Morin: The $810 million in upfront consideration for the Musselwhite acquisition was funded from $250 million of bank debt, $200 million in senior unsecured convertible notes led by Orla's cornerstone shareholders, and a $360 million prepay facility. The goal prepay is a three-year obligation to deliver a total of approximately 145,000 ounces in equal monthly deliveries starting this month. The facilities is based on the Gold IV prices averaging $2,834 per ounce over that three-year period. As a result of the acquisition, the company's debt outstanding balance is $450 million with net debt of approximately $260 million. We intend to use our strong cash generation from our operation to de-lever over the next three years while we also prepare to fund the construction of South Railroad.
The $810 million in upfront consideration, but at Musselwhite acquisition was funded from $250 million of bank debt $200 million in senior unsecured convertible notes.
Speaker Change: Led by orders cornerstone shareholders and at $316 million prepay to Saturday.
Speaker Change: The gold prepay is a three year obligation to deliver a total of approximately 145000 ounces in equal monthly deliveries starting this month.
Speaker Change: The facilities is based on the Gulfport prices, averaging 2008, an $834 per ounce over that three year period.
Speaker Change: As a result of the acquisition the Companys current outstanding balance is.
Speaker Change: Debt outstanding pilots is $450 million with net debt of approximately $260 million, we intend to use our strong cash generation from our operations to delever over the next three years, while we also prepare to fund the construction of South Railroad.
Etienne Morin: Our cash balance at the end of February was closer to $190 million.
Speaker Change: Our cash balance at the end of February it was closer to $190 million and with that I will pass it over to our senior Vice President of exploration Sylvain Huh.
Sylvain Guerard: And with that, I will pass it over to our Senior Vice President of Exploration, Sylvain Guerard, which will provide you a short update on the exploration activity. Thank you, Etienne. During the quarter, the fourth quarter in Mexico, the company completed the drill program at the Camino Rojo extension, now referred to as Zone 22. The first year of drilling in Zone 22 successfully defined mineralization up to 0.9 km from the current resource boundary. The system remains open.
Sylvain Huh: We will provide you a short update on the exploration activities.
Sylvain: Thank you Jim.
Sylvain: During the quarter the fourth quarter in Mexico. The company completed the drilling program in the coming or for extension now refer to as 122.
Sylvain: The first year of drilling in zone 22 successfully they find resolution up two point in line with <unk> from the current resource boundary the.
Sylvain: The system remains open bank loans and other debt.
Sylvain Guerard: Don't launch it at that. An updated on-the-ground resource on the Camino Rojo sulfide deposit is planned for the second quarter of 2025. And it's focus on the Caracol in the upper 500 meter of zone 22.
Sylvain: And David on the ground and the resource of the coming no whole sulfide deposit this plan for the second quarter of 2025.
Sylvain: And its focus on the Curragh coal in the upper 500 meter zone in 'twenty two.
Sylvain Guerard: Nevada 2024 marked another successful year of exploration at the Salt Carlin complex, with significant results at multiple targets over the entire 30 kilometer property strike length. The results from the 2024 Drill Program included multiple high-grade intersections within and beyond the feasibility study open pit at Dark Star and Binion, demonstrating potential for extensions and resource growth. Drilling in the south area of the property, which was extended by the acquisition of Contact Gold's Pony Creek property early in the year, increased our confidence in potential for additional oxide resource definition. At the sulfide targets within the north area, drilling tested the extension of the north bullion deposit, as well as current tide targets, which returned significant minimization.
Sylvain: In Nevada, 'twenty 'twenty, four and marked another successful year of exploration of the salt, causing complex with finishing Kevin Jordan resolved multiple targets over the entire 30 kilowatt later, probably do strike limb.
Sylvain: The results from the 'twenty 'twenty four drill program included multiple I agree that intersection within and beyond the physical T study open bids.
Sylvain: <unk> star and opinion, demonstrating potential for extensions and resource growth.
Sylvain: Drilling in the South area of the property, which was extended by the acquisition of contact Gold's pointed Creek property early in the year increased our confidence and potential for AGA Shlomo oxide resource definition.
Sylvain: At the sulfide targets went into Nord area drilling tested the extension of the north volume deposit azuela, corn type targets, which returned to its getting musician.
Sylvain Guerard: This sets the stage for high-priority follow-up to any. The results of the 2024 DRILL program support our Nevada strategy to enhance project value and extend mine life by identifying additional oxide resources and making new discoveries across the land back An updated resource and reserve estimate is expected to be completed in the second half of 2025.
Sylvain: Sets the stage for Heidelberg, they follow up drilling.
Sylvain: The results of the 'twenty, one quadrant program support our neighborhood doors throughout the G to N as project value and extend mine life by identifying additional oxide resources, and making new discoveries across the land package.
Sylvain: An updated resource and reserve estimate is expected to be completed in the second half of 'twenty 'twenty five.
Silvana Costa: I will now pass the call back to our Chief System Ability Officer, Silvana Costa. Thank you, Sylvain. Over the past two years, we have made significant strides in strengthening our ESG performance framework, and reflecting our unwavering dedication to responsible and sustainable business practices. As a result, we are proud to report notable improvements in our ESG ratings from Scotiabank in the last quarter, as well as above industry average in our first year participating in the S&P Global Corporate Sustainability Assessment. Both S&P Global and Scotiabank have recognized our overall SESG performance as exceeding industry benchmarks. Also during the fourth quarter, we continued our community engagement and our strategic investment initiatives at Camino Rojo and South Bay Road, while maintaining a strong focus on environmental performance and fulfilling our social commitment.
Sylvain: I will now pass the call back to our chief system, the ability officer Silvana Costa.
Speaker Change: Thank you Savannah over the past two years, we have made significant strides in strengthening our ESG performance framework, and reflecting our unwavering dedication to responsible and sustainable business practices.
Speaker Change: As a result, we are tied to deploy notable improvements in our ESG ratings from Scotia Bank in the last quarter as well as above industry average in our first year participating in the S&P global corporate sustainability assessment.
Speaker Change: Both S&P global and Scotiabank has recognized our overall ESG performance is exceeding industry benchmarks.
Speaker Change: Also during the fourth quarter, we continued our community engagement and a strategic investment initiatives at <unk>, South main road, while maintaining a strong focus on environmental performance and fulfilling our social commitments.
Silvana Costa: On the people front, in the fourth quarter, we prioritized a smooth transition for the Massa White Mine, welcoming new team members and addressing key processes like benefits, payroll, and employee records management. These efforts have been vital in retaining critical talent and supporting onboarding.
Speaker Change: On the people front in the first quarter, we prioritized as smooth transition for the NASA whitening welcoming new team members and addressing key processes like benefits payroll and employee Records management.
Speaker Change: These efforts have been vital oil retaining critical talent and supporting those avoided.
Silvana Costa: To reinforce our commitment to personal engagement, members of our executive team visited the site on our first day as owners and will return this week for a second town hall to warmly welcome MasterWide employees to the company.
Speaker Change: To reinforce our commitment to personal engagement named days of barriers that could take team visited this tightly on our first day as owners and we only turn does make for a second townhome to warmly welcome NASA wait until <unk> to the company.
Jason Simpson: With that, I'll hand the call back to Jason, who will share more about the NASA White Mine acquisition.
Jason Simpson: With that I'll hand, the call back to Jason who will share more about the musselwhite mine acquisition.
Jason Simpson: Thanks, Sylvain. During the fourth quarter, Orla announced the acquisition of the Musselwhite mine, expanding our operating footprint into Ontario and adding a second operating gold mine to our platform. The addition of muscle white is expected to more than double our annual production. To many of you, I have communicated that the two most important aspects of the deal to me is that number one, there's highly favorable geology, and number two, there is a great team. These two fundamental pieces give us great confidence about the long future at MuscleLife. We intend to invest in both the team and the geology, and we are launching an aggressive multi-year exploration program to outline that Muscle White extends for more than just six years.
Jason Simpson: Thanks Silvana.
Jason Simpson: During the fourth quarter <unk> announced the acquisition of the Musselwhite mine, expanding our operating footprint into Ontario, and adding a second operating gold mine to our platform.
Jason Simpson: The addition of Musselwhite is expected to more than double our annual production.
Jason Simpson: To many of you I have communicated that the two most important aspects of the deal to me is that number one.
Jason Simpson: Highly favorable geology and number two there is a great team.
Jason Simpson: These two fundamental pieces give us great confidence about the long future at musselwhite.
Jason Simpson: We intend to invest in both the team and the geology and we are launching an aggressive multi year exploration program.
Jason Simpson: Line that musselwhite extends for more than just six years.
Jason Simpson: An additional critical mass of new gold inventory will give us a pathway to improve the material handling to increase production rates in a material way and reduce operating costs. We will also look to the experienced team on site to bring their ideas forward on how to further improve the operation.
Jason Simpson: An additional critical mass of new gold inventory will give us a pathway to improve the material handling to increased production rates in a material way and reduce operating costs.
Jason Simpson: We will also look to the experienced team on site to bring their ideas forward on how to further improve the operations.
Jason Simpson: Looking ahead to 2025, there are several catalysts for Orla. the integration of Mosselwhite Mine into the business. Expected permitting milestones in both Mexico and Nevada. Resource Updates for the South Carlin Complex and the Camino Rojo Sulphide. advancing study work on the Camino Rojo Sulphides, and construction planning information from our South Railroad Project in Nevada.
Jason Simpson: Looking ahead to 2025, there are several catalysts for orla.
Jason Simpson: The integration of Musselwhite mine into the business <unk>.
Jason Simpson: Expected permitting milestones in both Mexico and Nevada.
Jason Simpson: Resource updates for the South Carlin complex and the Camino Rojo sulfides.
Jason Simpson: Dancing study work on the Camino Rojo sulfides.
Jason Simpson: And construction planning information from our South Railroad project in Nevada.
Jason Simpson: In 2024, Orla's and Sliver's. Record Production and Cast Generation.
Jason Simpson: In 2024 oral Lytton delivered.
Jason Simpson: Record production and cash generation.
Jason Simpson: The Transformational Acquisition of the Muscle White Line. and discovered more gold and additional exploration highlights throughout the year. We continue to execute on our proven strategy to generate value to the benefit of all of our stakeholders.
Jason Simpson: The transformational acquisition of the Musselwhite mine.
Jason Simpson: And discovered more gold and additional exploration of highlights throughout the year.
Jason Simpson: We continue to execute on our proven strategy to generate value to bent to the benefit of all of our stakeholders.
Jason Simpson: I am proud of what the team has been able to accomplish in 2024, with only more to come in 2025.
I am proud of what the team has been able to accomplish in 2024 with only more to come in 2025.
Jason Simpson: Thank you to our teams in all the countries where we operate, whose commitment and delivery are driving this business forward.
Jason Simpson: Thank you to our teams in all the countries, where we operate whose commitment and delivery are driving this business forward.
Operator: At this point, I'd like to open the call to questions and hand the call back to the operator. Thank you. And we will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join If you would like to withdraw your question, press star 1 a second time.
Jason Simpson: At this point I'd like to open the call to questions and hand, the call back to the operator.
Jason Simpson: Thank you and we will now begin the question and answer session.
Jason Simpson: Have dialed in and would like to ask a question. Please press star one on your telephone keypad to raise your hand and join the queue.
Jason Simpson: If you would like to withdraw your question Press Star one a second time.
Operator: If you are called upon to ask your question and are listening via speakerphone on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, it is star one if you would like to join the queue.
Jason Simpson: If you are called upon to ask your question and our listening via Speakerphone on your device. Please pickup your handset and ensure that your phone is not on mute when asking your question.
Jason Simpson: Again, it is star one if you would like to join the queue.
Wayne Lamb: And your first question comes from the line of Wayne Lamb with TD Securities. Your line is... Yeah, thanks, Morten.
Speaker Change: And your first question comes from the line of Wayne Lam with TD Securities. Your line is open.
Wayne Lam: Yes, thanks, guys.
Jason Simpson: I was just wondering, at Muscle White, obviously a pretty transformational acquisition. Is there anything you can share with us on what we might be able to expect with the upcoming guidance? Just wanted to understand some of the, with some of the improvements that Newmont had implemented prior to the sale, like the ventilation or the material handling system. Are there substantial cost savings that can be realized relative to the $1,500 ASIC run rate seen there the past year? Yeah, thanks Wayne for the question. We'll provide updated guidance in Q2 as we mentioned, which of course will include our expectation for the remaining three quarters for the all-in sustaining cost.
Wayne Lam: I was just wondering at Musselwhite, obviously, a pretty transformational acquisition is there anything you can share with us what.
Wayne Lam: We might be able to expect with the upcoming guidance just wanted to understand some of it with some of the improvements that newmont had implemented prior to the sale like the ventilation within material handling handling system are there substantial cost savings that can be realized relative to the 15 $1500 basic run rate seen there in the past year.
Yes, well, we will provide up thanks Blayne for the question, we'll provide updated guidance in Q2, as we mentioned which of course we include our.
Wayne Lam: Expectation for the remaining three quarters for the all in sustaining cost.
Jason Simpson: You're quite correct, we are going to be benefiting from some of the investment that Newmont put into the asset in years prior, the one that you described, ventilation improvements as well as cemented rock fill improvements. So that's one avenue that won't be passed on to Orla that we'll be the benefactors of and not have to do going forward. The second grouping of cost reduction we often speak about is the size of the companies, relatively speaking, is quite different and Orla will be able to run a different size operation and find some savings there. The third category of course is on the denominator and as we can increase gold production, that'll of course help with an all-in sustaining cost per ounce reduction.
Wayne Lam: You are quite correct, we are going to be benefiting from some of the investment that newmont put into the asset in years prior.
Wayne Lam: The one that you described ventilation improvements as well as our cement at Rockville improvements. So that's one avenue that won't be passed on to oral <unk> that will be to identify actors and not have to do going forward.
Wayne Lam: The second grouping of cost reduction, we often speak about is the size of the company's relatively speaking is quite different and we will be able to run a different size operation and find some cost savings there.
Wayne Lam: The third category of course is on the denominator and as we can and increase gold production.
Wayne Lam: Of course help with.
Wayne Lam: And all in sustaining cost per ounce reduction and then finally as I mentioned on this call. We've already had a number of engaging conversations with the site team and have already identified a number of improvement opportunities from the underground mine.
Jason Simpson: And then finally, as I mentioned on this call, we've already had a number of engaging conversations with the site team and have already identified a number of improvement opportunities from the ground line that will benefit us on the cost front. So we look forward to updating the market in Q2 of our first year, albeit a partial year, of production at Musselwhite inclusive of cost. Okay, great.
Wayne Lam: That will benefit us on the on the cost front. So we look forward to updating the market in Q2 of our first year.
Wayne Lam: Albeit a partial year of production.
Wayne Lam: At musselwhite inclusive of costs.
Wayne Lam: Okay.
Wayne Lam: Okay, great looking forward to that.
Wayne Lamb: Looking forward to that.
Jason Simpson: Maybe at Camino Rojo, just wondering what the environmental permit for the layback now resubmitted. How are you seeing the regulatory framework now in Mexico? And just wondering if the timing for resubmission of the change of land use permit has been impacted?
Speaker Change: Maybe at Camino Rojo, just wondering with the environmental permit and lay back now resubmitted. How are you seeing the regulatory framework now in Mexico, and just wondering if the timing for Resubmission of the change of land use permit has been impacted.
Jason Simpson: Just just wondering if you could provide some color on what you're seeing in terms of the ongoing discussions in country. Yeah, just to be eminently clear to all the listeners on the call, the MIA that we resubmitted on November 11th of last year is really the primary permit. There's a subsequent change of land use where we pay for the additional ground. That's a matter of process. So as we outlined, we had good, in the call today, we had good meetings with the new administration last year and as recently as a couple of weeks ago that gives us confidence that we're on track to deliver that permit this year.
Speaker Change: Wondering if you could perhaps provide some color on what youre seeing in terms of the ongoing discussions in country.
Speaker Change: Yes, just to be eminently clear to all the listeners on the call. The EMEA that we resubmitted on November 11th of last year is really the primary permit to Theres a subsequent change of land use where we pay for the additional ground that's a matter of process.
Speaker Change: As we outlined we had good in the call today, we had good meetings with the New administration last year and as recently as a couple of weeks ago that gives us confidence that we're on track to deliver that permit.
Speaker Change: This year.
Jason Simpson: And all the associated permits that are part of normal course operations will follow.
Speaker Change: All of the associated permits.
Speaker Change: That are part of normal course operations of will follow.
Speaker Change: And we hope to provide an update on that in the second quarter as well.
Wayne Lamb: And we hope to provide an update on that in the second quarter as well. Okay, great. Thanks.
Speaker Change: Okay.
Speaker Change: Okay, great. Thanks, and maybe just last one at.
Jason Simpson: And maybe just last one at South Railroad.
Speaker Change: At South railroad.
Jason Simpson: Similarly, just wondering how things are advancing on the permitting front and just wondering what you're seeing with the notice of intent now expected in mid 2025 and the subsequent impact on timing for the Record of Decision. Yeah, so as many people have been following our story will realize we submitted 20 supplemental environmental reports to BLM as Andrew characterized on the call. They're under final review in the ALCO office. They can then get transferred to Reno and Washington. And so we'll be tracking that progression through the next quarter. And then once the notice of intent is filed, we can really get to work with the cooperating agencies so that, you know, in a 12 month period, we can move through the EIS process with BLM and the environmental consultant that does the work such that we can begin earth movement in 2026.
Speaker Change: Similarly, just wondering how things are advancing on the permitting front and just wondering what youre seeing with the notice of intent now expected in mid 2025 and.
Speaker Change: And the subsequent impact on timing for the record of decision.
Speaker Change: Yes, so as many people have been following our story will realize we submitted 20 supplemental environmental reports the BLM is Andrew characterize on the call either under final review and the Alco office.
Speaker Change: They can then get transferred to Reno in Washington.
Speaker Change: So we'll be tracking that progression.
Speaker Change: Through the next quarter.
Speaker Change: Then once the notice of intent is filed.
Speaker Change: Can really get to work.
Speaker Change: With the cooperating agencies so that.
Speaker Change: In a 12 month period, we can move through the EIS process with BLM and an environmental consultant that does the work such that we can begin earth movement.
Speaker Change: In 2026, what we'd characterize also similar to our approach in Mexico with the board at the end of 2024 approved the budget for construction engineering in the first half of 2025, which is underway by M. Three that Andrew mentioned that engineering will buy.
Jason Simpson: What we've characterized also similar to our Mexico is the board at the end of 2024 approved a budget for construction engineering first half of 2025, which is underway by M3 that Andrew mentioned, that engineering will feed into a procurement process such that when we do begin turning dirt in 2026, we can build the project with the kind of pace that we built Camino Rojo. All of that such that we'll be producing from Nevada, another open pit heat bleach operation in 2027 with similar low costs that we see in Mexico, and then have a portfolio of three producing assets in Mexico, United States, and Canada, pushing us up to 500,000 oz mark.
Speaker Change: Into.
Speaker Change: A procurement process such that when we do begin turning dirt in 2026, we can build the.
Speaker Change: Projected the kind of pace that we built at Camino Rojo.
Speaker Change: All of that such that we're producing from Nevada. Another open pit heap Leach operation in 2027.
Speaker Change: With similar low cost that we see in Mexico, and then have a portfolio of three producing assets in Mexico, United States, and Canada, pushing us up to 500000 ounce Mark.
Wayne Lamb: Okay, great. Looking forward to the updates and best of luck in the months ahead. Thanks, Frank.
Speaker Change: Okay, great looking forward to the updates and best of luck in the months ahead.
Speaker Change: Thanks, Mike.
Operator: And as a reminder, it is star one if you would like to ask a question.
Speaker Change: And as a reminder, it is star one if you would like to ask a question.
Operator: And there are no additional questions at this time.
Speaker Change: And there are no additional questions at this time I would like to turn the conference back over to Mr. Jason Thompson for closing remarks.
Jason Simpson: I would like to turn the conference back over to Mr. Jason Simpson. Since there are no further questions, I would like to thank you for your time. Never hesitate to reach out to Orla should you have any follow-up questions. And I'd like to thank the team for their continued performance.
Speaker Change: Since there are no further questions I would like to thank you for your time never hesitate to reach out to oil that should you have any follow up questions and I'd like to thank the team for their continued performance.
Speaker Change: And ladies and gentlemen, this concludes today's call and we thank you for your participation you may now disconnect.
Operator: Ladies and gentlemen, this concludes today's call, and we thank you for your participation. You may now
Speaker Change: [music].
Speaker Change: Okay.