Q2 2025 Artemis Gold Inc Earnings Call

Speaker #3: Thank you for signing in. This is the conference operator. Welcome to the Artemis Gold second quarter 2025 results conference call. As a reminder, all participants are in listen-only mode, and the conference is being recorded.

Conference Operator: Thank you for standing by. This is the conference operator. Welcome to the Artemis Gold Inc. second quarter 2025 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 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 Meg Brown, Vice President, Investor Relations. Please go ahead.

Operator 1: Thank you for standing by. Welcome to the Artemis Gold Q2 2025 Results Conference Call. I would now like to turn the conference over to Meghan Brown, Vice President, Investor Relations. Please go ahead.

Speaker #3: After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad.

Speaker #3: Should you need assistance during the conference call, you may signal an operator for pressing star then zero. I would now like to turn the conference over to Meg Brown, Vice President, Investor Relations.

Speaker #3: Please go ahead.

Speaker #4: Thank you, operator. Good morning, everyone, and welcome. Thank you for joining our inaugural earnings conference call and webcast. It's an exciting milestone and a transformational time for Artemis Gold.

Operator 2: Thank you, Operator. Good morning, everyone, and welcome. Thank you for joining our inaugural Earnings Conference Call and webcast. It's an exciting milestone and a transformational time for Artemis Gold. Before we begin, I would like to remind everyone that certain statements made on the call today may be forward-looking, and we encourage you to refer to our public filings and disclosures, including the cautionary language in yesterday's news release, for more detailed discussion of potential risks and uncertainties related to these statements. I will now hand the call over to Artemis Gold's founder and Executive Chair, Steven Dean.

Meg Brown: Thank you, Operator. Good morning, everyone, and welcome. Thank you for joining our inaugural earnings conference call and webcast. It is an exciting milestone and a transformational time for Artemis Gold Inc. Before we begin, I would like to remind everyone that certain statements made on the call today may be forward-looking, and we encourage you to refer to our public filings and disclosures, including the cautionary language in yesterday's news release, for a more detailed discussion of potential risks and uncertainties related to these statements. I will now hand the call over to Artemis Gold Inc.'s Founder and Executive Chair, Steven Dean.

Speaker #4: Before we begin, I would like to remind everyone that certain statements made on the call today may be forward-looking, and we encourage you to refer to our public filings and disclosures, including the cautionary language in yesterday's news release.

Speaker #4: For a more detailed discussion of potential risks and uncertainties related to these statements, I will now hand the call over to Artemis Gold's founder and Executive Chair, Stephen Dean.

Speaker #5: Thanks, Meg. And thank you all for taking the time to join the call today. It is our first earnings call now that we're in operations.

Steven Dean: Thanks, Meghan. Thank you all for taking the time to join the call today. It is our first earnings call now that we're in operations, and we're all excited to present and talk a little bit more about and give some color to the results. In addition to myself, today on the call we have our newly appointed CEO, Dale Andres; our President, Jeremy Langford; our CFO, Gerrie van der Westhuizen; our Chief ESG Officer, Candice Alderson; and our VP Finance, Erik Marchand. I'd like now to take a moment to introduce Dale Andres, our recently appointed CEO. For those of you who have not had the pleasure yet of meeting Dale, I can tell you the company is very fortunate to have the benefit of his very capable leadership.

Steven Dean: Thanks, Meg, and thank you all for taking the time to join the call today. It is our first earnings call now that we are in operations, and we are all excited to present and talk a little bit more about the, and give some color to the results. In addition to myself, today on the call, we have our newly appointed CEO, Dale Andres, our President, Jeremy Langford, our CFO, Jerry van der West-Heysen, our Chief ESG Officer, Candice Olderson, and our Vice President of Finance, Eric Marchand. I would like now to take a moment to introduce Dale Andres, our recently appointed CEO. For those of you who have not had the pleasure yet of meeting Dale, I can tell you the company is very fortunate to have the benefit of his very capable leadership. We know Dale well, not only as a non-executive director of Artemis Gold Inc.

Speaker #5: And we're all excited to present and talk a little bit more about the results and give some color to them. In addition to myself, today on the call, we have our newly appointed CEO, Dale Andris; our President, Jeremy Langford; our CFO, Jerry van der West-Hazen; our Chief ESG Officer, Candace Alderson; and our VP of Finance, Eric Marchand.

Speaker #5: I'd like now to take a moment to introduce Dale Andris, our recently appointed CEO, for those of you who have not had the pleasure yet of meeting Dale.

Speaker #5: I can tell you the company is very fortunate to have the benefit. He's very capable of leadership. We know Dale well, not only as a non-executive director of Artemis Gold since 2023, but also for his very successful career with tech resources.

Steven Dean: We know Dale Andres well, not only as a non-executive director of Artemis Gold since 2023, but also for his very successful career with Teck Resources. In fact, he and I worked together there, rising to having a responsibility for its base metal business, as well as his exemplary job in creating shareholder value for Gatos Silver, where he was CEO and led the company through a turnaround process that ultimately led to the sale of the company at an attractive premium. Adding Dale Andres in an executive leadership position provides broader and even greater management bench strength, which will allow Jeremy Langford to focus on the concurrent optimization of Blackwater Phase One operations and the delivery of the Phase Two expansion. Dale Andres and Jeremy Langford will take us through the highlights of the quarter, then we will open the call to your questions.

Steven Dean: since 2023, but also for his very successful career with Teck Resources. In fact, he and I worked together there, rising to having a responsibility for its base metal business, as well as his exemplary job in creating shareholder value for Gato Silver, where he was CEO and led the company through a turnaround process that ultimately led to the sale of the company at an attractive premium. Adding Dale in an executive leadership position provides broader and even greater management bench strength, which will allow Jeremy to focus on the concurrent optimization of Blackwater Phase One operations and the delivery of the Phase Two expansion. Dale and Jeremy will take us through the highlights of the quarter. Then we will open the call to your questions. I would like now to turn the call over to Dale.

Speaker #5: In fact, he and I worked together there, rising to having a responsibility for its base metal business. As well as his exemplary job in creating shareholder value for Gartho Silver, where he was CEO and led the company through a turnaround process that ultimately led to the sale of the company at an attractive premium.

Speaker #5: Adding Dale in an executive leadership position provides broader and even greater management bench strength, which will allow Jeremy to focus on the concurrent optimization of Blackwater Phase One operations and the delivery of the Phase Two expansion.

Speaker #5: Dale and Jeremy will take us through the highlights of the quarter, then we will open the call to your questions. I would like now to turn the call over to Dale.

Steven Dean: I would like now to turn the call over to Dale.

Speaker #6: Thank you, Stephen. And it truly is an honor and a privilege to take on the CEO role at Artemis Gold at such an exciting and transformative time.

Dale Andres: Thank you, Steven. It truly is an honor and a privilege to take on the CEO role at Artemis Gold at such an exciting and transformative time. I do want to jump straight into the details of the quarter now. First and foremost, safety has, and will continue to be, our top priority. Nothing is more important than ensuring every person at the mine and across the company goes home safe and healthy every day. We do maintain rigorous safety standards and foster a culture where everyone looks out for one another. It is great to be recognizing a milestone of 5.5 million hours LTI-free at the end of July. During Q2, we produced 50,623 ounces of gold, which includes almost 35,000 ounces in May and June. That was after declaring commercial production on 1 May.

Dale Andres: Thank you, Stephen. It truly is an honor and a privilege to take on the CEO role at Artemis Gold Inc. at such an exciting and transformative time. I do want to jump straight into the details of the quarter now. First and foremost, safety has and will continue to be our top priority. Nothing is more important than ensuring every person at the mine and across the company goes home safe and healthy every day. We do maintain rigorous safety standards and foster a culture where everyone looks out for one another. It is great to be recognizing a milestone of 5.5 million hours LTI-free at the end of July. During the second quarter, we produced 50,623 ounces of gold, which includes almost 35,000 ounces in May and June. That was after declaring commercial production on May 1st.

Speaker #6: I do want to jump straight into the details of the quarter now, and first and foremost, safety has, and will continue to be, our top priority.

Speaker #6: Nothing is more important than ensuring every person at the mine and across the company goes home safe and healthy every day. We do maintain rigorous safety standards and foster a culture where everyone looks out for one another, and it is great to be recognizing a milestone of 5.5 million hours LTI-free.

Speaker #6: At the end of July, during the second quarter, we produced 50,623 ounces of gold, which includes almost 35,000 ounces in May and June. This was after declaring commercial production on May 1.

Speaker #6: Year to date, that production stands a little over 63,000 ounces, and all of that is in line with our guidance. Throughout the second quarter, the ramp-up of the mill continued, and by June, we had achieved 102% of nameplate capacity.

Dale Andres: Year to date, that production stands a little over 63,000 ounces, and all of that is in line with our guidance. Throughout the second quarter, the ramp-up of the mill continued, and by June, we had achieved 102% of nameplate capacity. Gold recoveries in May and June averaged about 84%, which were impacted by both ore characteristics in the upper layers of the deposit, as well as our push to drive higher throughput on an operating hour basis. The plant is currently running very well, and we continue to focus on both stability of operation and further optimization. In late July, we successfully completed a three-day plant maintenance shutdown to make various modifications and improvements to the dry and wet circuits, which is expected to enable the mill to further and more consistently outperform its nameplate capacity.

Dale Andres: Year to date, that production stands a little over 63,000 ounces. All of that is in line with our guidance. Throughout Q2, the ramp-up of the mill continued. By June, we had achieved 102% of nameplate capacity. Gold recoveries in May and June averaged about 84%, which were impacted by both ore characteristics in the upper layers of the deposit, as well as our push to drive higher throughput on an operating-hour basis. The plant is currently running very well. We continue to focus on both stability of operation and further optimization. In late July, we successfully completed a 3-day planned maintenance shutdown to make various modifications and improvements to the dry and wet circuits, which is expected to enable the mill to further and more consistently outperform its nameplate capacity.

Speaker #6: Gold recoveries in May and June averaged about 84%, which were impacted by both ore characteristics in the upper layers of the deposit, as well as our push to drive higher throughput on an operating hour basis.

Speaker #6: The plant is currently running very well, and we continue to focus on both stability of operation and further optimization. In late July, we successfully completed a three-day plant maintenance shutdown to make various modifications and improvements to the dry and wet circuits, which is expected to enable the mill to further and more consistently outperform its nameplate capacity.

Speaker #6: Various initiatives are also underway to further improve recoveries, including augmenting our understanding of the ore characteristics in the oxide zones and transitional zones, which is at the top of the deposit, and that's in order to optimize the ore blend going forward.

Dale Andres: Various initiatives are also underway to further improve recoveries, including augmenting our understanding of the ore characteristics in the oxide zones and transitional zones, which is at the top of the deposit. That's in order to optimize the ore blend going forward. This sets us up very well to meet our annual guidance target of 190,000 to 230,000 ounces of gold produced. Turning to slide five, in the second quarter, we reported revenue of over $230 million, net income of $100 million, and adjusted EBITDA of $146 million. In this record gold price environment, our average realized gold price, and that's in Canadian dollar terms, was over $4,500 per ounce, generating cash flow from operations in the second quarter of $185 million. Needless to say, we're very happy with this strong start. We also achieved cash costs and all-in sustaining costs for the post-commercial production months of May and June.

Dale Andres: Various initiatives are also underway to further improve recoveries, including augmenting our understanding of the ore characteristics in the oxide zones and transitional zones, which is at the top of the deposit. That's in order to optimize the ore blend going forward. This sets us up very well to meet our annual guidance target of 190,000 to 230,000 ounces of gold produced. Turning to slide 5, in Q2, we reported revenue of over CAD 230 million, net income of CAD 100 million, and adjusted EBITDA of CAD 146 million. In this record gold price environment, our average realized gold price, and that's in Canadian dollar terms, was over CAD 4,500 per ounce, generating cash flow from operations in Q2 of CAD 185 million. Needless to say, we're very happy with this strong start.

Speaker #6: This sets us up very well to meet our annual guidance target of 190,000 to 230,000 ounces of gold produced. Turning to slide five, in the second quarter, we reported revenue of over $230 million, net income of $100 million, and adjusted EBITDA of $146 million.

Speaker #6: In this record, gold price environment, our average realized gold price, and that's in Canadian dollar terms, was over $4,500 per ounce, generating cash flow from operations in the second quarter of $185 million.

Speaker #6: Needless to say, we're very happy with this strong start. We also achieved cash costs and all-in sustaining costs for the post-commercial production months of May and June that were within our guidance range for the period and significantly lower than the majority of our peers.

Dale Andres: We also achieved cash costs and all-in sustaining costs for the post-commercial production months of May and June that was within our guidance range for the period and significantly lower than the majority of our peers. At today's gold price of about $3,300 US and looking at our all-in sustaining costs of around CAD 800 per ounce, that delivers a margin of around CAD 2,500 per ounce. That's roughly CAD 1,000 higher than the average of our peer group on that margin. That margin does have the potential to grow further in the current strong gold price environment. As we stated in our news release, we also expect slightly lower all-in sustaining costs in H2 as operational efficiencies improve and production continues to increase.

Dale Andres: That was within our guidance range for the period and significantly lower than the majority of our peers. At today's gold price of about $3,300 US, and looking at our all-in sustaining costs of around $800 per ounce, that delivers a margin of around $2,500 per ounce. That's roughly $1,000 higher than the average of our peer group on that margin. That margin does have the potential to grow further in the current strong gold price environment. As we stated in our news release, we also expect slightly lower all-in sustaining costs in the second half of the year as operational efficiencies improve and production continues to increase. The cash flow we generated in the second quarter allowed us to begin repayments on our long-term debt, with $67 million repaid to date, and that includes a $40 million payment in July.

Speaker #6: At today's gold price of about 3,300 dollars US and looking at our all in sustaining costs of around 800 dollars per ounce, that delivers a margin of around 2,500 dollars per ounce.

Speaker #6: And that's roughly $1,000 higher than the average of our peer group on that margin. That margin does have the potential to grow further in the current strong gold price environment. As we stated in our news release, we also expect slightly lower all-in sustaining costs in the second half of the year as operational efficiencies improve and production continues to increase.

Speaker #6: The cash flow we generated in the second quarter allowed us to begin repayments on our long-term debt, with 67 million repaid to date, and that includes 40 million dollar payment in July.

Dale Andres: The cash flow we generated in Q2 allowed us to begin repayments on our long-term debt, with CAD 67 million repaid to date. That includes a CAD 40 million payment in July. Ongoing strong free cash flow, combined with the CAD 700 million new revolving credit facility that was announced yesterday, will give us financial flexibility that we need to support both our near-term expansion options as well as refinance our long-term debt. With that summary on the operating and financial performance, I'll now turn it back to Steven.

Speaker #6: Ongoing strong free cash flow, combined with the $700 million new revolving credit facility that was announced yesterday, will give us the financial flexibility we need to support both our near-term expansion options as well as refinance our long-term debt.

Dale Andres: Ongoing strong free cash flow, combined with the $700 million new revolving credit facility that was announced yesterday, will give us financial flexibility that we need to support both our near-term expansion options as well as refinance our long-term debt. With that summary on the operating and financial performance, I'll now turn it back to Stephen.

Speaker #6: And with that, a summary on the operating and financial performance. I'll now turn it back to Stephen.

Speaker #5: Thanks, Dale. I'd like to first highlight the building of Blackwater in an industry-leading 22 months—an exceptional achievement by our team that is not commonly achieved in our sector. This is a testament to the hard work and dedication of our workforce.

Steven Dean: Thanks, Dale. I'd like to first highlight the building of Blackwater in an industry-leading 22 months, an exceptional achievement by our team, not commonly achieved in our sector, and a testament to the hard work and dedication of our workforce. With the build and startup led by Jeremy, our team has a track record of delivering against our commitments on a timely basis and in line with guidance. In an industry often challenged with risks and uncertainty, this is an accomplishment we can be very proud of. In January, we completed construction of Phase One and poured our first bar of gold and silver. Just 3 months later, we achieved commercial production, a great success. On achieving commercial production, we published our 2025 guidance. I'm pleased to say we are on track to meet that guidance.

Steven Dean: Thanks, Dan. I would like to first highlight the building of Blackwater in an industry-leading 22 months, an exceptional achievement by our team, not commonly achieved in our sector, and a testament to the hard work and dedication of our workforce. With the build and startup led by Jeremy Langford, our team has a track record of delivering against our commitments on a timely basis and in line with guidance. In an industry often challenged with risks and uncertainty, this is an accomplishment we can be very proud of. In January, we completed construction of Phase One and poured our first bar of gold and silver, and just three months later, we achieved commercial production. A great success. On achieving commercial production, we published our 2025 guidance. Pleased to say we are on track to meet that guidance.

Speaker #5: With the build and startup led by Jeremy, our team has a track record of delivering against our commitments on a timely basis and in line with guidance.

Speaker #5: In an industry often challenged with risks and uncertainty, this is an accomplishment we can be very proud of. In January, we completed construction of Phase One and poured our first bar of gold and silver, and just three months later, we achieved commercial production.

Speaker #5: A great success. On achieving commercial production, we published our 2025 guidance, pleased to say we're on track to meet that guidance. In the first two months of commercial production, we have already demonstrated that Blackwater will deliver low-cost production, delivering strong cash flows that in conjunction with the 700 million dollar revolver announced yesterday giving the company the ability to refinance our project loan facility on very attractive terms and provide financial flexibility to deliver on our near-term expansion opportunities.

Steven Dean: In the first 2 months of commercial production, we've already demonstrated that Blackwater will deliver low-cost production, delivering strong cash flows that, in conjunction with the CAD 700 million revolver announced yesterday, give the company the ability to refinance our project loan facility on very attractive terms and provide financial flexibility to deliver on our near-term expansion opportunities. It's an exciting time for Artemis Gold. As you know, we declared commercial production in May, and we're now solidly established as Canada's newest gold and silver mine. Blackwater checks all the characteristics of a true Tier One asset in terms of size, scale, resource upside, large underexplored regional land package, infrastructure, community support, and a low carbon footprint through our connection to the provincial hydroelectric power grid.

Steven Dean: In the first two months of commercial production, we have already demonstrated that Blackwater will deliver low-cost production, delivering strong cash flows that, in conjunction with the $700 million revolving credit facility announced yesterday, giving the company the ability to refinance our project loan facility on very attractive terms and provide financial flexibility to deliver on our near-term expansion opportunities. It is an exciting time for Artemis Gold Inc. As you know, we declared commercial production in May, and we are now solidly established as Canada's newest gold and silver mine. Blackwater checks all the characteristics of a true Tier One asset in terms of size, scale, resource upside, large underexplored regional land package, infrastructure, community support, and a low carbon footprint through our connection to the provincial hydroelectric power grid.

Speaker #5: It's an exciting time for Artemis Gold, as you know. We declared commercial production in May, and we're now solidly established as Canada's newest gold and silver mine.

Speaker #5: Blackwater checks all the characteristics of a true Tier One asset in terms of size, scale, resource upside, large underexplored regional land package, infrastructure, community support, and a low carbon footprint through our connection to the provincial hydroelectric power grid.

Speaker #5: It is truly an exceptional asset that will make meaningful development and economic contributions to the local communities. The province of BC and, in fact, all of Canada for years to come.

Steven Dean: It is truly an exceptional asset that will make meaningful development and economic contributions to the local communities, the province of British Columbia, and in fact, all of Canada for years to come. In May, we officially opened the Blackwater Mine, and we were honored to have in attendance not only the Premier of the province, David Eby, but also his Minister of Mining and Critical Minerals, Jaghrib Ba, along with senior representatives from our First Nations partners and local communities. The Minister, in his comments, pointed to Blackwater as a great example of what we want to see more of in British Columbia, a project that creates good jobs, supports local and indigenous communities, and takes crucial steps to minimize the impact on the environment. It shows how responsible mining can move our economy forward in the right way.

Steven Dean: It is truly an exceptional asset that will make a meaningful development and economic contributions to the local communities, the province of BC, and, in fact, all of Canada for years to come. In May, we officially opened the Blackwater Mine, and we were honored to have in attendance not only the Premier of the province, David Eby, but also his Minister of Mining and Critical Minerals, Jagrup Brar, along with senior representatives from our First Nations partners and local communities. The Minister, in his comments, pointed to Blackwater as a great example of what we want to see more of in BC, a project that creates good jobs, supports local and Indigenous communities, and takes crucial steps to minimize the impact on the environment. It shows how responsible mining can move our economy forward in the right way.

Speaker #5: In May, we officially opened the Blackwater mine and we were honored to have in attendance not only the premier of the province, David Eby, but also his minister of mining and critical minerals, Jagrup Bha, along with senior representatives from our First Nations partners and local communities.

Speaker #5: The minister, in his comments, pointed to Blackwater as a great example of what we want to see more of in BC: a project that creates good jobs, supports local and Indigenous communities, and takes crucial steps to minimize the impact on the environment.

Speaker #5: It shows how responsible mining can move our economy forward in the right way. I just want to add that in the picture that some of you may see, in due course, the Premier of BC is six foot seven, and his minister is six foot five.

Steven Dean: I just want to add that in the picture that some of you may see in due course, the Premier of BC is 6'7", and his Minister is 6'5". I'm not that short. Turning to slide 9, Dale, would you like to make some comments?

Steven Dean: I just want to add that in the picture that some of you may see in due course, the Premier of British Columbia is six foot seven, and his Minister is six foot five. I am not that short. Turning to slide nine, Dale Andres, would you like to make some comments?

Speaker #5: I'm not that short. Turning to slide nine, Dale, would you like to make some comments?

Speaker #6: Thanks, Stephen. We're very pleased to announce the signing of a commitment letter with the National Bank for a fully underwritten 700 million dollar revolving credit facility.

Dale Andres: Thanks, Steven. We're very pleased to announce the signing of a commitment letter with the National Bank for a fully underwritten CAD 700 million revolving credit facility. The revolver will replace the existing long-term debt that is comprised of the project loan facility and the standby facility that was put in place to build Phase One of Blackwater, with an estimated CAD 450 million remaining to be refinanced at the expected closing date. The revolver does provide a lot of flexibility. It's on better terms, and we aim to have it in place by the end of this quarter. On slide 10, Steven did speak earlier about 2025 guidance, and I want to briefly touch on the details as well as a quick overview of how we are achieving industry-leading all-in sustaining costs. We are reiterating our full-year 2025 production guidance range of 190,000 to 230,000 ounces of gold produced.

Dale Andres: Thanks, Stephen. We are very pleased to announce the signing of a commitment letter with the National Bank for a fully underwritten $700 million revolving credit facility. The revolver will replace the existing long-term debt that is comprised of the project loan facility and the standby facility that was put in place to build Phase One of Blackwater, with an estimated $450 million remaining to be refinanced at the expected closing date. The revolver does provide a lot of flexibility. It is on better terms, and we aim to have it in place by the end of this quarter. On slide 10, Stephen did speak earlier about 2025 guidance, and I want to briefly touch on the details as well as a quick overview of how we are achieving industry-leading all-in sustaining costs.

Speaker #6: The revolver will replace the existing long-term debt that is comprised of the project loan facility and the standby facility that was put in place to build Phase One of Blackwater.

Speaker #6: With an estimated 450 million remaining to be refinanced at the expected closing date. The revolver does provide a lot of flexibility. It's on better terms and we aim to have it in place by the end of this quarter.

Speaker #6: On slide 10, Stephen did speak earlier about 2025 guidance, and I want to briefly touch on the details, as well as provide a quick overview of how we are achieving industry-leading all-in sustaining costs.

Speaker #6: We are reiterating our full year 25 production guidance range of 190 to 230,000 ounces of gold produced and that includes 160 to 200,000 ounces during the post-commercial production period.

Dale Andres: We are reiterating our full-year 2025 production guidance range of 190,000 to 230,000 ounces of gold produced, and that includes 160,000 to 200,000 ounces during the post-commercial production period. We are also reiterating our post-commercial production all-in sustaining cost guidance of $670 to $770 U.S. dollars per ounce of gold sold, which would put us in the lowest decile among gold producers globally. By comparison, this is, I think, roughly half of the all-in sustaining cost of the average of our peer group. I know that some of you have asked previously how that is possible, and the answer lies in a few strategic advantages that we do have over other producers. Beyond the fact that Blackwater is a new mine, and therefore maintenance and sustaining capital costs are low, we also benefit from a very low strip ratio compared to many other deposits.

Dale Andres: That includes 160,000 to 200,000 ounces during the post-commercial production period. We are also reiterating our post-commercial production all-in-sustaining cost guidance of $670,000 to 770,000 per ounce of gold sold, which would put us in the lowest decile among gold producers globally. By comparison, this is, I think, roughly half of the all-in-sustaining cost of the average of our peer group. I know that some of you have asked previously how that is possible, and the answer lies in a few strategic advantages that we do have over other producers. Beyond the fact that Blackwater is a new mine and therefore maintenance and sustaining capital costs are low, we also benefit from a very low strip ratio compared to many other deposits.

Speaker #6: We are also reiterating our post-commercial production all in sustaining cost guidance of 670 to 700 US dollars per ounce of gold sold, which would put us in the lowest decile among gold producers globally.

Speaker #6: And by comparison, this is, I think, roughly half of the all-in sustaining cost of the average of our peer group. I know that some of you have asked previously how that is possible, and the answer lies in a few strategic advantages that we do have over other producers.

Speaker #6: Beyond the fact that Blackwater is a new mine and therefore maintenance and sustaining capital costs are low, we also benefit from a very low strip ratio compared to many other deposits.

Speaker #6: The starter pit in particular, where we are mining now, and as you saw from our results, has a waste to ore ratio currently of just 0.5, and our life of mine over the life of mine, it's around two.

Dale Andres: The starter pit in particular, where we are mining now, and as you saw from our results, has a waste-to-ore ratio currently of just 0.5, and our life of mine, over the life of mine, it is around two. If we compare that to other large open pits with life of mine strip ratios, sometimes double that or even more. We do also benefit from diesel savings in the mobile mining fleet due to the fact that we are hauling downhill, both from the pit to the plant as well as to the stockpile areas and waste storage facilities. Perhaps more important, and being in B.C. and connected to the grid, we do benefit from inexpensive and renewable hydroelectric power. At this stage, I would like to turn the call over to Jeremy to talk about some of our future and what I think is very exciting growth options.

Dale Andres: The starter pit, in particular, where we are mining now, and as you saw from our results, has a waste-to-ore ratio currently of just 0.5, and over the life of mine, it's around 2. If we compare that to other large open pits with life-of-mine strip ratios, sometimes double that or even more. We do also benefit from diesel savings in the mobile mining fleet due to the fact that we're hauling downhill, both from the pit to the plant as well as to the stockpile areas and waste storage facilities. Perhaps more important, and being in BC and connected to the grid, we do benefit from inexpensive and renewable hydroelectric power. At this stage, I'd like to turn the call over to Jeremy to talk about some of our future and what I think is very exciting growth options. Over to you, Jeremy.

Speaker #6: And if we compare that to other large open pits, with life of mine strip ratios, sometimes double that or even more. We do also benefit from diesel savings in the mobile mining fleet due to the fact that we're hauling downhill, both from the pit to the plant as well as to the stockpile areas and waste storage facilities.

Speaker #6: And perhaps more importantly, being in BC and connected to the grid, we benefit from inexpensive and renewable hydroelectric power. At this stage, I'd like to turn the call over to Jeremy to talk about some of our future, which I think includes very exciting growth options. Over to you, Jeremy.

Dale Andres: Over to you, Jeremy.

Speaker #7: Thanks very much, Dale. And greetings, everyone. The core project team that developed Phase One of Blackwater has been working hard in tandem with the operations team, implementing and scheduling structured improvements across the Blackwater processing facility and infrastructure.

Jeremy Langford: Thanks very much, Dale, and greetings, everyone. The core project team that developed Phase One at Blackwater has been working hard in tandem with the operations team implementing and scheduling structured improvements across the Blackwater processing facility and infrastructure, whilst we're also exploring what we call a step change in increasing the current Phase One nameplate capacity. Additionally, in parallel, we are focused on finalizing the accelerated Phase Two plant configuration. If you recall back to the Phase Two expansion study back in H1 2024, well, that study produced an annual production of just over 500,000 gold equivalent ounces a year.

Jeremy Langford: Thanks very much, Dale, and greetings, everyone. The core project team that developed Phase One at Blackwater has been working hard in tandem with the operations, planning, and scheduling structured improvements across the Blackwater processing facility and infrastructure, whilst we are also exploring what we call a step change in increasing the current Phase One nameplate capacity. Additionally, and in parallel, we are focused on finalizing the accelerated Phase Two plant configuration. If you recall back to the Phase Two expansion study back in H1 2024, that study produced an annual production of just over 500,000 AU equivalent ounces a year. We further options and synergies that provide attractive upside and optionality to the expansion study of the Phase Two asset with our key objective of further increasing throughput capacity whilst increasing and improving on the operational flexibility and reducing our overall risk profile of the processing operation in general.

Speaker #7: Whilst we're also exploring what we call a step change in increasing the current Phase One nameplate capacity. Additionally, and in parallel, we are focused on finalizing the accelerated Phase Two plant configuration that, if you recall back to the Phase Two expansion study back in H1 2024, well, that study produced an annual production of just over 500,000 AU equivalent ounces a year.

Speaker #7: We feel there are options and synergies to provide attractive upside and optionalities to the expansion study in the Phase Two asset. With our key objective of further increasing throughput capacity whilst not increasing and improving on the operational flexibility and reducing our overall risk profile of the processing operation in general.

Jeremy Langford: We feel there are options and synergies that provide attractive upside and optionalities to the expansion study in the Phase Two asset with our key objective of further increasing throughput capacity whilst increasing and improving on the operational flexibility and reducing our overall risk profile of the processing operation in general. We are working on presenting the Phase Two execution strategy to management during H2 2025, as previously mentioned. Dale, would you like to comment or touch on the exploration thoughts moving forward?

Speaker #7: We are working on presenting the Phase Two execution strategy to management, during H2 2025, as previously mentioned. Dale, would you like to comment or touch on the exploration thoughts moving forward?

Jeremy Langford: We are working on presenting the Phase Two execution strategy to management during H2 2025, as previously mentioned. Dale, would you like to comment or touch on the exploration thoughts moving forward?

Speaker #8: Thanks, Jeremy. And yeah, so I mean, let's stay tuned on those growth options. I'm just for one recently joining as the CEO, very excited about that.

Dale Andres: Thanks, Jeremy. Yeah, I mean, let's stay tuned on those growth options. I'm just, for one, recently joining as the CEO, very excited about that. We're looking forward to updating the market on that as Jeremy and his team progresses. We do have substantial upside through exploration, both at the Blackwater Mine and in the region. At Blackwater, we really haven't done any extension drilling, expansion drilling of the resource or more broadly across the region since we acquired the asset in 2019. Since the previous owner had already defined roughly 12 million ounces of gold in resources, and that includes 8 million ounces of gold in proven and probable reserves. As a reminder, most of that, the vast majority, I think 97%, is in the proven category. However, the deposit does remain open to the north and northwest as well as at depth.

Dale Andres: Thanks, Jeremy. I mean, let's stay tuned on those growth options. I'm just, for one, recently joining as the CEO, very excited about that, and we're looking forward to updating the market on that as Jeremy and his team progresses. We do have substantial upside through exploration, both at the Blackwater Mine and in the region. At Blackwater, we really haven't done any extension drilling, expansion drilling of the resource, or more broadly across the region since we acquired the asset in 2019. The previous owner had already defined roughly 12 million ounces of gold in resources, and that includes 8 million ounces of gold in proven and probable reserves. As a reminder, most of that, the vast majority, I think 97%, is in the proven category. However, the deposit does remain open to the north and northwest, as well as at depth.

Speaker #8: And we're looking forward to updating the market on that as Jeremy and his team progresses. We do have substantial upside through exploration, both at the Blackwater mine and in our in the region.

Speaker #8: At Blackwater, we really haven't done any extension drilling expansion drilling of the resource or more broadly across the region since we acquired the asset in 2019.

Speaker #8: And since the previous owner had already defined roughly 12 million ounces of gold in resources, which includes 8 million ounces of gold in proven and probable reserves.

Speaker #8: And as a reminder, most of that, the vast majority, I think 97%, is in the proven category. However, the deposit does remain open to the north and northwest as well as at depth.

Speaker #8: With additional drilling, it certainly has the potential to be much, much larger and a longer-life asset. We have a very large land package in the region, totaling about 1,500 square kilometers.

Dale Andres: With additional drilling, it certainly has the potential to be much larger and a longer-life asset. We have a very large land package in the region totaling about 1,500 square kilometers, and that's largely untested. We have identified more than 30 targets, all within an economic trucking or conveying distance of Blackwater, with significant mineralization in numerous historic drill holes. We do expect to begin a regional drill program later, actually soon, which will be part of a broader and longer-term regional exploration strategy over the next 5 to 10 years to fully test this large and what we believe is very highly prospective land package. Regional exploration drilling, together with our continued optimization efforts and future expansion plans at the operation, aims to unveil the true potential at Blackwater and unlock further value for our shareholders.

Dale Andres: With additional drilling, it certainly has the potential to be much, much larger and a longer life asset. We have a very large land package in the region, totaling about 1,500 square kilometers, and that's largely untested. We have identified more than 30 targets, all within an economic trucking or conveying distance of Blackwater, with significant mineralization in numerous historic drill holes. We do expect to begin a regional drill program later, actually soon, which will be part of a broader and longer-term regional exploration strategy over the next five to ten years to fully test this large and what we believe is a very highly prospective land package. Regional exploration drilling, together with our continued optimization efforts and future expansion plans at the operation, aims to unveil the true potential at Blackwater and unlock further value for our shareholders.

Speaker #8: And that's largely untested. We have identified more than 30 targets all within an economic trucking or conveying distance of Blackwater, with significant mineralization in numerous historic drill holes.

Speaker #8: We do expect to begin a regional drill program soon, which will be part of a broader and longer-term regional exploration strategy over the next five to ten years to fully test this large and what we believe is a very highly prospective land package.

Speaker #8: Regional exploration drilling, together with our continued optimization efforts and future expansion plans that the operation aims to unveil the true potential at Blackwater, and unlock further value for our shareholders.

Speaker #8: Just turning to the last slide, in summary, we do have an asset that is not only robust in size and scale, but it is located in what we believe to be one of the world's best mining regions.

Dale Andres: Just turning to the last slide, in summary, we do have an asset that is not only robust in size and scale, but it is located in what we believe to be one of the world's best mining regions. We have stable mining laws, supportive government policies, quality infrastructure, and that includes renewable low-cost hydroelectric power in British Columbia. British Columbia is politically and socially stable and is recognized as a center of excellence for mining. We have had a very solid start to operations, where the team has achieved nameplate capacity in a very short period of time, and we're in excellent shape to meet our published guidance. We are establishing a track record of capital discipline and cost control and delivering one of the lowest all-in sustaining costs in the industry.

Dale Andres: Just turning to the last slide and in summary, we do have an asset that is not only robust in size and scale, but it is located in what we believe to be one of the world's best mining regions. We have stable mining laws, supportive government policies, quality infrastructure, and that includes renewable, low-cost hydroelectric power in BC. BC is politically and socially stable and is recognized as a center of excellence for mining. We have had a very solid start to operations where the team has achieved nameplate capacity in a very short period of time and we're in excellent shape to meet our published guidance. We are establishing a track record of capital discipline and cost control and delivering one of the lowest all-in sustaining costs in the industry.

Speaker #8: We have stable mining laws, supportive government policies, quality infrastructure, and that includes renewable low-cost hydroelectric power in BC. BC is politically and socially stable and is recognized as a center of excellence for mining.

Speaker #8: We've had a very solid start to operations with a team that has achieved nameplate capacity in a very short period of time, and we're in excellent shape to meet our published guidance.

Speaker #8: We are establishing a track record of capital discipline and cost control, and delivering one of the lowest all-in sustaining costs in the industry.

Speaker #8: Our balance sheet is strong with a growing cash balance expected as the year progresses, and which is expected to support our numerous other near-term organic growth opportunities.

Dale Andres: Our balance sheet is strong, with a growing cash balance expected as the year progresses and which is expected to support our numerous other near-term organic growth opportunities. I am very proud to lead this company going forward, where we value our people and the communities we operate in. We are committed as a team to high performance and continual improvement in absolutely everything we do. That extends from safety to production to future growth and just overall leadership. We continue to focus on building long-term value for our shareholders. Thanks. With that, over to you, Steven.

Dale Andres: Our balance sheet is strong, with a growing cash balance expected as the year progresses, which is expected to support our numerous other near-term organic growth opportunities. I am very proud to lead this company going forward, where we value our people and the communities we operate in. We are committed as a team to high performance and continual improvement in absolutely everything we do. That extends from safety to production to future growth and just overall leadership. We continue to focus on building long-term value for our shareholders. Thanks, and with that, over to you soon.

Speaker #8: I am very proud to lead this company going forward where we value our people and the communities we operate in. We are committed as a team to high performance and continual improvement in absolutely everything we do.

Speaker #8: And that extends from safety to production to future growth and just overall leadership. We continue to focus on building long-term value for our shareholders.

Speaker #8: Thanks. And with that, over to you, Stephen.

Speaker #5: Thanks, Dale. I think it's now time to move to Q&A. I think that concludes the formal part of our presentation. So I'll turn it back to the operator to open up for the Q&A session.

Steven Dean: Thanks, Dale. I think it's now time to move to Q&A. I think that concludes the formal part of our presentation. I'll turn it back to the operator to open up for the Q&A session.

Steven Dean: Thanks, Dale. I think it is now time to move to Q&A. That concludes the formal part of our presentation. So I will turn it back to the operator to open up for the Q&A session.

Speaker #3: Thank you. To join the question queue, you may press star, then one on your telephone keypad. You will hear a tone acknowledging your request.

Operator 3: The first question comes from Harrison Reynolds with RBC Capital Markets. Please go ahead.

Q&A Facilitator: Thank you. To join the question queue, you may press star, then one 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 two. The first question comes from Harrison Reynolds with RBC Capital Markets. Please go ahead.

Speaker #3: If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. First question comes from Harrison Reynolds with RBC Capital Markets.

Speaker #3: Please go ahead.

Speaker #8: Hey, good morning. Artemis team and congratulations on a great quarter and some very impressive early results out of Blackwater. A couple of questions for me.

Harrison Reynolds: Hey, good morning, Artemis team, and congratulations on a great quarter and some very impressive early results out of Blackwater. A couple of questions from me. Wondering if you can provide any commentary on the operating metrics you're seeing at the mine so far in Q3, particularly around grades, recoveries, and costs. Are you seeing that progress you would hope for, or are you learning anything new about the deposit that's requiring incremental adjustments?

Harrison Reynolds: Hey, good morning, Artemis team, and congratulations on a great quarter and some very impressive early results out of Blackwater. A couple of questions from me. Wondering if you can provide any commentary on the operating metrics you are seeing at the mine so far in Q3, particularly around grades, recoveries, and costs. Are you seeing that progress you would hope for, or are you learning anything new about the deposit that is requiring incremental adjustments?

Speaker #8: Wondering if you can provide any commentary on the operating metrics you're seeing at the mine so far in Q3, particularly around grades, recoveries, and costs.

Speaker #8: You know, are you seeing that progress you would hope for, or are you learning anything new about the deposit that's requiring incremental adjustments?

Speaker #5: Thanks, Harrison. I'll direct that question to Dale. But before I do so, just congratulations for you being the first analyst to get a report out on our results yesterday afternoon, late last night.

Steven Dean: Thanks, Harrison. I'll direct that question to Dale. Before I do so, just congratulations for you being the first analyst to get a report out on our results yesterday afternoon, late last night. I guess there is an advantage of being west, Dale.

Steven Dean: Thanks, Harrison. I will direct that question to Dale. But before I do so, just congratulations for you being the first analyst to get a report out on our results yesterday afternoon, late last night. I guess there is an advantage of being West. Dale.

Speaker #5: I guess there is an advantage of being west. Dale?

Speaker #8: Thank you. Thanks for the question. Thanks for the question, Harrison. Yeah, and as I said in the in the remarks on the presentation, the plant and the operation, the mine, and the plant and all the infrastructure continues to operate well.

Dale Andres: Thank you. Thanks for the question. Thanks for the question, Harrison. Yeah. As I said in the remarks on the presentation, the plant and the operation, the mine and the plant and all the infrastructure continues to operate well. We look forward to updating on our Q3 results as we progress. We did have a 3-day shutdown, as I mentioned. We did some major maintenance, but also some modifications. That includes to the ball mill, which we're really focused on driving both stability and increased throughput on an operating hour basis. Those two combined are currently and continue to be our focus. On recovery, we are, just as a reminder, obviously up in the upper layers of the deposit. We do see some weathering and oxide and transition zone materials.

Dale Andres: Thank you. Thanks for the question. Thanks for the question, Harrison. As I said in the remarks on the presentation, the plant and the operation, the mine and the plant and all the infrastructure continues to operate well. We look forward to updating on our Q3 results as we progress. We did have a three-day shutdown, as I mentioned. We did some major maintenance, but also some modifications, and that includes to the ball mill, which we are really focused on driving both stability and increased throughput on an operating hour basis. Those two combined are currently and continue to be our focus on recovery. Just as a reminder, we are obviously up in the upper layers of the deposit. We do see some weathering and oxide and transition zone material.

Speaker #8: We look forward to updating on Q3 guidance on our Q3 results as we progress. However, we did have a three-day shutdown. As I mentioned, we performed some major maintenance, but also some modifications, which include the vol mill. We are really focused on driving both stability and increased throughput on an operating hour basis.

Speaker #8: So those two combined are currently and continue to be our focus. On recovery, we are just as a reminder, obviously up in the upper layers of the deposit, we do see some weathering and oxide and transition zone material.

Speaker #8: So that's something that we're currently trying to get a better handle on just so we can blend that better. But the operation is performing well.

Dale Andres: That's something that we're currently trying to get a better handle on just so we can blend that better. The operation is performing well. We're driving both additional throughput and additional recovery. As I said, we look forward to updating on our Q3 results.

Dale Andres: That is something that we are currently trying to get a better handle on just so we can blend that better. The operation is performing well. We are driving both additional throughput and additional recovery. As I said, we look forward to updating on our Q3 results.

Speaker #8: We're driving both additional throughput and additional recovery and as I said, we look forward to updating on our Q3 results. Great. No, that's that's good to hear.

Harrison Reynolds: Great. No, that's good to hear. Maybe just one follow-up. It's good to see the revolver in place. Wondering if you could talk about your current thinking around the expansion scenarios. I know you touched on it briefly in the prepared remarks, but maybe specifically talking about what could an upsized Phase Two look like? Could that go directly up to your permitted level of 20 million tonnes, or kind of how are you thinking about that?

Harrison Reynolds: Great. No, that's good to hear. And maybe just one follow-up. It's good to see the revolving credit facility in place. And wondering if you could talk about your current thinking around the expansion scenarios. I know you touched on it briefly in the prepared remarks, but maybe specifically talking about what could an upsized Phase Two expansion look like? Could that go directly up to your permitted level of 20 million tons, or kind of how are you thinking about that?

Speaker #8: And maybe just one follow-up. It's good to see the revolver in place and wondering if you could talk about your current thinking around the expansion scenarios?

Speaker #8: I know you touched on it briefly in the prepared remarks, but maybe specifically talking about what could an upsized Phase Two look like? Could that go directly up to your permitted level of 20 million tons or kind of how are you thinking about that?

Speaker #5: So, so Harrison, it’s too early to comment on that. I appreciate the question and the level of interest from one of several people following us and supporting us who would like to know more.

Steven Dean: Harrison, it's too early to comment on that. Appreciate the question. Appreciate the level of interest in your one of several people following us and supporting us who would like to know more. As Dale indicated in his presentation, it's something we are working on. I expect that we'll get an initial update in the next 3 to 5 weeks. As we've said in our formal press release, I think something on Phase Two, probably October-November sort of time. We've taken a little bit more time for a very deliberate reason, and that is that the original Phase Two study that we released in, I think it was February and March of 2024, by the way, which was only, what, a year and a half ago? It seemed like a long time, but it wasn't, had us going to 15 million tonnes.

Steven Dean: So, Harrison, it is too early to comment on that. I appreciate the question. I appreciate the level of interest, and you are one of several people following us and supporting us who would like to know more. As Dale Andres indicated in his presentation, it is something we are working on. I expect that we will get an initial update in the next three to five weeks. As we have said in our formal press release, I think something on Phase Two expansion, probably October, November sort of time. We have taken a little bit more time for a very deliberate reason, and that is that the original Phase Two expansion study that we released in, I think it was February and March of 2024, by the way, which is only, what, a year and a half ago.

Speaker #5: As Dale indicated in his presentation, it's something we are working on. I expect that we'll get an initial update in the next three to five weeks.

Speaker #5: And as we've said in our formal press release, I think something on Phase Two probably pertains to our permanent member sort of timeline. We've taken a little bit more time for a very deliberate reason, and that is that the original Phase Two study that we released in, I think it was February or March of 2024—by the way, which was only what, a year and a half ago? It seemed like a long time ago, but it wasn't.

Steven Dean: It seemed like a long time, but it was not, had us going to 15 million tons. The gold price in Canadian dollars was some $1,500 lower. We knew less about the ore body, its characteristics. We anticipated it to be harder than it is certainly in the initial several benches of the Blackwater deposit. So there is a lot to reconsider and reprocess and update. We would rather take a little bit more time to do that and get an optimal result than rush out on the original plans.

Speaker #5: Had us going to 15 million tons, but the gold price in Canadian dollars was some $1,000 to $1,500 lower. And we knew less about the ore body.

Steven Dean: The gold price in Canadian dollars was some CAD 1,000, CAD 1,500 lower. We knew less about the ore body, its characteristics. We anticipated it to be harder than it is, certainly, in the initial several benches of the deposit. There's a lot to reconsider and reprocess and update. We would rather take a little bit more time to do that and get an optimal result than rush out on the original plan.

Speaker #5: Its characteristics were anticipated to be harder than it is, certainly in the initial several benches of the deposit. So there's a lot to reconsider, reprocess, and update, and we would rather take a little bit more time to do that and get an optimal result than rush out on the original plan.

Speaker #8: Definitely. No, that makes sense. I appreciate you taking the questions, and I’m excited to see what’s next. I’ll pass the line on now.

Harrison Reynolds: Definitely. No, that makes sense. Appreciate you taking the questions and excited to see what's next. I'll pass the line on now.

Harrison Reynolds: Definitely. That makes sense. I appreciate you taking the questions and excited to see what is next. I will pass the line on now.

Speaker #5: Thanks, Harrison.

Steven Dean: Thanks, Harrison.

Steven Dean: Thanks, Harrison.

Speaker #3: The next question comes from Wayne Lam with TD Securities. Please go ahead.

Q&A Facilitator: The next question comes from Wayne Lam with TD Securities. Please go ahead.

Operator 3: The next question comes from Wayne Lam with TD Securities. Please go ahead.

Speaker #7: Yeah. Morning, guys. And congratulations to Harrison as well for being first in the question queue. Maybe one for Jeremy. You know, we've talked about this before, but if I look at the initial performance here, it kind of mirrors some of the mines that you built in the past.

Wayne Lam: Yeah. Morning, guys. Yeah, congratulations there, Harrison, as well for being first in the question queue. Maybe one for Jeremy. We've talked about this before, if I look at the initial performance here, it kind of mirrors some of the mines that you've built in the past that have well outperformed design capacity out of the gates. If I look at Haile or ED as recent examples where those saw quite a bit of outperformance versus nameplate pretty quickly, can you speak to some of the optimizations still to come with Phase One, should we start to model some upside to the nameplate mill performance?

Wayne Lam: Good morning, guys. Congratulations to Harrison as well for being first in the question queue. Maybe one for Jeremy. We have talked about this before, but if I look at the initial performance here, it kind of mirrors some of the mines that you have dealt in the past that have well outperformed design capacity out of the gates. If I look at Hyundai or ED as recent examples, where those saw quite a bit of outperformance versus nameplate pretty quickly, can you speak to some of the optimizations still to come with Phase One, and should we start to model some upside to the nameplate mill performance?

Speaker #7: That have well outperformed design capacity out of the gates. So if I look at Hyundai or ED as recent examples, where those saw quite a bit of outperformance versus nameplate pretty quickly, can you speak to some of the optimizations still to come with Phase One?

Speaker #7: And should we start to model some upside to the nameplate mill performance?

Speaker #5: Thanks, Wayne, for your question. What Jeremy, you're pretty close to that. As I said earlier, we were a little bit reluctant to be too specific on those initiatives right now, but I'll let Jeremy have a go at that question.

Steven Dean: Thanks, Wayne, for your question. Jeremy, you're pretty close to that. As I said earlier, we're a little bit reluctant to be too specific on those initiatives right now, but I'll let Jeremy have a go at that question.

Steven Dean: Thanks, Wayne, for your question. Jeremy, you are pretty close to that. As I said earlier, we are a little bit reluctant to be too specific on those initiatives right now, but I will let Jeremy have a go at that question.

Speaker #7: Yeah, thanks. Thanks, Stephen. And good morning, Wayne. Look, I think Dal touched on it as well. We have got the time here to measure twice, cut once.

Jeremy Langford: Thanks, Steven Dean. Good morning, Wayne Lam. I think Dale Andres touched on it as well. We have got the time here to measure twice, cut once. You've heard me use this saying before. I don't really want to directly compare the past assets to Blackwater. They're very different in context and scale as well, with Blackwater being a stage 3 expansion, a 3-stage expansion methodology from day 1. Even you've seen, Wayne Lam, during your site visits where we talk about we're spoiled for choice at Blackwater. We're pretty busy exploring, as the asset further improves, how to get the maximum we can get out of the processing facility and generally the infrastructure that supports it and do this while we are building stage 2 as well. There's a couple of moving parts to it. I'm pretty happy with where it sits right now.

Jeremy Langford: Yeah, thanks, Stephen, and good morning, Wayne. Look, Dale touched on it as well. We have got the time here to measure twice, cut once. You have heard me use this saying before. I do not really want to directly compare the past assets to Blackwater. They are very different in context and scale as well, with Blackwater being a three-stage expansion methodology from day one. You have even seen, Wayne, during your site visits, where we talk about we are spoiled for choice at Blackwater. So we are pretty busy exploring, as the asset further improves, how to get the maximum we can get out of the processing facility and generally the infrastructure that supports it and do this while we are building Stage Two as well. So there are a couple of moving parts to it.

Speaker #7: You've heard me use this saying before. You know, I don't really want to directly compare the past assets to Blackwater. They're very different in context and scale as well.

Speaker #7: With Blackwater being a stage three expansion, a three-stage expansion methodology from day one, that even you're seeing, Wayne, during your site visits, where we talk about the spoil for choice of Blackwater.

Speaker #7: So, we’re pretty busy exploring as the asset further improves. How can we get the maximum out of the processing facility and generally the infrastructure that supports it?

Speaker #7: And do this while we are building stage two as well. So there's a couple of moving parts to it. So, you know, I'm pretty happy with where it sits right now.

Jeremy Langford: So I am pretty happy with where it sits right now. I am actually sitting in a design office looking at the designs as I speak to you all now. So we are in good shape and look forward to sharing the news with you all when the time is right towards the end of the year.

Speaker #7: I'm actually sitting in a design office looking at the designs as I speak to you all now. So we're in good shape and look forward to sharing the news with you all when the time is right towards the end of the year.

Jeremy Langford: I'm actually sitting in a design office looking at the designs as I speak to you all now. We're in good shape and look forward to sharing the news with you all when the time's right towards the end of the year.

Speaker #8: Wayne, if I could just also add to Jeremy's response, there are a few things that, in addition to the process plant, we should touch on briefly.

Steven Dean: Wayne, if I could just also add to Jeremy's response, there are a few other things that in addition to the process plant that we should touch on briefly. One, at some point, we probably should revisit the optimization of this deposit. As most of you will recall, it was optimized at $1,400 U.S. dollars. That is a fair bit lower now than today's price and certainly lower than the long-term consensus price. That is likely to result in more ounces reporting to the reserve category, but we need to do the work. That will change things like strip ratio, haulage and waste, etc. That is a succinct project, which has an interesting relationship with the process and throughput capacity.

Steven Dean: Wayne, if I could just also add to Jeremy's response, there's a few other things that, in addition to the process plant, that we should touch on briefly. One, at some point, we probably should revisit the optimization of this deposit. As most of you will recall, it was optimized at $1,400. That's a fair bit lower now than today's price and certainly lower than the long-term consensus price. That's likely to result in more ounces reporting to the reserve category, but we need to do the work. That will change things like strip ratio, haulage of waste, etc., etc. That is a succinct project, which has an iterative relationship with the process and throughput capacity.

Speaker #8: One, you know, at some point we probably should revisit the optimization of this deposit. As most of you will recall, it was optimized at $1,400, which is a fair bit lower than today's price.

Speaker #8: And certainly lower than the long-term consensus price. So, you know, that's likely to result in, you know, more ounces reporting to the reserve category, but we need to do the work.

Speaker #8: And that will change things like strip ratio, haulage of waste, et cetera, et cetera. So that is a succinct project, which is an iterative has an iterative relationship with the process and throughput capacity.

Speaker #8: And then also secondly, we've flagged in the past the opportunities we have to change the energy source of our haulage methodology from the pit, for both waste and ore, to electric hydro source energy source.

Steven Dean: Secondly, we've flagged in the past the opportunities we have to change the energy source of our haulage methodology from the pit, but for both waste and ore, to electric hydro source, energy source. It also occurs to us that that methodology doesn't necessarily have to be on wheels because we've got the benefit, as you know, from having visited the site. We've got the benefit of fixed centroids of infrastructure, whether that be the plant, the pit, 1 big pit, 1 TSF, 1 waste facility, and 1 low-grade stockpile. All of those things being relatively fixed in their location lends itself to other options on haulage. That's something else that we will report back to our shareholders and supporters over the next 6 months. We've got a lot on the go in terms of analysis and reanalysis. Stay tuned.

Steven Dean: Secondly, we have flagged in the past the opportunities we have to change the energy source of our haulage methodology from the pit for both waste and ore to electric hydro source, energy source. It also occurs to us that that methodology does not necessarily have to be on wheels because we have got the benefit, as you know, from having visited the site. We have got the benefit of fixed centroids of infrastructure, whether that be the plant, the pit, one big pit, one TSF, one waste facility, and one low-grade stockpile. All of those things being relatively fixed in their location lends itself to other options on haulage. That is something else that we will report back to our shareholders and supporters over the next six months. We have got a lot on the go in terms of analysis and re-analysis.

Speaker #8: And it also occurs to us that that methodology doesn't necessarily have to be on wheels. Because we've got the benefit, as you know from having visited the site, we've got the benefit of fixed centroids of infrastructure, whether that be the plant, the pit, one big pit, one TSF1 waste facility, and one low-grade stockpile.

Speaker #8: So, all of those things being relatively fixed in their location lend themselves to other options on haulage. And that's something else that we will report back to our shareholders and supporters over the next six months.

Speaker #8: So we've got a lot on the go. In terms of analysis, and reanalysis, so stay tuned. It's going to be a newsworthy next six months.

Steven Dean: So stay tuned. It is going to be a newsworthy next six months.

Steven Dean: It's going to be a newsworthy next 6 months.

Speaker #7: Yeah, definitely. There are a lot of levers to pull. Still to come. Okay, maybe that's a good segue into my next question. As we think about the pit optimization, maybe just considering the grades, obviously, we are still in the very early stages.

Wayne Lam: Yeah, definitely a lot of levers to pull still to come. Okay, maybe that is a good segue into my next question. As we kind of think about the pit re-optimization, maybe just thinking about the grades, obviously very early stages, and there has been a lot of drilling done inclusive of the grade control program. But just wondering if you are still targeting the process grades closer to the 1.67 grams outlined in the feasibility study, or do you anticipate moving towards a more run-of-mine strategy at some point in the near term, given that the mill has shown the capability of handling more material?

Wayne Lam: Yeah, definitely a lot of levers to pull still to come. Okay. Maybe that's a good segue into my next question. As we kind of think about the pit optimization, maybe just thinking about the grades, obviously very early stages, and there's been a lot of drilling done inclusive of the grade control program. Just wondering if you're still targeting the process grades closer to the 1.67 grams outlined in the feasibility study, or do you anticipate moving towards a more run-of-mine strategy at some point in the near term, given that the mill has shown the capability of handling more material?

Speaker #7: And there's been a lot of drilling done inclusive of the grade control program, but just wondering if you're still targeting the process grades closer to the 1.67 grams outlined in the feasibility study, or do you anticipate moving towards a more run-of-the-mine strategy at some point in the near term given that the mill has shown the capability of handling more material?

Speaker #5: I'll quickly answer that. But if Jeremy or Dale want to jump in and add, feel free to do so. The short, quick answer to that is that we do expect the grade to trend higher in the second half.

Steven Dean: will quickly answer that, but if Jeremy or Dale want to jump in and add, feel free to do so. A quick answer to that is that we do expect the grade to trend higher in the second half. You are right, once again, it is an iterative economic analysis because if we can squeeze more through the mill, then our unit cost per tonne is going to be lower, which means our economic cutoff is lower. It would follow that we should be sending more ore to the mill than we originally planned, and therefore the average grade may be lower than the original plan at nameplate. To add to that, it is not something that we advertise because anyone who has got some experience in statistics knows that we do not yet have a huge data population.

Steven Dean: I'll quickly answer that. If Jeremy or Dale want to jump in and add, feel free to do so. A quick answer to that is that we do expect the grade to trend higher in H2. You're right. It's an iterative economic analysis because if we can squeeze more through the mill, then our unit cost per tonne is going to be lower, which means our economic cutoff is lower. It would follow that we should be sending more ore to the mill than we originally planned, and therefore then the average grade may be lower than the original plan at nameplate. To add to that, it is not something that we advertise because anyone who's got some experience in statistics knows that we don't yet have a huge data population.

Speaker #5: But you're right, once again, it's an iterative economic analysis because if we can squeeze more through the mill, then our unit cost per ton is going to be lower.

Speaker #5: Which means our economic cutoff is lower. And so we would follow that we should be sending more ore to the mill than we originally planned; therefore, the average grade may be lower than the original plan at nameplate.

Speaker #5: To add to that, and it is not something that we advertise because anyone in who's got some experience in statistics knows that we don't yet have a huge data population but we've drilled a grade control about just over 20 million tons of ore to date.

Steven Dean: We've drilled a grade control about just over 20 million tonnes of ore to date, and we are seeing additional what we call medium-grade tonnes. In other words, conversion of waste, which we thought was waste, to medium-grade and low-grade material, which means that either we stockpile it or we put it through the mill at a faster rate. That's also making the analysis that we just talked about earlier more interesting. Let me say that. Dale?

Steven Dean: We have drilled a grade control about just over 20 million tons of ore to date, and we are seeing additional what we call medium-grade tons. In other words, conversion of waste, which we thought was waste, to medium-grade and low-grade material, which means that either we stockpile it or we put it through the mill at a faster rate. That is also making the analysis that we just talked about earlier more interesting. Let me say that. Dale.

Speaker #5: And we are seeing additional what we call medium grade tons. In other words, conversion of waste which we thought was waste to medium grade and low grade material.

Speaker #5: Which means that either we stockpile it or we put it through the mill at a faster rate. So that's also making the analysis that we just talked about earlier more interesting than we say that.

Speaker #5: Dale?

Speaker #6: And And maybe I'll just add one comment and just reiterate it is only two months into commercial production. So we do need to get some additional time under our belt but what Stephen commented on, it just again shows why this deposit really lends itself to expansion and expansion sooner rather than later.

Dale Andres: Maybe I'll just add one comment and just reiterate. It is only 2 months into commercial production, so we do need to get some additional time under our belt. What Steven commented on, it just, again, shows why this deposit really lends itself to expansion and expansion sooner rather than later, especially with this waste-to-ore conversion that we're seeing.

Dale Andres: I will just add one comment and just reiterate, it is only two months into commercial production, so we do need to get some additional time under our belt. What Stephen Dean commented on, it just again shows why this deposit really lends itself to expansion and expansion sooner rather than later, especially with this waste-to-ore conversion that we are seeing.

Speaker #6: Especially with this waste to ore conversion that we're seeing.

Speaker #5: Jeremy, any comment?

Steven Dean: Jeremy, any comment?

Steven Dean: Jeremy, any comment?

Speaker #7: No, other than I think for all the people who have been following us, you know the original study done back in 2013 had a 55,000 to 60,000 ton per day plant.

Jeremy Langford: No, other than I think for all the people who have been following us, the original study done back in 2013 had a 55,000, 60,000-ton a day plant. We know the pit can advance at that rate. We know that the ore and material is going to come out as fast as we can mine it. Certainly looking at the most efficient way of doing that long-term and leveraging off the BC Hydro to green energy for me is one avenue that we are working on pretty hard right now. I think it certainly lends itself to a less selective, more bulk mining operation, or whichever we choose. Those are the choices we have been lucky enough to have with this asset.

Jeremy Langford: No, other than I think for all the people who've been following us, the original study done back in 2013 had a 55,000, 60,000-tonne-a-day plant. We know they pick in advance at that rate. We know that the ore and material is going to come out as fast as we can mine it. Certainly looking at the most efficient way of doing that long-term and levering off the BC Hydro Green Energy for me is one avenue that we're working on pretty hard right now. I think it certainly lends itself to a less selective, more bulk mining operational, whichever we choose. That's the choices we've been lucky enough to have with this asset.

Speaker #7: We know the pit can advance at that rate. We know that the ore and material is going to come out as fast as we can mine it.

Speaker #7: So certainly looking at the most efficient way of doing that long term and levering off the BC hydro green energy for me is one avenue that we're working on pretty hard right now.

Speaker #7: And I think it's certainly lends itself to a less selective more bulk mining operational, whichever we choose. That's the choices we've been lucky enough to have with this asset.

Speaker #5: Thanks, Jeremy.

Steven Dean: Thanks, Jeremy.

Steven Dean: Thanks, Jeremy.

Speaker #8: Okay, perfect. Thank you. And then maybe just last one, for Jerry. Just wondering on the accounting side, wanted to ask about two items. The first is if you might be able to provide a bit more color on the inventory adjustment to the cash costs if that was more of a one-off this quarter.

Wayne Lam: Okay, perfect. Thank you. Then maybe this is the last one for Jerry van der West-Heysen. Just wondering on the accounting side, I wanted to ask on two items. The first is if you might be able to provide a bit more color on the inventory adjustment to the cash costs if that was more of a one-off this quarter. The second is just with commercial production having been declared in May, it seems as though the sustaining capital spend was pretty light. Just curious why some of that capital wouldn't have been characterized more as sustaining capital rather than all as growth.

Wayne Lam: Okay. Perfect. Thank you. Then maybe just last one for Gerrie van der Westhuizen. Just wondering on the accounting side, wanted to ask on two items. The first is if you might be able to provide a bit more color on the inventory adjustment to the cash costs, if that was more of a one-off this quarter. Then the second is just with commercial production having been declared in May, it seems as though the sustaining capital spend was pretty light. Just curious why some of that capital wouldn't have been characterized more as sustaining capital rather than all as growth.

Speaker #8: And then the second is just with commercial production, having been declared in May. It seems as though the sustaining capital spend was pretty light.

Speaker #8: And so just curious why some of that capital wouldn't have been characterized more as sustaining capital rather than all as growth. Jeremy, sorry. Wayne, you're referring to the fact that we attribute costs to high grade and medium grade or only?

Jeremy Langford: Jeremy, sorry, Wayne, you are referring to the fact that we attribute cost to high-grade and medium-grade or only?

Gerrie van der Westhuizen: Jeremy, sorry, Wayne, you're referring to the fact that we attribute costs to high-grade and medium-grade ore only?

Speaker #8: Just on the reconciliation, there was a change in the inventory number that to get to the net production cost. Yeah, so that's pretty standard in terms of the representation of production costs and reconciling that to all the sustaining costs.

Wayne Lam: Just on the reconciliation, there was a change in the inventory number to get to the net production cost.

Wayne Lam: Just on the reconciliation, there was a change in the inventory number to get to the net production cost.

Gerrie van der Westhuizen: Yeah. That's pretty standard in terms of the representation of production costs and reconciling that to all-in sustaining costs. That would always be on a net basis in terms of what's actually being sold. As you recall, this is all-in sustaining costs per gold ounce sold, and so that inventory adjustment has to be accounted for separately. We are being actually somewhat conservative in not attributing any cost to our low-grade ore. We certainly are not playing any games in terms of that inventory adjustment, in fact, being very conservative.

Jeremy Langford: Yeah, so that's pretty standard in terms of the representation of production costs and reconciling that to all-in sustaining costs. That would always be on a net basis in terms of what's actually being sold. As you recall, this is all-in sustaining costs per gold ounce sold, so that inventory adjustment has to be accounted for separately. We are being actually somewhat conservative in not attributing any cost to our low-grade. We certainly are not playing any games in terms of that inventory adjustment, in fact, being very conservative.

Speaker #8: That would always be on a net basis in terms of what's actually being sold. As you recall, this is all in sustaining costs per gold ounce sold.

Speaker #8: And so that inventory adjustment has to be accounted for separately. But we are being actually somewhat conservative in not attributing any costs to our low grade ore.

Speaker #8: And so we certainly are not playing any games in terms of that inventory adjustment. In fact, being very conservative. In terms of.

Speaker #5: And sorry, just to jump in. What we're saying here is that, under the accounting convention, one approach would be to capitalize the low-grade stockpile on our balance sheet, which would have the result of lowering our operating costs.

Steven Dean: Sorry, just to jump in, when you appreciate what we are saying here is that the accounting convention, one approach would be to capitalize the low-grade stockpile on our balance sheet, which would have the result of lowering our operating costs. We are expensing it, so we carry no cost on that low grade, zero on our balance sheet. There is no more conservative approach to how we manage inventory than that.

Steven Dean: Sorry, just to jump in, Wayne, you appreciate what we're saying here, is that accounting convention, one approach would be to capitalize the low-grade stockpile on our balance sheet, which would have the result of lowering our operating costs. We're expensing it, so we carry no cost on that low grade, zero on our balance sheet. There's no more conservative approach to how we manage inventory than that.

Speaker #5: But we're expensing it, so we carry no cost on that low grade. Zero on our balance sheet. And so there's no more conservative approach to how we manage inventory than that.

Speaker #8: And certainly far more conservative than a number of our peers. Yeah. And then in terms of all in sustaining costs, now the all in sustaining costs certainly we don't consider it to be surprisingly low.

Jeremy Langford: Certainly far more conservative than a number of other periods. In terms of all-in sustaining costs, the all-in sustaining costs we do not consider to be surprisingly low. This is consistent with us being a new mine. No issues there with the classification or sustaining costs.

Gerrie van der Westhuizen: Certainly far more conservative than a number of our peers. Yeah. Then in terms of all-in sustaining costs, no, the all-in sustaining cost, certainly, we don't consider it to be surprisingly low. This is consistent with us being a new mine. Yeah, no issues there with the classification or sustaining cost.

Speaker #8: This is consistent with us being a new mine. So yeah, no issues there with the classification of sustaining costs. Okay, perfect. Yeah, quite a phenomenal result on the cost side.

Wayne Lam: Okay. Perfect. Yeah, quite a phenomenal result on the cost side for just the first couple of months. Congratulations, and congrats on a great quarter. Thanks for taking my questions.

Wayne Lam: Okay, perfect. Quite a phenomenal result on the cost side for just the first couple of months. So congratulations and congrats on a great quarter. Thanks for taking my questions.

Speaker #8: For just the first couple of months. So congratulations and congrats on a great quarter. Thanks for taking my questions.

Speaker #5: Yep. Thanks, Wayne.

Steven Dean: Yep. Thanks, Wayne.

Steven Dean: Thanks, Wayne.

Speaker #3: The next question comes from Andrew Mickiewicz with BMO Capital Markets. Please go ahead.

Operator 3: The next question comes from Andrew Mikitchook with BMO Capital Markets. Please go ahead.

Q&A Facilitator: The next question comes from Andrew Makaric with BMO Capital Markets. Please go ahead.

Speaker #8: Oh, hi. Congratulations to Jeremy. Your team for phenomenal success here. A lot of great questions have been asked. Just a little bit of follow-up, maybe Stephen, you already talked about the reoptimizing the pit.

Andrew Makaric: Oh, hi. Congratulations to Jeremy and your team for phenomenal success here. A lot of great questions have been asked. Just a little bit of follow-up, maybe. Stephen, you already talked about re-optimizing the pit. Does the technical team think they have enough data and enough time to at least partially, or if not fully, re-optimize the pit for this Phase Two plan that is coming in November?

Andrew Mikitchook: Hi. Congratulations to Jeremy and your team for phenomenal success here. A lot of great questions been asked. Just a little bit of follow-up maybe. Steven, you already talked about reoptimizing the pit. Does the technical team think they have enough data and enough time to at least partially, or if not fully, reoptimizing the pit for this Phase Two plan that's coming in November?

Speaker #8: Does the technical team think they have enough data and enough time to at least partially, or if not fully, reoptimize the pit for this Phase Two plan that's coming in November?

Speaker #5: I can pretty well tell you for certain that we will not be optimizing or reoptimizing the mine this year. That is a separate exercise.

Steven Dean: I can pretty well tell you for certain that we will not be optimizing or reoptimizing the mine this year. That is a separate exercise. I think it's sufficient for us to know that even without reoptimizing that, there's a massive amount of ore that could be mined and released in the next 5 years, even without reoptimizing the pit. I think that in terms of data, 97% or 98% of the resource to get the reserve resource is in measured category, which would mean that we can convert, if the economics allow and design allow, a significant portion of the resource into a proven category of reserve when we do optimize. No, there's no shortage of data. Where there may be data lacking is what Dale referred to as the extension to the northwest and at depth.

Steven Dean: I can pretty well tell you for certain that we will not be optimizing or re-optimizing the mine this year. That is a separate exercise. I think it is sufficient for us to know that even without re-optimizing that, there is a massive amount of ore that could be mined and released in the next five years, even without re-optimizing the pit. I think that in terms of data, 97% or 98% of the resource, forget the reserve resource, is in measured category, which would mean that we can convert, if the economics allow and design allow, a significant portion of the resource into a proven category of reserve when we do optimize. There is no shortage of data. Where there may be data lacking is what Dale referred to as the extension to the northwest and at depth.

Speaker #5: I think it's sufficient for us to know that. Even without reoptimizing that, there's a massive amount of ore that could be mined and released in the next five years, even without reoptimizing the pits.

Speaker #5: So I think that in terms of data, 97 or 98% of the resource to get the reserve resource is in measured category. Which would mean that we can convert if the economics allow and design allow, a significant proportion of the resource into a proven category of reserve when we do optimize.

Speaker #5: So no, there's no shortage of data. Where there may be data lacking is what Dale referred to as the extension to the northwest and a depth.

Speaker #5: And at some stage, we need to drill some deeper holes to chase that. But we've got an abundance of resource category that's still not converted to reserve.

Steven Dean: At some stage, we need to drill some deeper holes to chase that. We have an abundance of resource category that is still not converted to reserve, even without it.

Steven Dean: At some stage, we need to drill some deeper holes to chase that. We've got an abundance of resource category that's still not converted to reserve even without it.

Speaker #5: Even without it.

Speaker #8: Okay, we want to, I think, as paraphrased by Stephen, your words, or maybe Jeremy's, there's an abundance of choices and opportunities here. So we all look forward to seeing that.

Andrew Mikitchook: Okay. I think as paraphrase, Steven, your words, or maybe Jeremy's, there's an abundance of choices and opportunities here. We all look forward to seeing that. Just a little financial question on this, a couple of financial questions on this revolving credit facility. Is it fair that what you guys press release today could be considered as an interim facility and that once the full Phase Two plan is out, this could be then revisited and right-sized to advance that on an optimized timeline and financing structure?

Andrew Makaric: Okay, I think as paraphrased, I think, Stephen, your words, or maybe Jeremy's, there is an abundance of choices and opportunities here. We all look forward to seeing that. Just a little financial question on this, a couple of financial questions on this revolving credit facility. Is it fair that what you guys press release today could be considered as an interim facility and that once the full Phase Two plan is out, this could be then revisited and right-sized to advance?

Speaker #8: Just a little financial question. On this a couple of financial questions on this revolving credit facility. Is it fair that what you guys press release today could be considered as an interim facility?

Speaker #8: And that once the full Phase Two plan is out, this could be then revisited and right-sized to advance that as on an optimized timeline and financing structure?

Conference Operator: that as you know, on an optimized timeline and financing structure?

Speaker #5: No, not our intent. This is a longer-term facility to accommodate and allow flexibility. For our expansion plan.

Steven Dean: No, not our intent. This is a longer-term facility to accommodate and allow flexibility for our expansion plan.

David Brown: No, it's not our intent. This is a longer-term facility to accommodate and allow flexibility for our expansion plan.

Speaker #8: Okay. And then just in terms of exiting post the RCF, just to be clear that the cost overrun facility, I guess 40 million dollars, does that stay in place or is that replaced as well?

Andrew Mikitchook: Okay. Just in terms of exiting post the RCF, just to be clear, the cost overrun facility, I guess, CAD 40 million, does that stay in place or is that replaced as well?

Conference Operator: Okay. Just in terms of exiting post the revolving credit facility, to be clear, the cost overrun facility, I guess $40 million, does that stay in place or is that replaced as well?

Speaker #5: It's all refinanced with this RCF.

David Brown: is all refinanced with this revolving credit facility.

Steven Dean: It's all refinanced with this RCF.

Speaker #8: Okay. Well, that's great. Thank you very much. And I'll let others ask questions.

Andrew Mikitchook: Okay. Well, that's great. Thank you very much, and I'll let others ask questions.

Conference Operator: That is great. Thank you very much. I will let others ask questions.

Steven Dean: Thanks, Andrew.

David Brown: Thanks, Andrew.

Meg Brown: Once again, if you have a question, please press star then one. The next question comes from Jeremy Hoy with Canaccord Genuity. Please go ahead.

Operator 3: Once again, if you have a question, please press star, then one. The next question comes from Jeremy Hoy with Canaccord Genuity. Please go ahead.

Steven Dean: Betsy and Adrienne, thanks for taking my questions. We are out on a big milestone, and it is a really good discussion here. All I have left is a couple of clarifications and one accounting question. On the clarification side, you did really good progress in terms of the trend of throughput and recovery of Phase One. You guys have discussed the three-day shutdown and the improvements and optimizations you have done there. You also talked about working on the blend of ore to get recoveries to where you are aiming to have them. Are there any additional improvements that you need to make to the plan, or was this three-day shutdown the last?

Jeremy Hoy: Hi, Steven and team. Thanks for taking my questions. We're at a big milestone, and it's a really good discussion here. All I have left is just a couple of clarifications and 1 accounting question. On the clarification side, you had really good progress in terms of the trend of throughput and recovery of Phase 1. You guys have discussed the 3-day shutdown and the improvements and optimizations you've done there. You've also talked about working on the blend of ore to get recoveries to where you're aiming to have them. Are there any additional improvements that you need to make to the plant, or was this 3-day shutdown the last?

David Brown: Dale, do you want to answer that? Once again, I think we, as we have said, it is too early for us to comment on what optimizations there might be before us. Because, as I said, we expect in the next three or five weeks or so to come out with an update on that. But Dale, do you want to?

Steven Dean: Dale, you want to answer that? Once again, I think, as we've said, it's too early for us to comment on what optimizations there might be before us because, as I said, we expect in the next three or five weeks or so to come out with an update on that. Dale, do you want to?

Steven Dean: Yeah, I would say that that's the, you know, that three-day shutdown does really set us up for the second half of the year. What we're doing is continually debottlenecking, improving, and seeing what the true capacity of the asset is. As we progress that, we will do various tests at higher throughput rates. We'll see where different bottlenecks appear. You know, there may be additional projects that we implement from a modification perspective. But as Steven said, you know, we're still working through that. We are running, you know, the mill above design capacity on a regular basis, on an operating hour basis. We'll see where that, we'll see where that takes us, you know, now that we have that three-day shut and we've set ourselves up for the back half of this year. So stay tuned.

Dale Andres: Yeah. I would say that's the that 3-day shutdown does really set us up for the H2 of the year. What we're doing is continually de-bottlenecking, improving, and seeing what the true capacity of the asset is. As we progress that, we will do various tests at higher throughput rates. We'll see where different bottlenecks appear. There may be additional projects that we implement from a modification perspective. As Steven said, we're still working through that. We are running the mill above design capacity on a regular basis, on an operating-hour basis, and we'll see where that takes us now that we have that 3-day shot and we've set ourselves up for the H2 of this year. Stay tuned.

Steven Dean: From an improvement perspective, what I will say is that when we look at so-called step change opportunities that Jeremy talked about, we are looking for very capital-efficient, quick wins, things that we can implement fast and ahead of the broader, bigger Phase Two expansion, which we're also in the middle of optimizing.

Jeremy Hoy: From an improvement perspective, what I will say is that when we look at so-called step change opportunities that Jeremy talked about, we are looking for very capital-efficient quick wins, things that we can implement fast and ahead of the broader, bigger Phase Two expansion, which we're also in the middle of optimizing. Okay. Great. Appreciating that it's an iterative process. I do know you guys said potentially 10% above nameplate capacity in the presentation, that's helpful to point to. The next question is also a clarification, kind of similar to what Andrew Mikitchook said. We've all been looking forward to this expansion, seeing where this next iteration of plant goes to and the capital and throughput and everything associated with that. He touched on the reoptimization, it's clear that that comes later.

Conference Operator: Okay, great. So, appreciating that it is an iterative process, and I do know you guys said potentially 10% above nameplate in the presentation. That is helpful to point to. The next question is also a clarification, kind of similar to what Andrew said. We have all been looking forward to this expansion, seeing where this next iteration of plant goes to and the capital and the throughput and everything associated with that. He touched on the re-optimization. It is clear that that comes later. These other opportunities that you guys have talked about, and Steven, you touched on them with potentially alternative haulage solutions that take advantage of the electrification. Is that going to be part and parcel with the expansion plans we hear about later this year, or will that be a separate catalyst?

Jeremy Hoy: These other opportunities that you guys have talked about, Steven, you touched on them with potentially alternative haulage solutions that take advantage of the electrification. Is that going to be part and parcel with the expansion plans we hear about later this year, or will that be a separate catalyst?

Steven Dean: Sorry, just say the question again, please, Jeremy?

David Brown: Sorry, just say the question again, please, Jeremy.

Jeremy Hoy: Yeah. Electrification of the haul, you've talked about that being a pretty big opportunity. Is that part of the expansion plans that you're going to talk to later this year, or is that a separate catalyst potentially coming later?

Conference Operator: Yeah. So, electrification of the haul, you've talked about that being a pretty big opportunity. Is that part of this, the expansion plans that you're going to talk to later this year, or is that a separate catalyst potentially coming later?

Steven Dean: I think there's an opportunity for an update on it, but I don't think we're going to get any significant outputs on those options in terms of technical studies before year-end. We'll give it a shot. The focus is on optimizing the phase I facilities and optimizing and putting a pin in what Phase II looks like in terms of the plan.

David Brown: I think there's an opportunity for an update on it, but I don't think we're going to get any significant outputs on those options in terms of technical studies before year-end. But, you know, we'll give it a shot. The focus is on optimizing the Phase One facilities and optimizing and putting a pin in what Phase Two looks like in terms of the plan.

Jeremy Hoy: Okay. Great. Great. Thank you. That's clear. Finally, last question in the accounting thing. On the non-cash changes and working capital in investing activities, there was CAD 61 million. Could you just walk us through those? It was related to the counterclaim against the EPC contractor.

Conference Operator: Okay, great. Great. Thank you. That's clear. Finally, last question, accounting thing, on the non-cash changes in working capital in investing activities. There was $61 million. Could you just walk us through those? It was related to the counterclaim against the EPC contractor.

61 million could you just walk us through those it was related to the counterclaim against the EPC contractor.

David Brown: I will let Jerry comment on that, please.

Steven Dean: I'll let Gerrie comment on that, please.

Well I'll let.

Gary comment on that please.

Gerrie van der Westhuizen: No problem. Jeremy Hoy. Even though it refers to non-cash changes, those are actually cash changes. The non-cash is a nomenclature directly from the IFRS standard, which we complied with. Those are really payments of payables associated with our initial CAPEX, so payables CAPEX that we incurred in Q1 that wasn't paid until in Q2. That's why that's being added back, and we're looking at the Q2 numbers.

Dale Andres: No problem. Jeremy, hi. So, even though it refers to non-cash changes, those are actually cash changes. The non-cash is nomenclature directly from the IFRS standard, which we complied with. But those are really payments of payables associated with our initial CapEx. So, payables, CapEx that we incurred in Q1 that was not paid until in Q2. That is why that is being added back when we are looking at the Q2 numbers.

Jeremy Hi, so the even though refers to noncash changes those are actually cash strangled. The noncash is that there's not one culture directly from July 1st stab at which we complied with but those are really payments payable.

Payables associated with our initial capex, so payable of Capex that we incurred in Q1 that wasn't paid until in Q2 and so that's why that's being added back and we're looking at the Q2 numbers.

Steven Dean: Okay. To be clear, Jeremy, what you're looking at, I think, Jerry, is the paydown of accounts payable related to the CAPEX incurred in early Q1.

David Brown: Okay. To be clear, Jeremy, it's what you're looking at, I think, Jerry, is the paydown of accounts payable related to the CapEx incurred in early Q1.

Okay.

To be clear do I mean the.

It's what you're looking at it I think Jerry is the is the pay down of accounts payable related to the capex incurred in in early Q1 initial initial capex.

Jeremy Hoy: Initial CAPEX, yeah.

Dale Andres: Initial CapEx, yeah.

Steven Dean: Initial CAPEX. It's an accounts payable rather than a CAPEX spend. Which is, the CAPEX spend had already been reported. A big chunk of that, as we've said, we will be claiming against the EPC contractor because a big chunk of that relates to rectification works as a result of them terminating the contract and leaving site.

David Brown: Initial CapEx. So it's an accounts payable rather than a CapEx spend, which is the CapEx spend had already been reported. A big chunk of that, as we've said, we will be claiming against the EPC contractor because a big chunk of that relates to rectification works as a result of them terminating the contract and leaving site.

So so.

It's an accounts payable rather than a capex spend which is the capex that had already been reported.

And a big chunk of that as we've said.

We will be claiming against the.

EPC contractor.

Cause.

A big chunk of that relates to rectification works.

As a result of all of them are terminating the contract and leaving aside.

Jeremy Hoy: Understood. I guess, finally, the rectification works, what exactly is that?

Conference Operator: Understood. Finally, the rectification works, what exactly is that?

Understood and I guess finally, the rectification works.

Is that.

Steven Dean: Fixing stuff that was not done right. How about that?

David Brown: Fixing stuff that was not done right. How about that?

Fixing fixing stuff that was not done right how about that.

Jeremy Hoy: Incremental expenditures.

Conference Operator: Incremental expenditures.

Incremental expenditures.

Steven Dean: No, no. Redoing works that were not done correctly or to specification by the EPC contractor.

David Brown: No, no, no. Redoing works that were not done correctly or to specification by the EPC contractor.

No no no.

Reed Redoing works that we're not done correctly or to specification by the by the EPC contractor.

Jeremy Hoy: Okay. That is really helpful. Thanks, guys, for taking all my questions. Really appreciate it.

Conference Operator: Okay. That's really helpful. Thanks, guys, for taking all my questions. Really appreciate it.

Okay, that's really helpful. Thanks.

Thanks, guys for taking all my questions really appreciate it.

Steven Dean: You're welcome.

David Brown: You're welcome.

Youre welcome.

Operator 3: This concludes the question and answer session. I would like to turn the conference back over to Steven Dean, Chair, for any closing remarks. Please go ahead.

Meg Brown: This concludes the question and answer session. I would like to turn the conference back over to Steven Dean, Chair, for any closing remarks. Please go ahead.

This concludes our question and answer session I would like to turn the conference back over to Stephen <unk> for any closing remarks. Please go ahead.

Steven Dean: Thank you, Aisha. Thanks to everyone for joining the call. I hope we've been able to answer your questions. There's a lot of data in this release, and we appreciate if you do have any further follow-up questions, we'd be happy to chat to you directly on those. We also look forward to reporting to you, as we've said during this call, on our optimization and growth progress over the next 1 to 6 months and also our Q3 results in early November. Thanks again for joining us, and we look forward to seeing and chatting to you all soon.

David Brown: Thank you, Aisha. Thanks to everyone for joining the call. I hope we've been able to answer your questions. There is a lot of data in this release, and we appreciate it if you do have any further follow-up questions, we would be happy to chat to you directly on those. We also look forward to reporting to you, as we have said during this call, on our optimization and growth progress over the next one to six months, and also our third quarter results in early November. Thanks again for joining us, and we look forward to seeing and chatting to you all soon.

Thank you.

The and thanks for everyone to everyone for joining the call.

We've been on to be able to answer.

Your questions. There's a lot of data in this release and we appreciate our if you do have any further follow up questions, we'd be happy to chat to you directly on on those and.

We also look forward to reporting to you as we've said during this call on our optimization and growth progress over the next.

Wanted to.

Six months and also our third quarter results in early November.

Thanks, again for joining us and we look forward to seeing and chatting to you all soon.

Meg Brown: This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

Operator 3: This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.

This brings to a close today's conference call. You may disconnect. Your lines. Thank you for participating and have a pleasant day.

Yeah.

Yeah.

Yeah.

Mhm.

Mhm.

[music].

Yeah.

Okay.

Yeah.