Release Date: May 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- B2Gold Corp (NAM:B2G, Financial) produced over 225,000 ounces of gold in Q1 2024, in line with expectations.
- Cash operating costs and all-in sustaining costs were well below annual guidance ranges.
- Encouraging discussions with the Mali government regarding the Fekola region, with potential for increased production.
- Successful ice road campaign at the Goose Project, ensuring necessary materials are on site for construction.
- Strong financial position with $568 million in cash and an undrawn $700 million revolver facility.
Negative Points
- Slight delay in the Goose Project, pushing first gold production from Q1 2025 to Q2 2025.
- Challenges in commissioning trucks and personnel issues at the Goose Project, causing delays in mining schedules.
- Potential concerns about the 2023 Mali mining code affecting future gold mining investments in the country.
- Uncertainty around final capital expenditure for the Goose Project, with some costs still being evaluated.
- Operational challenges at the Goose Project due to high snow levels and El Nino conditions.
Q & A Highlights
Q: Can you provide an update on the discussions with the Mali government regarding the 2023 mining code and the potential for nationalization of Western-owned gold mines?
A: Clive Johnson, President and CEO, clarified that despite rumors, there have been no indications that the Mali government is considering nationalizing Western-owned gold mines. Discussions have been productive, focusing on how the Fekola region can fit into the long-term future of the Fekola complex. The government is interested in fast-tracking the granting of an exploitation permit, which could increase production by 100,000 ounces a year.
Q: What is the status of the Goose Project, and what caused the delay in the first gold production estimate?
A: William Lytle, Chief Operating Officer, explained that the delay from Q1 2025 to Q2 2025 is due to some delays in the open pit and underground mining schedule, which means there won't be ore to feed through the mill on the original timeline. However, the construction is on track, and the team has successfully completed the ice road campaign, bringing all necessary materials to the site.
Q: How are the financials looking for the first quarter of 2024, particularly for the Fekola, Masbate, and Otjikoto mines?
A: Michael Cinnamond, CFO, reported that Fekola produced just under 120,000 ounces of gold, with cash operating costs well below the annual guidance range. Masbate produced almost 48,000 ounces, and Otjikoto produced just over 45,000 ounces, both with costs well below guidance ranges. The company remains in a strong financial position with a cash balance of $568 million and no debt drawn on their revolver.
Q: What are the next steps for the Goose Project, and how confident are you in staying on budget?
A: William Lytle mentioned that the team is working through the budget details, but they are confident in staying on or under budget. They are managing costs by optimizing reagent consumption, fuel costs, and labor. The focus is on ensuring that all critical items are ordered and delivered on time.
Q: What is the purpose of the infill drill program at the Goose Project, and are there any concerns about the geological model?
A: Victor King, SVP of Exploration, stated that the infill drilling is to increase confidence in the ore body and support the mine plan. There are no concerns about the geological model, which has been corroborated by the drilling results so far.
Q: How fast can you get the exploitation permit in Mali once the terms are agreed upon?
A: Clive Johnson indicated that if an agreement is reached soon, the government is interested in fast-tracking the exploitation permit, which could be granted in a few months. The company is ready to start pre-stripping and trucking ore within three months of receiving the permit.
Q: What are the potential impacts on CapEx for the Goose Project, and are there any opportunities to reduce costs?
A: William Lytle noted that they are evaluating costs and looking for opportunities to reduce expenses, such as optimizing reagent consumption and managing critical spares. They are confident in staying on budget or under budget.
Q: What are the long-term plans for tailings management at the Goose Project?
A: William Lytle explained that after the Echo pit, tailings will be managed by moving to other pits like Umwelt and eventually LOM. The current focus is on completing the Echo pit to ensure sufficient capacity for tailings.
Q: Will there be any updates on operating costs (OpEx) for the Goose Project after it starts production?
A: Michael Cinnamond confirmed that they plan to update the resource model and provide a comprehensive update on operating costs once the mine is in production.
Q: What is the timeline for realizing the potential of the Fekola underground project?
A: Michael Cinnamond stated that they plan to reach the base of the underground by the end of this year and aim to be operational by late Q1 or Q2 next year. Additional drilling will continue to support the regional opportunity and future production.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
