Newcore Gold Ltd. (NCAU) Earnings Call Transcript & Summary

Okay. Hi, everyone. Thank you for joining us today. Most of you likely already know me. But for those of you who don't know me, my name is Mal Karwowska, and I'm the Vice President of Corporate Development and Investor Relations for Newcore Gold. I'm joined today by Newcore Gold's President and CEO, Luke Alexander; as well as Newcore Gold's Vice President of Exploration, Greg Smith. Before we get started, I do want to highlight that we will be making forward-looking statements today. I encourage you all to visit our website where you can find the full cautionary language as well as a copy of this presentation. We are recording this webinar, and it will be available for replay. We look forward to taking this opportunity today to provide you with a detailed overview of the results of the pre-feasibility study for our EntyGold project that we announced yesterday. This study is a culmination of 2 years of technical work and advancement on the project. It's an important milestone for the company as we continue to advance and derisk the development of Enchi. As well, it's been a very busy first half of the year with an 80,000 meter drill program that is underway and is delivering strong results. It highlights the higher grade and growth potential of the project. We're going to dive into some of those results, discuss what investors can expect for the remainder of this year and then finish the webinar today by answering your questions. There is a chat function, please use that to submit those questions, and we will address those at the end of the webinar post the presentation. So with that, I'm going to pass it over to Luke to dive right in. Thank you.

Yes. Thanks, Mal. First of all, I just want to address the sell-off that we've seen in our stock the last couple of days on the back of us publishing the Obviously, we've been in a very challenging gold market. And yesterday was another day where we saw a significant sell-off across the board. Ultimately, we underperformed the market significantly yesterday. Ultimately, management and Board, we are aligned with shareholders. We own 12% of new core. So we do feel the pain and frustration alongside all of our investors. Today, I would say we are oversold. We're trading at a USD 75 million valuation that compares to an NPV that we outlined within this PFS of $500 million at $3,800 gold price. And obviously, we've got a tremendous amount of exploration upside, which we'll get into in this presentation. So yes, the last couple of days have been very painful. But ultimately, my personal view is we're completely oversold and this PFS sets the foundation for us to create a lot of value from here. A huge amount of work has gone into this PFS over the last couple of years. We worked with multiple consultants on putting this PFS together like a podium Fuse SLR, DRA, that culminated in us deciding to go forward with the CIL project, which we announced early February. In hindsight, we should have done a better job of ultimately highlighting that the CIL project or ACIL project is more expensive from a CapEx perspective and from an operating perspective and that it's not appropriate to ultimately compare it to a heap leak project. That's some of the feedback we've had over the last couple of days. And ultimately, I take responsibility for not doing a better job of communicating the additional costs that come with a CIL project relative to a heap leach project. That being said, all of that technical work that we've done since the PEA in 2024 outlined that a CIL project is the best way forward. And over the last 24 hours, one of the things that has been very encouraging is we've had a tremendous amount of positive feedback from industry peers as well as technically focused groups who've been very complementary of the study that we've put forward. And we ultimately now see an opportunity to create a tremendous amount of value from here. We've got 28,000 meters of infill drilling that went into this into this PFS, which leaves us with an additional 52,000 meters of drilling that will ultimately go into additional studies. Greg will get into it, but all of the drilling that we've done so far this year is not included in this study. And we'll see the productional file in the early years. And as we find additional higher-grade material and feed that into future studies, we see a real opportunity to create value from here. So I see this as a tremendous buying opportunity. But ultimately, the pain is being felt by us and the rest of the Board with the sell-off that we've seen over the last couple of days. Getting into the presentation, again, as I highlighted, management and Board, we own 12% of New Core. So we are truly aligned with shareholders from that perspective. We've outlined a PFS, which we're going to get into detail, which does outline very robust economics. And as we walk through this, remember today, we're trading at roughly a $75 million valuation. We've got an 80,000 meter drill program, which we're going to get into. But obviously, we've seen a lot of very positive results in 2026, and we're excited to incorporate that into future studies as well as continue to get lots of drill results out to the market. Getting into the PFS itself at a $3,800 gold price, which is what we used for our base case. If we look at the average gold price for 2026, we're looking at 47,400 Obviously, the market has seen a significant sell-off from a gold price perspective. But our view is 3,800 an appropriate price to use, and we see a tremendous amount of upside for the gold price from here. At 3800, we outlined an after-tax NPV of just under $500 million after-tax IRR of 37% and a 1.6-year payback. We'll get into the all-in -- those are above $2,000. And part of the reason for that is the additional royalties that we're seeing in Ghana as well as it being a lower grade project -- but in those early years, as we find additional higher-grade material, you'll see the positive impact that has from an ASIC perspective $351 million of upfront capital. When you look at these projects, 5 million, 6 million tonne per annum projects, we're looking at a 5.5 million tonnes per annum operation. This lines up very well with other studies that we've got out there, just under 1 million ounces of recoverable gold 104,000 ounces over the life of the mine. But importantly, we're seeing 130,000 ounces of average production in the first 3 years. And with all the exploration work that we're doing now, we're looking to continue to add ounces after year 3, higher grade that will ultimately bolster the production profile. And then again, as a reminder, we've got a very large land package, 248 square kilometers in size. We worked with lycopodium as our lead consultant on this project. They've got a very good reputation in West Africa, the arguably gold standard in West Africa. You can see the other companies that they've worked with over the last number of years. And gone specifically they've been working with Newmont on their project as well as the recent $1 billion expansion at half of North -- so again, always point back that the technical work that we run into this study is very defendable and sets us up really well to grow from here. Supporting like podium were Fuse, SLR and DRA, gain, all very well recognized international groups. Looking at the project itself, 5.5 million tonnes per annum. We do assume contract mining throughout the project. That is the mean way that mines operating on is through contract money, strip ratio of 4.3:1. One of the things that helps from a capital perspective. We have minimal pretty stripe on the project, which is a real benefit -- we did talk about the NPV of $496 million, 37% IRR and a short payback period. We will talk in a little bit of detail. But ultimately, when you look at the first 3 years of our project, an average of 130,000 ounces of production. That's really driven by some of the higher grade material that we see in our early years. With the exploration that we're doing now, we're ultimately looking to add additional higher-grade material in that 0.8 or higher range, which then obviously will contribute additional ounces in years 4 and beyond, which we see as a real opportunity to drive additional value. From an all-in sustaining cost perspective, starting with operating costs, we're looking at just under $1,700 on cash cost of just over $2,100 and then all in to stay just under $2,300. As I highlighted, when we then look at the first 3 years, which we're ultimately going to look to add to with this drilling you can see the impact it has from a cost perspective. Our operating costs dropped down to $140 million cash costs down to $1,850 and our all-in sustaining just below $2,000. So this is one of the building blocks for us. It's to continue to add this higher-grade material which will then ultimately really contribute to the NPV and IRR with our covering analysts who put out notes yesterday, SCP, Haywood and Canaccord, if you receive any of their research, I would encourage you to go look at that research, a number of them home in on this opportunity from an exploration perspective to ultimately add additional high grade and the impact of that will have from an NPV and return perspective. We are in the midst of a 80,000 meter drill program. None of the results that we've put out so far in 2026 are included in this PFS of the 8,000 only 28,000 meters have been included. And you can see here a number of the higher-grade results that we've had, which we're excited to include in future resource updates and studies. In terms of some of the drilling that we're doing at the moment, we've got 4 drill rigs turning 3 diamond and 1 RC rig that RC rig is focused on near surface target has identified stepping out a long strike, also doing some additional infill drilling to look to convert of our 600,000 ounces of inferred resource that we identified that will add to future studies. But with the dime, what we're focusing on is some of the higher-grade shoots that we've identified on our project. When we look at a long section of our entry project and we compare it to the -- where you'll see a lot of these deposits really grow in size and increasing grid as you start to identify these high-grade feeder zones. With the drilling that we've released so far in 2026, you can see where we've honed in on some of these higher-grade feeder funds -- looking here at our boiling deposit, you can start to see where these structures ultimately sit. And when you look at the results that we've been getting, they're very encouraging in terms of being able to add out is 147 grams over 1 meter 173 grams over 1 meter sitting here, we've got 2 grants over 16.5 meters. All of this is sitting immediately below our resource pit. -- to the north of that 1.2 grams over 33 meters an additional 1.7 grams over 2, 3.2% over 17. Again, all of this in immediately below the resource pits that we've got as we complete this additional 50,000 meters, that's not included in our current MRV or PFS, will then ultimately look to incorporate that into our resource look to add that higher grade material, which will then further support the economics in a full feasibility study. We are looking at a district scale object 248 square kilometers in size. When we look at the PFS specifically, we got SM as our largest deposit followed by pooling the infrastructure does sit immediately between the 2 deposits and 82% of all the material does come from those 2 deposits. The additional material comes from our NIM and Quattro deposits -- looking at the production profile, again, 104,000 ounces of production over the life of the mine. In those first 3 years with that high grade material that we're seeing, we averaged 130,000 ounces of production. -- with this additional exploration that we're doing and additional higher-grade material that we bring in, while we're ultimately going to be looking to do is add additional grade into the mine plan, which then obviously should add to the overall NPV and return for the project. So we really see this PFS as a data point in time and ultimately an opportunity for us to create significant value from here through the drill bit and ultimately, through additional optimization. From a payback perspective, again, using our base case of $3,800, we're looking at a 1.6-year payback. In year 1, we have $230 million of after-tax cash flow. Year 2, 190 year 3, $140 million. So it's a very low payback period when we then increased that to what was spot when we were putting these numbers together at the beginning of the week of $4,200 we're looking at a 1.4% year payback. So a very nice payback period and then obviously, lots of additional cash flow beyond that. From a sensitivity perspective, one of the things with a lower grid project, which is what we have there is a tremendous amount of leverage to the gold price. We outlined the base case of the base case of $3,800, which produces an after-tax NPV of $496 million but if we take the average for 2026, which is $4700, $4,800 or if we use 45 in this case, you're looking at $775 million of after-tax NPV that ultimately rises to $1.1 billion once you hit 5,500, which is where we peaked out in 2026. So that's the opportunity is if you see bulging higher than obviously our entry project does produce a tremendous amount of leverage and it's important to reiterate that my view is we are completely oversold sitting at a USD 75 million U.S. valuation today relative to the base case that we outlined let alone the upside cases, if you feel gold is going higher. From a processing perspective, you can go onto our website. Our presentation is sitting there. and you can go through the flow sheet in detail, if you like. But ultimately, it's a standard milling and CIL processing -- these have been built throughout West Africa. Again, this is the reason we're getting positive feedback from our peers who are operating in West Africa is there's a lot of familiarity with of a process, which was 1 of the main reasons we decided to go forward with the CIL in this PFS. From an infrastructure perspective, we've got good infrastructure. We've got paid growth that runs through the middle of our project to the talent of any and she sits about 10 kilometers away as the crow flies. So we don't see any issues in terms of relocation with the main town, but ultimately, one of the really advantages is we can house all of our employees here in the town of entry which creates a lot of benefits for the community there. Looking at the infrastructure and the site layout in a little bit more detail, if we lay it over top of our 248 square kilometer land package, as I mentioned, below and our 2 largest deposits, about 82% of the material comes from 80% comes from those 2 deposits. truck it directly to a central processing facility. The tailings dams are Valley games that processing facility. So a nice compact footprint from a locking perspective. We've then got our Niam deposit and, which we then track the material from those 2 deposits onto that central processing facility. So a nice kind of tight layer from a mining perspective that includes all of the infrastructure within a compact area. Again, you can go to our website and look at this mine plan in more detail. From a strip perspective, looking at 4.3% strip ratio across the project. One of the important things to continue to highlight is that when you look at the average pit depth vertical debt for all pits on our product, the average is roughly 85 meters -- so all of those drill holes that Greg's going to get into a little bit of detail on and the ones that I was just highlighting in that cross-section -- those are primarily sitting immediately below our existing pits. So my view is there will be an opportunity to pull those into future pits, which obviously again, will add to the overall production profile and returns for the project. From a debt perspective, the average between 60 and 220 meters across the project. From a capital perspective, I would encourage you to go and look at other projects in West Africa that have been recently built and you'll see that this number is very defendable, $351 million CapEx which we will look at within our feasibility study sustaining capital perspective or the bulk of that comes from the tailings dam expansion as we raise that tailing dam as we move through the life of mine, that's where the bulk of the CapEx comes from. And then from contingency perspective, it's important to highlight that we're looking at about an 8% contingency for this project as well. So again, lots of additional fat built into this CapEx number. We're looking at a 24-month build. Our view is that we will be able to build it in a shorter time line than that, which again, creates an additional optimization opportunity for us in the future. Looking from an all-in sustaining cost perspective, we've touched on this briefly, but we're looking at roughly $1,700 of operating costs. We then have roughly $460 of royalty costs. This does include the new royalty regime in Ghana. So it is a sliding scale royalty, which range is between 5% and 12%. So using our base case of $300. This includes a 10% royalty to the government of Ghana and then an additional 2% to triple flag. And then we've got our all-in sustained cost of roughly $2,300. From a reserve perspective, we have just over 1 million ounces of reserves. This is the first reserve that we have declared on the project. Now we are looking at a full indicated ounces of 1.5% and an additional inferred of roughly $600,000 One of the things we will look to do is continue to move those infer ounces into the indicated category and then ultimately, into reserves over time. So part of our drill program is focusing in on some of the higher grade inferred ounces that we've identified across the project and looking to start to convert those, which will then go into future mine plans. Important to reiterate that this PFS only includes 280,000 of our 80,000 meter drill program. So all of the drilling that we've done since October of 2025 is not included in this. and we see that as a real opportunity to add ounces and help ultimately contribute to the NPV of the project over time and then 85 meters average vertical depth and really just that first 150 meters a project is what has been tested, and we see tremendous opportunity to continue to add value through the drill bit and with this ongoing 80,000-meter drug program and 4 drill rigs that are turning on subject at the moment. With that, I'll turn it over to Greg, and he can get into the specifics of some of the exploration.

Thanks, Luke. So yes, as Luke mentioned, we've got 4 weeks going on the project now, and we have had for the last few months. We've made a number of news releases already this year and certainly expect to continue to have a number of additional results coming out as they're available. So just really quickly in terms of again, it's a great jurisdiction. It's Africa's largest gold producer, #6 in the world. Obviously, a number of large companies operating there. You just talked about and their investment that they're making to basically double their production in country as well. Again, 3 of the other top 10 lining companies globally operating there, a great place to significant M&A activity over the last number of years and then some various in investments in additional projects. So even though it's a long, long life area for gold mining, the shovel in particular, and then we're located here on the the new, if you will, separately maybe any belt with a hypo mine, thousands of years, basically gold production here but you're still finding new deposits, you're still having companies make significant investments to expand their footprint and their production there and again, a number of projects that even with their long lives have continued to find additional resources. So We're, again, located on this base year zone, most adjacent to us is the Toronto line and then the Malian mine. They're located along the same large regional shear zone and where the gold is, it's actually all of the displays come off of these years. So very similar geological environment to a couple of areas here that are sort of plus 6 million ounces, obviously, a lot longer life here Tarena's been operating for a dozen years. And in games Blue conserve PFS is obviously the first time we've had a pre-feasibility study on the project, and there's really a snapshot in time, and we believe something to build on -- how we're going to build on that is with this 80,000 meter program. Again, the first 28,000 meters was focused on near-surface mineralization, the infill. We were very successful in converting incurred into the indicated category between the last 2 MREs, we went from $700,000 to the cutover million. We will continue in some areas where we've got to integrate to move additional inferred material into the indicated categories. And obviously, as we continue on with these -- in the feasibility study, that's what's available to you. You cannot include the inferred material in these economic studies that provide an upside, but that's why we'll continue to look to do that where the average grids warrant. I've mentioned we've reported a number of news releases this year. Luke has highlighted some of these numbers, again, some really good well above average rigs over nice wide with -- it's probably one of the stars of the show here. We've got 1.7 over 25 and an additional over 17. And again, this is below the level of the current pit. So we're looking at extensions to inertization here. We believe that this will allow us to both extend the pits into some of this cetera and then start to define underground material as we do some additional drilling around that area. We had exciting hole this year as well. And you've seen all of the drilling that's been done. This was actually the very first hold encountered visible gold and again, we can see that it's below the level of the current pit below the -- all of the material that was included in the PFS. So great to see this, certainly the geologists upside, we're excited, and we've actually now backed some holds additional holes planned in that area. So let's move down to the this invention looks highlight the steel deposit and the Boeing deposits. So again, between us to over 80% of the ore that the approved feasibility study is coming from those 2 adjacent deposits. The infrastructure is going between them. So again, it all works well from having a small footprint to the development? And then just a little bit of material coming from the satellite deposits that I am. We'll look now at in. We've talked a lot about point, and then that's because we've, again, been doing a lot of drilling there recently. This is those the resource blocks there. We're just focusing in here on the higher material. Again, we've seen some of these as highlighted in the earlier slides. This is all of the drilling that we've done this year. You can see it's all outside of the mineral resource estimates are outside of the material that's included in the prefeasibility study. And again, essentially all of these holes intersecting gold well above the average rigs that are in the current study and certainly economic at these levels. So these are some of the deepest pits that we have on the project because this is some of the best grade material in some of the material that's being mined in those early years currently in those first 3 years, and this is where we believe we'll be able to find some additional material and again, above average grades and continue to both expand the pitch to depth. And then ultimately, as Luke pointed out with our name, there at Toreo, where you start to see the really high grades and longer land lines is following these well-defined shoots. So we've got an advantage here and at the higher grade or defined rate from surface, but then then continue on very consistent nature. You can see here in this crop section. Again, this is what I call the highlight hole and the insects are below the level of the kit here. So this is the mineral resource pick the bias the material that's gone into the PFS, and you can see here in no 1.7 grams over 25.5 meters and then a nearby Intercept of 3.22% over 17. So a real good chance there to add additional material well above the average grades to be included in future studies. We had again a mention we've got some additional holes plan both a little bit deeper down and also laterally year along strike as well. So we've got 1 drill hole diamond rig specifically working stepping out from some of these better holes we have released already this year. On the next slide. SP-4 Yes. So again, we've talked about being quite a bit. See you, which, again, is the other one, the 2 relatively close based deposits. This is actually our largest deposit. It's it a bit different in its character than Boeing. You saw the structure was kind of 1 central structure that was set in nature, whereas here at CM, we've got a whole series of relatively flat line stacked structures, and this is allowed team to build into our largest resource area. What you're seeing here is basically the drilling on the right-hand side of the to cross sections, in particular, the left 1 or you see the shadow holes on top of the range there? That was all of the previous drilling that was completed and that's what went into the and these darker holes here with the Intercept in particular whole 11 here with a relative average grade intercept of 1.37, over 20 meters that's outside of the fitness is some of the new drilling that we've just announced. So looking to, again, not only expand what is already our largest deposit, but again, the ability to focus on some areas where we've got some much better than average correct. It seems our largest deposit, but it's also our lowest grade because, again, most of it was within the oxide material there on top of the ridge, -- and having these sorts of intercepts that you see here, 1.37 over 2 or 1.5915.5%,.0.9 grams over multiple tens of meters these -- all of these occurred right at the base of the pit just getting into the first material. This is going to give us the ability to start to include in the updated before the feasibility study material at that in this case is probably looking at about for the average grade of the material that we defined in the near service oxide zone. So quite exciting to see these brands. These are the first deeper holes we've ever drilled at sum. It's great to see that we're seeing sort of growth than we expected, and we'll continue to -- we've got another rig that's there working at Sino and we'll continue to have the 1 rig working at Boeing and the other 1 in. And can here, you can see the resource pits with the the great block for the MRE. And you can see the new holes that are highlighted here. These are the ones that we've been just looking at in that cross section. And again, intercepted anywhere, even the full rate as is above average rate for CEO and a significant with the 41 meters there. So this is how you're able to build larger and higher-grade resources, having these nice wider zones again, either slightly above average grade or in stock basis, again, 4x the average grade of the current resource. So quite excited that see this very first deeper drilling at you giving us the sort of rates that we were targeting. Just a quick unmet here of the geophysics in terms of the information that we use for looking at where these deposits step out. We've got a geophysics and it highlights really were structures. We've covered the whole project in loyalty and chemistry as well. Obviously, if you're looking for gold deposits, gold anomaly stand a way to go. So yes, outside of the deposits to sales, we've got a couple of dozen carbon areas, some of which have advanced through trenching. -- some of which are again, a combination of the chemistry and geophysics. And as we're continuing to build on the existing deposits, we'll also look to test some additional zones. So that's quite exciting to be actually doing some real greenfields exploration at the same time.

Thanks, Greg, for kind of running through some of the expectation and the tremendous upside that we see from the drilling that we're doing at the moment. As we pilot multiple times, it's important to highlight that we've only included 28,000 of our current 80,000 meter giga in this PFS. And the bulk of that really why it's focused on infill. So really, we took our PEA MRE and really infilled a lot of that to create the -- we're now obviously focused on expanding the resource, adding higher-grade material, which we think will create a tremendous amount of value for future studies. And we're obviously very accepted by the results that have been coming back thus far. So expect to continue to see lots of drill results coming from New Core. As we mentioned, we do 4 do turning at the moment. Management and Board, we've touched on this before, but obviously, it's a team that does have a track record of creating a lot of value for shareholders. And we are, again, truly along through our 12% ownership in the business. Looking at the cap truck briefly. We currently sit at just over 310 million shares outstanding. The drilling that we're doing at the moment, we are fully funded for all of that drilling. And I think it's important to reiterate that today, we're sitting at roughly a USD 75 million market cap. So the sell-off that we've seen in the last couple of days, I think, has created a real disconnect between the value of what we outlined within the PFS specifically but then also the tremendous exploration upside that we've got across the project that we think will then feed into future studies and add even more value from a project perspective. We are well bought back by deep-pocketed institutional investors, good volume in the stock so far this year, trading just under $1 million. As I mentioned, we do have 3 covering analysts, Canaccord, Haywood and if you do have access to research from any of those groups, I would highly encourage you to go pull their PFS notes, and you can see what their commentary is. And a lot of it, again, focus is in on of additional ounces will create a lot of value -- it's important to highlight that we do have a tremendous amount of support from the government of Ghana that has project is 1 of 2 large-scale projects, a greenfield project in country that can be fast track to production. And they're very supportive from a permitting perspective to see it drive this project forward. And ultimately, our view from a project perspective is all stakeholders, ultimately need to benefit from the project. And probably one of the questions we get asked most from the local communities around our project is when are we going into production because they see the tremendous opportunity that will create for the community from a job perspective, from a benefit perspective. And ultimately, that's part of the reason why we've got such strong support to fast track this project towards production. With that, I think we can probably hand it over to -- now who is going to bring up a number of the questions that we've got on this call.

Thanks, Like, Greg. And I just want to thank everyone on the line for providing such great questions and for our shareholders for their continued support. So we'll kick things off the question for Luke. One was the decision made to go from heap leach to CIL -- and has this been communicated before?

So the decision ultimately evolved over the course of 2 years. Obviously, in 2024, we put a study that outlined a bleach project. On the back of that, we did a huge amount of technical work over the course of 1.5 years additional network, Geotech, hydrological work, environmental work, all of that work, which then culminated in us conducting a trade-off study in the second half of 2025 and into early 2026. Through all of that technical work that was done on the project, we determined that going the CFL route was the best path forward. A few reasons for that. From a metallurgical perspective, we saw much higher recoveries using the CIL flow sheet. CIL projects are also the kind of bug standard or the standard way of processing goal around the world what specifically in West Africa. So back to that slide that looks at all of those projects at Lycopodium has built across West Africa -- those are all CIL projects. So that's a real blueprint for us. So through -- it was a process that kind of evolved over the course of 1.5 years, and then when we announced the commissioning of our PFS, we announced that at the beginning of February this year, we outlined that we're going the CIL route. So that's kind of how it evolved and then Colin navi in us announcing that at the beginning of February.

So just to be very clear, yes, this was communicated to the market earlier this year at the beginning of February when we commissioned the pre-feasibility study. Staying on the theme of more technical questions, and I think this plays nicely into the rationale for moving to you please dive into a little bit more detail on what metallurgy has been done on the deeper fresh mineralization or.

Do you want to take that, Greg? Or do you want me sir.

Yes. I can dampen what we have completed is industry standard bottle roles. So the big change going from keep lead to see the heat lead tests were largely column tests, and that was reflective of the fact that you needed to be able to recover the material in these columns using the direct sanitation. And then with the bottle rules associated with the CIL we were looking at was both the offset is pre-digging material and the nonfree digging material that includes the fresh rock. And we did a series of bottle roll tests that, again, are using in what are, in this case, looking at ground and milled material because that's part of the flow sheet now is you're grinding and milling all of this material to various different growing sizes. So we look at a whole series of model rules and again, the different types of interior the free dating material and the material that's going to have to be drilled and blasted that again is largely the fresh material, and then we looked at those at different grown sizes and again, came up with the optimal flow sheet, which was presented today.

Yes. So I think really, the key there is going to our study in 2024. A lot of the metallurgical test work and focused on the shallow free-dig material that was amenable to heap leaching. And then over the course of the last few years, we've obviously done an extensive metallurgical test we're focusing more on a deeper material including fresh that has led to the decision to move forward with the CIL as we think that's the best value for the project long term. Steve was technical. So we managed to minimal pre-stripping, but the study mentions a 4.3 strip ratio. Can you please elaborate? Just want to highlight a pre-spin is the waste rock you need to remove in the preproduction year prior to commencing operations. So that is minimal for this project. We have about 5 million tonnes at point and assume that need to be removed ahead of production, and then Luke I'll pass it over to you to reiterate and comment about the 4.3 ratio.

Yes. Thanks, Mal. So looking at at that strip ratio, and we've got just find it here. Strip ratio slide. So you can see here, depending on which deposit we're looking at, the strip ratio will fluctuate -- at our Boeing deposit, we are seeing the highest strip ratio but that also is driven by the fact that we're seeing the higher grids there. At C, we're seeing the lowest strip ratio, which is also being driven, which drives that lower material at Boeing as well. So overall, 4.3:1 strip ratio when you compare that kind of other projects across West Africa. It sits well from a strip ratio perspective. As we continue to ultimately drill and look to expand and grow the overall sides of the resource, then we'll continue to obviously update what that looks like from a strip perspective.

Yes. And benefits as we saw in those cross-sections from the fact that it's a whole bunch of flattering back to zones. So that basically just means that can be a better or 2 ways ratio closer to surface and that became is very much reflective in the much lower stripping ratio. And even as we drive those pits deeper into this higher-grade material that we've now tested with the recent drilling yes, we expect that will continue to be our lowest stripping ratio. It also helps that the mineralized zones are are daylighting, if you will, at the top of that rig. So again, that means you've got to move less waste rock to get to your ore. So as again, it's our largest deposit. We've had some good recent success drilling, and I suspect going forward, it will continue to be our largest deposit and with our lowest proping ratio?

Yes, it's important to highlight the 5 million tonnes of pre-strip the advantage of doing that pre-strip is it ultimately opens the ore body up and open the pit up for mining. So you could incorporate that into your mine plan and start that on day 1. But by doing a small amount, $5 million to be considered a small amount of pre-strip it opens up all of those pits and allows us on day loan to get immediately into the ore which then allows us to drive that much higher production profile in year 1 of the mine. If we were to kind of incorporate that into the regulator mine plan, you would see a lower production profile in year 1 because part of that mining would ultimately be the opening for the stripping of these areas. So that's the reason we kind of structured the mine plan the way we did is get that done, all construction is happening, and we're strainer and producing a nice high 134,000 ounces in year 1.

Moving on to the processing circuit. Do you provide the design and grind size for the processing circuit and comment on the relationship between grind size recovery and power consumption.

Yes. So this actually is one of the opportunities that we've got for the project. When we look at -- and if you go into the study in detail, we will have the full 43-101 tech report published in the next month or so, which will get into some detail on this. But what it assumes is 5.5 million tonne per annum plant. What you'll see with the number of these plants in West Africa is that they're actually producing well above their main plate capacity, primarily when they're in the soft oxide material. So you're able to push a lot more material through the plant because of the nature of that oxide sale material. So what was assumed in our study was in year 1, we're about 90% or even a little more than 90% of the material that's going through the mill in year 1 is that really soft oxide saprolite material. But what's assumed is in the inside of 75 microns in year 1 because it's a soft material that's already basically been broken up naturally. After that, it's assumed that we moved to 53 metro One of the opportunities for us is with a digital test work is to highlight that we can move a digital harder transition material, transition material and fresh material into a 75-micron milling situation. So that's one of the optimization opportunities for us. So in year 1, it assumes 75 for the oxide saprolite material. Beyond that, a lot of the things and have 53 is just driven by the lack of test work 75-micron level. So we are going to look at additional test work to prove out that look, all of this material can be run in which then helps from an OpEx perspective, it also helps from a CapEx perspective and then ultimately from a throughput perspective covered it with anything to add.

Perfect. So another question around all-in sustaining costs. Is there an opportunity to drop those all-in sustaining costs moving forward? One thing I will on and we've spent time on is that years 1 to 3. That is what we're looking to build on. And what you will notice there is a lower on sustaining cost rationale for that is, it is driven by your production and your production is driven by your grade. So the opportunity here is to find that higher grade here, which will inherently draw on cost Luke, do you want to add anything to that?

No, I think it's a great point, Mal is the first 3 years of production that we're looking at here driven by 0.8 grams per tonne. With this additional exploration, we're looking to continue to add that type of material more in year 3, 4, 5, 6. And the more kind of 0.8 gram plus material that we can add the more it's going to increase our production profile, which then helps our NPV. And when we look at the all-in sustaining cost at the in those first 3 years, which just trying to remember where it is in here. In those 3 years, you'll see it is obviously lower than what we're looking at for the life of mine. And ultimately, that helps with the overall economics of the project higher production, call it, 130,000 ounces is driven by that 10% to 20% higher grade that we're seeing. And then that directly drives lower operating costs, cash costs and ultimately, all-in sustaining cost. We're looking at $300 lower from an ASIC perspective with that higher grade material. So there's a direct correlation there or inverse correlation grade lower ASIC.

And can you comment on what this in price per kilowatt hour was as well as the diesel price?

So it was $0.14 per kilowatt hour is where we landed 12 or 14, 14 was where we landed. -- and diesel ended up being 105 or One of event.

Can you comment on the royalty, the royalties and the all-in sustaining costs and whether there's any expectation of those royalties to change moving forward?

You want me to take that? Do you want to.

Please go forward.

Yes. So from a royalty perspective, you see earlier this year, Ghana came out and implemented a sliding scale royalty that ranges from 5% to 12%. So at $4,500 or higher we'll incur a 12% royalty. And then for every $500 below that, it goes down to treat 4,500, 11% between 3,500 and 4,000. -- you're looking at 10% and then 3,000 to 350 then it ultimately drops from there. So all of our sensitivity analysis that you'll see within our presentation within our press release incorporates that sliding scale royalty into it. When you look here, again from a base case perspective, this includes the 10% royalty at 3800. It also then includes Triple Flag royalty. They've got a 2% royalty on the project as well. There has not been a lot of change to the mining code in Ghana over the last number of years. We were actually with the CEO of the Minerals Commission last week in trauma and we hosted him for a number of meetings with investment banks and investors in Toronto. And he kind of reiterated that, look, these changes happened with the parabolic move we saw in the gold price. Ghana's view was that they should benefit alongside companies and investors with that move up -- but with the move up, if ultimately, we see gold prices coming back down, then they should be readjusted accordingly. So that was what led to the sliding scale. -- they did not change the free carry interest. That remains at 10%. Also, at the same time, got implemented, it's important to highlight that they also moved a growth in sustainability, let which was in what was in place -- that represented 2%. There was also a coded levy, which they got rid of of 1%. So yes, the sliding scale went in, which invested things to 5% to 12% but 3% or 2% growth in sustainability level, 2% per 1% COVID, so 3% total got removed at the same time. I haven't come across anyone yet who kind of outright recognize that is not obviously watching on it very closely. So I think it's important that 3% was removed at the same time is this -- the other thing for us, specifically given the aggressive drill program that we got is they also remove the VA, the value-added tax of 15% and 5% for drilling and exploration. So the way to look at that is we get an additional 15% meters as a result of being able to claim back that VAT. So that was another thing that was implemented at the same time as the slide. Last week, he was adamant that, look, these changes happened and then realigning the country but there is no of further changes from a royalty and for carry interest perspective?

I think that's very important to reiterate. At this stage, we don't expect any further changes. And the most recent shifts in royalty rates have been accounted for within the prefeasibility study. For Permitting and mining license, how will this project meet God's increasing requirements for increased local participation and was that factored into the pre-feasibility study. I will note that PFS does assume contract mining that would be with a local contractor group out of Ghana. Can you please add to that?

Yes. So if you look at some of the changes from a implementation of a requirement to use contract mine in country. It's important to highlight that the bulk of companies in Ghana have used contract mining for a number of years. It is a very mature mining district over 5 million ounces of gold produced every year. As a result, you've got a lot of competition in country from a contract mining perspective. So we always assume contract planning for our projects. So there's really no change from that perspective. We went out to multiple different contractors for the PFS. We got bids and quotes from those contractors. We had looked at those and incorporated that into the PFS. So -- so from our perspective, it's what we've always assumed -- and these kind of -- this implementation of contract mining in Ghana doesn't impact our spending at all because it's -- we always assume what happened. And if you look at most companies in country, that's the case. The 2 or 3 where there has been an impact is New loan DG, and that's they had owner-operated fleet they're now looking to move over to contract.

So same on the theme of Ghana, what different permitting discussions from those seen at Goldfield recently in Bogoso-Prestea.

Yes. So we -- we've got 1 of the 2 most advanced projects in -- it's interesting, when you look at Ghana as a whole, you've got 5 million ounces of production per year. And on build the and project broaden to production last year. They bought that asset in 2021, we optimized to start construction in 2023. And we're in production by 2025. So I think that speaks to the ability to push projects forward in country to go from buying a project to permitting to having in production within a 3, 3.5-year period is standout. For our project, it is 1 of the 2 most advanced projects in country from a development perspective. So we've got a tremendous amount of support from the government. They recognize that it will add a lot of value to the inch area. It will obviously add value for a country as a whole, create jobs, trade FPI, taxes, royalties, all those things. So again, if you were with us last week in Toronto, when we met with the CEO of the Minerals Commission and last month, we were in New York with the Minister for Lands and Natural Resources Minister Bua, they have express the full support for this project. And on the back of this PFS, 1 of the key things for us to apply for a mining lease is to have reserves. So for the first time, we now have reserves -- that will then get incorporated in a -- we're going to look to have that mining lease application submitted in Q3 of this year, so in the next 3 months. and we'll look to have that granted in 2027. So we've outlined that with the minister, with the CEO of the Minerals Commission and they've committed their full support and said that, that is a very realistic and achievable time line. So we've got a tremendous amount of support, and it is one of the real differentiators in Ghana and in a lot of West Africa is the ability to fast track projects into production. With this PFS, we've outlined the economics that justify us aggressively moving it to a feasibility study, getting it permitted while we're doing that, continue to aggressively explore ad ounces, which will help improve the overall economics of the project, further justify putting it into production. And that's really the focus for us as a team at the moment.

I think you've likely answered most of this, but how far along with the permitting time line is the team is the team looking to fast track a feasibility study, mining license into operations on the back of the pre-feasibility study.

Yes. So I think we covered the mine lease. So we now have reserves, which was the critical element to apply for a mining lease. We'll get that mining lease application submitted in Q3, so in the next 3 months. We'll then look to have that granted in 2027, and we've already spoke to the government, and they're very comfortable with that time line and are going to work alongside us to get that done. From a feasibility study perspective, our view is the base case that we've outlined here more than justifies us aggressively taking it to a full feasibility. What we're going to want to do is incorporate a lot of this additional drilling that we're doing at the moment, so an additional 52,000 meters of drilling and maybe more could then go into an updated mineral resource estimate, which we would get done next year would then be the foundation for us to be able to go to a full feasibility. So that's our plan. And then obviously, on the back of that, we would look to get the project funded and get it construction ready.

And I'll just jump in there and say as well, we won't be waiting for this up and mineral resource estimate. There's a lot of additional work that we can do -- in particular, we talked about some additional metallurgy and looking to optimize the grind sizes and those sorts of things. We've got ongoing baseline work, hydrogeological work, geotechnical work. So we're not just waiting for that updated MRE before we even started a bunch of the work that we know we'll have to go into the feasibility study.

So if capital remain available, when would you foresee routine production?

So our kind of time line at the moment is applied for the mining lease alongside us doing the additional drilling that will feed a PFS, along with all that additional work that Greg highlighted, environmental work, geotech work, hydrological work, additional baseline work in metallurgical work. We're doing all of that to a feasibility level at the moment, so filling in any gap between PFS and FS to be able to then get a full feasibility study completed. So all that been happening over the last couple of months and will continue right into --. So feasibility second half of 2027, at which point we would then look for budget financing and ultimately look to get into production or into construction in 2028.

And just to caveat not, obviously, that time line is as of today. As we get more information, we'll continue to have a better idea of those time lines as we advance the project and see in the exploration on sent the economics. Any options for running a small heap fleet to get the project running over.

Yes. So we -- again, in 2025 spent a lot of time looking at different scenarios and ultimately, we look at the legible scenario we looked at each plus the CIL scenario. We looked at a CIL scenario and really, we landed on CIL was what made the most sense for the project. In terms of size and scale as well as build a heap leach project, there's a lot of overlap in terms of infrastructure roads and building pads and you start to incorporate all of the capital required to do leach going directly to a CIL again is what made the most sense for the project based on all the technical work that into those studies. So I don't anticipate starting with a small heap leach. One of the interesting things if you want to look much bigger picture and you look at our mine plan today, that mine plan is obviously involve evolve with the exploration success that we continue to have but you could see a scenario where we get into production with the CIL and Boeing material, other material going through that CIL and some of that lower grade material that we've got at you could potentially see at some point, bringing that into a small heap leach alone CIL to then ultimately increase the overall production profile. But short at there's no, I don't foresee us putting a small heap leach into production day 1. But you see less branded production and using the cash flow from that to put in is fall deeply alongside it as something that can make some sense.

I think there's optionality in the future. So when does prove on higher upfront CapEx costs, how does this change your thinking around financing the mine build? Are we to expect large equity raises relative to your current market cap in order to get to first goal? How do you assess them JV or debt rate opportunities look at this point? One thing I'll just note before I pass it to Luke is obviously one of our key focuses is to bridge that gap. Our current market value, we believe does not reflect the value of the product. And with the drilling underway, we hope that, that men had success in bridging that gap so that valuation gap isn't as long as it is today, but already.

Sure. So yes, I mean, again, I think, obviously, building a PFS out on like yesterday and having parts of the market who didn't fully appreciate the additional costs involved in going to Seattle led to a selloff in the stock. But to Mal's point, I think we're deeply undervalued at this stage relative to the NPV that we've lined and the tremendous upside that there is project perspective, that's driven a lot by all that exploration that we're doing at the moment that will go into future studies. So yes, getting us back to a point where we've got a more reflective market cap relative to the project and the exploration side is something that we start from now because, obviously, we got sold off yesterday. So we'll work on that and we'll get out there and highlight the tremendous value that there is from a pure financing perspective, project financing perspective, I mean, there's lots of different ways we can ultimately go with that debt financing will be a large component of any overall package that we would get in place. So if you look at 50% debt or 60% debt, then you obviously got a left over equity piece that needs to get filled from a pure equity perspective, again, we've got tremendous support from our long-term institutional investors who want to see us fast process into production as quickly as possible as to move the cash flow from that. But then beyond that, as we derisk this project and move it forward, partners or take out of the company, all of that stuff will ultimately be on the table. If the market doesn't value us appropriately and we often see this, market value for a project relative to what a corporate will pay for a project there can be complete discount. And that's where you ultimately start to see a lot of M&A takeout happen is when you have that distinct between what value of a project is for the equity markets versus a corporate. So as we move and we've said this countless times before, a demo project from PEA to PFS to you get permits in place, you derisk it, all of that additional work that commands a higher valuation from a market perspective that's where corporate also get very interested. So I would say where we're trading today, and that disconnect that there is, from a project value perspective relative to what the market is pricing the company at is where there is also the reality that corporates will get very interested because of that disconnect that there is. So that's the other kind of path we continue to advance it. We funded ourselves. We've got lots of debt providers who've expressed the interest. They like Kona, they want to be supportive. They like projects of our size. Strong institutional support. But then beyond that, if there continues to be a disconnect in the market, then ultimately, someone probably comes and put on the table that we would then need to take to our board and ultimately take to our shareholders.

I think that's a great segue to a question about our Board of Directors and our team. Can you talk about the capabilities of the directors and officers with regard to construction and operations experience.

Do you want to take that? Or you have made it or...

So we have a very, very strong leadership team and 1 that has significant experience in creating not only shareholder value, but also operations experience. We thought we got hotel.

Yes. So when you look at our board and management team, a long track record of success in the mining sector. I mean if you look at Tug Forrester Bull Johnson, their co-founders of Newmarket goal that was a brownfield project went in there, restarted it, brought back into production and ultimately sold that to Kirkland Lake Gold. Ryan King was involved in that all the way through. Then if you look at Caliber Mining, again, that was a $40 million market cap company, vended in the B2Gold assets in Nicor to become a producing company than what the Marathon assets in Newland, really ramped up and optimize the assets in Nicaragua. And then fast forward to today, they got merged or and then got taken out by Equinox Gold. And if you look at the team that's running Equinox Gold today, they were primarily former caliber management team, Four of our current board members actually sit on the Equinox Board today. From a technical perspective, manoendeavor on the debt some things that has a tremendous amount of operational experience. Alan Anbern, he came in as a strategic adviser to us about 2 years ago. You've got a lot of experience in the mining sector. His last operational role as a COO of SSR. So he's been a pretty good technical adviser and yes, so we've got a strong team. But what we will also look to do is continue to add to the overall management team as you go from PFS to FS to production, we'll look to bring in the individuals to help complement the existing team that's in place and really drive us along that path.

So just one question on exploration. And then we're going to pivot to a few last questions around valuation, cash position trading. -- to wrap things up. So over to you, Greg, on this one. How much lateral drilling are you planning roughly on buoyant to see if there's a material outside the higher growth shoots that can make the cutoff should the pit be expanded going forward?

Yes. I think the answer to that is going to be very little just because these cuts are so large. So -- when you look at that, what is a longitudinal section and you see those new recent results that we've announced below the level of the current pits, each 1 of those shots is have a order to almost a kilometer in lens strike. So our goal will be community for each 1 of those 0.5 kilometer to kilometer long shots in terms of this image that we see here, we see 3 of them. There's probably 3 more along strike at Boeing, and there's a similar number at CEO. So our drilling will concentrate. And again, by concentrate, I mean zones that are half a kilometer or a kilometer long within these shoots. And again, that's the benefit that we have is they're already now fairly well defined where we see the better grades and the better widths. We see that rate from surface continuing to the bottom of the pit and now below the pit with these drill holes. So we will concentrate on these sort of sized shoots and look to -- from the existing holes that we have that we've released this year, step out 25 to 50 meters. And again, the idea will be that we'll define this mineralization right to the indicated category and this would be available for the future feasibility study.

And I'll just jump in that, yes, the focus right now is on defining these higher grades, but with the large-scale drill program that we do have underway, there is an opportunity to find more mirror surface above resource grade across the district-scale property, it is 248 square kilometer land package, 40 kilometers end to end. We have defined mineralization in 4 specific areas to date that exist in our resource. But above and beyond that, all of these deposits remain open along strike at depth, along with areas like Arati, Cogna Hill, seems so redrilled. We've had real success, but we do not yet have a resource. And then in addition to that, a number of additional early-stage exploration targets, -- so there is a lot more potential on the property, and we will allocate some of our drilling to continuing to define that earlier stage in advancing those earlier-stage targets. Luke, do you want to add any last comment on exploration before we wrap things up with a few questions on the company?

No, I think -- I mean, you guys have highlighted it. I mean, obviously, it's a district scale exploration program, the average vertical depth of the pits that -- and we've consistently talked about. And now we've got 4 drill rigs turning. This is the first time we've had 4 drill rigs turning in the last number of years. So we're aggressively drilling on the project. We think that can create a huge amount of additional value that will then go into feasibility studies into the overall project economics and I think that, that's a really good place to be at the moment. So expect lots of drill results from us, and we're excited to continue to the positive impact that, that will have on the project.

So before we wrap comes up likely in the next 5 minutes. Luke, what is Malacas. any warrants slot? What's the fall-up budget?

Yes. So if you look at our cash as of the end of May, we were sitting at $18.8 million. So everything that we've talked about in terms of the 80,000 meter drill program of that additional work or feasibility perspective by doing in the background. That's all funded with the cash on the balance sheet today for funded right through the end of 2026, in 27 million and then we're 55% institutional today and continue to have a lot more from those investors to keep driving this project forward. as I mentioned, I was blown away that we traded down to USD 75 million market cap. -- on the back of outlining a project an NPV of $500 million at $3,800 gold price, we went through the tremendous leverage to the gold price that our project has when you look at it average gold price for example, $4,800 in 2026. So that is a resetting of the company. And obviously, we needed to do a better job of communicating the additional costs that are associated of the CIL project. But from here, I for investors and 12% owners of the business that are obviously, steadfast on communicating that and creating that ultimately for shareholders.

Some funded going forward for this year for the 80,000 meter drill program, of which we have this year was 12,500 meters of which 28,000 went into our additional resource and prefeasibility study. So a lot more drilling to come. And just to be clear, there are no more warrants on within our capital structure. So with the strong volumes that we saw, obviously, the last 2 days or yesterday and going into today. Luke, did you have significant shareholders or institutions yesterday.

We didn't have anyone that we know of. Obviously, the market is a bit of a black box in terms of knowing who's selling or buying. That being said, did have a couple of individuals get in touch who has similar to less a real disconnect in terms of where we're trading today and yesterday and stepped in and bought out of stock -- some of their rationale was if you look at our resource $1.5 million indicated another 600,000 ounces of inferred 2.1 million ounces trading at USD 75 million valuation with a PFS that line to $500 million project at $300 million gold. It just doesn't make sense to be trading where we are. But Luke, I take responsibility that we didn't probably communicate properly some of those additional costs and it was a definite new jerk reaction with the market. So that's on me for being at the helm and and not making sure that, that was also be communicated. But from here, again, we see a huge amount of upside.

So one last question. From a shareholder, thank you for your work today. Given the market's reaction to the prefeasibility study, what milestones do you think are required to close the valuation gap. The nanometers and drilling are not in the prefeasibility studies that you have done so far. I think this is a great question to ask things. Again, we have a lot more results to come. So from the 80,000 meters 12,700 meters were reported this year that have not been included, and we had an almost another 40,000 meters to go. So lots of drilling, lots of news flow to come. And I'll pass it to Luke for the closing remarks on what things the milestones are needed to close this valuation gap going forward.

Yes. So drilling has now highlighted as Greg walked through in some detail. The PFS today is obviously a snapshot in time. It creates a lot of fundamental value for the project. It's a much more defendable, credible study than what we saw with the PEA. A lot of technical work went into producing this PFS as well as all of the studies in the background. What was encouraging is, yes, it's painful as made for shareholders to see the reduction that we saw yesterday in the market. But we also got a lot of positive feedback from a lot of very typically focused investors from a number of our covering analysts as well as a number of our peers in what Africa. So again, that disconnect between the market and industry is something that, for me, was very encouraging to hear that feedback yesterday? We will have a lot of drill results to come. We've got 4 drill rigs turning. So that will obviously produce drill results. On any given day, we could wake up and find out we've got another big line high-grade intercept that we'll point to additional ounces and upside for the company. We will apply for our mining lease. That is a critical element for any project and a major derisking event so we'll apply for that in Q3. We'll look to have that in place in 2027. So that will be another major milestone in the back around all the additional derisking work. So metallurgical network or hydrological or geotech work, and biometal work baseline work. We've been doing that continuously for the last year half 2 years to get us in a position to be able to produce the -- and we've already started on the path of getting the full feasibility level work done to be able to produce the feasibility study. So that's additional work that will be happening in the background. Obviously, it's less news flow worthy. But from a project perspective, and from a value creation perspective, often as that's also happening in the background. So drill results, mine lease and then all of that leads to a full feasibility companies where we think we'll create auto from here?

Thanks, Luke. I want to thank everyone for joining today for the webinar and for the great questions. I really appreciate the engagement level. So going to wrap things here, but please do recess directly if you do have any further questions or want to have an update with our team. I also encourage over to follow us on social media, we post a long content on there on Allied on Facebook I need to. And with that, I just want to thank everyone again, and I hope that everyone has a great afternoon.