Alexco Resource Corp

Thank you for standing by. This is the conference operator. Welcome to the Alexco Resource Corp First Quarter 2022 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 Paul Jones, Senior Vice President, Corporate Development. Please go ahead.

Good morning, ladies and gentlemen. Today is Friday, May 13th, 2022. My name is Paul Jones and I welcome you to the Elexco Resource 2022 first quarter results conference call. This call is being webcast and a recording can be accessed through the events and webcasts section of our website at ElexcoResource.com later today. Our website also contains our most recent news releases and our financial statements for the quarter ended March 31st, 2022. All amounts mentioned today are in Canadian dollars unless otherwise indicated. Today, our Chairman and CEO, Clint Nauman, will discuss our most recent results, and he will be joined by our President, Brad Thrall, and our CFO, Mike Clark, during the question and answer period. Please be reminded that some statements made today may constitute forward-looking information within the meaning of applicable securities regulations. Past performance discussed today is not indicative of future results, and our business involves several risks that could cause results to differ from projections. Investors are encouraged to review the disclosures pertaining to risks that can be found in our most recent regulatory filings available on our website and on CDAR and EDGAR. I will now leave you with Clint Nauman.

Thank you, Paul. Good morning, good afternoon, and thank you to all those joining our call today. Given the volatile and challenging environment, I want to thank all our shareholders for their continuing support. and for helping shape Alexco's vision of becoming Canada's only primary silver producer. It's only been about eight weeks since our last conference call, so I'm going to take this opportunity to be very brief today, but I'm going to be happy to answer questions after this brief discussion. As we had noted in late March, reduced workforce availability coupled with supply chain interruptions led to a reduction in underground equipment operating hours in the early parts of the year. This was particularly so in January and February as COVID-related workforce issues gave way to delayed delivery of critical parts and components for underground equipment, primarily scoop trams. Even though we began to see improvement in workforce availability in March, supply line delays continued, as did availability of underground mechanics. But we did see operating improvements in March, with about 70 percent of the Q1 silver production being produced in March, about 56,000 ounces. And these improvements continued through April, where there's another 15 to 20 percent step up in silver production. In particular, we saw better advance rates in the ramp at Birmingham and an additional production level coming on stream, the 1815 level at Flamin' Moth. We've been encouraged by these improvements. They are admittedly short of where we need to be, so we do need to ensure that this trend continues in order for us to be successful over the longer term. Notably, our focus currently is for the near future and for the near future will be on improving underground equipment availability, which will have a direct impact on accelerating our access to additional underground ore faces. More equipment availability means more underground development, and that drives access to additional ore faces, which is key for ramping up throughput to the mill. We had previously anticipated providing formal guidance for the balance of 2022 as part of this release, but we are deferring that until we have more confidence in our projections. In the meantime, we're evaluating a number of production and operating scenarios which will drive our overall assumptions for underground development rates. With more clarity and confidence on how best to advance our development, we will then be in a better position to guide when we'll achieve our targeted 400 ton per day mill throughput. Although nearly all of our attention is focused on improving our underground productivities, we are launching a relatively small exploration program later in May, leveraging off our success at Birmingham. Now that we have a solid understanding of the structural geology architecture in which the larger and higher grade deposits occur at Keno Hill, we see many areas which require additional attention and testing, not only a long strike in both directions from our discovery of Birmingham, but also in a number of other areas in this very large district. Finally, I want to thank our shareholders for their patience and support of Alexco as we deliver Keno Hill back to full production. And with that very brief statement, I'd like to ask the operator to open the call for questions.