Northern Star Resources Limited

you for standing by and welcome to the Northern Star March 2026 quarterly results. All participants are in a listen only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Stuart Compton, Managing Director and CEO. Please go ahead.

Good morning and thank you for joining us today. With me on the call is Chief Financial Officer Ryan Gurner and Chief Operating Officer Simon Jess. As previously announced, in the March quarter, gold sold totaled 381,000 ounces. And today we announce the delivery of those ounces at an all-in sustaining cost of Australian dollars, $2,709 per ounce. This improved operational performance exiting the quarter has delivered high-margin ounces to generate group underlying free cash flow of $301 million. More specifically, we are prioritising cash flow at KCGM by accelerating volumes from the high-grade Golden Pike zone during current mill constraints. At Dundee, the operational review is underway, and across Thunderbolts and Pogo, we've seen gold grades improve. With this improved performance and high-grade ROM stockpiles at KCGM, the company is forecast to deliver its revised FY26 production guidance of above 1.5 billion ounces. As previously disclosed, this outlook remains particularly dependent on melt throughput at KCGM, with both downside and upside potential. Total growth capital expenditure for FY26 remains unchanged. with revisions to the KCGM Mill Expansion Project and Operational Readiness CAPEX. The KCGM Mill Expansion Project remains on track for commissioning in early FY27, and pleasingly the project started transitioning from construction to the completions and commissioning during the March quarter, which is marking the next stage of project delivery. Due to ongoing poor productivity levels for construction activity, we prioritised the importance to keep the project on track and $160 million in FY27. The increased capital expenditure during FY26 for the mill expansion has been offset by a reduction in the forecast spend for operational readiness related to delay in the spend of the thermal power plant and transmission infrastructure. You'll see in the quarterly report we've also introduced some extra detail regarding Stage 1 and Stage 2 for onsite construction. to the construction of the 27 million tonne per annum plant. Stage 2 refers to the consolidation of a digi-facility which simplifies the processing footprint to a single location efficiency, which supports longer term operating efficiency and cost structure benefits. At Hemi our team continues to optimise the engineering and design of the project while advancing approvals. So our balance sheet remains in a net cash position and our hedge book increase in cash flows going forward. I'd now like to hand over Simon Jessup, our Chief Operating Officer, to discuss our operational highlights.

Thank you, Stu, and good morning. This quarter we delivered a solid operational and financial performance with improving production, stronger cost control and continued investment in the long-term growth across our portfolio. At the Kalgoorlie Production Centre, we sold 210,000 ounces of gold at an all-in sustaining cost of $2,550 an ounce, improving on the December quarter. This was driven by stronger cost efficiency at Casey Gem and a return to normalised performance at the Kalgoorlie operations. Mine operating cash flow was $588 million, generating a net mine cash flow of $156 million after $432 million of growth capital. reflecting both asset strength and continued investment. KC Gem sold 117,000 ounces at an all-in sustaining cost of $2,485 an ounce, supported by higher grades and optimising the available mill feed. Importantly, mining volumes continue to trend towards our annual targets. Open pit material movement is tracking towards 90 million tonnes, and underground production towards 3 million tonnes per hour. Ongoing waste stripping is supporting this progress. At the same time, productivity gains are allowing us to accelerate mining in the higher-grade zones, prioritising margin and cash flow, particularly while the mill throughput remains constrained. At Karasu Dam, open pit mining is expected to conclude in the June quarter, with production transitioning to underground sources and stockpiles. At the Kalgoorlie operations, performance improved with higher grades and the normalisation of underground mining following the earlier H1 disruptions. Turning to our Yandall Production Centre, performance also strengthened. Gold sales increased to 105,000 ounces at an all-in sustaining cost of $3,347 an ounce. with a mine operating cash flow of $177 million and net mine cash flow of $91 million after growth capital. At Jundi, an operational review is underway to reduce costs and improve consistency. During the quarter, we return to conventional oil processing following the remediation works, while a completed power upgrade is expected to support improved mining volumes and grades in the June quarter. At Thunderbox, production was particularly strong, with gold sales plus 26% quarter-on-quarter to 59,000 ounces, driven by higher-grade ore, initial open-pit contributions and improved mill recovery. Turning to Pogo, we saw a step change in performance. Gold sales increased to 66,000 ounces at an all-in-sustaining cost of US$1,529 an ounce. driven by higher grades from optimised stoking in the mining areas. This translated into a mine operating cash flow of US$136 million and a net mine cash flow of US$124 million, highlighting the strength of this asset as a cash generator. Operations continue to perform strongly, with the mine and mill running at an annualised rate of 1.4 million tonnes per annum. Development activity remains robust, establishing new mining fronts and advancing infrastructure to unlock future production, including access to the star ore body, supporting both growth and potential mine life extension. In summary, the March quarter reflects a business delivering improved operational performance, disciplined cost management and positioning itself for stronger, more sustainable returns. I would now like to pass over to Ryan, our Chief Financial Officer, to discuss the financials.

Thanks, Simon. Good morning, everyone. Northern Star remains in a great financial position. Our balance sheet remains strong, with cash in bullion of $1.2 billion at 31 March. Pleasingly, all three production centres generated positive free cash flow in the quarter. quarterly net mine cash flow was $426 million. Figure 8 on page 10 sets out the company's cash and bully movements for the quarter, with key elements being the company generating just over $1 billion of post-tax operating cash flows, a 180% increase on the prior quarter. After deducting capital of $618 million relating to the KCGEN expansion plant equipment and mine development, $48 million of exploration and $66 million of lease payments. Quarterly free cash generation was $301 million. Also during the quarter, the company received $50 million in proceeds from the divestment of the Central Tanami Gold Project and paid an interim dividend of $0.25 per share, totaling $347 million. Stu has already discussed the revisions to AFY26 growth capital expenditure forecast, particularly KCGEM. But in respect of the other investment activities, our exploration expenditure is tracking to plan with guidance of $225 million for the full year unchanged. And at HEMI, we continue to work closely with key stakeholders and regulators to advance the project, including approvals and progress on the engineering and design works and procurement of long-lead items. On other financial matters, the board has recently approved an on-market shared buyback program of up to $500 million, supported by the company's strong outlook and value opportunity. The buyback will be subject to the company's security training policy, including blackout periods, and will not affect the company's dividend policy to pay out 20% to 30% of cash earnings. From a cash tax perspective, we are guiding the second half of FY26 range to be 240 to 280 million, with 37 million already paid in Q3. No changes to our estimate quantum or timing for landholder duties for the De Grey and Saracen transactions, both likely to be paid during FY27. The company is not experiencing any supply restrictions on fuel, and we continue to engage with our suppliers on this matter frequently. Q4 oil and sustaining costs are expected to be $75 to $85 per ounce higher as a result of increased oil prices. Year-to-date depreciation and amortisation of $1,015 per ounce sold is just above the top end of the guided range of $8.75 to $9.75 per ounce and is expected to track modestly above the top end of the guided range for the full year. For the quarter, non-cash inventory charges for the group are a credit of $46 million, primarily from increases in stockpiles at KTHM. During the quarter, the company refinanced and upsized its corporate bank facilities with maturity dates of March 2030 and March 2031 across two equal tranches totaling $1.75 billion. These facilities remain undrawn and available at quarter end. Also a reminder that the company will pay interest on its senior guaranteed notes in Q4, which will amount to US$18 million. The company continues to unwind its hedging commitments, with 165,000 ounces delivered during the quarter. At 31 March, commitments totaled 950,000 ounces at an average price of Australian just over US$3,350 per ounce. I will now hand back to Ashley to begin the Q&A. Thank you.

Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you're on a speakerphone, please pick up the handset to ask your question. Your first question today comes from Hugo Nicolasi with Goldman Sachs. Please go ahead. Hugo Nicolasi, your line is now live. Please proceed with your question. We will move on. Your next question comes from Levi Spry with UBS. Please go ahead.

Yeah, hello, team. Thanks for your time. Maybe just a little bit more detail on the two key growth projects, KCGM and HEMI. So can you just talk us through the delay in capital into next year? how that ties in with the potential ramp-up through, I guess, the second half of this calendar year.

Yeah, thanks, Levi. So on the actual expansion project, there's an increase in the overall capital. It's pretty much spread this financial year, next financial year, so you'll see those lifts in FY26, FY27 in regards to the expansion, about $60 million, $30 million in FY26, FY27, That's due to the productivities. We're just getting poor productivities, got a lot of labour there, but it's very important to us to keep the timing of the completion in line, and that's why we've been jammed but prepared to keep that labour there to complete that project. The delay of this band is the new thermal power station infrastructure pending approvals. We're fine with power because we own the Parkston Joy Venture power station there, plus we have grid connecting. So they're not issues, but that's just delayed capital. And in FY26, there's no net change, but there's certainly that uplift of the overall project due to those poor productivities.

Yeah, okay, thanks. I guess I'm just trying to drill down a little bit more in retaining the 23 million tonnes as a guidance number effectively for next year, given that the capital has moved a bit. So is there anything more we can add on that?

No, so we'll provide the full year guidance with the quarterly, which we typically do in July, which is on the June quarter. So that'll give the outlook for everything for the full year for FY27 and equally the overall ounces, throughput, full case GM sources, et cetera. So, yeah, quarter, we're on track for completion and commissioning of the plant in the September quarter. It obviously moves from the old plant to the new plant and then has ramp-up and that'll all relate to how we achieve the full year on that.

Got it. OK, thank you. And then, just, is there... Can you give us a little bit more detail on the progress at Hemming as you move towards FID there sometime next year?

Yeah, so, really, it's still pending on environmental approvals. We're working closely on the water trial progress, which would be this quarter. So working on that... I totally understand that. Just need silence on the back of some of those calls. People are going to need to go to mute. The... Yeah, sorry, on Hemi. So the approval's still bending with environmental. It's tracking OK. There's no real curveballs in it. but we're certainly, you know, it's been delayed from where we predicted and that's why we've pushed the timing of FID out. But, yeah, I think the other part with FID, we're going to have to be very dependent on the refreshed pricing and with the current backdrop of cost escalations, some real comfort, you know, with learnings from KCGM, et cetera, productivity levels in labour and then escalation costs around... any hydrogarden-based, you know, plastic fuels, tyres, freight. We've got to be really certain on FID there, so I think we'll be very conservative in our view on that.

Hey, thank you. Thanks for the time. Thanks, Leila.

Your next question comes from Daniel Morgan with Baron Joey. Please go ahead.

Hi, Stuart and Sam. Just on the superpeda menu, you've explicitly given more detail on splitting the project ramp up into stage one and stage two. I'm just wondering, you know, what are you trying to, the message you're trying to get to the market here, is that throughput will face, you know, a lot of disruptions, a factor that in from tie-ins. Is it costs, realised pricing from selling, you know, concentrate, not gold dore for a period of time? And I know that throughput is 23 million tonnes On page four, has this been updated at all in light of latest thoughts of delivery, and does it include the disruption at Gitche that you're talking about?

Thank you. Thanks, Daniel. Look, the 23 million tonne hasn't been updated, and we'll revisit that with the full year guidance that we'll provide in July. So we need to keep that in mind. the stage at which we've turned on the plant. What we're trying to communicate with the Division of Stage 1 and Stage 2, it would not make sense or sound odd if we were continuing to spend money in FY27 on this project yet have it running. So we're trying to be really clear that Stage 1 is the 27 million tonne per annum plant operating. And that's for commissioning. That's built in that way and will be commissioned and ramped up in that September quarter. Continuing on in parallel and subsequent to that, not affecting throughput or impact, is stage two. It's effectively all of the ultrafine grinding activity occurring for 100% of that 27 million tonne per annum capacity at the Finleston location. So people just... I think maybe that granularity wasn't there Right now, the concentrates go 20 kilometres north to Gidgee from the current plant, get ultra-fine ground and then brought back and treated and turned into Gold Dore at Femaston. So all of that, part of the efficiencies productivity spring, all that activity, which was explained in the feed and explained in the overall project approval, it's all occurring on the one site. The original pricing includes those two things, but the design of the activity stage one, stage two is there. The other highlight that we'll talk to is in half one of FY27, we will be selling concentrates, continuing to sell concentrates, which is fine, and the economics of it are sound. So that's not an issue, but we're just letting people know that until that second stage is complete and can take 100% of the concentrates generated... there'll be some of the concentrates go to Giji and some go in sales, which we've been doing. They go out through ports and go to smelters, and we've got good payability terms on those.

Yeah, thank you for that detail. Just moving to Karasi Dam, I see that you've just called out that open-pit mining is a sea thing. Any plans for higher underground production there? Or, you know, what are current thoughts on the longevity of underground mining? Thank you.

Yeah, thanks, Daniel, Simon. So we're still continuing with the underground mines that we've got. So Karari, Dervish is looking, you know, better at depth and, you know, we're getting some good drill hole hits at Dervish. But Porphyry and Million Dollar, they're the four mines undergrounds that we're running at the moment. Our sort of next phase is really looking at Twin Peaks and Keenah as the underground operations. So we're just moving into that phase of more undergrounds as some of them wind off over the next couple of years. We then transition to those other underground operations coming in. There will be some open pit operations further into the future, but not at the moment.

Thank you. And just on, I guess, a broader question of, I think you're conducting operational reviews across the business. Obviously, you've got Jundi. Sorry, Daniel, I dropped out there. Sorry, can you hear me? We can hear you. Yeah, sorry. My last question is just, you're doing operational reviews, I imagine, across the business. including, you know, Jundi and others, you know, what is the latest plan on providing the outcome of these? But, you know, earlier you had said by the end of the year. Is there any update to that time? Thank you.

Yeah, thanks, David. No, we'll stick to the timing of. We'll provide that medium-term guidance, which is a multi-year outlook, and we'll provide that this calendar year. we will provide the FY27 guidance with the quarterly, for the June quarterly, say, in July.

Okay. Thanks so much for your perspective. Thanks, Dan.

Your next question comes from Matthew Friedman with MST Financial. Please go ahead.

Sure. Thanks. Morning, Stu and team. Can I firstly just dig into a little bit more detail on that staging of the expansion? And I understand that the detail you've given in terms of the mechanics of Stage one versus stage two, moving the ultrafine grind down to Finnesden. But I'm just wondering, is this timing or staging approach, has this always been the plan or has this really been an outcome or been driven by the productivity issues that you face in terms of bringing one part of the process on a little bit later than the rest? Cheers.

Yeah, thanks, Matt. Look, the staging and the way the contracts form with the contractor has always been separable portion one, separate and their contract structure is different. So they were designed, engineered, sequenced exactly like that, and that's how the FIT was approved, and that's how the total number contemplated this with contingencies on both those projects. As they've transpired, separate portion one, which is the 27 million tonne per annum plant, that's on track with the timing, but it's overspent because of the productivities. and we're still working very hard for those final commissioning to be commenced and switched over from the old plant to that new plant in the September quarter. Early in the September quarter is our current design plant and ramping up throughout. Several of portion two, the ultrafine grinding activity, is another four to six months of activity, so the team moves from the first to the second, stay on site and get that completed. So that was always understood to be the case, and we don't get the recovery improvement of the overall project, and we said that on the onset, until all of that activity and that polymer concentrate gets done. So we're saying expect that through half one. which will be material going to Gidgee and the lower recovery in half two of FY27, and we've got stage two all commissioned and all the concentrates staying there, improved recovery, lower operating costs, and all of the activities staying on the site. That's the final piece of the improvement for the investment project.

And, Matt, just to add to that... several portion one is over 95% complete today and the second portion that Sue was talking about is already 48% complete so they're happening in parallel it's just the priority 27 million tonne case is the focus to get first ore into the mill and start producing gold and the second stage is just under 50% complete at the moment so that just trails and gets finished in H1.

I understand. Thanks for the additional detail there, guys. And then secondly, on the power plant, you know, you said that you're comfortable there given that obviously you've already got your own plant and also a grid connection, but obviously we know that the grid stability in Kalgoorlie has been an issue recently. So I guess just wondering... When exactly is the new power plant needed to support the upgraded throughput from the bigger mill? And, yeah, I guess how do you see those grid stability issues potentially impacting or potentially not impacting things?

Yeah, so we won't have access to the grid and the 50-odd meg of power from it. We won't be reliant on it. In the first instance, Parkston's the foundation supply for the new plant, and then the move to the newer thermal plant, it can occur within 18 months to years, and it improves the overall unit cost of the power. And final piece of that is the renewables project that has been approved. So the wind and solar. So really that thermal is just the firming power for that renewables project. And that's another step change in the cost structure for the site. So, yes, step one is we own, we're in 50% joint venture of Parkston Power, which underpins the expanded project. sort of mill demand. We are building a new thermal power station subject to those approvals timing. And then the renewables that sits on the back of that, which is a third-party balance sheet. We've got some switching gear we own. Fundamentally, that comes in within a couple of years to start really driving the power costs down. And we will be in control of our own power security, not dependent on the grid. And if anything, we're out there to support the Goldfields grid We've got some arrangements progressing quite positively with the state to assist the normal start and assist the golf fields in underpinning that power.

Okay, thanks Stu. Maybe to put it another way, can you achieve 23 million tonnes without the support of the Calgary League group in FY27?

Yes, and it will be running at times, it will be running at full 27 million tonne per annum capacity, so full demand. We've got over 100 meg capacity at Parkinson's, so 99 meg, you know, derated with temperature, and we've got 52 meg from the grid, well in surplus of the demands of the mine and the mill expanded case.

Okay, that's pretty great. Thanks for that. And then maybe just lastly, on the Jundi technical review, you've talked about considering a range of outcomes there. And obviously, you said you're going to give more detailed guidance a little bit down the track. But maybe just conceptually, can you bookend the sort of range of options that you're considering in that study? I mean, if I think, you know, hypothetically, maybe a conservative study, or a conservative option might be at Jundi that you just mine out the remaining reserves and then kind of, you know, ramp down the reinvestment in that asset? That might be a conservative kind of view, or should I actually be thinking, you know, even more conservatively than that? You know, conceptually, could there be a reduction in the current reserves given the increase in the cost structure or some of those other factors? Thanks.

I think it's certainly to give that granularity, but the concepts are the costs are high. and our aim is to cut absolute costs out of the site and then see the maximum output we can get through the current infrastructure that's there. So it means reduction in intensity of activity to get the lower unit costs. If anything, that will extend, at a lower price, I can extend the reserve life that's there. And as far as that investment, again, it has to be ranked and prioritised against the other opportunities we have in the business as you brush up now, there's a lot of intensity around number of jumbos developing, number of stokes occurring, number of diamond drillings doing discovery to cover depletion. So taking a bit of that pace out will actually enable a bit more time with the overall asset to focus on quality over quantity.

Anderson, thanks for your perspective. Cheers. Thanks, Matt.

Your next question comes from Kate McCutcheon with Bank of America. Please go ahead.

Hi. Good morning, Stu. I got the company right this morning. I wanted to ask about the buyback. So we had that announced. Aussie 500 mil is circa 1% of your market cap. Just talk me through how you think about buying back your stock here versus investing that in organic growth, etc.? ?

Hey Kate, it's Ryan. Look, I think right now it's some of the most accretive capital allocation we can put back into this business. We see a strong outlook ahead. We're close to turning on our new mill. We're going to see cash flows list significantly there. So we see strength ahead and we see value in our underlying business.

Okay. And while I've got you, Ryan, I think the tax cash saving numbers you gave us are new. Is it fair to think about that magnitude being less than P&L tax for 27 and 28 that you gave us on the tax yield? And secondly, did you say next quarter's ASIC is expected to be 75 to 85 an ounce higher as a result of oil prices, or did I mishear what those comments were?

No, so I'll start with the last question first, yes. Yeah, so $75 to $85 an ounce higher is our sort of estimate. Obviously, oil's volatile, but that's our best view of the impacts this quarter. And then on the tax shield, which I think you're referring to Henny, I guess we added some more commentary at the back there on page 10, but it's really just, again, reminding people of some of the timing of that. So... Again, the maths being that, you know, we get a shield essentially of that purchase price. The total value of that from a tax effective perspective is about $1.5 billion and we're sort of saying we'll get 50% of that back over five years. And it's a bit front end weighted from a tax perspective. So we're just guiding and reminding people that, you know, we will get this benefit. We won't see it, though. We're not going to see it in a big lump sum come back into our treasury. It just means that FY27 tax will just be slightly lower. That's all.

Clear. And then if I can sneak one more in, updated resources reserved in May. Can you help me understand the drilling that's been done at Henley? I assume that's mostly been infield drilling, Stu? Yes. because I will probably get an update on CapEx, OpEx with the multi-year outlook. Is that correct before the end of the CY? And I'm just trying to understand how we think about mine life or upside of that asset versus what the focus is now.

Yeah, thanks, Kate. Just before I close, I've got a hemi. On that ACE with diesel and fuel, that is the expected up to the $75 to $80 in ACE, but it's not. and as we grow out, so there's other things that are moving in that. So please don't just be critical of that. Hemi, we've done the drilling, but you're right, it has been really, you know, infill and testing and we've been more aggressive on some of the PID shapes and shells on the resource. So we've had to sort of incorporate that into how we would do things, which may be sort of a bit stricter, but that'll be reflected in how we report the resource. And I think equally, just being more aggressive on the reserve generally to build contingency and the like. So that will be reflected and reported, which will likely be in May. We won't be giving... any other aspects of the HEMI project there, but we'll be working on... We're still working on those numbers in line with expectations around approvals, but the mechanics you're talking about perhaps is the budget of exploration in the forward years. That will be in the multiple, and whether we intend to put money into HEMI. My attitude is there's enough ounces in the ground without really heavily... Going into growth, we don't need it for a trigger for a feed decision. So there might be other opportunities like Pogo or Finiston where we get much more effective investment in exploration to add houses to make bigger, longer-term decisions than Hemi needs today. So Hemi might have a lighter approach to that drilling expenditure because there's a very, very solid base for an investment case without it.

Okay. Thanks, you too.

Thanks, guys.

Your next question comes from Hugo Nicolasi with Goldman Sachs. Please go ahead. Hugo Nicolasi, Alina's Live. Please proceed.

Hey, guys. Can you hear me?

We can hear you guys now.

There we go. Sorry, technical issues and apologies if some of these have been asked. It's just revisiting firstly on Karastu Dam and Simon, your comment that the open pit mining concludes. I appreciate you've probably got new open pits that need developing, but I guess just to clarify around the timing, is that decision to end the open pits this quarter and maybe devitalise that fleet largely around the strip ratio increasing and the diesel requirements that go into that? And then you're able to maybe talk through... anything around the underground mining rate and grade going forward from here to potentially offset the fall in gold production by processing stockpiles?

Yeah, thanks, Hugo. No, look, just to be clear, it's not around diesel and trying to conserve, you know, or slow down open pit mining due to diesel. It's purely the mine sequencing. So, you know, mines coming and going at that asset is fairly normal over the journey. It's just we've reached the end of the current open pits. Eleven Bells Red Bull finishes this quarter. Then we might have some box cuts and a few things to do early in FY27, but there's no ounces attached to that. It's more setting up for the next leg of the underground growth. So probably the best way to think about it is when we do the investor day later on, this calendar year, we can really show, with a bit more visibility, some of the sequencing of the mines.

That's helpful. So if we think about it today, then realistically the underground rates aren't picking up that materially. You've probably seen Karasu drop below that 200,000 ounces a year for the next couple of years while you do that underground development?

It could do. We're still working through that, but we've got some good growth at Dervish, so we'll see how that plays out when we do the resource and the reserves and then feed that current information back into the life of our certain mining plant.

Got it. That's helpful. And then, Ryan, just sort of running back on the buyback piece, just confirming then, so the timing and magnitude of the buyback as it stands is purely a value decision on your stock, and then maybe come August as KCGM and your capital requirements become a little bit clearer, should we consider scope to maybe take this to a magnitude you've previously targeted as being more meaningful around a buyback?

I think everything's always on the table, Hugo. We want to allocate our capital to the best return. So buy back something if it gets exhausted. If we're through it quickly, we're always able to assess a new opportunity there. And as I said, we're not too far away from seeing that change in free cash flow. There's challenges across the business. There's challenges in oil, all these things. So Right now, we've decided on that, I guess, quantum. We're ready to act, and I guess we'll make those decisions as the time plays out.

Great. Thanks, everyone. I'll leave it there. Cheers, guys.

The next question comes from Jonathan Sharp with J.P. Morgan. Please go ahead.

Yeah, morning, Stu and Sam. Just with KCGM mill expansion and the CAPEX, can you just help us understand the split between construction productivity and cost inflation, which is proving harder to control as we move through to commissioning?

Yeah, so... Thanks, John. So there's an uplift of about $60 million for that project that we've just reported, so 30 this year, 30 next year. I'd say, and one knocks through to the other, but probably two-thirds of that is just the labour, lower productivity, so you've got more people doing the same work at that elevated cost. In turn, cost escalation is occurring, not just through diesel, but through all other things, and labour's embedded in all of those cost escalations, which we don't see easing. So that's been a large part of You have extra labour, it flows through to commuting that labour, housing that labour, the consumables they use, all of those things knock through. But it's a reality that underpins anyone spending money at the moment.

Yes, I get it. That's clear. And just as you move through commissioning, without getting into commercially sensitive detail, Does the main contractor remain accountable through web commissioning, performance testing, and are there performance incentives, acceptable criteria, sort of final handover? Just interested in knowing a little bit of detail on that. Thanks.

For sure. I mean, there's pretty traditional standard things where, you know, like you do a handover and it's got to meet criteria, so that's embedded. And look, we've got the commitment from the contractor to, you know, they want to see this working as well as we do and promote it for the next opportunity. So that's there. Equally, we've got the same contractor doing stage two. It's a different structure, again, different incentivisation. So, you know, an approach to that's going well. And Simon spoke to 95% of the stage one's complete. Nearly 50% of stage two is complete. And those structures drive that behaviour largely. So, yeah, we're OK with those things. And we'll be tracking and checking those things closely. We won't be silly on the risk balance here. If it comes down to, you know, disputes around small amounts of quality... We think running the plant and addressing some of those things as we go rather than not waiting to move into your house until your fly screens are on. We'll be sensible in the timing of that. Okay, great. Thanks for that.

Your next question comes from Adam Baker with Macquarie. Please go ahead.

Thanks, Jim and team. Thanks for the colour on the increase in fuel prices. Just assuming here, mostly it's related to diesel, but just looking at the midpoint of guidance, I mean, that's implying about a 3% increase in your cost base. Just wondering, if you go back to the start of 26 prior to the diesel price escalation, can you give us any colour on what diesel prices were as a percentage of cost base for the business?

They're probably, Adam, it's Ryan, they're So they've basically doubled, I guess, in this quarter, that's what we're forecasting. They're probably 4% of our business, I'd say, back then. Now they're obviously pushing 7%, 8% for the quarter.

That's great. Thank you. And just secondly on the buyback, you know, clearly a lot of optionality here for you guys to deploy that. Just wondering if you've considered, you know, any minimum net cash thresholds before you deploy it, you know, noting you've got $320 million at the end of the quarter. You know, I'd hope that you wouldn't draw down on the $1.75 billion corporate bank facility to prioritize the buyback, for example.

I think, Adam, what it says, yeah, we want to maintain good liquidity. We've got good flexibility on our balance sheet if we have to draw debt, if for whatever purpose, and we see the cash flows ahead, right? So we're sitting here in late April. You know, the mill will turn on early FY27. We're really looking forward to that. We see what's ahead. You know, there's challenges in the sort of more global economy with oil, but we feel as though with our balance sheet, with our cash going on hand, we can manage that.

Okay, thank you.

There are no further questions at this time. I'll now hand back to Mr Tongking for closing remarks.

Okay, well, thanks, everyone, for joining us on the call, and I appreciate your interest in the company on what is a very busy day. Thanks very much.

That does conclude our conference for today. Thank you for participating. Email disconnects.