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spk06: who remain energized and focused on delivering safe operating results. We faced several challenges at the start of the year that impacted our operating and financial results. In the first quarter, we produced over 93,200 ounces of gold. During January and February, all operations were impacted by higher than anticipated absenteeism related to the surge of COVID-19 cases. We were also impacted by a government mandated power outage in Turkey and severe weather in both Turkey and Greece. Despite these challenges, we are seeing a recovery at our operations. As we mentioned on our last conference call in February, we expect first half production to be lower than second half production and we maintain our 2022 production guidance range of 460 to 490,000 ounces. Joe will speak to the operations in more detail later in the call. As we've noted in previous quarters, we continue to face inflationary pressure similar to the wider market, which has been intensified by the Russian-Ukraine crisis. Principal cost increases are in electricity, fuel, and reagents. We continue to monitor our supply chains to ensure our sites have the necessary equipment and supplies to safely operate. We have not experienced any significant disruptions related to availability of supplies. We also continue to monitor our concentrate shipments, including redirecting shipments as required. We have not experienced any disruptions with respect to refining of dore or fulfillment of concentrate shipments. In the first quarter, we continue to see inflation in Turkey. However, cost increases dominated in local currency, primary labor, were mostly offset by the continued weakening of the Turkish lira. In the Abitibi region of Quebec, increased activity in the mining sector has impacted the availability of contractors and labor. This year, we have completed two-year collective bargaining agreements with our labor unions in both Turkey and Greece. In Greece, we strengthened our relationship with our labor partners by incorporating technology and flexibility into our labor agreements, which helps us to move forward with our productivity and efficiency agenda. These labor agreements are instrumental in allowing us to focus on delivering safe operating results. During the quarter, we progressed at scurries, with activity focused on finishing steel erection and enclosing of the mill building. commencement of basic engineering, continued preservation of site facilities and equipment. Our scurries financing discussions continue to advance. We are evaluating all available options, including joint venture equity partners, project and debt financing through EU and Greek lenders, as well as the EU recovery and resilience fund and metal streams. Our focus in selecting a financing package will continue to be driven by value optimization and de-risking for the future. Following financing and board approval, we expect to restart full construction at Scurries in the second half of 2022. Finally, I would like to highlight a sustainability reporting milestone for the quarter. In March, we published our second responsible gold mining principles report, providing independent assurance that the year two requirements have been achieved with an impressive level of conformance against the principles demonstrated ahead of the 2023 deadline. We continue to work towards full conformance with the RGMPs across four operating minds to produce our year three report, which will summarize this achievement forthcoming in 2023. I'll stop there and turn things over to Phil for a review of our financial results.
spk04: Thank you George. Good morning everyone. Slide 5 provides a summary of our Q1 2022 financial results. As a result of the operational challenges and lower production this quarter, our Q1 cash operating costs was $835 per ounce sold. And all the sustaining costs were $1347 per ounce sold. Free cash flow in the first quarter was a negative 26.8 million. In Q2, We expect cash flow to be impacted by the timing of annual royalty payments in Turkey and Greece and the timing of capital spend. Eldorado reported a Q1 2022 net loss attributable to shareholders of $317 million or a loss of $1.74 per share. After adjusting for one-time non-recurring items, including a $365 million non-cash impairment of certège, our non-core asset in Romania, and a $20 million non-cash write-down of decommissioned equipment at Kissadag, among other things, the Q1 adjusted net loss was $19 million, or a loss of $0.10 per share. Q1 cash operating costs and all its sustaining costs were higher in the quarter due to operational challenges that resulted in lower gold ounces produced and sold. We are seeing higher prices in the quarter for diesel, electricity and reagents. Yet total direct operating costs, primarily mining, processing and related costs on a US dollar basis. We're slightly lower in Q1 2022 compared to the previous quarter, due in part to the weakening Turkish lira. Despite higher tons placed on pad at Kissaday in Q1 2022, compared to Q4 2021. In light of these significant increases in prices for electricity, fuel, reagents and other consumables required for our operations, we are closely monitoring the impact on expected full year direct operating costs and will provide an update next quarter. Capital expenditures were $61 million in Q1, of which $25 million was related to sustaining capital, including underground development, processing upgrades and equipment replacements and rebuilds, and $32 million was related to growth capital, including waste stripping and construction of the north leach pad at Kissaday. We are actively reviewing our growth and sustaining capital expenditures given inflationary pressures and volatility. We are practicing sound capital discipline by focusing on non-discretionary capital required to maintain production, asset integrity, and our license to operate. Income tax expense was $5.1 million in Q1, comprised of $16 million current tax expense, partially offset by $10 million deferred tax recovery. The current tax expense related to $4 million in dividend withholding tax, $5 million in investment tax credits received related to the Kisadek heap leach improvements, Quebec mining duties, and corporate tax and operations in Turkey. In Q1, Turkey announced a reduction in the 2022 corporate tax rate from 23% to 22% and reduction in the 2023 corporate tax rate from 20% to 19%. The deferred tax recovery of 10 million in Q1 was primarily related to the deferred tax impact of the impairment on the Sirtej project, partially offset by the impact of further weakening of local currencies. At quarter end, we had unrestricted cash, cash equivalents and term deposits of $435 million. Our net leverage ratio is at 0.31 times as of March 31st, compared to 0.89 times at the end of Q1 2020. This reflects a much improved credit profile for the company over the last two years. With that, I will now turn it over to Joe to go through the operational highlights.
spk05: Thanks, Phil, and good morning, everyone. I'll start with an important health and safety highlight from our operations. In the first quarter, we improved our total recordable injury frequency rate year over year from 8.1 to 4.7. Our focus on leading indicators such as leadership engagements and risk assessments is building a sustainable safety culture. Also, I would like to congratulate the Lamarck team for achieving three and a half years without a lost time injury. Moving to our operating results, we produced 93,209 ounces of gold in the first quarter with cash operating costs of $835 per ounce sold. Slide eight looks at our operations in more detail. Starting in Turkey, Kisladad's production in the first quarter was 29,779 ounces and cash operating costs were $861 per ounce sold. Gold production during the quarter was lower than planned as a result of COVID-related absenteeism, severe weather, and a government-mandated power outage. Lower production was also related to the reduction of tons placed on the heat bleach pad in Q4 during the commissioning of the high-pressure grinding roll circuit. The severe weather and breathing temperatures in Q1 led to lower tons stacked on the bleach pad, which is expected to negatively impact gold production in Q2. We anticipate production at Kisladad to be weighted to the second half of the year and maintain full-year production guidance. We continue to balance agglomeration and throughput with leach kinetics to obtain optimal performance. So far, the performance of the HPGR circuit is meeting our expectations, and we are seeing recovery rates as expected. At FM2 Group, first quarter gold production was 21,057 ounces at cash operating costs, of $648 per ounce sold. Gold production, throughput, and average gold grade at FM2Crew were in line with expectations. The operations were minimally impacted by COVID absenteeism during the quarter, and FM2Crew continues to be a high-performing asset with solid results. Current exploration at FM2Crew is focused on the co-carpenter and body vein systems, Resource expansion drilling at Coe Carpenter South has indicated a high-grade footwall splay to the principal vein and has potential for further resource expansion through step-out drilling. Moving to our Canadian operations, first quarter gold production at Lamoc was 33,377 ounces and cash operating costs were $763 per ounce sold. At Lamoc, reduced workforce due to COVID early in the quarter delayed the underground development of high-grade soaps, which led to lower-than-planned gold grades. Mine development progressed, and planned gold grade and tonnage were achieved in March. Full-year gold production at Lamoc is expected to be in line with guidance. In late March, we released exploration results, which included new step-out drilling at the Ormoc deposit that identified extensions to the known mineralized zones, both laterally and at depth. The ORMAC deposit has now been extended to a depth of about 800 meters from surface and remains open in multiple directions. With the Triangle Sigma decline completed, we are focused on an exploration drift and resource conversion drilling at ORMAC, which is expected to commence this quarter. Finally, let's move to Greece. At Olympias, first quarter gold production was 8,996 ounces and cash operating costs were $1,449 per ounce sold. In the early part of the quarter, gold production at Olympias was impacted by COVID absenteeism, power outages related to severe weather in the region. Operations resumed mining to plan and achieve planned tonnage and grade from the mine in March. Plant throughput in the second quarter is expected to be impacted by planned processing tie-ins to improve water treatment plant efficiency and capacity. Recent approval of an extended surface ore stockpile will allow mine improvements to continue as the water treatment plant upgrades are implemented. As a result, we expect production at Olympias to be weighted to the second half of 2022. Underground resource expansion drilling at Olympus Olympus has identified a new mineralized lens representing the western extension of the flat zone, which remains open to both the South and the West. Further step out drilling is planned for the second half of 2022. I'll stop there and turn it back to George for closing remarks.
spk06: Thanks team. Despite the challenges we faced in the first quarter, we are already seeing improvements at our operations in the second quarter. We remain focused on delivering safe operating results and executing our strategy to maximize value for our shareholders. Thank you for your time. I will now turn it over to the operator for questions from our analysts.
spk01: We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. We will pause for a moment as callers join the queue. The first question comes from Cosmos Chu with CIBC. Please go ahead.
spk07: Hi, thanks, George, Phil, Joe, for the presentation. Certainly a tough Q1. Maybe my first question is on your cost guidance. I appreciate that, as you mentioned, volatility in prices. You're closely monitoring it. We'll get an update in Q2. But I guess the guidance of 1075 to 1175 announced on sustaining costs
spk06: is that should we no longer rely on it is that now kind of like uh let's call it like uh previous guidance is that how they should look at it hi cosmos it's george um hi george you know what good morning you know if you when you look at the q1 dominantly production impacted us and so you saw an uptick in our costs phil phil give you some more color around the cost in Q1 relative to our expectations. The way we're looking at it right now is we don't have any indication from our Q1 results that the inflationary pressures are going to have an impact on the year. Now, there's no doubt we're paying more for electricity in Europe. There's no doubt our diesel costs are up, although we're dominantly an underground miner, so it's really Quesada that has the volume on diesel consumption. And we are seeing some higher reagent costs. But overall, when you look at our spend in Q1 relative to Q4 or last year's run rate for mining, processing, GNA, we're not seeing an impact on our costs to date. So Q1 was all about the issues related to lower production and no indication yet that our overall costs are being impacted. That's why our release talks about we'll continue to monitor this. We'll give you a further update in Q2 as to how well are we combating the higher costs from power, diesel, and reagents with other measures we're taking. So far, we didn't update our guidance because we don't have the indicators on the bottom line yet to say it's here. You know, we can't hide from the fact that there are cost pressures coming in some parts of the business and some of the commodities. Maybe, Phil, you can add some further color there. Sure. Thanks, George.
spk04: Hi, Cosmos. Hi, Phil. So I think George has summed it up pretty well. From a cost perspective, there's a number of – there's no doubt that, for example, we did have increases in electricity, specifically in Greece. We had increase in diesel prices in Turkey. But there's other factors that are also moving as well. For example, in Turkey, the lira continues to weaken, and that has offset. And if you look at the total direct operating costs in Q1, specifically our mining costs, our processing, and other related costs, even though at Kistadag, for example, in Q1, our tons placed on pad was higher than Q4, uh our costs in q1 2022 compared to those mining processing and related costs q4 were actually lower um so you know we recognize that there are price increases uh we're trying to get a you know just get more information in terms of the trend and um you know we're monitoring that as we say and we continue to look for opportunities as well to to be more efficient and offset those cost increases as well.
spk07: Of course. And then to wrap up this part of the question here, Phil or George, could you remind us what kind of year-over-year cost inflation assumption did you factor into your 2022 cost guidance? And is that consistent with what you're seeing so far?
spk04: maybe i can answer that cosmos so for example our biggest impact of inflation that we expected in our in our plan for 2022 was in turkey um the published inflation rate at the end of 2021 going into 2022 was i think it's between 50 and 60 percent and we fact that all then but at the same time um the impact of those those of inflation has been offset primarily by the by the impact of the weakening lira so we haven't seen you know when we convert it to us dollar operating costs in in turkey for both our operations combined uh throughout 2021 q1 all the way through to q4 our us dollar operating costs are pretty flat and that continues to be the case for q1 2022. got it thanks phil um maybe switching gears out a little bit um
spk07: You know, looking at Kiss the Dog, you know, I noticed that you did about a little bit less than 30,000 ounces in the quarter. You know, you've reiterated 145,000 to 165,000 ounces for the year. Just want to get a better understanding, you know, of how you're going to improve on your operations for the rest of the year. Maybe on two points, I guess, you know, grade decreased to 0.61 gram per ton in Q1. Are you seeing that, you know, improve now? And then the other point is, you know, as you mentioned, cold temperatures in Turkey impacted some of the conveyor systems. And so, you know, but now the HPGR sounds like it's coming up, you know, ramping up as expected. So could you maybe comment on recovery? So first on grade and how that's going to improve and also comment on recovery. What are you targeting for the rest of the year?
spk05: Cosmos, this is Joe. Maybe I'll start with... Hi, Joe. Maybe I'll start with kind of the production numbers or kind of the trend that we're seeing. So you're right. As in Q1, as we were using belt agglomeration in the cold temperatures, that kept us from, you know, stacking the planned number of tons. But we did see... good agglomeration, which has resulted in a couple of things. One, we're seeing higher solution application rates than pre-HPGR with the agglomeration that we have done, and that kind of speaks well to potential improvement in leach kinetics, which we have indications that that's headed in the right direction. As well, we have looked at the mine plan and grade, and as we have stacked in the beginning of Q2 through the month of April. We're about 10% ahead in ounces to pad so far this quarter, and we see that trend continuing. And we are meeting budget times placed on pad at slightly better than budget grades at present. So just with that, all those things look pretty good and we're optimistic. As we look at recovery, You know, total, we were targeting 56% and we don't see any indication of anything less than that. And, in fact, we're optimistic.
spk07: Great. Thanks, George, Phil, and Joe. Those are the questions I have. Thanks a lot.
spk04: Thanks, Cosmos. Thanks, Thomas.
spk01: The next question comes from Tanya . Please go ahead.
spk02: Great. Good morning, everyone. Thank you for taking my questions. I do have a few, and I just wanted to start with just on the quarterly performance. Just trying to get a handle. You've got stronger performance coming out of both Olympias and Kisledag for the second half. So how should we think about Q2? Is it going to be similar to Q1? and then we have this huge bump up in the second half, or do we have improvement quarter over quarter? I'm just trying to understand whether I do 60-40, 55-45. How should we think about that?
spk05: Tanya, this is Joe. We see a bit stronger performance in Q2, but still a bit challenged as the lower performance tons placed in Q1 at Kisladat, even though we are seeing favorable indicators on recovery and leach kinetics. It'll come up in Q2, but it'd still be weighted to the second half. And at Olympias, we took the opportunity in Q1 to set ourselves up for the second half. As it mentions in what we spoke earlier about water treatment plant and efficiency and quantity. So given the fact that we knew we were lower tons in Q1, we decided to make some adjustments to allow us to increase capacity of the water treatment facilities and do some different tie-ins with how we're using our thickeners. So we set the mill up to be able to run a bit higher than planned in the second half. And as mining has progressed reasonably well over the past four quarters and continues into Q1, we also have a stockpile arrangement now where we can continue in Q2 to make a few more adjustments in water treatment and have the capacity to run those tons off the stockpile before the end of the year. So we're reasonably comfortable in both of those that they'll be more second half weighted. At Lamarck, we got a little bit of a slow start on development. And as we were transitioning from longitudinal long-haul methods in C4 to transverse, it requires a little bit more development. And a slow start to development in the year cost us a bit of grade. However, we are running ahead of budget development rates now and see Lamarck coming back reasonably well in Q2 and continuing for the balance of the year.
spk06: Maybe I'll jump in with a little more clarity on Kisada. So because it's a heat bleach pad, you kind of have to look at two sets of numbers. And so as Joe described in his earlier comments, you know, we had a tough Q1 due to weather. and we were ramping up the agglomeration of the ore on the conveyor belt, and we're seeing, we expect to see a strong Q2 and recoverable ounces placed on the pad, and even a stronger second half. So we're ramping up recoverable ounces placed on the pad, and we're comfortable with our guidance. Then when you look at ounces produced, because there's a delay between placing the ounces and pouring the gold, Q2 will ramp up over Q1, but it's going to be a significantly stronger second half just due to the delay between placing the ounces and then the ounces coming out on the pond. So the trend will be up both on placements and production, but weighted to the second half on ounces per.
spk02: Yeah, I'm just trying to understand, like, so Q2 overall for the company will be better than Q1, and then is Q3 better than Q2 and then Q4 the best, or are Q3 and Q4 the same?
spk05: Q3 and Q4 will be similar. Q4 may be slightly better.
spk02: Okay. And that's mainly driven by Kisladag?
spk05: Correct.
spk02: Okay, that's helpful. Thank you. And then just if I could ask, Phil, we were kind of really low on our care and maintenance costs, specifically at Strattoni in Q1, and that was our biggest miss. Can you give us some guidance on what these care and maintenance costs are going to be? It was like 9 million or something in the quarter.
spk06: Yeah, it's George. So our overall care and maintenance costs on an annualized run rate are around 2.5, 3 million bucks, I believe. In terms of the quarter, we had a heavy impact as we were transitioning from the shutdown of the the underground and then the transition of the plant. So it's, I'd say, an extraordinary impact on the quarter.
spk05: Coupled with that, we had some early retirements that we had to cost in Q1. As well, any other kind of departures that we saw, those were accumulated in Q1 costs, and we may see a bit more of that in Q2 before we normalize to the numbers that George mentioned. Yeah, Tonya, it's Phil.
spk02: Yeah, Phil, yeah, something we use then for looking at Tony separately from Scourius, because we're assuming Scourius starts construction in the second half, so it won't have care and maintenance costs.
spk04: That's correct. But just to summarize, I think the future quarters will be lower than, we expect to be lower than what we had in Q1.
spk02: So if we use like 10 million a year for scrutiny, is that reasonable?
spk04: I think that's a reasonable number, yeah. Like we had some, for example, like Joe mentioned, we had some labor costs That's for Tony that may still have some of that come through in Q2, but I think most of that has come through in Q1. So we expect the future quarters will be less than what we experienced in Q1.
spk02: Okay. And then maybe just on the CAPEX and OPEX review that you're looking at, and then I'll get to my final question, which is inflation. When you're looking at all of your operations, are we also to assume that you're going to review SCORES again?
spk06: Could you repeat that?
spk02: Will you also be reviewing the CAPEX and OPEX SCORES again? You just did the feasibility study in December, but is that under review also in your review process?
spk06: So on the initial capital costs, maybe just to reiterate where we're at on the project, you know, the main body of the plants in place. We believe that the overall capital cost is largely reduced relative to other projects that are starting from scratch. So all of grinding, crushing, flotation, concentrate handling, all that major gear is actually set in place. In fact, we're putting the building up around it. The exception in the processing area is just the filters. And, you know, we went out for competitive bids in the first quarter for the filters. And those bids have come in slightly below what we budgeted in spite of higher inflationary pressures on steel. So that, I think, was a pretty good indicator. And that's essentially the biggest piece of equipment yet to be procured. And when you look at what's left to be done, there's a lot of civil work. You know, there's a lot of plumbing and piping and wiring to be done in the plant. But at this stage, we're pretty comfortable with those capital costs. We have civil works to do in construction of the dam. You know, obviously, diesel prices are up. And during the construction phase, we're not consuming a lot of electricity. So, you know, we don't see those issues having a major impact or a material impact on that capital cost estimate. Obviously, we'll continue to monitor that. But Tanya, I think we're in a pretty good position still on our capital estimate of December.
spk02: Okay. And just on the inflationary pressures, I guess, you know, would you say it's, you know, you're seeing it at all of your operation or is it more localized to Turkey and Greece because of it's, you know, closer to the to the Ukraine-Russia situation where other companies are feeling more exposures on consumables than other?
spk06: Well, I'd say the unique thing in our situation is that our two operations in Europe are seeing higher electric energy costs, and it's being driven by the natural gas crisis, and so costs are up materially in both countries. Now, in In Turkey, we're having some benefit from the currency, as Phil denoted, but we don't have that sort of counterbalance effect in Greece. So I think our electric power costs are up. They're double what we had budgeted in Greece, and we're not seeing that kind of impact in Turkey due to the FX counterimpact.
spk02: And maybe just a comment.
spk04: Sorry, go ahead. Just a comment. Just a comment, Tanya. So just to add on to what George has indicated, I think I would say the most significant impact of inflation is in Turkey. As I mentioned, the published rate was quite high, between 50% and 60% at the end of 2021. But we're not seeing that come through to the bottom line because of the lira. But in Turkey, probably the most significant cost is the diesel impact. at Kisadek, but it's not a huge amount. It's probably around less than 5% of our consolidated direct costs. It's really just the use at Kisadek because it is an open pit mine. All the other mines are underground. In Turkey, the biggest impact, as George has outlined, has been the electricity. At the same time, electricity on a consolidated basis is about 10% of our total direct operating costs. So again, it's not a huge, huge percentage.
spk02: Maybe Phil can remind us what oil price or diesel price did you use in your guidance for 2022 and what's the sensitivity for a $10 a barrel or a 10% change in diesel price?
spk04: So in terms of diesel, The current price is about about $1.25 a liter. In in Turkey. And everywhere else in terms of diesel at FM True Crew Greece and in Quebec, it's really not significant. So again, diesel is about 3% of our total costs. And the impact on our costs, you know, based on our 2022. guidance for sales is probably around $13 an ounce. It's not huge.
spk02: Take it offline. Thank you. I'll let someone else ask.
spk04: Thank you, Tonya.
spk01: Once again, if you have a question, please press star, then 1. The next question comes from Carrie Smith with Haywood Securities. Please go ahead.
spk08: Thanks, operator. Phil, maybe you can answer this, or maybe Joe. What is the grade profile like at Kishidae quarter over quarter this year? Is the grade expected to be pretty flat and you're getting more ounces on the pad because you're getting more tons to the pad, or is the grade profile actually going up as well?
spk05: The grade profile is relatively flat, Kerry. Maybe slightly better later in the year. I don't have it in front of me, but I think we're right around 6.65, 6.6, quarter over quarter. But it's really about getting tons on the pad at mine grade. So what we saw in Q1 a bit, though, is that when we had – We picked up some tons above cutoff that were on the lower end of grade that kind of pushed us down. So as we look forward in managing grade, those marginal tons above cutoff, we will not bring to pad, which will help us with grade for the balance of the year. But we are stockpiling that lower grade for later placement.
spk08: Okay, okay. And when do you start putting tons onto the NORC pad? When is that actually available to be receiving tonnage? Because that'll obviously help the leach curve too.
spk05: Well, I think there's two answers to that question. One of them is that, you know, we did place additional interlift plastic on the south leach pad for the early placement of HPGR tons as we work through what we expected to be getting our agglomeration right, and we're going to extend that a little bit. We will be available for placement probably mid-Q3, but one of our concerns is just making certain that we're really confident on agglomeration quality before we go to the north leach pad since that's the foundation. But we will be on clean plastic nonetheless, even on south. And I would say that we'll have that, you know, we'll know that more clearly by mid-year as to how we wish to deploy that going forward. But you're right, I mean, the north leach pad is really attractive.
spk08: Right, right, okay. And they're just going back to a timeless question on the majority standby cost, the 9.4 million in Q1. So if it's two to two and a half to three million a quarter on a go forward basis in Q2, we'll still have some residual costs in there. Sort of one time things. What what number are you expecting in Q2 then? Like, is it going to be five million maybe or six million? Can you give any guidance?
spk04: Yeah, Kerry, it's Phil here. So I think, you know, based on what we had in Q1, I would say, you know, probably less than $5 million, but I think it's probably in that ballpark per quarter.
spk08: And then by Q3, you would be back to sort of this $2.5 to $3 million run rate, then you'd have all the one-time things out of the way. Is that right?
spk04: By Q3, you know, assuming we get scurrious returns, reconstruction started, then the care and maintenance costs related to scurries would end.
spk08: Yeah, OK. But I'm talking to Tony, though.
spk05: Kerry, this is Joe. By end of year, we should be normalized fully. But the start of construction of scurries offsets any residual labor that's still on the books. choose to maintain that before and move it over to contract labor at the start of construction.
spk08: Okay. Just so I'm clear, that $2.5 to $3 million run rate is with Scurrius not contributing any care and maintenance costs to that number, right? That's just for Tony?
spk05: Correct.
spk08: Gotcha. Okay. Okay. And then, Phil, just going back to your comment about you're not really seeing any us dollar terms anyhow any real cost inflation in um in turkey but are your are your unit cost per ton no in for mining milling and dna let's say on a pretend basis they seem like they're going up at well if they went up a lot of olympias based on what i calculated and it seems like kishida has gone up a significant amount as well it was like 14 and a half a time in in q1 and last year it was slightly below 11 bucks so How should we think about your unit cost per tonne at Kiss the Egg and Olympias on a go forward?
spk04: So Kerry, just to be clear, your question is specifically to Olympias? Or Kiss the Egg?
spk08: Yeah, so if I look at your total cost for mining at Olympias from your Q1 in US dollars divided by ounces sold, it's like $350 a tonne. that number last year was like was well below that it was you know 270 or something so i'm just wondering about the all-in cost per ton going forward at both olympias and kissaday kissaday tons in q1 2022 as i mentioned were lower than q4 um it's already higher than q4
spk04: But they were lower than the first three quarters of 2021. So tons were down compared to, you know, the first few quarters of 2021. And we expect those tons will increase.
spk08: Right.
spk05: Terry, this is Joey. Are you thinking in total tons, strip plus, or are you thinking in just or tons? So we're giving you the numbers back in or tons.
spk08: I'm thinking of all the... Yeah. Yeah. All in cost divided by tons processed. Tons milled, tons leached.
spk05: We can get back on the consolidated number, but just just for your information, total tons moved in Q1 was higher than Q4 or Q3.
spk08: At just today. At just today. Yeah, so in my numbers, in Q4 at Tishida, your cost per ton to the pad was about $19 a ton. In Q1, it was about $14.5. But last year, average was less than $11. So I'm just wondering about that number on a go-forward basis. Is it going to get back to around $11 a ton? And then I have the same issue with Olympia. The cost per ton milled is quite a bit higher in Q1 than it was in, well, it was higher in Q4 as well, but it was certainly higher than last year. And last year was kind of a year when every quarter you kind of incrementally were doing better on the cost side as you got more tons up. But then obviously Q1 was pretty tough for you. So that's what I was trying to get a handle on.
spk04: Yeah, Kerry, it's Phil. So tons in Q1 2022 were just over 2 million tons for Kissaday. In Q4 of last year, the tons were below 2 million tons. So that's why you had a higher... cost per ton in Q4, but then the previous three quarters were over 3 million tons. So you had a much lower cost per ton. So that's why you see that fluctuation. And I think going forward in 2022, we expect to be over 3 million tons, probably approaching on a quarterly basis, you know, above that placement rate per quarter. So you should see the cost per ton drop again.
spk08: Right, okay. Okay, so 3 million times a quarter in the cost should come down then. And then what about Olympias just on the cost and the total cash cost guidance? I was looking at the grade in Q1. Obviously, it was pretty low. Your guidance was 7.4 grams. It seems like based on the ore body, it'd be pretty tough to average 7.4 grams this year. But what will the grade look like at Olympias this year? And... you know, is it gonna probably be more in the seven gram range, which is kind of what I was thinking.
spk05: So Q2 today, Gary, we're placing at 7.4, or we're mining at 7.4, and, you know, for the full year, we're working to maintain the grade as close to that as possible, but we'll be, in forecast, we're 7.3, 7.4,
spk00: Okay.
spk05: So we're looking to maintain that grade rate as we have at the start of Q2.
spk06: Okay. Kerry, it's George. One of the other issues in Q1, because we have significant byproduct credits at Olympias, you see lumpiness in our costs, and it's dependent on the lead and zinc con, but those shipments occur when we've got a full shipment to ship. And sometimes those costs are also impacted just by timing. You get tough storms at the end of a quarter, we can't get a ship out and it moves to the next quarter. So when you look at Q1, we had a lot lower byproduct credits against our cost relative to Q4, just due to the lumpiness and timing in byproduct sales. It's only a part of the story. You know, the COVID impacts were part of it. We also ended Q1 with four stockpiles on the ground, which is not typical at Olympia. So it's kind of positioned us a bit better to start Q2. So a number of factors that don't show up in the bottom line that, you know, I think help give you an indication of why we, We're confident we're going to improve performance out of Olympia as quarters unfold.
spk08: And George or Phil, are your TCRCs, have they gone up significantly in Q1 from what you were paying last year for the concentrate? Because you don't produce a lot of cons, so you're probably not getting great terms, but have the TCRCs gone up significantly in Q1, or should we expect them to be much higher going forward? I know you've talked about it a little bit in the commentary.
spk04: Yeah, so Kerry, so last year there was a new Chinese VAT that was introduced for concentrate from Olympias that was being shipped to Chinese smelters. So that was a 13% VAT. Now, we had planned to offset a big chunk of that, and... Part of the plan was to ship that, I think it was up to 50% of the production to a Russian smelter. And unfortunately, with the sanctions that have been imposed recently because of the ongoing conflict, we're redirecting some of that. And we've managed to redirect a small portion of it at this point, but we will continue to look for opportunities to redirect it to different smelters and avoid the 13% VAT imposed by the Chinese smelters?
spk06: Just to be clear, we're no longer shipping anything to Russia. Some of that now is going to China, but some of it's going elsewhere and avoiding that VAT. Right now, that's a negative against what we budgeted. No shipments going to Russia and So part of that we're paying the VAT into China, and part of it we have found another customer that's testing the concentrate. Hopefully we'll be able to ramp that up.
spk04: And, Kerry, just, you know, the impact of not being able to ship to Russia is about $5 million.
spk08: Okay, okay. So that was in Q1, like so?
spk04: No, totally. That's totally here.
spk08: Okay, for the year. Okay, gotcha. Okay. Yeah, so you're not really seeing any significant increases in your treatment charges. Generally, it's just this tax that's causing you a bit of a problem. Okay, I got it. Yeah. Okay, great. Thanks very much, guys. I appreciate it.
spk05: Thanks, Harit.
spk01: Once again, if you have a question, please press star, then 1. The next question comes from Fahad Tariq. with Credit Suisse. Please go ahead.
spk03: Hi, good morning. Thanks for taking my question. It's pretty quick. On Scouries, can you just remind us, you mentioned the snowfall impact on some of the other operations. Was there any impact on Scouries? Thanks.
spk05: We did have snow at Scorias, but it didn't impact us anyway. And as far as, you know, critical path for project, we were able to slow down the steel erection and building cladding during that time period. And we have since picked up without any type of penalties. So really no impact and no significant impact on of water systems or drainage or collection or that kind of thing.
spk03: Okay, great. I just wanted to confirm that. Thank you.
spk01: That is all the time we have for today and this concludes the question and answer session and today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.
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