Aeris Resources Ltd

Thank you everyone and thank you for joining the ARIS resources core activity support presentation. As a start, it's fair to say that the third quarter was a bit of a disappointing quarter and a bit of a more interesting type of quarter for specifically at Twitham, but also the impact of the production throughput of Mount Collin Tuns through an due to the rain events we had up in northwest Queensland. To summarize, the corporate equivalent production at 11.1 thousand tons was lower than the previous quarter, but if we were able to treat those tons out of that colony, it would be significantly different. We'll talk a bit more about the impact of those. At Triton, budgerigar delays still impact. We're now delayed by over nine months. And it's really just timing of getting the raised bore through. And as we speak, they're busy setting it up. And they will start drilling it by Monday. And we should have the ventilation shaft up by mid-May and then production into budgerigar. At Mount Colin, we ended up the quarter with 135,000 tons, roughly about 3,200 copper production metal tons on stockpiles. That was worth about $25 million of revenue or net realizable value, which we didn't bring into the quarter. But since then, 100,000 of that has already been treated and 30,000 is being treated as we speak. So most of that stockpile has already or will be all treated by the end of April. And we'll go through a bit more detail on whether we see Mount Colin. On the cost side, you know, we all know cost has been challenging across industry, but I must congratulate the teams. They're doing an amazing job to keep costs under control. In the environment, we see power costs going up, labour costs going up, but they have done an amazing job to keep the costs under managing the cost on a monthly basis at all four of the operations. On the capital spent, we have put a huge effort in specifically at Jaguar Mine and Krakow to manage the capital, to ensure that we don't spend unnecessary money. And you will see in the next slide, we are revising our capital forecast down specifically around the management of capital and managing the balance sheet. On the exploration side, every quarter we show success. Every quarter, this quarter, it's about JAG. At Jaguar, we found a new deposit called Bacalar. And what we're seeing at JAG is as we drill, we find more. And what is in the benefit is as we try to get down to Turbo, there's more and more ore bodies on the way through to Turbo. And we'll touch on that going forward. On the corporate side, we closed the cash and receivables with $56 million. As I said, that $25 million impact on Mount Colin all made a difference, and that could have been significantly more than that. We still have no debt. And on the stockman side, feasibility study is well underway. We had a detailed, in-depth review in the last two weeks, and it remains a very exciting project for us going forward to bring that into production as soon as we possibly can. Those who have seen the announcement this morning, you would have seen we revised our guidance, but it's only on the copper. And that's really impacted by Mount Colin on a major, major impact where, as I said, we're at 135,000 tonnes at the end of the quarter. That has now been treated. But at this stage, we have only one more block set aside of 30,000 tonnes, which will result in about 90,000 tonnes of stockpiles at the end of the financial year. Now, we will keep talking to the tall treaters and see if we can get another slot in June. So they're potentially upside to that. But at this stage, there's about 2,000 tonnes, which we were planning to bring into this quarter's production or this last quarter, which we potentially might not be able to. And that's one of the reasons why we've downgraded the guidance because of that. That doesn't mean the tonnes are there. The tonnes will be on deck. It will just come through in July instead of June. And that's just the unfortunate side of timing. And when you are a tall feeder or you rely on third parties, which had their own issues with the rain events up there, you need to respect that as well. At Tritton, as I said, budget has been delayed. That said, though, the team at Tritton has done a really good job identifying opportunities to catch up. We're looking at – they have been assessing and are planning to mine remnant pillars, which is high-grade pillars available to us, which is already ready to go. We're mining the south wing. So we're bringing in other sources to try to catch up on Bajigar. But there's risk associated with that, and we decided to be realistic in the guidance and downgraded Triton as well with 2,000 tonnes, which then resulted in that new guidance. On the capital cost, our regional guidance was $173 to $213 million on total capital. We now downgraded that to $139, so significant downgrade on capital, but it's purely capital at both Jaguar and Krakow. All the growth capital is spent at Triton. Mount Collin doesn't take a lot of capital. And the capital we delayed at Jaguar was necessary because of the understanding we needed for turbo, whether you put the leak on and how quickly you get there. And the guys have worked up some alternative options in the short term to improve ventilation and pumping, and that's being implemented. Obviously, when you drop 4,000 tons potentially out of your copper production, that will impact on EBITDA and we revise EBITDA accordingly down to $50 to $70 million. I'll just touch base on a few other things we've done. On the sustainability side, we had one lost arm injury, which was unfortunate when an operator thumb was degloved while working on a draw rig on a And on the sustainability side, we have now launched an internal project to have all the data ready for release as part of the annual report, have a baseline sustainability report, and that will go out with the annual report. But at the board level, we've restructured the board as well to become more compliant. The sustainability was normally stability and risk. We've now put all risk to the audit committee and the sustainability committee is a separate and really focused on strategic way forward on sustainability. On the environmental side, we had two bigger events which were reportable. The one was the water level at Barbara because of the heavy rain we had in northwest Queensland. It was just reporting on water levels. And at Tritton, we had a bushfire which was a result of an angle grinder setting the bush alight and that has burned down some properties and also ended up in some power loss which had a small impact on production but not material. I'll just touch on the operations at Tritton. We did 3,900 tons. The main thing was the ventilation for Bajigang. You can see the picture on the right-hand side. That was the piling we did, so you do down to 30-plus metres. We did these piles, which will now stabilise the ground. The pilot hole is in, and as we speak, they're very busy setting up the raised bore to pull that through. So by mid-May, We will be able to get the ventilation on, and then we can mine those stoves, which has already been set up out of budget. We just can't mine it legally if you don't have proper ventilation in place. We will also see a significant improvement in grade coming out of a Boca tank. Look at the tank. I was there underground the other day. That photo is a photo of ore sitting there, development ore. We're not allowed to stope until we've got the second egress in place. That is being done as we speak. And as soon as the stove's ready, and those first stoves, we expect to come out at around 4% to 5%. As we drilled that area, did some grade control drilling, we had an interesting surprise on the upside. on the resource. As you know, the resource we thought was about resource grades about 2.5. We see grades about 4% in those first stopes. And that's why it's very important to get those high grade stopes to the plant in the fourth quarter to push that production volume through the plant. So as a result, we've changed the quarter forecast to 5,000 to 6,000 tons, which is still significantly more than what we've achieved in the last three quarters. But that is on the back of those two operations coming online, plus the opportunities the guys identified, which we will still mine, even though a bunch of you guys coming online. And our operating cost and capital, as I said, no change in guidance. The guys are doing a really great job to managing on that side of the business. On the exploration side, we spent $15 million on growth projects and exploration. I talked about Avoca Tangwood. We've seen some real good grades coming out of it. We have put a resource out of Karajong. It was always just an exploration target. Now, that's sitting at 2.2 million tons at 1.7% copper, but there's a high-grade zone of 1.1 million tons at plus 2.5% copper. So it's a significant opportunity, and it's still open at depth. We also have moved the focus a lot to the north. You can see that VTM, we've done the VTM, we've identified the targets. So the guys are busy working through those targets and we're planning to do some drilling in the next three to six months on some of those targets. But we also drilled three holes at the 5M7 target, and we've seen we did get sulfides. We're waiting for the results to come back, and then we'll see if there's something material or something to do more work in that specific area. Jaguar. Look, although 4,200 tons is lower than previous quarter, we did plan for lower grades from those stoves, but there was an impact from a seismic event which has impacted production a little, but it's not material enough, or it's not that material that it will impact gardens. The guys are working through those, and they are impacting production. What is very interesting, you can see that picture on the right hand side, where that area sits, it's at the bottom of the mine. And as we drill it, we got the bacalao deposit, we got turbo hanging wall, even java deeps. So there's a lot of opportunities. Originally, when we looked at it, you were just going to have a barren area, you're going to put development through to get to turbo. But as we drill it, we keep on finding more and it looks very interesting and trying to put the plans together to get access. to those turbo deposits. And that's all plans for FY24 in trying to get there and start that. That is one of the turbo deposits, still one of the biggest lenses in the Bentley mine itself. So that's quite exciting. They have managed to retail their capital. We have made decision to move growth capital for ventilation out to FY24 and start the development we've started now to get down to turbo. So some capital has been moved, but there's also been a focus to save on capital as much as we can as we move through FY23. Excuse me. This is just some of the intersections in that bucket. You can see the copper grades, 3.7, nearly 2, 2.9% copper with good zinc That is a great deposit, a great farm. And there's more work now being done to draw that out and understand that whole ore body around Turbo and further down there to get to Turbo. So this has been a really good outcome for the Jag team. Woolworths Queensland, they did 1,600 tons of copper. As everyone knows, there has been a massive rain event, and NSNG was out for quite a period of time, and it was just not possible for us to put all the tons through the mine. And there was, as you can see there, 135,000 tons of 2.4% copper left at the end of the quarter. That has now been treated and it's really going forward. How do we can bring that forward? The team has put an extraction plan in place. So that is on the right hand side. You can see the extraction plan basically to get out of Mount Collin in the next 15 months or so. And there's a clear plan being developed and strategically developed to manage the exit of Mount Collin and ensure we get the returns we're looking for. The potential of having 90,000 tons of stockpiles has been brought into the guidance, as I said earlier, and efforts will be made to see if we can reduce that significantly by getting another treatment slot. The barbara deposit has now been drilled. Engineers are looking at the, and the geologists are looking at the resource, update the resource and update the block models to see how does that work as an open cut or as an underground and see if there's potential to move from Mount Colin to Barbara in using the same process. Barbara has previously been mined as an open pit. That was struck to Mount Isa, so that opportunity still remains there to do exactly the same, but also look at the underground extension of that ore body. At Krakow, look, this is... the best operating mine currently in the business. The team is doing exceptionally well in managing cost, managing production, managing compliance to plan and have achieved 13,000 ounces of gold. What we're also seeing, you would remember in the first two or three quarters, we talked about the reconciliation between grade control drilling and actual grades. Mine was always a challenge. We now got that under control. We're getting very good reconciliations, so we know where we mine and what we're getting. And now what is happening now that there's time and effort, we can look at these new opportunities that have been identified. You can see on that slide on the right-hand side. Drilling is underway and testing new areas where we think there might be opportunities to extend that western rain field even further from what it is today. We have revised the capital guidance, as you can see. And a lot of that is purely looking at, do we have to spend the money? Can we move it out? Or can we just have to do everything? So the team has really worked hard. As I said before, the Krakow model has been for a long time. You need to make money to put in exploration. And these coal prices are actually starting to generate money and spend money on exploration. Interesting new technology. Well, for me, it's new at least. At the southern vein, which we now focus on because that is where we still have a view that that's our best exploration target nearly in the business. They did an ANT survey. That image on the right-hand side is the first data from that. And it's all trying to identify where the structural geology is moving to the south. and um that's just the first pass but some that was other work will drive the exploration plan to test that southern veins though golden plateau still remains high priority um the idea with golden plateau is we now get a resource on it um put an exploration drive in drill it out and then start mining it as quickly as you can because there's some potential for three plus four around four percent four gram a ton gold or three to four gram a ton gold sitting in those in the golden platter deposit and then you bring that into production while you still got some funds in the western rain field. At a corporate and projects Stockman is going really well. Feasibility study, as I said, we had a detailed full-day review the last couple of weeks. The permitting is underway. We're doing now some technical work on mine drainage. We're doing some more work on the meteorological processing side of things. We have registered now vegetation clearing offsets. Some of it is already underway. Some of it is still negotiating. But a lot of that work and network has been done and obviously very close to the community. We've got regular quarterly meetings with representatives, and that project is going to plan and still on track for a study to be finished by the end of June. That photo on the right-hand side is an interesting photo. So that's the current infrastructure. You can see the roads. You can see where the plant site's going. You can see the TSF at the back, which is already in place. So a lot of that road infrastructure to get to all these mines, the Currawong and Wolga, is already in place and has been there for a long time. So we'll keep you up to date, but really it is all good meetings next week with the government to make sure there's alignment. But we have yet to see any reason why we can't do this. So all everything's on track to deliver this project. At a corporate level, you can see the cash we talked about it, the cash on sea was at 56. We got a bit of hedging left. So there's some gold hedging, which is obviously out of the money at this point in time, 2,700. But it leaves a gold hedging, the copper hedging at 3,000 tons at 13,200 in the money. So we haven't got any hedging at this stage planned post-June, but we always look at opportunity and being a bit opportunistic on hedging. But that will be part of when we finalize the budget for FY24. I guess the key takeaway is, for me, crack on, Jack. done a great job, well on track on guidance. Triton had its issues, but we can really see the light at the end of the tunnel now with Bajigar and Avocatank coming online in production this quarter. And then what I need to probably stress is the production from Mount Colin, which is on stockpiles, plus the delayed production out of Triton and Bajigar is not lost. It will just come in the first quarter. That's what we don't mind. in this quarter will just be in the next quarter and unfortunately it falls over financial years. On the exploration side, we talked about the success and there's a clear exploration strategy for each one of these mines to keep delivering successful exploration and then extend the mine life of these businesses. I guess that sort of summarized the quarterly results.