B2Gold Corp. (BTG) Q2 2022 Earnings Report, Transcript and Summary

Good afternoon. My name is Pam, and I will be your conference operator today. At this time, I would like to welcome everyone to the B2Gold Second Quarter 2022 Financial Results Conference Call. All lines have been placed on you to provide any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Mr. Johnson, you may begin your conference.

Thank you, operator. Welcome, everyone, to the B2Gold conference call to discuss the results of the second quarter of 2022. As you can see from the news lease we put out, we had another very strong quarter. We beat our budgets in a number of areas. And very importantly, we're able to maintain our guidance for 2022 even in this current environment of inflation, what we're seeing in the world. So a very good first half. We have guided that we're going to see some higher cost due to inflation primarily in the second half of the year. But because of the start of first half of the year, we remain on our guidance for 2022. Then Mike is going to talk a little bit about the details of the quarter financial results, but I just want to give a little summary for that. So as we said, very happy with the results. The other significant announcement we made today was that we are not going to proceed at this time with the development of the Varroate project, our joint venture, joint venture, was Gold Chevy. -- both parties that have agreed at this time that it does not meet our economic thresholds to go ahead and develop the project. We had -- are in the process of doing an updated feasibility study, which will be completed in the third quarter of the year. And we had some hopes that we could approve the economics of Gramalote from what we had in the previous study, which indicated a $1,500 gold to about a 15% IRR, but we thought there was potential to improve the economics in 2 ways. One was to look at some of the different engineering approaches and design approaches to try and bring that capital cost down through some high-quality engineering work and some good work was done to actually reduce the footprint of the project as well. So the good news was that we knocked a little over $100 million off the original projected capital cost, which was over $900 million. We actually managed by doing this different approach to the project technically to bring that cost down, as I said, by over $100 million. But inflation really bid at this time, not surprisingly looking at the construction protagnitume. So most of the gains from the reduction of capital were wiped out by the effect of inflation. The second thing that happened was we were hoping that with some additional infill drilling, we could perhaps improve on the resource in the sense of increasing then amounts, so we can divide the capital cost by more ounces, which made sense. Unfortunately, drilling is hard to predict. So we didn't get additional ounces we hoped for. We had a bit of a drop in grade with infill drilling. So for now, the good news about the Gramalote project is projected operating and all-in sustaining costs have always been low and they remain quite low. The biggest issue is that a big capital cost of front. So we're going to now look at our alternatives. AGA and ourselves have signaled that we're each going to look at our turns going forward. And clearly, they would need to go on a -- maintain our permit and continue with some of our resettlement planning and things that we've been doing there. We've done a lot of work there, continue with that work while we evaluate the alternatives going forward. And clearly, the alternatives would be -- is there a smaller project. We've played around that a bit before in the past. Is there a smaller project that makes sense for the large scale we were approaching with -- or does it make sense to look to sell the Gramalote project. So both companies are -- each company has to make this determination, and we're reviewing all the various alternatives. But we do have a permit in place and this decision was based on really the -- using our capital, our very strong financial position and how we want to utilize our capital -- so part of that focus going forward now in terms of use of capital will be to consider even increasing the amount of drilling that we're doing, what we call now called the Fekola complex. So the engineers like to call it, which includes the coal misfeasalandat goes all the way to Atacadao and made many targets in between. We continue to get really good drill results that suggest we're significantly increasing the 3 million ounce resource that we had released before for the Atacama area, in the further north area of the Fekola complex. We continue to get good results. And most importantly, not only in the levers material down to 50 meters, but below that, we continue to get some very good intercepts some good grade, good wins, given the sulfide below. So we do believe that there's tremendous base potential here. We've seen some of it, but we're very much in the early stages in the coal complex with the drilling we've done when we look at the multiple targets. The amazon itself in Anaconda is really getting our attention in terms of -- in the short term, it shows the potential that the dealing done so far to be another Fekola-type deposit and maybe have that sort of size implication and potential. In addition to that, the drill programs can be a lot of rigs focused on Manmato see how made that gets, but also drilling many other targets and other deposits that we now have in this bill. So we're very focused on that because we can in the short term as we're planning, as we said before, Stage 1 at exploiting the Anaconda area is to truck the ore formations from CARDINAL and potentially other sources like the recent to the project we acquired through AkolResources. So we have almost in the barrage of benches and opportunities to truck various site staff that Recall that we're going to be moving some of that material later on this year from some of these sources of mineralization or deposits we will be able to increase production simply by trucking good-grade material. -- by 800,000 ounces a year for calling. So it's a real positive. It really improves the life of mine which we'll be coming out soon with life of lancet significantly improves what was already a strong life of money for Fekola. So lots of news to come on. We'll be coming out soon with additional drills from this area and let you know why we're very excited about it as a significant project, not only in the first stage of trucking separate material, but the second stage, which would involve building a second mill solar in the anaconda area. So that's something worse we're having a hard look at right now, obviously, it's subject to further successful drilling results, but what we're seeing, we're very confident that there's going to be a stage 2 year, which would entail subject to further drilling and feasibility, et cetera, building a second mill. So the Fekola complex in our mind, for what we're seeing so far clearly has the potential to significantly produce gold production on Stage 1, but also in stage 2. So difficult complex on day producer the year. We think that's the kind of attention that we're seeing. So we'll be really focused on that. In terms of other things, we're beginning some very encouraging drill results in Finland as well in our project there that patent to the roofer resources exciting new discovery in Finland. So we're news to come from that. And beyond that, we are -- I think as everyone knows that everyone in our sector is looking at M&A alternatives opportunities. So we're looking at a few things right now. We're in an enviable position because we have a very stall cash position. We decided not to go ahead of Gramalote. So we're in an extremely strong cash position with no debt and are able to continue to pay one of the leading dividends on a yield basis in our sector, but also have significant amount money to devote to exploration and potentially the next development projects in the carve-out -- but also, if we find something we like, we also can use our strong cash position when we look at M&A without the need to significantly deli our shareholders. So we're looking for opportunities. There aren't many projects were moved with out there. There's a few. And sometimes it's hard to find a dance partner willing dense partner in terms of looking to grow in our sector these states. But we continue to look at if we do a deal, it won't be because we view ourselves seeing it. It's because we will have found something that we like and we think is accretive for our shareholders. And then we'll do what we've always done, which is to bring our great technical team to bear not only to build these projects, but also our exploration team has had tremendous success in every acquisition we've done in the last 15 years and finding additional gold, which we don't pay for an acquisition, but we've had a great track record of doing that. So that's where we sit. We're very, very happy with the quarter. It's Mike's going to tell you why, and we think we're very well positioned for continued growth in our existing assets and also looking at the potential for responsible, accessible accretive M&A. With that, I'll pass it over to Mike. And I will open it back to Mike for your questions.

Thanks. So let's start -- I'll just run us quickly through the second quarter, some of the main results. So firstly, on the revenue side, we had a good revenue quarter. We sold 205,000 ounces at an average realized price of $1,861 per ounce for revenues of $382 million. So it's a bit higher than we thought we were going to have. Obviously, we sold a bit more than we thought with positive production and also revenue was higher than we forecasted. On the production side, total from our operating mines, 209,000 ounces from our 3 mines for the quarter. We included our share of calibers results, total production reported was 224,000 ounces. So both of those total is probably in line with the budget. Fekola had another strong quarter, 123,000 ounces, in line with budget and its Fekola's processing facilities actually achieved record quarterly throughput of 2.42 million tonnes in the Q, which is very impressive and higher-than-budgeted throughput, though was offset by lower-than-budgeted mill feed grade as we use the gain, low-grade stockpiles to feed that additional budgeted feed. Reminder to that Fekola's production is expected to be significantly weighted to the second half of 2022 when mining reaches the higher-grade portions of Phase 6 in the Fekola pit. I should also comment on the recoveries in the quarter were slightly lower, 92.4% in the budget of 94%. And that's mainly because we had lower availability of lime because of some of the actions that were in place in Mali. So that led us to reach some of what we were doing and reduced recoveries in the quarter. However, with the sanctions now left, all reagents are now available, so that shouldn't be an issue going forward. Masbate production in the Q, 54,000 ounces, slightly above budget of about 1,000 ounces. And with process time, which is about 6% or above budget, which was offset by lower-than-budgeted process grade. The higher than budgeted throughput really came from continuous optimization of the grinding circuit. -- and the lower the budgeted process grade came mainly from lower than budgeted mine grades at the bottom of Montana pit, which is now effectively mined out. At Prodakoto, 31,000 ounces, slightly below budget, 2,000 ounces below budget, and that was really due to slower-than-planned ramp-up in development at the Wolfshag underground mine. We did replace the underground mining contractor and those development rates at which age have improved. And we now expect that we'll hit development ore in the third quarter of the third quarter and then still for production sometime in the fourth quarter. So it's basically -- we pushed that out 1 quarter from where we thought it would be before -- and we did see lower grades as well because we're not getting into that full shut higher grade as quickly as we thought. So when we take all that into account, we did reguide production in Woche went a production release a little early in the month. So it was 175,000 and 185,000 ounces. We reguided down by 10% to between 165,000 and 175,000 ounces for the year. But we did have an offset at Ms. Bay because Masbate was already year-to-date at 7,000 ounces ahead of budget. So we reguided Masbate upwards by 10,000 ounces. And so overall, total production guidance for the full year remains unchanged. And Clive alluded to or mentioned the positive cost results for the period so we definitely saw some good results. On the cash cost side, including all our operations, including NurseCaliber, total cash costs are so $181 per ounce. -- compared to budgets 95%. So we're actually under budget or broadly our budget, I guess, we could say. And that's -- when you look at that, it's really as a result, we did have lower-than-budget tonnage at some operations, but this was offset at all operations by higher-than-budgeted realized fuel prices. So when we took those 2 main factors into account, we ended up broadly on budget for the quarter. Fekola has always led the way, $639 per ounce, that was $64 under budget, and it was a result of lower than budgeted total mining processing and site general costs. Total mining costs were lower due to lower overall tonnes being mined and that was partially offset by higher than budgeted fuel prices, as I mentioned. And the mine tonnes were lower than budget due to as a temporary change in mine sequencing. And again, it relates back to those Ecossanctions, the availability of some reagents and other supplies meant that we've temporarily changed our mine sequencing. We expect to regain that and put it back on track for the full year -- and on Dakota. Otjikoto was $1,136 per ounce, which is $24 under budget. And in total, under budget as a result of a weaker nominian dollar and delays in incurring the Wolfshag underground mining costs, but again, partially offset by higher fuel prices. Bay was maybe the outlier for the Q in. So it's cost for the cash cost for the quarter were $840 per ounce, which is actually more than $100 over budget, and that's almost exclusively due to higher-than-budgeted diesel and fuel pass in the Philippines. And on the all-in sustained cost side, we really saw that merit gain. The consolidated all-in sustaining costs include uracaliber were $1,111 which was $78 under budget. And that beat against budget was mirrored holies apart from Masbate and really, it's a function of, again, lower than budgeted cash costs, higher gains on fuel derivatives and lower sustaining CapEx. And the lower sustaining CapEx as we've seen quarter-to-quarter is just a function of timing. We think that the full CapEx that we expect to incur for the year will be incurred later in 2020, we will catch up. And then Masbate, it was $1,082 per ounce or 28% over budget, and that really mirrors the fact that we were over budget on the cash cost side, partially up lower budgeted CapEx in the cut. But again, we think those be thought of -- then year-to-date, a couple of comments on year-to-date where we are for the 6 months. So we're 12,000 ounces ahead of budget overall, total including in all operations, our share of calipers that's positive. And like I said, we've retained our overall budgeted production guidance for the year. On the cash cost side, including all operations and our share of caliber, we were $52 under budget on the cash cost side on $193 under budget year-to-date on the all-in sustaining cost side. As I mentioned, the cash cost side, we've just seen some gains there in Q1, offset based on the fuel price increases that we've seen coming in mainly in Q2. The all-in sustaining cost side, we're well under budget and that is a function, as you mentioned, those lower cash costs, timing of CapEx, which all of which we expect to see reverse later in the year and also some higher derivative gains. But overall, very positive first half of the year performance. And so what we've seen overall, though, is that we did see fuel prices increase through the Q. And as we look forward and reforecast for the year, we did forecast higher than budgeted fuel prices across our operations. So that led us to revise the second half cost guidance for each operation, we revise that upwards -- but because the -- we had such a positive first half, when you put it all together, we still guided on an overall consolidated basis that our cost guidance is maintained. For cash costs, we think we'll come in at the upper end of our consolidated range of $600 to $640 per ounce. And on the all-in sustaining cost side, we still think we'll be in that overall consolidated range of $1,000 to $1,000, $40 per ounce. So very positive, I think, on the overall operating results as they are. In terms of other things that are happening in the operation, I think Clive can mention most of them. Obviously, Fekola and moly regional development is a big thing for us, and Polvetouched on all of those things. We do expect to see Oklo, that deal close sometime mid-September. And then, as part of that and part of what we disclosed in the releases, we are looking at how best to optimize that Fekola complex regional development. We've got 4 licenses there now, including Meda and Bakolobi, Mankato, the Taco and now we've got Opacoming on expected mid-September. And so we're really -- we've just been looking at those, just trying to decla what's the optimal wage feed percolate higher grade saprolite in the short term? And then also looking at that bigger picture of what we want to do maybe longer term with potentially a second melt Manacoto. So that's a big focus for us. studies are underway. I think we expect to happen by year-end. And then I think we now see that saprolite truck we maybe start sometime in the second quarter '23. And Clive, I think the other main thing we focused on in the quarterly results of looking in Gramalote and evaluating our options. There's something Clive already touched on that. A couple of things to highlight on the earnings side. We did see some volatility on foreign exchange. So we saw some foreign exchange being and losses there mainly due to cash holding that we all need to cut in some of the payables that we have locally. And then on the tax side, we did see higher taxes than we expected in the second quarter, and we tried to highlight that in the release. And those are really related to 2 things. One was, again, fluctuations in foreign exchange led us to some hits on the future income tax site due to that. And then, also on the folditaxside, we had approximately $22 million of holding taxes that we had to pay in the second quarter related to dividends, intercompany dividends that we declared in Mali, which are a little higher than we thought they were. So we had to pay the taxes upfront, and that impacted the overall tax charge. On one other I have to know on the derivative side, we do have -- we are so seeing the gains and the benefits of our fuel hedging program. We had just under $8 million of gains on fuel hedges in the Q. And year-to-date, we've seen $27 million. And we took a look back at how that's done since really the inception of Covid March '20 when it came on when we really started seeing fuel prices start to fluctuate. And since March '20, we've either realized or recorded gains of approximately $50 million since I've started. So we've got about $20 million of that still on the books that we expect to online over the course of the next year, 1.5 years. I will say also on the fuel side that we had a rolling program where we were trying to put on 50% of 1 year's needs and 25% of the next year's needs. As we've seen fuel peak becomes so high. We've stepped back from putting on new hedges because it's very hard to tell exactly what the volatility that is. But we still have 30% of our needs hedged for the balance of 2022 and 18% in 2022. And a couple of comments on maybe -- or sorry, on the earnings side. So earnings, EPS, GAAP EPS of $0.04 per share and adjusted EPS also $0.04 per share. Year-to-date, EPS was $0.11 per share, and adjusted EPS was $0.10 per share. And maybe just a couple of comments on the cash flow side. So cash provided by operating activities for the quarter. This is after changes in working cap of $125 million or approximately $0.12 per share from a non-GAAP basis. And then year-to-date, operating cash flows after working capital changes were $232 million, approximately $0.22 per share. I remind everyone as well, just like we guided on the production side, production is definitely weighted to the second half. It's approximately 40% half 1, 60% half 2. And cash flow is also weighted much more significantly in the second half of the year. We had guided operating cash flow initially $625 million for the year. That assumes a $1,900 gold price for fiscal 2022. We've reguided now slightly downwards to $575 million for the year, and that reflects the effect that we're now using $1,700 for the second half of the year. And like we showed in our cost guidance, we do expect there to be some higher costs due to inflation mainly fuel in hit in the second half and also just the time of some working capital items. So operating cash flow for the year currently forecast assuming $1,700 gold for the balance of 2022 to be $575 million. We ended the period to $587 million in the bank, $600 million undrawn on the line and in great shape of liquidity waste. And we continue to pay that as Clive mentioned to one of the highest dividends in the sector, $0.04 a share per quarter approximately $170 million annualized for the year. So a very good step there. And that rounds out I think what I was going to mention on the financial results.

Thanks, Mike. Just a couple of things. I want to talk before we have the questions. So the stock politics. There has been some positive developments in Mali recently with the eco of the organization of West African states, reaching an agreement with the current government of Mali about the elections and having democratic collections to be held in the 2 years we expect our March of 2024. That caused that agreement, which we welcome caused ecos to draw the second. So they've really been hurt on the economy of Vale, we have mortars challenges in the world today. Everyone is aware, has been hit as things like the -- also the Russian invasion or in the Ukraine has obviously here in many countries or other world, including Africa tours supply and what those sorts of things. So it's good to see the sections that are moved in the Raleigh economy has a chance to start recovering here. Gold production is remains a very, very important part of both economy, and we remain with a very good relationship with the current government has we have for the previous governments, and we're confident we will have going forward, not online from many other Western companies that are successfully explored and developed over many years. If you go back and look at Randall, et cetera, various decades of successful gold production. -- not related as our partner. We're a major tax payer in the gold space in Gold is a very important part of the economy of Vale will remain so going forward. So the government is a 20% partner in Tiago and will be -- we anticipate we'll be a 20% partner as well in the rest of the licenses as we move them towards development. So we've seen an improved environment in volume, which is nice to see the local people for the economy also it makes it easier for us. We've done an excellent job of staying on or beating budget during a difficult time of getting supplies and, as Mike alluded to. That's eased up now, and so we're very positive on that development. In terms of Columbian politics, some people have already speculated as part of our decision to acoramalate was based on projects in the recent cent elected government. That's not the case at all. It was -- this is an economic decision based on the economic results of the study that we've been working on that those results are not strong, as I said, for us to what has been the use capital to build Galati at this time. As I mentioned, inflation hurdles, et cetera. So at the end of the day, it's not a decision clinical decision at all. we're waiting to see the Minister is appointed to the ministers of the clumping government. But we everything we've seen so far suggests to us that the company wants to continue to grow their economy and a good way of doing that is our responsible mining and from everything we've heard so far, but the government we expect the new government to honor the permits that people have for mining and we have a permit to migrate. So not a clinical decision at all based on the economic factors of the utilization of capital today what's the best use of capital. So I guess speak for AGA, but I do have heard that they're going to continue to pursue the Taber daughter project, which is a large copper-gold project that would be exploited by blockade and mining. I understand there continue to be positive looking at that project going forward. But I can't speak to them, but I believe they're going to continue with that project in Colombia. So I just wanted to make those 2 comments on the political situation that we find ourselves in our improved for sure in May. -- and something is not a political decision. With that, I’ll open it up for questions.

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] Your first question comes from Ovais Habib with Scotiabank.

Thanks, operator. Clive and B2B team. Congrats on a strong first half and really great to see full year production and the specialty cost guidance unchanged. So I have a couple of questions from me. Maybe starting off with the fact that you mentioned earlier on the call with [indiscernible] input on hold, the focus of B2 will now be on exploration, advising Anaconda as well as M&A. Maybe a little bit more clarity on the M&A side. Is the focus to look at late-stage development projects still? Or would you consider producing operations as well? Also, maybe some color on any jurisdictions that you would focus on?

Yes. I think, meso, we are, as we've been in our history, really looking across the whole spectrum of potential acquisitions in terms of stage of development. We are looking at some gene exploration companies where perhaps there's some kind of a strategic investment but also joint ventures or potential as we've done in the past mergers. So we're looking at that, we're definitely looking at development projects with our construction team and who are going to be working on a common shortly in terms of road construction, et cetera. So we have a team that can take on anything as we've shown virtually anywhere in the world. So we're looking at development stage projects as well. And we're also open to the potential friendly merger or acquisition of producing company as well. So right across the whole spectrum. And I think in terms of jurisdictions, we really don't tend to limit ourselves. But of course, we would like to see some opportunities in jurisdictions. North America, we'd love to do something we got the right fit. But we're pretty open that won't understand the potential significance of the Finland exploration drilling as well. There's a major discovery there that was made and we are not just an area of play by any means, we're getting some good mineralization and some of the new homes there that we're seeing. So that's going to be a focus as well. But right across the spectrum in terms of M&A, as I mentioned in my earlier remarks, we're an extraordinarily strong financial position to utilize cash as well as potentially some shares in terms of M&A activity, but we're going to maintain the discipline that we've shown for 15 years and before that at BemaGo in the acquisitions we do. They have to be accretive and they have to be raised on realistic low prices going forward, and we're just going to continue to have a lifetime which is to do with accretive acquisitions that have some upside potential, so we'll continue to pursue them.

And then just switching gears to Anaconda in terms of trucking of the satellite material, Mike mentioned that, that’s been pushed on to Q2 of next year. Is this a function of your expectations on the permit additional exploration and development work required? Any more color you can provide on that?

Yes. I think I'll pass that to Bill. But I think the -- yes, I'll just pass it over to Bill to were to understand what we're going to be doing and when we're going to start to see material, whether it be Cardinal or others or these other deposits being trucked down.

Yes, as, it's a good question and one that we probably should have been clarifying the whole way. We always talk about this kind of end of 2022 as a time period where we could do it. if we so chose, you have to remember, we're trying to optimize the whole district. And so we're looking at not just getting material from an taco, but what does it look like for a whole optimized area. So yes, there are some permitting things that we have to go through, but we're also trying to find out where the best or is to get to the mill first. And so it's not just looking at Ben taco by itself. So we picked Q2 as a way that we feel like all the permits can be in place, get our equipment in, put the road in and get ore down there. But I would argue that from your side, you shouldn't really focus on that because those ounces have already been replaced with ounces from other places like Cardinal and in Fekola. I think just to be clear, the Taco is part of Fekola complex, which is within the Fekola Complexes part of what's been called the code condo area, which Mehas [ph] been -- within that has been a very exciting target where we've be getting some of these really good results in the sell-in just so we're on the same page. So when we talk about the Taco put that in perspective.

And just kind of just a follow-up on that. So essentially, you’re looking to come out with a kind of a master plan for the district, and that’s expected by the end of this year.

Yes. So remember, we've kind of got 4 studies going on, and 2 of them are kind of love to get it, right? So at first, we got the underground, right, which we didn't really talk about. We got the underground study, which has shown really good economics. We're actually now looking at contractor bids and how does that all work to try and move that forward. So that will be coming out this year, an update on that. You've got the Phase 1, which is what you're talking about, which is kind of like the regional play, whether it's Aqua or whether it's Bentako Menico -- we're also taking -- we've been very open about this high-level Phase 2, which would be a stand-alone mill. What would it take to do that? So we're looking at what would the cost be and the ounce profile, which would exceed the NPV of trucking and when would that come in? And then the whole thing is being optimized by Whittle looking at all of our sources to include Fekola and Cardinal and really trying to put the best ounces in and that will definitely come up by the end of this year.

Got it. Okay.

Thanks.

Your next question comes from Anita Soni with CIBC World Markets.

I just wanted to follow up on what you just said, Clive. I just want to make sure I heard correctly. Did you say that you would be open to a friendly merger of a producing company.

Sure. We're -- we've always maintained the growth opportunity for the company to pair up with another producer that's obviously something we're here to build shareholder value, and we look at every opportunity to do that. I think we like where we are today in the sense of our ability to take on additional projects and grow the company and also our ability to potentially to add some additional production to what we're doing. We just had a very strong ringing endorsement from our shareholders not a couple of months ago now or last -- at our AGM, we're somewhere close to 80% of the shares that are outstanding on the B2moted, which is really extraordinary and over 90% of the shares bonded voted for the Board of Directors, which therefore the strategy of the company and for management. So paying the industry-leading dividend, maintaining a strong cash position being debt free with the technical teams that we have, the financial teams and all the things that we have in our responsible mining team and you'll see our new digital writing for just came out -- continue to be an industry leader. We're -- we do have a strong mandate from our shareholders to continue to grow the company, and that's our focus. We'll look at various alternatives, how to divest to that.

Okay. I was -- I just wanted to say that actually my questions were with regards to whether or not you had considered Senegal and specifically thinking about IAMGOLD photo asset in light of their updates this morning. And I just want to maybe get an idea of some of the assets that might be up for sale or available for sale some of the regions other than friendly merger that you might be interested in?

Yes. I mean I can't comment on specific opportunities, but suffice to say that in our -- looking at opportunities, of course, one of the areas that you look for opportunities in is around where you are because you've proven your ability to do it in that part of the world, et cetera. And there are some interesting opportunities. We're looking at a whole lot of different things as well as you saw the Aqua deal. We're looking through is there value to be added because we have a mill or maybe a second money that further value in the Maui area where we could traditionally analysis to the Fekola mill. Not a need for sure when you look at the -- all the targets we have and the results we got so far within the Fekola complex completely if there's something that makes sense, we'll be looking at it. And also, as I mentioned earlier, of other jurisdictions around the world. We think we're in a very strong position right now to do the right kind of M&A to continue to complement growth from existing projects with other opportunities.

Okay. I just want to close out by commending you for being disciplined. I've seen a lot of companies just rush headlong into projects, whether or not they make sense. And I know your share price is down a little bit today, but I think pausing the Gramalote project is the right decision. And I'll leave it at that.

Great. Thanks for your questions.

Your next question comes from Don DeMarco with National Bank Financial.

Congratulations Clive and team on another strong quarter. My question has to do with the Aqua acquisition and [indiscernible]. The opportunity here something that is relatively near term, like, for example, are the permits in place? Is there potentially near surface mineralization whether for trucking or stand-alone, just if you could provide a little bit more color on what you see as the opportunity here. I recognize that we'll wait for the master plan at the year-end and we'll find out more then, but what were some of the things about Dando that attracted you? And what's the near-term opportunity here?

Sure. I mean Acumedia Banco [ph] is a pretty exciting acquisition for us because of just what you talked about the potential for good grade material on our surface building want to talk about more.

Yes, sure. I mean we saw it really as fighting both the whole [indiscernible] as to what place it comes into the sequencing. It's got some high-grade material relatively close to surface. -- they've actually done a very good job of bringing their permit forward. They've got a lot of their environmental baseline work done. They had a mining plan, which showed it trucking it somewhere at some point. So that made it very easy for us to think about what it meant for us -- we actually -- we've been out in the field. We see certainly an easy trucking route to Fekola. And so the answer is it's got all the things that we would look forward to really fight for one of the first positions that we would bring it in trucking into Fekola for sure.

It also has a very strong expertise potential. There's a story is partly told there through some good aspiration, but there's a lot of potential like we're seeing in all these zones, but the potential start with potential TAM.

And will you be setting up any rigs on Dendo anytime in the near future?

Maybe what sorry are resides.

Yes, indeed. As soon as the closes in September, we were on standby ready to get a straight away.

Okay. Great -- that's all for me.

On that topic, we will – I would say, within the month, we will be coming out with an additional news release on some of the exploration results we’re seeing from the Fekola complex. We’re seeing some great results of those shares assume, I would say, by early September.

There are no further questions at this time. Please proceed.

Okay. Well, thank you, operator. Thank you all for your attention and thanks guys for the questions and good answers. Thanks, everyone. Have a good day.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a great day.