Standing by, and welcome to the St Barbara FY23 Q1 September Quarterly Report and Presentation. All participants are in a listen only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Craig Jetson, Managing Director and CEO. Please go ahead. Thank you, Melanie, and good morning, everybody, and thank you for joining us for St Barbara's Q1 FY23 quarter report briefing. I am pleased to join this call from Perth, the land of the Whadjuk and the Noongar people. Please note the disclaimers on Slide 2. I would like to begin by recognizing the traditional owners and First Nations people of the lands of which St Barbara operate. In Australia, Canada, Papua New Guinea, and pay my respects to Elders past, present, and emerging. Moving on to safety, our safety remains our number- one commitment, so it's disappointing to see an increase in our TRIR during this quarter. We are working hard to ameliorate this on a number of fronts. Across the group, we are creating a deeper focus on safety, leveraging October as a Safety Month. All sites are extending the Safety All Ways Program to frontline workers, commencing with the Leonora operations. In addition, we have defined and commenced simplification of key elements of our safety system and coaching leaders for improvement. In terms of moving on to highlights in quarter one, we produced 64,000 ounces of gold this quarter at an all-in sustaining cost of AUD 2,490 per ounce. Simberi and Atlantic performed as expected. However, we had lower than expected performance from Leonora. Our costs on a per-ounce basis were above expectations as a result of the lower production, particularly driven from Leonora. We have progressed our Leonora Province Plan studies. This has allowed us to release today an inaugural Tower Hill open- pit reserve of 560,000 ounces. This increases our strong reserve base in the region to 3.1 million ounces. At Simberi, the mining studies we were conducting as part of the strategic review have identified additional oxide material, which has the potential to extend the oxide ore mining through FY2025. As a result, no decision on the sulfide project is required for the next 12 months. The strategic review is continuing, and we remain in discussions with interested parties. We believe the decision to delay the sulfide project is a prudent one, given the additional oxide ore that ensures business continuity in an economic environment which makes project execution risky. Papua New Guinea is, of course, not experiencing this environment in isolation. Western Australia also is in an economic environment characterized by supply shortages for equipment, parts and labor. As such, we've elected to defer capital projects in Leonora, which have not already commenced or do not bring immediate value. We will therefore defer the refractory upgrade to the Leonora Mill, the 2.1-million-ton plant expansion, and the construction of Aphrodite by at least 12 months. This, in essence, will defer a total of AUD 180 million of capital spend in Leonora by 12 months. We are, of course, continuing to surge ahead with the development of Zoroastrian, which remains on track for Q1 FY2024. This enables us to fill the mill next year and sooner than we first thought. St Barbara continues to investigate larger scale free milling options to gain benefits of scale from the Gwalia and Tower Hill while freeing up Leonora processing facility for refractory ore treatment. Finally, we are adjusting our full year guidance to reflect on what I've outlined above. Our guidance from Leonora was built on a plan to deliver 1.1 million tonnes of mined ore to the plant, and this was predicated on improvement of our equipment availability and utilization rates. Recently, we have been able to slowly but surely improve these rates by our contractor, but unfortunately, these rates were not achieved as fast as we had planned due to our inability to maintain and operate as labor became critical for the site. In our planning for quarter one, we assumed that with the lifting of border closures and the reduced impact of COVID-19 isolation rules, we would be able to accelerate our improvement rates as more highly skilled staff joined the company. This wasn't the case. What we didn't anticipate was a higher competition for skilled fitters and maintainers. Not only were we not able to quickly fill our positions, we actually lost key staff as well. We have been able to fill most of these positions now, however, not at the same skill level that we would have done in the past. As a result, we will not be able to make up for the lost time. To be clear, our equipment and availability utilization rates did improve during the quarter, just not to the levels we had originally planned. Our mined ore quarter on quarter actually increased to 165,000 tonnes. However, we were aiming for 240,000 tonnes. We have recast our production plans, and we will continue to increase ore delivery to the mill for the rest of this year. We are very conscious of the ongoing competition for key staff and have therefore elected to lower our guidance on ore delivered to the mill down from 1.1 million tonnes to 950,000 tonnes. This is a 14% decline in ore, and therefore we have lowered the production guidance by 14%. Great expectations for Leonora have not been changed. The deferral of capital for Leonora and Simberi have been reflected in the lower CapEx guidance for this year. Our cost guidance for Atlantic and Simberi remain unchanged and in their local currencies. However, the recent depreciation of Australian dollar has resulted in increase in Australian dollar cost guidance for both sites. Our all-in sustaining cost guidance for Leonora has been updated to reflect the lower gold production. Leonora produced 34,000 ounces of gold at an all-in sustaining cost of AUD 2,487. This was well below our expectation. As I've mentioned, the drive for lower production was a result of sustained shortage of skilled labor, which meant we didn't have the equipment available to do the mining and particularly the drilling that we had planned. In partnership with Macmahon, we have been working diligently on filling these roles, and at the end of September, we have succeeded in filling most of the roles, but there is a vast backlog of maintenance work and development meters to achieve. In parallel, we brought new equipment to the site to help alleviate some of the availability problems. Now that we have most of the resources required in terms of people and additional equipment, we expect to see quarter-on-quarter improvement for the rest of the year. As you can see from the graph, our mine grade was down quarter-over-quarter, but this was well expected and certainly flagged and not a driver. The reduced production has had significant negative impact on our costs on a per ounce basis. It is pleasing today to announce that we have delivered our inaugural Tower Hill open- pit reserve in accordance with our timelines we provided the market previously. The Tower Hill ore reserve adds an additional 560,000 ounces of gold to our large and high-grade ore reserve base in the Leonora Province, which now sits at 3.1 million ounces of gold. The Tower Hill open pit is just 2 kilometers from the Leonora processing plant. We've also made progress with negotiations with the rail operators, and we have signed a memorandum of understanding for the relocation of intermodal activities from adjacent to Tower Hill to a new facility to be built west of the mine. Simberi has continued its operational performance in the last quarter. Consistent production at Simberi is beginning to return. Roadblocks have been removed, and the operation is delivering as expected. More oxide material was delivered to the site, improving recovery rates, which offset the anticipated grade decline. The all-in sustaining cost was higher than expected at $2,754 per ounce due to diesel prices were higher than we expected. Maintenance costs were also higher as we continue to work through the backlog of maintenance issues which developed during COVID-19, when we were unable to send specialists to the site for almost two years. The rising U.S. dollar has resulted in a higher all-in sustaining cost when converted to Australian dollars. Now turning to our Atlantic operations. As we expected, there was lower production, but the stripping ratio increased in the current quarter. Our all-in sustaining costs were in line with expectations. At the tail end of the quarter, Hurricane Fiona impacted the operations. The site was without power for seven days. The storm also caused a wall slip, and we estimate that it'll take approximately three weeks to remediate. Power has since been restored and remediation of the wall slip has commenced. For the start of quarter two, the processing plant is processing stockpiles as we remediate the slip. This will not have any impact on the full year production as we cease mining operations in the coming months, and we always plan to process these stockpiles in the back half of the year. In terms of Leonora's essential to regional consolidation, I'd like to take you through our premium position in the Leonora Province. Our Province Plan strategy places Leonora in the center of any consolidation, both literally and figuratively. St Barbara has the highest mineral reserve and ore reserve in the Leonora region. We have near-term growth from Old South Gwalia and Seraphim will be in production within the next 12 months. We have a large landholding that grew significantly in this calendar year with the acquisition of Bardoc, which delivers on our province strategy. Our focus on Gwalia and Leonora Province Plan is generating early rewards with the expansion of reserves and resources, extending St Barbara's footprint across the region. The next slide clearly articulates why St Barbara is key to consolidation. It has the grade required to justify and cover cost of transportation. The 3.7 grams per tonne is a combination of all we have in the region, but let's keep it in mind that our reserve grades at Gwalia are far higher. As you can see, we have a very different problem than others in the region. We have over 122 million tonnes of ore to be processed containing 10.5 million ounces of gold. Our 3 million- ounce deposits would benefit from a larger scale processing facility, no doubt. Not only are we key to a meaningful consolidation in the region, we also are a low-cost entry into consolidation, should you wish or should we wish to take part. It shows that we have the largest reserve base, yet on a per ounce basis, our enterprise value is the cheapest. Before I open up for questions this morning, I'd like to emphasize the following. Simberi is literally and figuratively central to consolidation in the Leonora region. We have high-grade ore, which makes everything else possible. It can travel economically. We have a lot of ore, which is a unique problem to have. This is a unique problem for others in the region. Finally, as I highlighted today, we are a low cost entry into consolidation. With that stated now, I will open up for questions. Back over to you, Melody, and thank you. Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Andrew Bowler with Macquarie. Please go ahead. G'day, Craig. I'm just talking about the delaying of those two capital expenditures for the Leonora district. I know you commented in the text that you expect to see a decrease execution risk along with that project. Just wondering about that sort of circa AUD 180 million of CapEx that you talked about. Are you expecting that needs to be repriced over the next year or two? Or do you think that you know freeing up of labor and materials and normalization of that whole sector will see CapEx remain largely unchanged from that AUD 180 million from six months ago? Yeah, Andrew, look, I think as the studies unfold and we get more accurate costing on some of the construction costs and fabrication costs and the like, things will move around. I'd be reluctant to change it at this point in time. I'd certainly, I think, over the next 12 months, 18 months in particular, post-COVID-19, settling down and all the noise and the current market demands on people and resources and costs will somewhat stabilize. I don't know whether they'll ever come back to pre-COVID-19 rates and prices, so I wouldn't predict that. To de-risk the business going forward and now the need to expand immediately is not as great as what it was. We can defer capital and move capital around as we see fit to where the best value in returns are coming from. At the moment, clearly filling the mill through Aphrodite in particular coming online and Old South Gwalia certainly gives us more flexibility to be able to do that sooner than we anticipated. That gives us the flexibility to defer capital even more as we look into regional consolidation. I don't think the capital value as such will change a lot, but certainly the timing of that and the ability to be able to deliver capital projects on budget, on time, 12 months out from now is probably less risky than what it would be today. No worries. Thanks. Just turning to Simberi, obviously pretty handy life extension from the oxides. Is that material that's been sort of discovered? I mean, is that largely oxide or is it a little bit of transition material? I guess what I'm asking is, you know, can we expect to see the recoveries tail off over the next couple of years as you eat into those new oxide tonnes? Yeah, good question, Andrew. It's actually new material, so it's new oxide material. So I wouldn't expect to see a drop in recoveries because of what we just found. As I said, the studies have been able to find this material. It extends the current operation by the period that I stated before. So no, it's not a conversion at all. It is new material. I know you obviously probably can't say much, but Simberi sale process. I mean, I think some could say that the commentary from today about, you know, delaying the FID for the sulfide projects perhaps is indicating that a near-term deal is a little bit less likely than it was previously. Is that a valid comment or still plenty of people in the data room? No, it's still quite active in the data room, Andrew, so that's going quite well. There's obviously a lot of work to do once you're in that data room and site visits and you know, a whole range of due diligence activities. Of course, sale remains to be one option. There are plenty of options available to us, and we're exploring whatever we possibly can. I think, you know, I've stated before, it's not a fire sale. Simberi, the sulfide project in itself is still even with its escalated costs, as I know it today, still has a great NPV. It's a fantastic project. Extends the life of the mine by 10-12 years. It is a great little asset. We're doing a strategic review for many different reasons, not just because of the capital or the growth. Look, there'll be more of that to come. There's still quite a bit of work to do before the decision's made on that. Now that we have more oxide material, we're extending the life of mine a little bit, more on oxides themselves. There is actually no hurry into moving into the sulfide project than what we've already indicated today. We'll wait and see how that process unfolds. There's still a bit of work to do, and the data room is active with multiple participants. That's very pleasing. No worries. I'll pass it on. Thanks for that, Craig. Thanks, Andrew. Thank you. Your next question comes from Matt Greene with Credit Suisse. Please go ahead. Good morning, Craig. Hope you're well. Yeah, I wonder, look, I wasn't gonna touch too much on the challenges you face at the moment. I just have a few on Tower Hill. I think this deposit could be a key longer term deposit for any sort of consolidation in the region. Just on the reserve you've announced today, which is based on the premise of the mill expanding to 2.1 million tonnes, which you've now deferred for 12 months, can you just give some color on what the average annual production rate you've assumed underpinning the reserve? Matt, I'm not sure I actually fully understand the questions, but look, I think the deferral of the expansion is a prudent one given where we see the flexibility coming from the recent purchase of Bardoc assets and how we're going to fill the mill. I think there's still a number of development opportunities available that's not well and truly defined in the region yet, with particularly Tower Hill, Harbour Lights, and when we bring you know Harbour Lights online with Zoroastrian, for example, is look like been deferred even more because of what we have today and how we're growing the reserves and the resources at the moment. Look, it's really difficult to make that call. I think from a province perspective, from a siloed view of where Tower Hill, Harbor Lights, and the pieces of the Bardoc assets all fit together, still being reviewed and still creating some exciting value propositions for us as we unfold going forward. I think the deferral of the expansions and capital, given the current climate, the construction issues that we're seeing in the market at the moment with labor, material prices, I think the deferral is the prudent one at this point in time. Great. Thanks. I mean, I guess just if we look at the 2.1 expanded case, and just looking at the appendix on the reserve statement, when you've got about 1 million tonnes coming from Gwalia underground, you'll have some from, you know, Zoroastrian and some refractory material. But, I mean, are we looking at kind of, you know, 300-400 thousand tonnes a year coming from Tower Hill? Is that kind of what thinking? Oh, that would be the thinking at this point, yeah. Obviously I'd like to have more milling capacity and increase that. You know, once we become deconstrained and we move the railway line, and re-permit, we do our cutbacks, I think the, you know, Tower Hill will certainly give up more than what we are anticipating at this point in time. It gets back to, you know, eventually the milling capacity. What is the right, I guess, balance for the area. As you point out, you know, Gwalia, around a million, 1.1 million tonnes stabilized eventually. You know, the 300,000-400,000 tonnes that'll come next year, from Zoroastrian. It really does beg to increase over the next two years up to that AUD 2.1. We don't have to do it straight away. We were hoping to do it sooner, but there's actually no need for it at this point. Deferring the capital in today's climate is probably the best one for us to pursue. That's great. Just to follow on your comment there about the additional milling capacity. I'm sure this is a combination, but is this more around just trying to lower the processing unit costs, just given Gwalia's higher, you know, higher fixed cost base there? Or is it also just sort of, I guess, better optimize that open pit mine plan? Yeah, look, it's both. I mean, sorry, Matt. I was gonna say, which one is the key value driver here for unlocking more reserves? Is it more around the processing? Yeah. Yeah. It's more around the processing. Absolutely. The processing is certainly the holy grail and the bottleneck. Not so much now, but in the next 12 months, it will be a significant bottleneck that we need to address, starting now. Our studies and our options into that are well advanced, and we're getting a better view of what that position would be. You know, we have so much reserves and resources, so little milling capacity, then we're driven to do something different. That's why we're looking for consolidation. That consolidation in the region can come from many different ways and different methods, and we're looking at every one that's available to us. I think with the excitement of Tower Hill being as good as what it is, as close as what it is, certainly begs to you know, mill expansion quickly. It also helps us defer some of the refractory expansion or modifications to the plan for the refractory as well. We'll be able to push that down the road in terms of investments at the same time, which is a good position to be in. Yeah. Okay. Not missing your point, Matt, about, we need to do a lot of work, and we are doing a lot of work to reduce our fixed cost base at Gwalia. Yeah. I mean, just looking at this, it looks like you've assumed, you know, processing and G&A for around AUD 34 per tonne, when if I look at Gwalia for the last few quarters, that's averaged around AUD 16. You know, appreciating the mill hasn't been fully utilized. Where do you ideally need to see that sort of processing and G&A cost on per- unit basis? Where do you really need to get that to really optimize the value there at Tower Hill? I mean, there's a lot of mills and as you say, on the consolidations, a lot of mills with some capacity that are already at processing costs lower than that AUD 34 level. Does it really make sense to go ahead and expand Gwalia when, you know, there's a lot of capacity up the road, for example? Yeah. Look, as I said, the consolidation, the capacity can come in many different ways. Certainly consolidation is one way of increasing the capacity. Clearly, you know, the Gwalia mine, for example, or is such a high grade that it travels and covers its cost very, very well, where some of the others certainly don't have that luxury. The flexibility within consolidation is part of what we look at in a review, of course. Clearly, Leo in its own right needs a mill expansion. You know, 1.4 million tonnes, 2.1 million tonnes- is 2.1 million actually enough? If you look further down the road, then it may well not be. We need to be ahead of the curve and understanding what that looks like in three to five years from now. More milling capacity and depending on how it comes is certainly the holy grail for this region. Yeah, got it. All right, Craig, that's very helpful. Thanks a lot. Thanks, Matt. Thank you. Your next question comes from Alex Barkley with RBC. Please go ahead. Hi, Craig. Just trying to get a bit more clarity around that mining, the Leonora mining figure in FY2023, the 950 kilotonnes. You'd previously suggested the 1.1 million-tonne figure probably included some mine waste, and the straight ore as you'd report it would be more around 1 million tonnes. Just trying to work out what that 950 kilotonnes exactly. Does that include any mineralized waste you plan on processing? And I suppose a second part to that, can you fill the extra milling capacity through the year with stockpile, mineralized waste, third-party ore, et cetera? Thanks. Yeah. Look, absolutely. I think we can fill the mill late in the year, early next year. If you look at the issues that's really when we put our plan together, we made some assumptions on availability, utilization rates of equipment and people and access to people. All of which have improved towards the end of the quarter, but nowhere near like we planned and we expected to see early in the quarter to be able to achieve the 1.1 million tonnes to the mill in ore this year. With that lost, now that we do have more people and mining contractor and ourselves have been working very hard to close that gap and the skill gap as well. We have a backlog of maintenance to do. We have a lot of drilling to catch up on because of the equipment availability and the operators available to turn the equipment wasn't there in the quarter. Now we are in a better situation than we have been. We will continue to see the rates improve over the next three quarters at the rate that we expected quarter one. The problem is when you start getting to the 1-1.1 million tonnes run rates, it's very, very difficult to continue any improvement above that. Any sprint capacity to catch up is already absorbed in the capacity going from 850,000 tonnes this year to 1.1 million tonnes. You know, at one point one's probably the limit of what, as we go deeper, one mine, one hole or decline can actually give that mill. The rest is gonna come from Zoroastrian when that comes online, about 300,000-400,000 tonnes, and on an annualized rate later this year. We're also developing quite well out into Old South Gwalia. That won't give us much more extra ore, but it'll give us better flexibility and more reliable ore feed to the mill as such. I think, clearly by the end of this year, we'll be well and truly delivering above the one or around the 1- 1.1 million- tonne run rates annualized. The mill will be full as soon as we get Zoroastrian online later in the year, early next year as well. That's why we're looking at mill expansions and consolidation and, you know, whether we transport ore somewhere else and looking at every avenue, every lever to pull to create value. The thing we need to do is reduce our costs and offset our fixed costs by filling that mill, and that's what we're aiming to do as soon as we possibly can. Okay. A quick addendum. When you say with Zoroastrian, you can fill the mill from first quarter FY2024, is that the 1.4 million tonnes capacity? You think you'd be milling about 1.4 million tonnes from that quarter onwards, or is that a rate you're sort of- No. Ramping up through the quarter? No, no. That's the rate we're ramping up through the quarter and heading into next year. As our targeted rates. I mean, if we're delivering 1-1.1 million tonnes out of Gwalia with the deeps and the shallows, and you're adding 300,000-400,000 tonnes from Zoroastrian, you know, that's your 1.4 million tonnes. We're almost there. I'm sure we can optimize the mill a bit more and get a bit more than 1.4, but let's wait and see how that unfolds towards the rest of the year. Okay. Sure. Thanks very much, Craig. Thanks, Alex. Thank you. Your next question comes from Peter O'Connor with Shaw and Partners. Please go ahead. Good morning, Craig. Just circling back to the Simberi. You've mentioned there are multiple parties in the data rooms active, which is great feedback. Exactly where are you at, though, in the process? Have you received non-binding indicative bids, so you'd be on that stage? No, Peter, not at this stage. We're certainly very close. We're getting close to the end of the process. It's not gonna go on forever. There's a lot of work to be done to understand, you know, and answer a lot of questions that people have. Look, we're not far away. There's no agreement that's been made, and no offer's been put on the table of any description or any options at this stage. We've still got some journey to go. Judging by typical M&A, if non-binding bids are due in the next few months, is this something that could be wrapped up in early 2023 calendar? No, not gonna drag on forever. No, it's not gonna drag on forever. It'll be, you know, this year, I would hope we're in a position to announce what we're doing this calendar year. Okay. To the CapEx deferral, while I accept your commentary and description being fiscally prudent and pragmatic, given the Leonora Province Plan backdrop, is it a tactical move as much as it is a fiscal move? i.e., is this an acknowledgment of the process and the chess game that's been played out, and just deferring CapEx just to see what happens? Gee, Peter, that's an interesting question. Yes, it is on both fronts that you really highlighted there, to be honest. It's strategic. It's also the best outcome from an investment perspective on an investment proposition by St Barbara, and our shareholders at this point in time. That's number one. Fiscally and financially, whichever way it looks, it's certainly the best outcome, deferring that capital. It's great to be in a position where we can fill the mill, defer capital, and assess what the future would look like. Then strategically, how does that fit with the combinations of what's available or may be available or could be available in the region for consolidation? Once you unlock that value and put the, I guess, ore to its rightful home in terms of where does it create the most value, it gives you significant optionality to be able to make changes going forward. In some cases, potentially bringing capital need forward, but also in our case, deferring capital. I think it's prudent. It's the right decision by the business in terms of strategy and certainly, for now, the right business decision in terms of risk. Craig Jetson, further to that and to your comments in an article which you wrote yesterday in The Australian by Nick Evans, and you were quoted. The province potential, you talked about, I think you gave the number of 600,000 ounces, and it's pretty easy to do the math on grade tonnes and mill capacity to get that type of number. What's the journey to get to that type of tonnage in the Leonora area? Is that a five-year view? I don't think you gave a year for that. Is that 2025? Is it 2027? Is it end of decade? Is this something that's really deliverable with the mills that are there now? Yeah, look, I've got a strong view, and this is just a view that the consolidation gives you the optionality to be able to process, you know, the refractory ore and the free milling ore in different locations in different ways through minimal expansion. I think the region consolidation is the Holy Grail to be able to develop the gold industry to where it adds enormous value over and above what it delivers at this point in time. I'll probably leave it at that, but you know, it really does lend itself, and it's critical for the right consolidation to occur. In terms of being achievable, I think it's achievable sooner than later. I don't think it's a five-year or four to 5-year down the track aspiration. I believe it'll be much sooner if the right consolidation took place. Okay. Can I segue to Gwalia, just to nuts and bolts? Gwalia costs FY2022 were about AUD 1,947 all-in sustaining. They're now obviously higher than as you talked about during your update. What's normal? If we're thinking about FY2023, end of that going to FY2024 with Tower Hill coming on, the mill running full at 1.4 million tonnes with Gwalia Deep, Old South Gwalia and Tower Hill. You've got a bigger denominator. You've got better tonnes going through. Where do you see the trajectory of all-in sustaining costs in a reasonable world and a reasonable labor environment? I'm not going to give you what I believe is the right number because I think there's so many more efficiencies and costs out of our business we had, not just filling the mill. I just point there's a lot of other consolidations that we need to do, like our operating model, our corporate overheads and recharge, what we're doing supporting the sites and how we do that. There's a lot of work to be done in the next 12 months reducing that. At the same time, as you point out, increase in the mill to 1.4 million tonnes. The most significant reduction in all-in sustaining is gonna come from filling that mill because of the high fixed costs. We need to make sure that we are super competitive in that region, and we're not there yet. Okay. Thank you, Craig Jetson. Thank you. Your next question comes from Paul Keenan with Ord Minnett. Please go ahead. Hi, Craig and team. Just a couple questions from me. Firstly, on the underperformance of the two stopes at Gwalia. What drove this? Was there any sort of overbreak there or was the grade just not what you expected? Yeah, the grade was always going to be a problem for us, Paul. We've got to do a lot more grade control drilling and certainly a lot more development. So those two stopes certainly underperformed on expectations, which was disappointing, but you're going to get that. The consistency of the ore body, particularly over the next what has been the recent past and going into the future, as we go through a certain phase of the mine, if you like, the grade drops off and becomes inconsistent for a period of time. I believe we've got a very good handle on that now and understanding what that should look like for future production calls. Pleasingly, the grade will jump back up in about a year from now to back to, you know, something that is more palatable than what it is today. Look, the underperformance of those two stopes did take us by surprise. The biggest issue is us not being able to drill and not being able to move the material because of equipment availabilities, you know, because of the resource issue that I spoke about before. Yeah. If we think about the current stopes that you have on the go at the moment, are they performing to expectations? Are you having any reconciliation issues there as well? No, nothing to mention at this stage, no. No worries. Maybe just moving on to Atlantic. I see that you wrote you've decided to not pursue an extension under the Canadian Environmental Assessment Act for Cochrane Hill. Could you maybe explain what this actually means for that deposit? Yeah. Look, Cochrane Hill is so far out in the future, as you'd appreciate, the engineering and the project work, if you like, is way behind where, say, Beaver Dam and Fifteen Mile Stream are in this stage of evolution. With the regulators changing the ct, it's just not enough knowledge and not enough engineering completed to be able to grandfather it any other way other than regulated and permitted eventually under the new Act. It doesn't change what we've been doing. It just means that, you know, there's a bit more work to do and we'll re-permit under the new Act. It, it's not. It was the decision that we took. We don't need. We've got plenty of time to be able to permit and get that project in train. It was really the maturity and the level of where the project is today of whether we'd meet the core criteria of grandfathering or whether we would reapply under the new Act. We decided, obviously, to I guess permit under the new Act, new reg. Yeah. No, no. Understood. Thanks for that. Thank you. Once again, if you wish to ask a question, please press star one. Your next question comes from Alexander Papaioannou with Citi. Please go ahead. Hi, Craig and team. Another quarter of cash burn over AUD 30 million and cash is sitting at AUD 65 million. Are you comfortable with the balance sheet where it sits? Yeah, good question. The answer is when you burn that sort of cash, no, we're not you know, pleased with the position of that performance. We're certainly reasonably comfortable with the cash position at the end of the quarter and what we're predicting going forward, knowing now that we'll get a better performance out of Gwalia for all the obvious reasons we've just stated. At this point in time, I'm certainly comfortable, yeah. Thanks. Could you give a sense on the margin of these new ounces at Simberi, and whether they're pretty similar in grade to historical oxide material? Yeah. Look, they're very similar to what you've seen in the past. The grade could be a little bit higher, but you know, I'm not going to call that just yet, if at all. It'll be similar to what you've seen in the past. I think the biggest issue for Simberi in terms of margins is the catch-up work that we're doing around mobile fleet and fixed plant now that we can get technical people in to catch up on the backlog that was created during COVID-19. The inflated costs, particularly end of last year into this quarter, will start to normalize somewhat during this quarter two, and then be back on track for the last half of the year. Perfect. Thanks. That's it for me. Thank you. Your next question is a follow-up from Matt Greene with Credit Suisse. Please go ahead. Thanks. My follow-up, Craig. Just on Gwalia, third party ore, you've highlighted in the past that they've underdelivered on grade. Have you seen any improvement there, or are they continuing to underdeliver? Yeah, Matt, it's. The answer is yes, it's been underdelivering, but there's been pockets of on swings and roundabouts, I think it's pretty much on par than what we thought. Maybe a little bit lower than we expected, to be honest. There has been times when they've overperformed. Mostly, they have struggled to meet their performance of what they were requiring. It is up and down depending on quarter-on-quarter. It needs to be more consistent than what we've been able to achieve in the past, but there's a lot of effort and a lot of work going into that as well. It is still a good business for us while we have the milling capacity. It's certainly making some money for us at this point in time, which is good to see, and we'll continue with it for the short term. Okay, thanks. Just on the utilization in the quarter, are you able to give us some numbers as to what you saw relative to what you've been seeing in the previous few quarters? Yeah. Look, I can give you. If If you use industry-standard numbers of around 80-85% availability, and the mean time between repairs sort of data, we're about 60% of where we should be. You know, the backlog of maintenance now has to be dealt with. I think the resources that we've been able to bring to site has certainly helped us do that. Even with all the headwinds that we have, we did improve, you know, add material to the mill, ore to the mill, but nowhere near as fast, and that was the problem, the speed and the rate of that improvement wasn't being able to achieve. We're in a better position we are now going into Q2. We still have significant skills shortages. We may have the number of people now, but I think the skill and experience is hurting productivity significantly and we need to get across that the best way that we can. It's certainly improving. That's great. Thanks, Craig. Thank you. Your next question is a follow-up from Peter O'Connor with Shaw and Partners. Please go ahead. Craig, just further to Matt's question about labor and availability in training and skills, are we in a cycle now where we won't get back to normal as an industry in WA until these people have got experience and training, so it's multiple quarters, multiple years? Or does the pool that was supposed to open up with border reopening, does that suddenly turn up? What's the timeline to normality in labor and labor availability and skills? Yeah, I think the other one that we're not talking about much is the growth in the industry as well, Peter. I think with the new mines, the expansion of existing assets in Western Australia, I'm only talking about WA, has put a lot of pressure on resources, all resources, whether it be technical or whether it be non-technical. I think the immigration laws changing may have helped somewhat, but I haven't seen that flow through. We're working with Macmahon and looking at high-level, high-skilled based technical roles from overseas within, you know, one or two different countries to help us close that gap here ourselves for our own businesses. But it's. People are not coming back across the border like we thought. There is so much growth and demand in Western Australia that the technical resources, the maintainers and the experienced people are certainly very, very difficult to attract and find. The growth in the industry is absorbing even more pressure on that issue. I think, you know, it's going to be one of immigration, two of training, three of time and experience for seats in the role, and people sitting in these seats for significant, you know, periods of time getting the productivity where it should be. You know, us being able to maintain the fleet to an acceptable level that the industry's been able to do that in the past. We're not doing that at the moment. We've got a long way to go. I think it's a multi-year recovery from the impacts of COVID-19 and a multi-year of growth in the industry, making labor even shorter than what it is now. Okay. Thinking about other parts of the cost pie, are there any areas of respite in the last quarter? Is diesel cost quarter-on-quarter, are you seeing improvements there and any of the other consumables? Is there any easing of that supply chain pressure in those prices on the raw materials? Look, I'd like to say that I can put my hand on a range of things, but I actually don't see a lot of it normalizing or coming back to where it was. I think we made some mistakes on the diesel costing for Simberi, which hurt our budget and budget forecast. I think the fuel costs have come down a little, but I'm not seeing that come through in reagents or spare parts or materials from overseas. Anecdotally, I'm hearing that, you know, freight and shipping costs are reducing. I haven't seen that flow through to the bottom line as yet. I don't think the inflated costs of the last two or three years are going to normalize anytime soon or drop back to pre-COVID-19 rates. Thank you, Craig. Thank you. There are no further questions at this time. I'll now hand back to Andrew Strelein for closing remarks. Yeah. Melanie, well, thank you for that. Look, thanks, everybody, for your interest and dialing in and asking some of those questions today. It's been a very slow start to the year, as you can see, and it's not palatable changing guidance so early. We thought that and I clearly thought that this is the best way to be transparent, best way to drive our business as we move forward. We will certainly now move on and improve our production performance as I've forecasted. We will be working very hard on reducing costs and work through the, I guess, the process of Simberi and of course, the consolidation opportunities at Leonora. Thank you, everybody, for your questions and dialing in, and I look forward to updating you at the end of this quarter or the half. Thanks, everyone. Thanks, Melanie. That does conclude our conference for today. Thank you for participating. You may now disconnect.