B2Gold - Earnings Call - Q2 2025
August 8, 2025
Transcript
Speaker 3
Thank you for standing by. This is today's conference operator. Welcome to the B2Gold Corp second quarter 2025 financial results conference call. As a reminder, all participants today are in listen-only mode, and the conference is being recorded. After today's presentation, there will be an opportunity for analysts to ask questions. To join the question queue, you may press *1 on your touch-tone phone. Should you need assistance joining today's conference, you may call and signal for a conference operator by pressing *0. I would now like to turn the conference over to Mr. Clive Johnson, President and CEO of B2Gold. Please proceed.
Speaker 0
Thanks, Dr. Lee. Good luck with your call, everyone. For me, too, we have the strong quarter. The second quarter, we saw a lot of favorable financial results. I put all my praise to your guys' team since our second quarter results. The total of $530 qualified for all. I didn't have expectations in the second quarter on the production side. We're looking at lower than expected tax operating costs throughout the operation. The operating continues to run well with the expected needs of our annual value. Additionally, looking at the top for our June 30, 2025, we saw the amount of growth for our cash flowability expected to drop. It's hard to face. That's great for both B2Gold as it's a key option for our tasked partners. We have worked. Privacy and research treatment.
The students are focused on our plans to continue studying and staying up late, and please do give full attention to that when you see some wrap-up. We commence the production of the expected to be achieved in September 2025, which is quite a rapid wrap-up. Pretty much, yeah, that's a little over a 20-hour period of history. The following weeks have seen increased rate opportunities in our view, and I say the following: that's approval to the benefit of our operation. The approval follow-up production lease agreement was seeking that to add or see in addition to the value. Including the finance, there's some financial notes from my dead advice from my accountant. I think this is a really important point. Just for those that understand about the piece of global value, it's clearly under my staff, the government values, cooperating with B2Gold. That's B2Gold.
To be in the country that operates the coal mine and be a collection agency. To protect yourself, please always be able to stay in the value to realize that it's a mindset change for you. Call and see if it's not. During the second quarter of 2025, we also have the opportunity to help with the notice of two challenges in the cycle. Nevertheless, we see stability starting. It's an understanding that the MI project has been here for the past 12 months and part of its project economics. We're determining about, and we already have a prudent note to matter if our transaction loss rate happens to have a repetition. This through a full cycle provider of B2Gold as well to update value planning and go back to the one million out in January.
I'm going to be starting to grow the targeting of the assessment of product 20% to help out the asset over value over the next 10 years, including production before looking forward to 18. As we are looking forward to that, it's on quarter-optimization financing. Like I said, that's going to be our guide through 2025. With that, I'd like to now turn it over to Mike Cinnamond. He's a board member. He'll quickly do a financial ad, and then we'll have a little line on the CBG operations talking. Do a quick update on the piece. Then we'll open up through 22. Mike, over to you.
Speaker 4
Thanks, Clive. I mean, financially, it was a strong quarter. Our basic earnings per share were $0.12 per share, and adjusting for one kind of items, which were actually offsetting, we actually realized $0.12 per share of adjusted earnings. You know, fair to say that that's definitely benefited from the strong average gold sales price. Just to maybe touch on the sales point too, we were slightly behind budgeted sales ounces in the quarter, but that was purely on a timing basis. The timing of shipments from several of the sites, those ounces were shipped out just after the period end in early July. On the operating cash flow side, the operating cash flow before working capital adjustments was $301 million in the second quarter, another strong result. Again, highlights the cash generation potential of our operating assets and the sales price environment.
Balance sheet-wise, we continue to remain in a strong financial position. We've got cash and cash equivalents of $308 million at the end of the second quarter. Also, at the end of the second quarter, we had the full $800 million available in our revolving credit facility, which is undrawn, plus the $200 million accordion feature. I will say that subsequent to the end of June, we did draw down $200 million on the revolver. That was to help us manage working capital requirements as we start to deliver into our gold clean haven commitments over the 12-month period from July 2025 to June 2026. In fact, we have already delivered the first tranche of those. We're trying to unwind that position.
With continued strong performance across the portfolio and a ramp-up of Goose, which is now well underway, we were pleased to restate and reiterate our production guidance for 2025 unchanged, with full-year production expected to be between 970,000 and 1,075,000 ounces. We expect Goose to still contribute between 120,000 to 150,000 of those ounces. Again, on the positive side, with lower than expected cash cost per ounce as the existing three operating mine sites, Fekola, Masbate, and Otjikoto, we're pleased to announce that the company has reduced its consolidated cash cost guidance range for those three operations to between $740 and $800 per ounce. This is lower than the previous guidance range of between $835 and $895 per ounce. With the employment of the post-commercial production estimates for the Goose Project, I remind you that we expect Goose to come into commercial production in September.
Consolidated cash operating guidance is now forecast to be between $795 and $855 per ounce. Overall, on a liquidity basis, we continue to maintain a good amount of financial flexibility. We look a lot to complete our remaining ramp-up of construction activities at Goose, to fully repay our deliverance of the gold prepaid to enter into in early 2024, and to complete the elevated sustaining and growth initiatives across the portfolio. We will continue to fund healthy aspiration programs as well, which we expect will extend line-wise. With that, I'll turn it over to Bill for an operation and project update.
Speaker 5
All right. Thanks, Mike. I just got back from the Goose, so I may be a little sparrow during this, so bear with me. As Mike said, on the three operations, we expect to meet or exceed all of our targets for the year. Probably what everyone wants to talk about is Goose. Just going back to what has been completed there, Goose, all the major construction activities which are required were nearly completed at the end of the quarter, and the mine ramp-up is now well underway. The focus for the third quarter now turns actually to optimizing the current operations and increasing the throughput to full capacity. As Mike indicated, the ramp-up to commercial production is expected in September 2025. Things which were completed in the first half of 2025 at the Goose include the completion of the mining of the Echo Pit.
Remember, that was our tailings facility and commissioning. We are now placing tails in Echo. Full ramp-up of mining of the Emerald Open Pit in the second quarter. We also had continued development of the Emerald Underground. We completed the Fresh Airways 1 already and are in the process of developing Fresh Airways Number 2, which will be needed in the second half of 2025. We commenced dewatering of the Lama Pits. All these things are required to run the mill correctly. This provides fresh water and reclaimed water to the mill. We developed the Emerald Open Pit and Underground, and that remains a priority to ensure that the adequate mill feed volumes are maintained. If you look at around the other operations, Mali continued the strong performance for 2025, exceeding gold production expectations again in the second quarter.
As Mike said, cash costs per ounce were also lower than expected. Underground, after meeting with the government last quarter or last month, the underground production has commenced, as announced on July 30. The underground development is well advanced with over 9,300 meters of development work, plus the installation of all required underground mining infrastructure having all been performed prior to commencing production. If you remember, we were actually given a permit to do all the development. Even though we were 30 days late on the starting of mining of ore, we, in fact, continued to develop right up until July 30. The question I've heard being asked several times is whether or not we think we're going to get the ounces required from underground. We absolutely see a path to make sure that all the required ounces from underground will be delivered in 2025.
The regional project, we continued with our meeting with them. We continue to work with the state of Mali to finalize the approval of the regional exploitation permit in the third quarter of 2025. Just kind of late-breaking. We've actually had our first technical session with them this morning. We absolutely see a path toward getting this permit. B2Gold is ready to commence pre-stripping activities with the Fekola regional infrastructure. Remember, once again, this was one of those facilities where they allowed us to do all of the infrastructure development. So the haul roads in place and all the infrastructure is already in place. We're just waiting on a permit pre-stripping. Subsequent to June 30, 2025, the Fekola mill celebrated a significant milestone with 4 million ounces of gold produced since the inception of the project.
At Masbate, the operations continue to perform well with a world-class safety track record, which I think we announced more than 2,400 days without a lost-time incident. Mine production significantly outperformed expectations, and we anticipate consistent production in the second half will result in strong 2025 performance and robust margins. Otjikoto is also going very well. The open pit and underground went well during the second quarter with production also exceeding expectations. During the second quarter, remember, we're working on this Antelope deposit, so we continue to focus on developing that with the target release in the third quarter of 2025. The other development project is Gramalote. We released the positive feasibility studies. Work has commenced on the modification of the work plan and environmental impact study, and we expect to be complete in late 2025 or early 2026.
We anticipate that the current modification timeframe should be approximately 12 to 18 months. With that, Clive, I'll turn it back over to you.
Speaker 0
Thanks, Bill. I'll update the range of some of the questions.
Speaker 3
Thank you. We will now begin the analyst question and answer session. As a reminder, to join the question queue, you may press * then 1 on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw it, please press * then 2. We will now pause momentarily to assemble our roster. Today's first question comes from Fahad Tariq with Jefferies. Please proceed.
Hi. Thanks for taking my question. In the press release, it mentions lower than anticipated fuel cost in a number of places, not just at Fekola, but also in Masbate. Can you just maybe talk about what the expectation was at the beginning of the year when you set guidance? I'm just curious why it's trending lower than expected. Thanks.
Speaker 5
Mike, do you want to take that? Do you want me to?
I'll start. When we budget, we typically have a look at the forward curve on the fuel price, usually around September, October. We use those as the base. What we've seen and what's been realized is the price of the HFO is about 9% lower than most prices over the first six months of 2025, and diesel's actually been more, seeing something more like 13% below. We made our best guessing at that back when we set the budget, probably set somewhere around the October price because we were budgeting to finalize it up in early November. Our change policy is as we've looked forward, we have taken into account those lower fuel costs when we're looking at the re-guidance that we put out in the cash operating side.
Speaker 4
Yeah, that's helpful. On Goose, there was a comment about the CapEx guidance for the second half of this year, $176 million. I'm just trying to reconcile the overall CapEx at Goose relative to what the project guidance, the project CapEx guidance was before, and I think it was reiterated in the May release. Can you just maybe help us walk through that? I guess the other way of asking is, is that second-half CapEx guidance of $176 million consistent with what you were expecting? Thanks.
Yeah. I can start with that and Bill can jump in. I mean, overall, on the projects, we did see some acceleration of costs as we worked our way up to the first goal quarter at the end of half one. We probably saw somewhere around about 5% overall cost increases against the budget. What we also experienced as we ran up to that is we did accelerate some CapEx. CapEx that we're doing in half two in the track report and actually a little bit in future years. That totaled about somewhere in the region of $60 million. We also had, what we've described in the NDA and disclosures, some mill and process plant upgrades somewhere in the region of $40 million.
So approximately $100 million between those two, where we pulled stuff forward from the second half, and then about $40 million that we've added into the second half, I think. A little bit.
Speaker 5
Yeah. Really, relating to upgrades, I would say once again, it was really operability or availability of the mill. One of the things that as we got in and built and we realized a lot of the lines didn't have the necessary valving and piping, the redundancy built in, the ability to do maintenance on the mill while it continues to operate. We added, I think I saw from the finance group, approximately an additional $25 million on the mill side related to what I would call upgrades or improvements in availability. I'd say that really relates to a lot of that small stuff, additional pumping, piping, valves, and installation of all that stuff.
Speaker 4
Okay, thank you.
Speaker 3
Our next question comes from Wayne Lam with TD Cowen. Please proceed.
Yeah. Thanks, guys. We've got some good quarter in and getting the Fekola Underground permit. It seems like you have some good momentum in Mali now. Just wondering what the mechanics would be in terms of getting the Fekola regional permit and what the final points of negotiation might be. Any potential hurdles to getting that permit by the end of Q3?
Speaker 5
Yeah. As I said, we went down and met with the Minister of Mines. During the discussion, it almost seemed like for them, the regional permit has kind of dropped off because they were dealing with some of the other government, the other mining houses issued there, which shall not be named on this call. Once we brought it forward, quite frankly, they were a little embarrassed that they hadn't done it yet. They immediately agreed to try and get this thing pushed out by the end of Q3. That was their schedule, not ours, and they immediately agreed to set up a commission and start working on that. That happened this morning. We haven't heard any outstanding issues, other than to hear that it wasn't a yell fest or an argument. It was just a very constructive discussion, which we think leads to the permit.
That was great. Thanks. Just wondering in terms of the ramp-up of Goose relative to the mine plan, you guys had outlined in the plan 125,000 ounces this year, which would be at the lower end of the guidance. It seems like you've been making some good progress there, just on the stripping of the Echo Pit and the development. Just wondering where you guys kind of see the opportunity to outperform, what's been outlined in the plan. Is that on the plant performance or is there upside on the grade profile as well?
I would say both at this point. Once again, you're asking questions right at the front of commissioning. Certainly, we have an aggressive ramp-up plan, but historically, we've been able to beat that. There is some potential there. There's also some potential as we start to move out of kind of the eco low-grade material, which, you know, remember, the Eco Pit was never designed to be a kind of a high-grade feeder into the mill. Into the Emerald Pit, if we can get our head around how we can mine that quicker, certainly there is some potential there. I would say not only on the mill ramp-up side, which admittedly a three-month ramp-up is aggressive versus many other of our peers, but not really aggressive versus what we've historically done. On the Emerald side, if we can get additional grade from the open pit.
That was great. Thanks. Maybe just a follow-up on the CapEx side. Just given the increase in CapEx relative to the $270 million in the mine plan, just wondering how much of that would have been brought forward from 2026. Just trying to figure out if maybe we should be anticipating a lower CapEx number relative to the $140 million outlined for next year in the mine plan. Okay. You're talking about what may have been pulled forward from 2026 in the second half? Is that what you're asking? Yeah. I think there's some site infrastructure upgrades where Bill's doing what he wants to do to enhance both the MLA and the site. That's about $15 million. As Bill mentioned, there's $26 million roughly related to the mill.
So there's $40 million, let's say, that are things we didn't have to do this year, but we want to do to enhance it. Then there's some pre-payments on some generator additions that we have. There's another $24 million. It would be more than $60 million that would be pulled forward from a future year.
Speaker 4
Okay. Got it. Okay. Cool. Thanks for taking my questions.
Speaker 3
The next question is from Ovais Habib with Scotiabank. Please proceed.
Thanks, operator. Good morning, Clive and B2 team. Congrats on a good quarter. Just a couple of questions from me. Starting off with Fekola, maybe. In terms of the mine plan sequencing for Fekola going into 2026, does that change now that you have the Fekola Underground permit in hand?
Speaker 5
Remember, we always talked about having it after Q2. Our Otjikoto mine showed it really coming online in July. The Underground permit doesn't really change it other than we have done a little bit more development than what was in Otjikoto mine. We may be able to steal some additional ounces, but I really think that's more of a 2025 issue, not a 2026 issue. As far as 2026, we're still working on the budget and where we're going with that. I don't really want to comment on where the ounces will come from in 2026 this year.
Got it. Bill, in terms of what would be the current grade of the underground stockpiles that you will have on site, what would be the grade that you're expecting from the stopes that you're currently mining?
You're talking at Fekola?
Fekola Underground, yes.
I don't, I'd have to look that one up for sure. I did actually report to the board what it is. Let me come back during this call. Let me come back to you on that.
Sounds good. No worries. Just moving on from there, in terms of, you know, you're targeting about 25,000 ounces from the underground in 2025. I guess this is kind of my follow-up question from my previous one, but is there a target that you have in mind for 2026 for the Fekola Underground? Is there a range that you can talk about right now?
Yeah. Remember, we always talked about the fact that we thought we could produce about 80,000 or 100,000, between 80,000 and 100,000 ounces out of the underground. Remember, that replaces lower grade ounces. The reality is you're going to get kind of probably 50% of that, so you know, we're kind of targeting that 50,000 ounces a year. Just going back to your previous question, I see the total underground tons mined through this kind of development, which is on the stockpile right now, is just about 35,000 ounces. It's just like 2.7 grams per ton. Once again, I'm speaking out of turn, but we're at least double that in the stopes we'll be mining.
Got it. Thanks for that cover, Bill. Just moving on to the regional permit side, assuming you get the permit by the end of Q3, is that what you're targeting? Are you comfortable with the 160,000 to 180,000 ounces of production in 2026? That's kind of going by the tech report that was presented earlier this year.
Yeah. I mean, there's no changes to what the actual mining looks like from the tech report. Clearly, once again, in the budgeting process on where the ounces are going to come from, that may stick around some, but the ounces haven't changed from the regional from what was in the tech report.
Sounds good. Okay. Thanks for that. Just quickly moving on to Goose. I'm really looking forward to that commissioning of the Goose in September. Bill, how's underground development progressing there? Do you have kind of, you know, now the right people and equipment in place, in terms of what you were targeting for the underground? This is at Goose.
Yeah. Yeah. First of all, I remember when I first joined these calls, Clive declaring, I think to you, that we only get three questions. Let's start with that. Since this is question number four, I'm going to take it. Things are going well. We kind of hit our stride. We have, as you know, turned over a bunch of people in the underground. There's a new mining manager which came in this year, new Technical Services Manager. All those people are in place. We also brought in additional equipment on the HERC program this year for the underground. The answer is yes. We now have the right people, and yes, we now have the right equipment. There really isn't an excuse for the site not to be able to deliver.
Okay. Good stuff, Bill. Thanks so much for all this color. Thanks for taking my questions, and congrats on a good quarter.
Thanks, guys.
Speaker 3
As a reminder, if you do have a question, please press * then 1. Our next question is from Anita Soni with CIBC Capital Markets. Please proceed.
Speaker 1
Good morning, Clive, Mike, and Bill. I'm just going to ask two, so that will make up for Ovais's extra question there. First question was, your commercial production. What's your definition of commercial production? I just want to clarify because everyone has a different definition.
Speaker 5
Yeah. I think it's the same thing we used at Fekola and Otjikoto. That's like, an average of 65% mill plate throughput over 30 days.
Speaker 1
Okay. From your perspective, what's the next milestone in terms of the ramp? I guess year-end. What are you targeting for? What are the throughput ramp-ups you're hoping to get to by year-end, and for how long?
Speaker 5
By year-end, we want to be at that nail plate 4,000 for sure.
Speaker 1
You mean be 100% for the whole quarter?
Speaker 5
I think it's like 92% or 93% availability. It's something like that. Okay, I forget what it'll be in the tech report.
Speaker 1
Okay, and then last question, I guess, that I did ask for you. Just in terms of the optimization plans that you're looking at, in terms of the doing a winter ice road less than, I think you said, less than annually, what would that entail? I would assume that it's kind of a, is there a way to do an ice road that's, you know, not like not at the ice road timing? Or like was it every other year? Or what, like what are you looking at? Like in every 15 months or so? Like I'm just trying to understand that phrase.
Speaker 5
It can't be every 15 months. The ice road must be almost always between February and kind of that May 1, let's say May 6. That is the ice road date. The question you're asking is actually one that's almost like an engineering interest. The question really revolves around fuel as the first problem. If, in fact, you need 80 million liters of fuel, which is what we're sending down the road every year right now, it would have to be every year. We just don't have the tankage to do anything less than that. Let's say that we actually are successful by putting these medium-speed generators in, which saves about 10% of that. Then you say, "Okay, now we're going to put our wind farm in, which is 50 megawatts." Could you get to a point where the number is less than half?
You suddenly say, "Okay, now can I increase my raises to make up that difference in the off years and do it?" Those studies are obviously very preliminary, so much so I'm not convinced that 80 million liters is actually what we're going to use this year. For example, right now, we're sitting here in August, and we still have 70 million liters of fuel sitting on site. How does that really add up once you get into full production? We just don't know yet.
Speaker 1
Okay. All right. That's it for my questions, and congrats on some strong operations this quarter.
Speaker 5
Thanks, Anita.
Speaker 3
The next question is from Lawson Winder with BofA Securities. Please proceed.
Thank you, operator. Good morning, gentlemen. Thank you for today's update. Well done on the permit success in Mali. What I wanted to ask is, going around the jurisdiction, and as it pertains to Colombia in particular and Canada. Acknowledging B2Gold's historical success at, you know, being jurisdictionally agnostic and focusing on asset quality instead, I think feedback from the market would suggest that the market likes to pivot to Canada. How do you think about assets in Canada? What's B2Gold's appetite to add more assets in Canada? Conversely, how does Colombia then stack up in terms of jurisdictional risk? Does that start a headwind today for a potential site-changing decision on Gramalote? Thanks.
Speaker 0
Yeah. I think we always are definitely interested in Gramalote in Canada. Once again, we're project-driven. From a theoretical point of view, we want more of those stages. Definitely, we're putting various options in Canada. Gramalote is in Colombia, we see quite a bit happening there. I mean, we do have a permit for a larger opportunity to lease back and modify that permit. We've got three houses to board in Ethiopia, local population and government in Ethiopia, and also some signals from the federal government as well. I'm going to raise the question because I want to segue that a little bit as you talked about M&A. We will not fund fuel development projects M&A. It's just one of these build one line at a time. We think Gramalote would carry a production as well as the project to start new financial movement and start positioning.
To do that, we might oversee the feasibility economy. I think it would be a very good project for us. We've got to get through the permitting process and that they can see where they can go forward. I just want to underline, again, no M&A for development projects. Particularly in the future, sometimes if we find an opportunity to increase our goals, we should have kind of a deal. We need to have a look at that part. That makes sense. At the end of the day, we're not going to surprise them with a base estimation for development project.
Thanks, Art. If I could just get one more in on Goose. In your update earlier in the year, you highlighted the potential for an expansion in the processing capacity. Today, now that you're approaching commercial production, what's the latest thinking on timing of that expansion in the processing capacity? Has there been any change in thinking on the magnitude?
Speaker 5
Is this a what have you done for me lately question?
Sorry, guys. Thanks a lot.
All right. The answer is, as you know, we've got several studies in the hopper. One would be, you know, we've got a flotation circuit, which you might be able to add. The other is, would you expand the mill capacity, go up to something like 6,000 tons a day. Those are all due really at first look by the end of this year. I think we're, I can't remember if we're talking Q1 next year, if we're talking about putting out the results. At the end of the day, those are very, very early on in the study, you know, where they go. We think they're all very real. Just so you know, we talked about some of these optimizations. The mill will run at more than 4,000 tons. It's just a question of can you keep the availability up?
By increasing some of these optimizations we've already put in, like I said, these valves, piping, and everything, there is the potential we get to squeeze out some additional capacity as it currently stands. No promises. We're saying 4,000 tons a day.
Fair enough. Thank you very much for taking my questions.
Speaker 3
The next question comes from Francesco Costanzo with Scotiabank. Please proceed.
Hi, guys. Sorry, I didn't mean to jump into questions here. I think Ovais, Benito, and the others could already answer all the pertinent questions, so apologies for that.
The next question comes from Don DeMarco with National Bank Financial. Please proceed.
Thank you, operator. Good morning, Clive and team. It sounds like things are moving along well in Mali now. You've got the, it looks like the regional permit. You know.
What was the reason for delay? I mean, was the government focusing on Bearer? Can they do other stuff? Is this kind of just an arm in Mali? Are permanent benefits from optimal mine performance from a tax point of view?
Speaker 5
Yeah. Maybe I'll take that since we were just down there. There's a couple of things there. Remember, there was this whole shift in the government, and they readily admitted that they didn't really know who was doing what. You had the Minister of Finance working on this kind of updated mining code, and the Minister of Mines didn't know where his mandate ended and the Minister of Mines started. We've highlighted that. We had a chance to meet with the Prime Minister, and they were visibly embarrassed and said that's a non-starter for them, and they will get it rectified. Certainly, I think some of the other mining issues in Mali play a factor.
I think the fact that there were some big disputes out there that they had to pay attention to took up some of their bandwidth, but ultimately, they also didn't really know what each other was doing. I will say that all three ministers we met, we met Minister of Mines, Minister of Finance, and the Prime Minister, they all apologized profusely. They all said that they're committed to getting this done. Remember, they've got a big stake in this too. They want to go as quickly as they can, of course, legally, to get us this permit and get us going.
Okay, great. Thanks for that. Yeah, go ahead.
Speaker 0
And then.
Thank you.
Maybe just add a little bit, if I could just add a little bit to that, some of the questions here passed without further negotiation for the government to get the permit for the vehicles. There is no further negotiation. We're inactive in terms of negotiating in the MOU last September. That clarified that we're not in negotiation mode with getting the permit done and hoping for the government to do it. During these times when the government balances and other things, the revenues, the capacity for them to get revenues from the gold mines would be to get us that permit because they own 35% of the vehicle. They're on the same page as us. I want to get that permit and get going with 2024 as soon as possible.
Okay. That helps. That certainly clarifies things because that would have been our impression as well. That's encouraging for the future. Sticking with Fekola then in Mali, I saw production's up 35% quarter to quarter. Grades are elevated. Bill, do you expect this to continue into H2? What were some of the drivers here in Q2?
Speaker 5
Some of the drivers really revolved around finding additional or kind of on the margins of where the resource model was. It wasn't higher grade ounces, but it was ounces, or it was tons that would have been considered waste that we ended up being able to process through the mill. We also had a very good run with the mill. The mill had a very good quarter, and those were the two main things. Obviously, I can't predict what's going to happen outside of the resource model in Q3 and Q4, but the mill is kind of firing on all cylinders. One of the things that we've been very open about is that even if we don't get tons or get ounces from the regional stuff into the mill in 2025, we still feel very comfortable with our range that we put out there.
That obviously would mean that we're going to get additional ounces from somewhere else.
Speaker 0
Now, that's a pre-scripting.
Speaker 5
Yeah, I figured I didn't. Yeah, Clive, it's back to a good point. Even if we get a permit in, let's say, August or September, there is still a pre-stripping campaign which we have to do before we start charging tons down to the mill.
Okay. Okay. Just for a final question, though, shifting over to Goose. I see that the AISC for Goose is lower than what it was in the tech report by a bit. You know, what are some of the efficiencies that would explain this delta, favorable delta? Is there a read-through for lower costs at Goose in 2026 versus the technical report? Is some of the CapEx that you kind of push forward also provide read-through for lower AISCs in 2026?
Yeah. Maybe I'll talk, and then I'll let Mike correct me. When we wrote the technical report, really, the information we had was what was created by Sabina for the feasibility study and the actuals we had during construction, right? In construction, there are all these inefficiencies where you're flying stuff in, you've got the wrong crew. What we've seen as we've now been able to tighten that up, and particularly around the mining side, is that we're probably a little bit worse than what Sabina had promised the world, but a lot better than what we had seen as kind of a developer. I do believe that the costs that we're now presenting on the mining side in particular, and hopefully on the milling side, will carry through. We're going to see those.
I think I can't remember what we said they were ultimately going to be, our off-chain costs, but they were coming down, and we do see those as real.
Okay, thanks for that, Bill.
Speaker 0
I'm following the ads on part of the impact in the 25 number that we're using post-commercial production, which is basically post the chamber. That would be estimated. You have a production, what, there between Q3 and Q4, and you also have some of this CapEx that we pull forward and accelerate. Also, it's already occurred. That has some impact on the post-commercial production numbers.
Okay. Great. Thank you. That's all for me. Good luck with the rest of the quarter.
Thanks.
Speaker 3
The next question is from Terry McCrory with Canaccord Genuity Corp. Please proceed.
Thanks, everyone. ID, congrats on the quarter. Maybe just a question for Mike on the accounting around Goose now that you're ramping up production. Are we going to see OpEx starting from now on at Goose, or is that going to come after commercial production?
Speaker 0
No. Yeah, you're right, Donnie. In the new world order, I think for a few years, all results will go through the P&L and all production reported. It's just so you'll see everything from Q3, whatever production you have, whatever operating costs you have, whatever sales you have, you'll see them in our financial results.
Okay.
We will be subtracting the cash costs and all-in post-commercial production.
Is that based on the OpEx charges you've given us?
Correct.
I presume? Yeah. Okay. Maybe just kind of Fekola regional, just seeing the permit on the slimmer future here. Is that still an attractive area from an exploration focus, or do you see better opportunities elsewhere, just given the economics of that area now?
I'll have to hear to see the gas stuff on the exploration upside, believe it.
Speaker 5
Yeah. One of the areas that the CES side is the benign deoxide resource that we've pretty much started, and we have sufficient oxide on to keep us going quite a while. I think the big push is to actually pursue higher grade, fresh or sulfide material beneath the Fekola or beneath the off-cut zone, within the Fekola regional. That's really where a lot of the upside is. The other is looking at the underground, you know, obviously pursuing that as we develop the underground, we'll be able to drill, dark trench. There's nothing to suggest that that is clinical. We'll certainly be pushing that forward. There's also a potential for picking up a parallel to the main zone as the underground as well. That's really where the potential is.
On Dan Duncan, which is part of the Fekola regional, I think we pretty much have a depth that's probably held a lot more there, but that's it, really.
Speaker 0
you speak to us, please, about that?
Speaker 5
Yeah. We have a $62 million budget, U.S., for collaboratives. Half of that is at Goose. It's about half, and then obviously, ongoing drilling is high, pursuing extensions of the Antelope deposits in the Midias. Also looking at the potential for surface material in the Midias to complement, and to help the throughput, as we look down the road at Otjikoto to use more than just the stockpile, to blend the high-grade material that we have there. That's where it's at. Also pursuing new areas, using and leveraging our experience in Masbate, the Philippines. We're looking at opportunities in New Zealand at the moment, but that's all very early stage. That's where we're at.
Okay. Great. Maybe one last question from me, just on Gramalote again. Were you guys, did the feasibility study kind of meet with what you're expecting? I guess what I'm asking is, if you get through the permitting for the next 12 to 18 months for a $3,000 gold environment, how likely is this to move forward?
Speaker 0
I think the microscopic studies are going to subscribe to us. We're not going to have a ton of work done. All we need to do is buy ETA and buy ourselves and buy the supplies you want to pay for. A lot of people probably know what I'm going to have to send them. There's a lot of technical work, a lot of studies that happen forward. They're using the localized ingredients that it's going to be. I think it's worth it for our clients. We would expect it to be a feasibility study to be hopefully to the DA. You know, I think if you look at how we get the potential to produce the 240,000 ounces a year on the gate at Gramalote, there aren't many of those ounces. You're only going to have to say if we don't buy it.
Like the economist, you know, I don't know how you would, you know, help fill that. What are you going to do in terms of projects that say cold virus issues, which you own, and we'll be able to send a picture of tickets. I'll give them the same right now. I want you to get much like Jay LeBeau about what took our advice.
Okay. Great. Thank you. Thanks, guys.
Speaker 5
Thanks.
Speaker 3
Again, if you are an analyst and you do have a question, please press * then 1. At this time, there are no further questioners in the queue. This does conclude today's question and answer session. I would now like to turn the conference back over to Clive Johnson for any closing remarks.
Speaker 0
Thanks, Clive. Since we did a question and we covered a lot of ground there, one final question I have for the analysts, if anybody is figuring out the market, I'd like to know how these codes are. Got a good quote like that. That's how I see the profit on the I said the price of the market was only tied to price to work, I guess. Thank you very much for participating in the call.
Speaker 3
Today's conference is now concluded. Thank you for attending today's presentation, and you may now disconnect your line and have a pleasant day.