Q2 2019 Northern Star Resources Ltd Activities Report Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Hayden Bairstow - Macquarie Research - Analyst : Just a question on Pogo. I just want to get my sort of head around tonnes and grades. I mean, obviously, the reserve is much higher. And with this sort of strategy you're taking now, do we assume there's sort of more diluted sort of mining inventory with more tonnes at a lower grade? That given your quarter you've just gone is sort of in line with guidance, I guess, but is that -- so is that sort of an indication of what the next 12 months or so looks like?

Question: Hayden Bairstow - Macquarie Research - Analyst : Okay. So the increased development that you're doing now, that carries on for another couple of quarters? Or is it a whole year? Or what sort of timing before we...

Question: Hayden Bairstow - Macquarie Research - Analyst : Okay. And just quickly on Kal. I mean, you sort of deliberately, I guess, dropped the grade given where gold prices are. So if we assume gold stays where it is, then that sort of the go-forward plan from here is to maintain those sort of rates? without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. JANUARY 22, 2019 / 11:30PM, NST.AX - Q2 2019 Northern Star Resources Ltd Activities Report Call

Question: Hayden Bairstow - Macquarie Research - Analyst : Okay. So these -- and these ounces are almost with no development cost, I guess, it's all remnant stuff?

Question: Paul Hissey - RBC Capital Markets, LLC, Research Division - Analyst : Three questions from me. Just maybe a little bit more granularity on the change in your guidance at Pogo. I mean, I think you only gave guidance a quarter or so ago on what that would look like. What have you learned over the last quarter or so that's led to that change? I mean, obviously, it arises from a decision to spend more money. But just take us through what's changed.

Question: Paul Hissey - RBC Capital Markets, LLC, Research Division - Analyst : Yes, yes. That comes through in the quarterly today. Second point on reserves. You say in the note -- you talked about the margins in the release, sorry. You talked about margins, and then you talk about it sort of auguring well for reserves at midyear. Can we take an inference from that, that you might consider using a new perhaps higher gold price assumption in your reserve calculations?

Question: Paul Hissey - RBC Capital Markets, LLC, Research Division - Analyst : Yes, got it. And last question is I guess philosophically, does that mean margins for Northern Star have peaked notionally? If you guys are prepared to manage to a margin, is 50% EBITDA or whatever, is that the right number? And if we saw another $100 an ounce on the gold price, you'd bring in the next round of marginal material, effectively trading away an even higher margin because you're comfortable with where you're at, at the moment? Is that, I mean, fundamentally correct?