K92 Mining Inc Q3 2023 Earnings Call Transcript

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

Question: Arun Lamba - TD Securities Equity Research - Analyst : John, just given it's pretty close to year-end, just wondering what you're thinking in terms of this growth CapEx guidance? Should we expect it in the next month or so? Or at this point is the thinking to maybe just wait for January when you plan on when you usually release kind of 2024 guidance?

Question: Arun Lamba - TD Securities Equity Research - Analyst : And just you mentioned record development in October. I believe earlier in the year, the hope was to catch up on the kind of delays that happened because of COVID by year-end, but we had the unfortunate accident in late June, which caused some downtime. Do you expect to be kind of caught up by year-end or what it might potentially take a couple more months based on what you're doing on development?

Question: Arun Lamba - TD Securities Equity Research - Analyst : Great. Okay. And just lastly, more just logistics. In terms of timing, was it planning to do an updated resource before year-end? Or would that come in Q1? And same with kind of the closing of the $100 million facility. I know you don't need the $25 million that can be released on there, but just in terms of timing on the resource and the closing of the facility.

Question: Don DeMarco - National Bank Financial, Inc., Research Division - Analyst : I think most of my questions have been answered, but maybe we could dig a little bit deeper into the mining rates about to commence in the twin incline. Congratulations on that. So looking at the mining rights in December, would this -- like this new mining front, what would you expect the mining rates to be there? And would this or be potentially available to be milled in which case it could mitigate the potential for any interruption like we saw earlier this year in entering sort of a lower grade zone?

Question: Don DeMarco - National Bank Financial, Inc., Research Division - Analyst : Okay. Great. And while we're talking about the resource and any update and so on, could you provide us with anticipated updates for the exploration that you have ongoing at the A1 porphyry. I guess that the next update would be a drilling update and then maybe later on further drilling or potentially a resource update. Is that how you see it?

Question: Don DeMarco - National Bank Financial, Inc., Research Division - Analyst : Okay. Great. So we look forward to a number of exploration catalysts pending in and resource as well. And final question, going back to the Trafigura alone, encouraged by your response from -- to a recent previous caller that the terms are expected to be finalized before year-end. But I see also that you're planning on drawing down $25 million in Q4. Now is that -- of course, like looking at your cash balance, which appears adequate at this point, the $25 million doesn't appear to be needed. Is that just sort of a prerequisite of the loan conditions to make that initial drawdown even though it's not (technical difficulty) It's not a prerequisite of the loan. There's no requirement to draw down the first $25 million. We obviously want to maintain a healthy cash balance. So it's more about just maintaining that healthy cash balance. And although the cash balance did go down this quarter, the majority of that, that went down was simply that we either -- that we ended the quarter as was flagged by Justin with something like 4,000 ounces more than we started the quarter that haven't been sold. So a significant portion of that was that plus the buildup in our stocks, which obviously is in part because we're expanding the whole operation. We're increasing into equipment that we have. So no, there's no specific requirement -- and we're just -- we're not used to having debt. So it's a new experience to have some debt as well sitting there. Okay. Well, that's all for me. So good luck with the rest of the quarter, this strong quarter that you're working through right now.