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Regis Resources Ltd

View Company Profile

September 16, 2024 at 1:00 PM (MDT)|Broadmoor Hotel & Resort

Jim Beyer

Managing Director and CEO

Jim Beyer
Managing Director and Chief Executive Officer, Regis Resources

Jim Beyer has been the Managing Director and Chief Executive Officer at Regis since October 2018.

Jim is a Mining Engineer with a broad range of strategic, operating and start-up experience encompassing more than 30 years across a number of commodities including gold, copper, uranium, lead, zinc and iron ore.

Prior to joining Regis Resources Jim was the Chief Executive Officer of ASX listed Western Australian based iron ore producer and explorer Mt Gibson Iron Limited (ASX: MGX).

Jim holds a Bachelor of Engineering (Mining) degree, a Master of Geoscience (Mineral Economics) and is President of the Association of Mining & Exploration Companies (AMEC) Executive Council.

This is an automatically generated transcript. Denver Gold Group cannot accept responsibility for mistakes, errors, omissions, or any action taken in reliance thereon. Use of this transcript is governed by Denver Gold Group’s Terms of Use.

Jim, welcome back to the Denver Gold Conference and we look forward to your presentation. Yeah, thanks Hayden and thanks to the organizers for the opportunity to present the update on the reader's story. Ok, I will draw everybody's attention to the cautionary statements. We are making forward looking statements and production outlook and exploration targets. So, first off for those that aren't familiar who is Regis and where are we? We, we're an unhedged producer. We've got Long Life assets and we've got producing assets in Western Australia and we have a resource sitting in New South Wales called mcphee's 2.7 million ounces at Juke to, to give you a bit of a feel for scale and size. Last year, last financial year, we produced 290,000 ounces of gold at an all and sustaining cost of $1583 at Tropicana. And we've got about six years of life at Juke at Tropicana. We own a 30% share with Anglo Gold as Shanty. Our share of that proportion of production last year was 100 and 29,000 ounces for an all in sustaining of 1425 and these are all in us dollars, total resources of 7 million and total reserves of 1.5. A quick corporate snapshot. I won't spend too long on this. Although I would point point out that our our capital structure, about 4044 45% of our shares are held by Australian. on the are Australian based about 40% from North America and then the rest spread across other parts of the world. We're a $1 billion us, us $1 billion market cap 755 million shares on, on issue. And as you can see, we've got a fairly wide brokerage cover, turning a, a little bit to our how we go about our business and the corporate responsibilities. We see safety, of course, a prime objective. We're very pleased that we had a full year of lost time injury, frequency of zero. So we had no lost time injury frequencies across our business. Now, these are our managed assets. So this is just a duke and this doesn't include Tropicana, which is, as I said before, is managed by Anglo. Our land rehab is up up 400% relative to fy 22. We're doing a lot of work now to, to to catch up and it's actually proving to be a lot cheaper to do rehab. Now during operations than it is to leave it towards the end. So we've been picking that rate up quite a bit our female representation, if as one measure of diversity is sitting above industry average in W A. It's around about 19 to 20% female participation in the resource industry. And we're sitting at 22% in our employees and about a third of our board. the F I guess the other elements, the renewable energy front, reducing our carbon emissions as part of the safeguard mechanism and to manage our carbon reduction but also to avoid the carbon carbon credit costs. We've implemented and commissioned a nine megawatt plant at Duke, a nine week megawatt solar farm at Duke, which is proving to be extremely effective in reducing our power costs as well as reducing our carbon footprint. A very very successful project that that one and a Tropicana at the moment, there's a huge 62 megawatt plan going in includes an array of solar and as well as some very large wind farms as well. Other elements that we introduce. We've built, continued to build our capacity and our relationship with the local Matin Jania group with a working together agreement and implemented some of the actions from the safe work culture across W A at our site business wise. It was a certainly a year of two halves last year as we wrapped up our hedging and we got rid of all of the hedges and bought out the last of it for about 98 million Aussie. At the end of December, we had a rec we, we finished the financial year at the end of June with just over $200 million in cash and bullying a record. We also had a record strong operating cash flows, EBI Das, 202 million and net debt is effectively zero. We've continued to build our cash since then. So we're very pleased to have, we have 300 million in debt was part of the debt that we took out for the Tropicana acquisition. And and we're that's 300 million Aussie. We're now over the line, we haven't paid it back, but we've certainly got more cash on hand than we do debt. So if you look at the half though and look and see, when did we start to generate significant cash? It was certainly in the second half of the year. And in the fourth quarter, in, in Aussie dollar terms, we generated from our, from our business just on $90 million for the quarter. We actually, if you look at our accounts, you'll see it a bit more than that. 100 and 10 million was added, but that included about $20 million worth of tax credit that we got back from some,, tax that we overpaid a few years ago, a couple of years ago. So now that we, we, we've removed the, the,, the hedging and we're moving forward, we are certainly becoming a very strong cash generating company. Now, if you have a look, this is our guidance for Fy 25 which really starts to set the scene as to how the company is going to look for the next few years. All up for the group of production range of 350 to 380. all in sustaining costs with the middle sitting at around mid 17 hundreds, growth capital sitting 75 to 85 exploration, 35 to 41. And you'll see that Mc Phillis, we've got under review. If you're not aware, we've got this very large project. But about a month ago, we got a very surprising and unusual declaration by the Federal Environmental Minister. That's meant we've put expenditure on mcphee's on hold while we work out what the next plan ahead is. But if you take a step back from that mcphee's is not the, the key and the heart of the business, the key and heart of the business for us is the operating business that we've got running in in Western Australia. And if you look at the rough midpoints, 365,000 ounces is the midpoint of our guidance for next year and all in sustaining costs, it's sitting at 1750. Now in that is about 100 $100 an ounce of non cash costs because we're doing a lot of stockpile treatment. The way all in sustaining costs is calculated, it involves stockpile accounting. So our actual cash costs are probably sitting at around 1650 in the middle of the middle of the guidance range there. So you can see do the maths, we will generate significant cash flow this coming business, this coming financial year. So how does that then position us for looking forward and how, how should you be looking at at at Regis over the next few years? Well, certainly out to 2028. If you look just simply at our reserves space, we'll be producing a duked in, in this range of 200 to 250,000 ounces of gold. And for Tropicana, 100 and 35 to 100 and 50,000 ounces of gold looking first at Juke Duke's made up of 33 mills all up. We have a a soft or a an oxide capacity of about 10 million tons per annum. We've actually put one of our mills on career and maintenance at Muller. We just don't have any material up there at the moment. We ran out of ore and we've got some exploration underway, but we decided to put that on care and maintenance. So the the primary source of our production, which is one of the reasons why it's come off year on year from last year is we're just running on a combination of undergrounds and open pits through the garden well, and Rosemont mills. So our plan at at Juke is to build up to and maybe even more four underground mines being supplemented by a series of smaller satellite open pits to give us this production range of 200 to 250,000 ounces. And this is an example of why we think. And as I said, that you look at our very simplistically, look at our reserves, you look out to fy 28 but because we're going underground, you need to be very careful about how you look and consider the value of the underground mines because they have a clear track record of replacing depletion. This graph on the left shows back in 2019 when we declared a maiden reserve at Rosemont Underground, we had about 100 and 20 odd 1000 ounces of gold. You jump forward for four years or so. And at the end of December in underground reserves, we had nearly three times, we had 335,000 ounces of gold sitting in reserves in our underground mines. And over that time, we produced just over a quarter of a million ounces. So what we're seeing here is a building up of our reserves in the underground and you're also seeing a replacement, a very consistent replacement of our reserves, which is the key to underground mining. You see it quite commonly in western Australia. There'll be a mine that has two or three years of reserves and it has done for the last 10 or 15 years. And that's what we're seeing here. We're setting this up. We've got two mines that are running at the moment. We've got a third mine that we've just approved called Garden Mill Main. So give it another 12 months or so and we will have three underground mines running. They generally each one can produce 50 to 70,000 ounces per annum each. And that's just a start. We do see that we have more potential for undergrounds and these are three of the next hot to trot targets. looking at underneath an old two is well pit where we're getting very similar geology to Garden. Well, where we see a potential for another underground mine at Ben Hur which is a mine that we're running at the moment, that's got some excellent intercepts down there that are really starting to shape up. And then there's another prospect which is actually it doesn't have anything on it yet. It's both got potential for an open pit as well as an underground. So sitting in that, in that little portfolio of three assets here and they're not the only ones we've got, we've got plenty more, but out of this we can see, we'll at least get another one I would think. And that's what we're wanting to get four or five underground mines between them. We can safely,, operate that 200 to 250,000 ounces where we can allow for the ebb and flow that usually happen with underground mines from year to year. The next asset is Tropicana, which is a very similar story. It's made up of an underground and an open pit one mil. In this case, in total 9 million tons of capacity, our share of that is 30%. So this coming year, we expect it to produce somewhere between 100 and 30 to 100 and 40,000 ounces. You can see the range for the A isc 1564 to basically a little bit under 1770 very low growth capital that r growth capital that we put in there is actually related to a third underground mine that we've at Havana that we've just announced the start of. So Tropicana we see is also having this capability of generating over the next few years out to the end of the decade, 100 and 35 to 100 and 50,000 ounces per annum. And again, if you have a look at the reserves, you might look at that and think I just can't see, you haven't got that in your reserves. But that again is the story of the undergrounds. So at, at at Tropicana, there are currently two main producing areas. I don't have a laser on this. So you can see over on the left hand side, there's Boston Shaker, which is the first major production area just to the left of that underneath the Tropicana pit, there's a second underground producing area and further off to the left in that purple area is the third area that we ha we're not producing from yet, but we will do. And the graph on the left shows this growth in underground reserves over time and over its life. So back, Boston Shaker had a maiden reserve of 320,000 ounces and here we are five years later or so, it's now got reserves underground, a drop of 661,000 ounces. And since we declared the first maiden reserve, we have produced nearly half a million ounces of gold. And that is the story of the underground mines that we are running or that we own. It just continues to replace depletion and in fact grow. So we see this third area sitting underneath Havana, which will come into production in probably 18 months to two years time. It's not big and none of them start life as being big, but it will be a third production zone that we will be sitting on in the in Tropicana area. So out until around about 2028 2029 we'll get a combination of production from the open pits and the undergrounds, then we'll see the undergrounds become more dominant. Although we have some very highly prospective exploration just north and south of the trend of the existing pits as well, which hasn't been looked at up until recently. So if you look at at the, where our business is generating its cash and it's got good life at Juke, it's about two thirds of our, of our capability at Tropicana. It's the other third and we see the potential for, for really growing the two belts that we're on at Tropica at at Juke and we sit on the Juke and Greenstone belt and it really hasn't shown up much ounces relative to some of its big big relatives of Greenstone belts and who are similar in physical size, but have got much, much larger gold endowments. The only reason that they're smaller is just because it just hasn't had the same amount of exploration done over on it over time. So both at Din and the Albany Fraser Belt, which is where Tropicana is located. They're both very junior or in they're in the infancy of, of gold potential because they just haven't been explored for as long as these other areas. So we see that we're that there's huge potential for us on the exploration front to add further value on top of those mines that I've already gone through and described. So I touch on mc Phily's, which is a very a large it was a 2 million ounce reserve. It's now dropped back to 2.7 million ounces of resource. It sits over in New South Wales. We did release a ad fs on this a couple of months ago. It's designed to have a 7 million ton per annum plant that would be, would have been co producing 61 million tons over that life averaging about 100 and 87,000 ounces per annum. And it improves higher production with age because the grades actually improve with depth peaking at about 235,000 ounces significant capital 666 177 million us. But a great all in sustaining cost sitting just over 1000 ounces. Now, this asset was all through the permitting process and then the federal government, the Federal Environment Minister declared an area called section 10. Now I won't go into the details of it. But basically that section 10 is a heritage clearance over the area of the Tailings Dam and I've the the area of the project you can see on that diagram is the purple outline. But the area that's cross hatched is the area that the minister declared as being preserved for cultural heritage value, which is obviously there's a lot of debate and discussion about that. And the minister's, we're still waiting to see the full explanation from the minister on what grounds that was on. But it has had the impact of making the Tailings Dam design, unusable and ineffective and in fact, has made the project unviable in its current form. So we will now take this project and why we will look at our legal options as to what we can do with it. We will also examine alternative Tailings Dam sites or tailing storage facility sites. We'll consider commingling new areas. Unfortunately, the declaration has made all of the existing project area unusable, it's just not physically able to fit. So this has the impact of pushing this project at least. I it could be 5 to 10 years. certainly before we get a viable Tailings Dam location and get that into a point where we would be ready to make a final investment decision. So basically what that has done and what that means is that this time, probably five weeks ago, Regis was a company that had a very, very strong cash generating capability now that it had, it had, it had broken clear of the hedge book that had been significantly drawing back on its or holding back its cash flows. So we had a, we had between Duke and and Tropicana, very significant cash generating capability and quite a large project over here, that was the target, the the focus of our, of our attention. We now have a project that is certainly easily 3 to 5 years away before it even contemplates being restarted. So, so our position really has changed quite significantly from being, having a clear objective of what we were going to do with our, with our and where our, where our capital investment was going to head to being quite different. We now see ourselves, pardon me as a business that has started to really deliver on its cash flow generating ability. As I said, there was 50 or 60 60 million us generated in the fourth quarter. And that trend of cash generating on a quarter on quarter basis will continue now moving forward. You can see the capacity for, you know, using the spot price today and an all in cost including all our capital growth capital is probably sitting at around 19 or $2000 an ounce. We will generate a significant amount of capital of cash inflow. The question for us now is not we it's very clear for where the organic growth is going to occur within within Juke and also within Tropicana. our options on where else and what else we do? We're just starting to turn our mind to wh we we deal with the with the fallout and the implications of the mcfie decision by the Federal Minister. So we think we're a golden opportunity. We've got a very experienced team, very capable of experience in starting up new underground mines and open cut. And we've got a business that's got a great generating cash generating capability. We're now ahead of, we're, we're net debt. Well, we net cash and we've got a very clear, many years of cash generating capability sitting in front of us, we see ourselves as 100% Australian assets. Clearly a golden opportunity. Fantastic Jim. We're out of time. So thank you very much Jim for the presentation.


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