Thank you for joining the Aeris Resources December Quarter Results Presentation. In a few moments, Aeris Resources Executive Chairman, André Labuschagne, will present the results for the December quarter. At the end of the presentation, André will take questions during the Q&A session. You can submit written questions throughout the duration of the call using the Q&A function at the bottom of your Zoom screen. We will also open the floor to verbal questions. To ask a verbal question, please indicate you would like to speak by using the raise hand function at the bottom of your Zoom screen. With housekeeping settled, I will now hand over to Executive Chairman André Labuschagne, who will begin the presentation. André?
Thank you, Maddie. Good afternoon, everyone, and thank you for joining the Aeris December quarterly activities presentation. These are just the disclaimers, but I would like to jump into the highlights for FY 2023. For this quarter, the group copper equivalent production was 13.1 thousand tons, slightly lower than the previous quarter, but we have seen good improvements at both Tritton and Cracow, and that has been offset by lower production from Jag and Mt Colin. On a year-to-date basis, Jaguar is still way in front of the internal forecasts. We'll talk a little bit more detail on each one of those, we are very proud to say all the mines have been within their costs as an internal plan, at least, on the operating cost side.
A lot of focus has gone into cost control, and we are seeing some of those results as we move forward. We kept spending money on capital. We've invested another nearly AUD 37 million on capital projects, including exploration, and that's all and we'll talk about mainly at Tritton where we are really focusing on developing Avoca Tank and getting Budgerygar going to production. The resource upgrades, we have some really good success at most of the operations. At Cracow, Golden Plateau seems to be getting bigger and better. The Turbo deposit at Jaguar, the more holes we drill, the more promising it looks. We got some very good high-grade copper intersections from drilling at Avoca Tank, which is now showing that that ore body is what we expected, but also visual to extend significantly further.
As we talked before, the Carnegie deposit, we've done some more drilling, got some really good results, and that would be one of the future projects we would embark on in the life of a business. On the cash and receivables, we closed the quarter with AUD 76 million, a AUD 22 million increase on the previous quarter. We still got no debt. We talked about our focus on projects, and specifically the Stockman Project and bringing that in production. We've employed Charles Rousseau as a General Manager project who would oversee the Stockman Project development and actual he's a builder, he's a construction guy, but also be involved with the other major projects in the business.
As we've stated in the quarterly, although we got a few big months ahead of us, on production-wise, we still maintain our production guidance for all operations. On the ESG side, a good safety performance by the operations in the last quarter or last four months on lost-time injuries. A lot of focus is going into the consolidated group after the acquisition of Round Oak to standardize systems and processes, standardized definitions, and we've seen some of that success. On the sustainability side, we are planning to put another sustainability report out this year. A lot of work is going into data and baseline setting, there's a lot of internal discussions on the sustainability strategy going forward and set ourselves some targets as we move forward in the business.
As we discussed before, we have decided on those four focus areas. That's where the main focus will be on the sustainability side of the business. We had no environmental incidents for the quarter. Nothing to report on that. Looking at the operations, Tritton did 4,100 tons of copper, an improvement on the last quarter. Although it was still below internal plans. They had an unfortunate situation where in the beginning, the first two weeks of December, they could get no cement. That meant we couldn't do any stoping at the Tritton mine itself, where we use paste fill as a support.
That has now been resolved, and the whole issue around delivery has been resolved. We are now back on track, and we'll catch up on that paste fill. On the Budgerygar deposit, as we said before, development has hit the ore body quite a few months ago. We're getting small volumes of tons out of it. One of the key capital projects was to get a new ventilation or is to get a new ventilation shaft in. Unfortunately, the raise bore got stuck 30 m from the bottom, right on surface. We had to drill that out.
We managed to get the raise bore out, but what we found is the condition of the first 30 m or so on top of that raise bore is very bad in geotechnically. We're now putting piling in place. We basically drill holes, put concrete piles in place, then do the raise bore in the middle. That should be finished by the end of the quarter. We will see much higher production levels coming out of Budgerygar at, you know, at around 1.8% copper, which is a significant improvement in grade as we go forward. We said previously we're investing in some technology. The Jameson Cell, which we're busy installing at the Tritton mine, that's underway. That will improve the concentrate grades and that payback is less than 12 months.
That is underway. On the capital side, we keep on putting money in. The main development was in Avoca Tank, and we've seen, we've hit ore body in December. That was slightly ahead of plan. The plan now is to move as fast as we can getting the development in place and start to see do we get some actual scoping ore out in the fourth quarter. We already had some development ore into the mine, and some of those grades has been really spectacular. As I said earlier, we've drilled the Kurrajong deposit. We'll put a mineral resource out on that in quarter three. Some very interesting results. I'll show you a slide coming up.
We discussed this before in the first and second quarter, we did an airborne EM over the northern part of the tenement package. Those results has returned. We've got 14 new priority targets. Just to take a step back, that's exactly the way how we discovered Constellation. We've did the same. We found the targets. In fact, the first one we really got stuck into and drilled was Constellation is now a 7 million tons ore body. We've also focused a lot on technology in the business, we have been awarded funds from the New South Wales government, Critical Minerals and High-Tech Metals Activation Fund for ore sorting.
A lot of opportunity for us is as we move into these smaller deposits like Constellation, not a small deposit, but trucking that 47Ks , if you can ore sort and upgrade it, that will be a significant saving going forward. We got funds to do that, but we also got significant funds to work with a group looking at coarse particle flotation processing. If that comes and that works, that can be a game changer for the industry, in fact. Just touching on total exploration. There you can see the EM results. There you can see where the targets are. Some really high priority targets, but a few others.
Those will now be proof tested, make sure that there normally is not a infrastructure on ground, and then we'll do some ground-based EMs and start to do some drilling once we've identified the highest priority targets. At Murrawombie, it's just a mine keep on giving. Two years ago, we thought there's only 12 months left, every time the geologists just do that next level or a bit of deeper drilling, this time around they did a 250 m hole down plunge, intersected the ore body and put some EM results down and it ended up showing significant potential for further exploration and further extension of the Murrawombie mine.
Murrawombie mine, if that is 250 m down plunge, there's a significant potential there to increase production by another two or three years. At Kurrajong, you can see some of those good results, 2.7, 3.4, 3%, still some good results, and some of those is now outside the original boundaries of what we thought to be a resource, so that keeps on extending the size of the Kurrajong deposit as well. Well, a significant result for us is we always knew that Avoca Tank, all our deposits extends to depth. That's just been the history of this business for the last 10 years. We went into Avoca Tank with 800,000 tons sitting in that top end of where you can what you can see there.
We drilled a hole about 280 m below the current EM plate, as you can see there, intersected massive sulfide to wait for the results. You can easily correlate that EM plate to further extents down below, and that will be a significant extension of the life of Avoca Tank. If it continues at the grades, Avoca Tank current resource grade is 2.5% copper, significant potential for Avoca Tank as we get into it, as you can see where the declines sit at this stage with the drilling we're doing, we're getting very good results and some of the stopes we're seeing or the decline development we're seeing looks quite spectacular. Going on to the Jaguar mine. Jaguar was a little disappointing but not unexpected.
It was 7,300 tons at all-in sustaining costs of just AUD 1.65. The reason for not achieving the mining, the ore mine site, was an underbreak one of the stopes which impacting on production sequencing, so we had to resequence, and we had to resequence some lower grade stopes for the quarter. Although we didn't mine it, there's about a 40,000 tons stockpile at the mine because we need to blend the ore as we put it through the mill. We still achieved the mill throughput in the mine, although at a slightly lower grade. As we said, their cost is well within plan, as we said, for all the mines.
What we found with this business, there's quite a big working capital movement going through the business, you don't get monthly concentrate sales. We had two zinc concentrate shipments for the quarter and two copper shipments for the quarter, which sort of impacts the next quarter, you might not get as many, and you see these high working capital movements. That's just part of the business going forward. We just spent AUD 1.2 billion on growth. We quite excited about the Bentley resource itself where we're currently mining. It looks like, you know, when you drill, we keep on seeing potential for that to extend. Really the Turbo deposit, it does keep on growing. You can see the resource we put out. Most of that is indicated now.
A significant increase, 23% and 37% between tons and metal. What we are seeing, though, some of the latest drilling, as you can see on that image, is outside the current resource and has significant intersections which we're waiting for results. The geologists and the mining team out at Jaguar is quite excited about the opportunity for this to become bigger and bigger. As it become bigger, it will get closer to the current working areas, which will help with the access to get into Turbo. One of the things that are on that slide, but one of the things we're really working on is the old Jaguar mine, which was mined before they discovered Bentley. When they discovered Bentley, they basically pulled out of Jaguar mine and went straight into the Bentley mine.
Looking at the late, the historical stuff, information, there's stopes there ready to be mined. There's broken stopes. We need to pump it out, and we're planning to start that process. It's got good copper grade, lower zinc grades, and in this market, focusing on getting more copper, and we think that there's a lot more to get out of that Jaguar mine. That's part of the things we're looking at.
When we bought this asset, we were only focused on the Bentley mine and the Turbo deposit and said, "Well, we think there's four years life." As we get into it, there's a lot more opportunities, like the Jaguar mine and a few other deposits which we can bring into the plan as we go forward, and we see quite a potential to extend this mine life significantly from where it is today. In Northwest Queensland, the Mt Colin mine produced 100,000 tons of copper. The mined tons was impacted basically by a breach which formed between two stopes and loader availability. They are behind plan at this point in time. We have set it up for quarter three and quarter four production to increase significantly.
We got more mining areas available. We also got another loader into the fleet, and that has been the bottleneck, was the loader to get to clean up the stopes and do it and go again. That has been brought in, and we're confident that they will catch up in the next six months going forward. We've also changed to put tons through. It's usually the tons went through the Ernest Henry Plant. We've changed it to go through the Mount Isa Copper Concentrator. The recoveries wasn't as good as we were hoping, so we have moved back, starting to put some tons back to Ernest Henry.
We treated 82,000 tons, but there's already another 80,000 tons sitting on deck at the Mount Isa mine and some tons sitting at the Ernest Henry process facility going forward. The Barbara drill program, which we've been working on, we talked about, that drilling is now done, it's been done, finished in December. We're waiting for some of the results. We'll then put a resource around it and then start to do the study to see if that is gonna become the next operating mine once we finish Mt Colin. At the same time, we've put a team together to look at the regional opportunities within the Mount Isa region.
We know that there's a lot of opportunities to do the similar model like we're doing at Mt Colin, where you got a small mining team, a camp set up, and a treatment facility to take the tons to treat at a very decent rate for the, for the amount of tons we're putting through the plant. That is the model we wanna apply going forward because we think there's a lot of explorers out there who would like to take the opportunity to extract value from their assets. At Cracow, the team at Cracow is actually doing spectacularly well. You know, the grade of the Cracow mine has dropped over the last 12 months, and they've done a lot of work to understand the grade, and we got the grade now under control.
We know what we're mining, and the grade reconciliations are basically on plan. They've done record tons mined, record tons milled, so they know we need to push the volume through the plant to keep doing what we're doing. I must say they're doing exceptionally well on all fronts on both the tons milled, mined, and costs are very well controlled within that business. We also keep spending growth capital. Golden Plateau is one of the future operations, but we're also doing some work on the southern side of the tenement package for Cracow as we move forward. You would have seen we put our announcement in January, the Golden Plateau resource sitting at 620,000 tons or 62,000 oz, and that's only the red blocks on that image on the right-hand side.
All those yellow structures which we're showing there still need to be tested. We had intersected, so we also added an exploration target of 60-130,000 oz as still to be drilled and defined in this project. This can become 150+ thousand oz sort of copper deposit, which will then be fast-tracked to get into production at Cracow to add to the current mine, also looking at opportunities going forward. The exploration, the greenfield exploration on the Southern side is continuing. We're doing some surveys. The guys are doing some work, and we're planning to put some targets in place to start to drill within that Southern region. That S outhern region is probably still one of our best prospective areas within the Cracow or you can even say in the business to find another big ore body.
Now just on corporates on the project. Stockman, as I said earlier, we now got Charles in place, and he's taking this on. We're still planning to finish off the definitive study by the end of FY 2023, so by June. We are busy with looking at different logistical options to get the concentrate to port. Early works is being defined or re-refined, and we now got a much better understanding of the vegetation clearance offsets which need to be in place, and there is a plan to move that forward. Quite a few approvals has been received in the quarter. The team is well advanced and the project, once the study is done, we'll move it forward.
At a corporate level, as I said earlier, the cash and receivables has gone up, and then we've seen the increase and, although, you know, sometimes hedges are good or bad, but there's still a little bit of hedge left for the next two quarters for gold and zinc. At this stage, there's no other hedging in place for the business, going forward beyond June. Thank you, everyone. That's the presentation. I'm very happy to take questions.
Thank you, André. I'd like to remind attendees that they can submit questions using the Q&A function or the raise hand function at the bottom of their Zoom screens. We will give callers a few moments to get their questions in. Hi, André. It looks like we have a verbal question from William. William, I'm going to turn your mic on now. Can you hear us? Is this working?
Hello. Can you hear me?
Yes, I can hear you, William. How are you doing?
Wonderful. Good afternoon, André. Thanks for hosting the call. Just a couple of quick questions on my behalf. Maybe firstly, just touching on capital spends. Just looking at year-to-date growth and sustaining spends, sitting lower than what guidance would imply just for the first half. Can you provide some color on what that might be a function of, and whether any capital decisions are being made that might have an impact on future sequencing and production sources? Outside of necessarily of FY 2023.
Sure. Sure. Yes, we are below the current plans, but not significantly. There's some capital spend coming out of the next six months. One of the decisions we have moved into 2024 was the ventilation upgrade. The cost of that would have come through in this next six months. That's about AUD 6 million for the next six months for Jaguar. The pre-work and the technical work around that has taken longer, and we decided to move that across into FY 2024. And that's also one of the reasons why we are looking at the Jaguar deposit to bring that online, because that will bring tons forward again, if there's any delay in getting to Turbo because of the ventilation. There's a contingency in place for that.
On the other operations, as always, we look at optimizing capital. We don't spend money if it's not necessary. On our quarterly forecast, we reassess all the capital spend, and sometimes it's just not necessary to spend it. There's a little bit of that. Nothing has been done which will impact production in the short to medium term.
Okay, wonderful. Thank you, André. That's, that's really helpful. Maybe just quickly touching on Tritton, just regarding the ventilation works going on in Budgerygar, how should we be thinking about the production and grade profile over the next couple of quarters from Budgerygar and I guess similarly to Avoca Tank, given the piling works that'll be going on?
Currently the piling is underway at Budgerygar. The current plan is within the next, I think 20 days, the piling will be done, then we can restart the raise bore process or start the raise bore. The plan is that for that to be finished off in by the end of this first quarter, then we'll see a significant increase in production from Budgerygar at a grade of around 1.88% is what we'll see from Budgerygar. We are going to do exactly the same piling at Avoca Tank. You know, we've seen the impact of this failed or the drill which got stuck, that's delayed the Budgerygar production by at least four or five months to full production.
We're still getting small, you know, a small amount of stoping done based on the ventilation available, but not to the levels we wanna be. We're going to do exactly the same. The piling contract is gonna move direct from Budgerygar to Avoca Tank. In the fourth quarter, we'll see production coming out of Avoca Tank. Grades, you know, resource grade is 2.5%. We're expecting 2%+ coming out of Avoca Tank in the fourth quarter.
Okay, wonderful. Thank you, André. If I might, just one last question. Just regarding Jaguar. I guess there was the disclosure of Bentley development rates being impacted by vents, deep watering and labor. Are there any implications into the second half for the production and grade profile for Jag, as a result of those lower development rates?
Look, the we have called up and opened up more resources or more stoping fronts now at Jag. Some of them is gonna be a bit lower grade, so we're seeing that they will achieve their guidance, but they won't do significantly better than guidance. We've put, you know, what we ended up with when we bought it, you know, the water pumping system had to be improved, so we're putting AUD 1 million into improving the pumping for a start. We got our ventilation engineer, which we had at Tritton, which made a massive difference. You know, 12 months ago, we said, "Look, We won't be able to get much deeper at Tritton. He'd done some work, and now we think we can put another six levels into Tritton, based on the ventilation.
Just the quality of the work he's done. He's helping us out now at Jag as well. I'm not saying we can do it, ventilation is an issue. That's why that ventilation shaft is quite important to put into Jaguar, into Bentley, sorry.
Okay. Excellent. Wonderful.
Thanks, William.
I'll pass on.
Thank you, William. André, we have a question submitted through our Q&A by Samsath. Samsath is asking: André, you mentioned no further hedging in place past June. Does that mean the board has decided to leave currency on an unhedged basis going forward? You mentioned in the last meeting that you would be looking at your currency risk management policy. Can you share what that is?
You know, when you said with the price, copper price sitting at, you know, where it sits today, it is really good Australian dollar copper prices, and you're really very tempted to look at what do you do? At this stage, we haven't done anything. At some point it might make sense. We're not saying we won't do it. I think it's more managing the risk of the business. We are spending capital, so if it makes sense, we will still look at it. At this stage there's nothing being discussed or implemented in the business.
Great. Thank you, André. We will give callers a few more minutes to get their questions in via the Q&A function or the raise hand function. We'll just wait a few minutes.
All right, Maddie. Have you got any more questions?
André, it doesn't appear we have any further questions for this call. That brings us to the end of our Q&A. Thank you everyone for joining the Aeris Resources December Quarter Results Presentation. We'll see you next time.
Maddie, just hang on.
Um.
There's one open, but it's just stopped at Round Oak.
Gregory?
Gregory has something.
Yeah.
Round Oak.
Gregory, who's just raised his hand for a verbal question.
All right.
Gregory, we'll just unmute you now. Gregory, is that working for you?
Just take yourself off mute. It's still on mute, Maddie. There you go.
Now can you hear me? Yeah. Okay.
Yeah. There you go, Gregory. Just in time.
Yeah. Thank you. I had trouble getting that raise hand function to work.
Oh, all right.
I'm not used to this sort of stuff.
Okay.
I'm interested, with the Round Oak acquisition last year, which effectively happened at the end of the financial year.
Yeah.
You nominated the working capital adjustment of AUD 28.7 million. The thing is, I noticed in the quarterly activities report, there's no add-on value of the cash flow that the Round Oak mine has produced in the current quarter activities report. I was wondering, you know, because in the, in the Soul Pattinson, it used to produce around about, you know, AUD 18,250,000 a quarter .
Mm-hmm.
I was wondering, is that included in your cash flow? Is that gonna get nominated later date?
No. Look, the current cash what we're showing there is cash in the bank. There's AUD 676 including receivables. That includes the AUD 28 million which we got from Washington H. Soul Pattinson. Look, the time where they made AUD 80 million a quarter was when zinc price was through the roof and the Mt Colin mine was generating good money. Now, zinc prices come back. We are reinvesting a lot more than what they would have done. They were in the process of, you know, end of their ownership of that asset. We invest in quite a bit more to get the Jaguar mine, you know, settled down and for the long term.
The numbers you're seeing includes that and includes the cash from Jaguar and the Mt Colin mine, both generating operating cash.
All right. Yeah, yeah. Okay. all right. I was hoping to see a bit more cash in the, you know, in the current quarter activities report. That was all.
Yeah. No, I understand. We are putting a lot of money back into capital for Avoca Tank and Jaguar and Cracow. We are investing to create the future at this point in time.
The other one's a different question to ask. Because there's a relatively a small number of shareholders in the company, like 670,000 shares on each of them, is it likely the company could consider paying a dividend in August?
No, we won't be paying dividends, Gregory. Not at this point in time, at least. While we got the investments we need to do, I think the prudent value is to put the investments back, shareholders will get a significant value through that if we can grow this, you know, turn into a eight to 10-year mine life, and even Jaguar significantly increase. For us, it's a capital period which I think is better for us to put the money back in the business.
Yeah. All right. Thank you very much for your time.
Pleasure. Thanks, Gregory.
All right.
Thank you, Gregory. André, we have one more verbal question from Owen. Owen, I'm going to give you permission to talk now. Can you hear us? Is that working for you?
Hi, Owen. How are you doing?
I actually don't have a question, André, whilst you've got me, Constellation.
Yep.
Is very silent in your report on Constellation. Is that sort of been relegated down the food chain relative to Budgerygar and Avoca Tank?
Look, absolutely not. Not relegated. I think what we are doing with Constellation, we've got enough drilling to get the resource. We've got enough drilling to put a mine plan and a strategic plan or business plan around it. The team is putting a feasibility study around it before we start drilling it again. There's enough information there to know. You know, there's 7 million tons sitting there. We're looking at open pit mine or, and a underground or just one, just underground. We're assessing all the different options, the capital cost to bring it into production. All of that is being assessed. The approval processes to get mining licenses and environmental approvals is already underway. It's just we're not. The reason why we're silent is we're not doing any drilling currently.
It's all about getting the studies done, and once that's done, we'll do a lot more grade control drilling and setting it up.
Okay.
All right. Thanks, everyone.
Wonderful.
All right, Maddie.
We'll just give everyone a few more moments for any final questions. Great.
All right.
That brings us to the end of our Q&A. Thank you for joining the Aeris Resources December Quarter Results Presentation. We'll see you next time.
Thank you, everyone. Appreciate your time.