Good morning, and welcome to the Perseus Mining investor webinar and conference call. All attendees are in a listen-only mode. If you would like to ask a question directly to the company, please use the Raise Hand function within Zoom. For those phoning in, dial star nine. Alternatively, you can enter in your question into the Q&A panel within Zoom. I'll now hand over to Perseus' CEO and Managing Director, Jeff Quartermaine. Thank you, Geoff.
Thanks very much, Nathan, and welcome everybody to Perseus Mining's webinar to discuss our September 2022 quarter report. Now, as usual, today, I'm joined on this call by several of my senior colleagues, including Lee-Anne de-Bruin in finance, Jess Valeck, sustainability, and Phil Russo in investor relations. They'll all be available to answer specific questions within their area of expertise later on. What I plan to do this morning, though, is firstly to provide a brief overview of what Perseus has achieved operationally during the September 2022 quarter, and then follow that up with the Q&A session. I'll keep my presentation brief, as all the details that you need to understand our performance this quarter are fully documented in the market release that was published earlier today.
Let me highlight a few key points, and then we can discuss the detail if you wish. Once again, Perseus has delivered another strong production and cost performance this quarter. Record gold production, in fact. We're positioned to not only achieve our December half-year production guidance, but if things continue to plan, we should stand a pretty good chance of outperforming the guidance range entirely. Now, in the September 2022 quarter, Perseus produced 137,460 ounces of gold. 12% more than in the June quarter, and nearly 7,000 ounces more than our previous best quarterly result, which was recorded in the March quarter this year.
Perhaps, more importantly in the current economic climate, a weighted average all-in sustaining cost for the quarter of $879 per ounce was recorded. Now, this was based on a weighted average production cost of $762 per ounce. This all-in sustaining cost, which was the second best quarterly all-in sustaining cost on record for Perseus, I think the best was way back in March 2019.
It was something like 12% lower than the June quarter, and certainly places Perseus towards the bottom end of the global cost curve, a position that may not have been associated with Perseus a few years ago. Once again, we're well on track to achieve guidance. That's something that not everybody is able to claim at the moment.
Like everybody else in the mining industry, though, Perseus is battling against a global trend of rising costs, but we are managing to keep things reasonably in check for the time being, and long may that continue. Now, as I've said in the past, the strong performance by Perseus over the last few years is a clear vindication of our corporate strategy, which was to transform us into a multi-mine, multi-jurisdiction business as rapidly as possible. This strategy has enabled us to not only materially increase our production and cash flow, but also to reduce the volatility of our performance by spreading our risk across three operations.
Despite plenty of challenges from both within the business and outside, this strategy of diversification has enabled us to stay on course and to keep delivering on our promises, which goes to the very core of the values of this company. Now, in the past few quarters, our Yaouré Mine has been the standout performer. This quarter, once again, it's continued in this manner, albeit off the record highs of last quarter, producing 71,469 ounces of gold at an all-in sustaining cost of $658 per ounce. This places Yaouré well down the list in terms of the global cost curve. The star performer this quarter, though, has been the Edikan Mine.
It's been a while since I could make this statement, but this quarter, Edikan's overcome the challenges of runtime, grade, and recovery that it experienced in recent quarters and produced 52,127 ounces of gold. That's 82%. That's 82% more than last quarter, at an all-in sustaining cost of $1,060 per ounce, which is a vast improvement on the cost of $1,859 per ounce recorded in June. Now, full credit goes to our team at Edikan, ably led by Stephen Ndedi, and also our Chief Operating Officer, Chris Woodall, who, like me, has ridden every bump in the track at Edikan over the last few years. Last but not least, of course, has been our Sissingué Mine, where an improved performance was also recorded this quarter.
In the September quarter, Sissingué has produced 13,864 ounces of gold at an all-in sustaining cost of $1,336. Both of these metrics were better than last quarter and clearly demonstrate that this small mine, that many thought should never have been built, continues to punch above its weight and make a sound contribution to our bottom line. All in all, it's been another very good quarter on all three of our sites, and looking to the future, our management guidance for production and costs for the December half year of 240,000- 265,000 ounces at an all-in sustaining cost of $1,000-$1,100 per ounce, looks very achievable at this time.
This should mean that our calendar year guidance of 493- 518 thousand ounces of gold at an all-in sustaining cost of AUD 980-AUD 1,025 is also well within our reach. Now, I should note that in conducting all of our mining exploration activities across the company, we've sought to do this in a manner that is in line with the global sustainability standards that we've adopted.
The exact metrics of our ESG performance are documented in full in the quarterly report and also in our annual sustainability report that was released to the market last Friday. It is, however, worth highlighting just a few of the achievements from this quarter on this call. In terms of safety, our safety performance across our operations has generally improved.
Our total recordable injury frequency rates are continuing on a downward trend, reducing from 1.45 at the end of March to 1.21 at the end of June, and to 1.19 this quarter. Our lost time injury frequency rate across the groups remain flat at a fairly credible 0.26. On the social front, the economic contribution to our host countries that we've been doing in the past. In this quarter, it amounted to around $116 million.
This included approximately AUD 87 million paid to local suppliers, representing about 78% of our procurement, AUD 8 million in salaries and wages to local employees, about $21 million in payments to the government in the form of taxes, royalties, et cetera, and about $1 million in social investment. These sums of money are actually quite important to our host countries, and we're very proud to be able to contribute in this way, even if we don't usually take to the grandstand to highlight the work we do. Local and national employment, that's been maintained at above the 95% level of our total workforce. Our gender balance across the group is fairly stable, around 14% female, 86% male.
Which, given the industry in which we operate, but more particularly the cultural setting of our host countries, is a reasonable outcome. I should note the situation is different in our corporate office, where the female to male split is about 31-69, and in our management team, 40-60. I think that's, you know, more of a reflection of the current cultural orientation of Australia as opposed to that of our host countries in Africa. Now, environmentally, we've had no incidents of any type during the quarter, and in absolute terms, our Scope 1 and Scope 2 greenhouse gas emissions has actually reduced by about 5% from 0.55 at the end of last quarter to 0.5% at the end of this quarter.
This has largely come about as a result of Edikan replacing its grid power with power generated on site using natural gas as an energy source. On the ESG front as a whole, we're performing reasonably well, and we remain committed to continuing to incrementally improve our performance in this area relative to the standards which we've set for ourselves that align to the internationally accepted standards in the most instances. Now, I should just make a note that we will be hosting a separate webinar on the third of November, I think it is, to discuss the fiscal 2022 sustainability report. For those who would like to do a deeper dive into this area, please join us on that occasion and we'll explain things in full. Now, turning to financial matters.
At the end of the quarter, our gross cash and bullion on hand amounted to $354 million. Now, after deducting our outstanding corporate debt of $25 million, our net cash and bullion balance was $329 million, an increase of $51 million in net cash relative to the end of the June quarter. Now, it should be noted that our cash and bullion on hand of $354 million comprised cash of $197 million and 93,634 ounces of bullion on hand, valued at a spot price of $1,672, giving a value of $156.5 million.
Now, of the 93,634 ounces of bullion on hand, 67,261 ounces of the gold was held in Perseus' metal account, with the balance either in transit or on a site. Now, I should make the point that the 67,261 ounces in the metal account is gold that was produced this quarter and is designated for sale under existing forward sale agreements at an average price of $1,780 per ounce, thus eliminating any price risk on this metal. Those sales contracts will be completed in the December quarter when all sales will be brought to account.
Now, before anyone asks the question of why we didn't close out the hedge contracts prior to the end of the quarter and put the cash on the balance sheet, there's nothing particularly notable about this. It simply goes to the issue of managing our capital balances and cash flows and making sure that all approvals are in place to move funds between onshore and offshore bank accounts before we make that move. But by the end of this calendar year, all of the designated hedges will be closed out, and our year-end cash balance will reflect the receipt of some fairly significant amounts of cash during the quarter.
I mean, I note, for instance, that the hedge price of $1,780 per ounce on the 60,000 ounces is above the spot price at which they were valued on the balance sheet that I just spoke of. Now, speaking of hedging, in addition to the 67,261 ounces that we've got so pre-sold under that forward arrangement that I mentioned, we also have other forward sale contracts in place covering a further 336,000 ounces of gold of future gold production at a weighted average cost of about $1,890 per ounce.
Now, this represents about 23% of our production on a three-year forward production on a three-year rolling basis, and is important, as even if the gold price weakens below the current levels as a result of the strong U.S. dollar, Perseus' projected cash flows are, to a fair extent, underwritten, and this is a very healthy financial position to be in.
To give listeners an understanding of just how much cash we are currently generating in the company, our net cash flow this quarter was around $112 million. Now, you know, this is obviously different to the $51 million net increase in cash. They are not the same thing, so don't confuse that.
I don't want to unnecessarily complicate it, but notional cash flow is somewhat theoretical, as it doesn't take into account the timing of payments and the timing of receipts. It's safe to say that right now, Perseus is generating a lot of cash and is in a very strong position to fund all of its activities, including exploration and the development of new projects, and the continuation of our dividend policy from existing cash balances, let alone any future cash flows.
Now, speaking of business growth activities, this is another area in which we've been very busy and pleasingly productive this quarter. Speaking firstly about our latest acquisition, namely the Block 14 project in Sudan, where we recently awarded a 100,000-meter drilling program to Capital Drilling, a highly regarded international drilling company.
They're in the process at the moment of mobilizing equipment to site, and we'd like to think that they'll start drilling before the end of this month. Their designated task is firstly to perform infill drilling on the GSS deposit to convert some Inferred Mineral Resources into Measured and Indicated Resources that can be incorporated into the Ore Reserve and then the mine plan.
In addition, they're also tasked with performing sterilization drilling to ensure that in their enthusiasm to locate waste dumps and tailings dumps as close as possible to infrastructure, the previous owners of the property haven't sterilized any valuable mineral deposits. We've also commissioned our friends at Lycopodium to undertake a front-end engineering and design study, FEED study, on Block 14.
As it happens, Lycopodium prepared the definitive feasibility study for the previous owner of the property, so they're very familiar with the project. Perhaps more importantly, they're also very familiar with the exacting standards that Perseus will require for this project to be built. We've learned a lot from the development of Sissingué and Yaouré over the last five years or so, and all of these lessons will be applied when it comes to the final design of the Block 14 mine development. Now, as part of that FEED study, we'll also be undertaking confirmatory work on the water aquifer in Area Five. That's about 80 km from the main deposit. That area will ultimately supply water to the Block 14 operations when they're up and running.
Now, this work has been assigned a high priority given the importance of water supplies in this part of the world. Once again, the contractors that we plan to use have a lot of experience in Sudan and several of their consultants have, in fact, worked on the original study for the previous owners. We're looking forward to early confirmation of the capacity of the aquifer to satisfy not only all of our water requirements, but also for there to be excess water that we can share with any communities in the area. I must say there aren't too many communities in the area, but if indeed there are people living there, then they will be able to gain access to that.
Now, aside from the above, there's a lot of preparatory work happening on the ground in Sudan. Things are tracking very, very well. The one thing that does deserve comment is the terrific support that we're receiving from key ministers in their departments within the Sudanese government. A small number of people have expressed reservations about our investment in Sudan, based on their knowledge of the country's recent history. I can genuinely say that we've received an excellent level of support from the government, who clearly acknowledge that Perseus and the government are joined at the hip on this project, and that a successful development will be of enormous value to both parties.
We're also very comfortable with backing our ability to set up operations in a new country, just as we did in Côte d'Ivoire with the development of Sissingué and Yaouré. Now, at this time, we're targeting making the final investment decision for the Block 14 gold mine at about this time next year, if not a little bit before.
Being conservative, it's probably safer to say the second half of 2023 on the basis that this will be the very first industrial scale gold mine development in Sudan, and there'll be no prizes for us committing capital prematurely. This project and all of the other opportunities that are starting to emerge as a result of our first mover advantage into Sudan are way too important to mess up.
We'll take, you know, whatever time it is required to make sure that this project is a fantastic success, not only for Perseus, but also for the people of Sudan. Now also, as we've recently announced, we've had exploration success close to our existing infrastructure in West Africa and making pleasing progress towards being able to sustain our targeted level of production of 500,000 ounces of gold per year out towards the end of the decade. That's without taking into account any M&A or greenfield development activities. During the quarter, we issued a market release detailing the results of work that had been completed at the Nkosuo deposit, located about seven kilom from the Edikan mill in Ghana.
In summary, we measured, we announced an indicated mineral resource of 422,000 ounces, and a bit more inferred. We've done a feasibility study on the project, and that resulted in probable ore reserves of about 332,000 ounces of gold. Based on this study, the processing of the Nkosuo ore reserves in the Edikan mill is expected to increase the life of the Edikan operation by something like 18-24 months, extending the life as we see it at the moment out towards the end of fiscal 2027. We've recently applied to the Minerals Commission of Ghana for the land that is covered by the Nkosuo exploration license to be incorporated into our existing Nananko mining lease.
Discussions on this front are progressing well and should result in ore from Nkosuo being mined and trucked to Edikan for processing sooner rather than later. The delineation of this mineable deposit at Nkosuo is actually a significant achievement for Perseus. As Nkosuo is our first discovery on what we believe is a mineralized zone that stretches across three separate exploration license areas to the north of Edikan, northwest of Edikan. In addition to recently exercising our option to buy the Agyakusu license on which Nkosuo is located, we've also given notice of intent to exercise options to acquire the other two license areas that are contiguous to our land packages, as both of these have similar potential to the Agyakusu license. That's pretty exciting.
We are committed to intensive exploration of this zone, expecting that Nkosuo will turn out to be one of, or be the first of several discoveries in the area. If this is the case, we can expect to see further extensions to the life of the Edikan operation coming up. Having recently invested, you know, a lot of time and effort and money into upgrading the Edikan plant that yielded the very good results this quarter, you know, Edikan certainly has the potential to once again become an important part of our asset portfolio. While on the subject of organic growth, I should also mention that we've continued to make excellent progress on the delineation of a large additional mineral resource at Yaouré that can be mined economically using underground mining techniques.
During the quarter, we announced a maiden Ore Reserve of about 259,000 ounces on the initial stages of mining of the CMA ore body by underground methods. The pre-feasibility study that we have completed on the drilled out portion of this deposit, it extends about 200 m down dip, and it's proven to be both economic and technically viable to conduct that mining operation under the existing pit. We've got more widely spaced drilling below the pit that shows that the mineralization extends quite a lot further. In fact, the total mineral resource at the present time is about 1 million ounces.
We will be drilling out the next 300 m of the structure during the course of this year, so taking us down 500,000, and we do expect to be able to put that into the reserve statement towards the end of this year. In addition to that, we've returned some fairly encouraging results from exploration drilling of some deep holes below the known mineralization. You know, that is certainly very interesting that we've been inspired to do that from the results of a three-dimensional seismic survey that clearly shows us that something is down there.
We're not quite sure what it is, but it's certainly giving us fairly a high level of encouragement that further expansion of the CMA underground operation is very possible. It is early days as far as the CMA underground project's concerned, but I suspect that more will be said of this as the drill results come to hand in coming months.
Excuse me. In conclusion, as I said at the start of the call, the September quarter has been another outstanding quarter for Perseus on all fronts, including gold production, all-in sustaining costs, cash flow generation, and business development. We've delivered gold production and all-in sustaining costs. It's put us well on track to achieve, if not exceed, stated guidance ranges. In doing so, we've outperformed a lot of our peers.
Our all-in sustaining costs are currently very competitive in terms of global measures, and we are managing our business successfully, even though we are operating in a fairly tough economic environment at the present time. Perseus has excellent growth potential in front of us. As importantly, we have the team and the existing financial means to successfully execute and to unlock value, as we have demonstrated several times in the recent past. In an equity market sense, our share price has been holding up fairly nicely in the face of some pretty stiff headwinds coming from the strength of the US dollar.
We are performing relatively well compared to the rest of the market, which I'd like to think is a recognition of the strong track record of achievement that we've built up over the last few years. As I say, a strong quarter for Perseus. We're very pleased with the way things are tracking and looking forward to repeating this in future periods. Thanks very much for your attention today. This brings my presentation to a close, and now my colleagues and I are happy to take any questions that you might have. Thank you.
Thanks, Jeff. If you would like to ask a question directly to the company, please use the Raise Hand function within Zoom. Alternatively, you can enter it into the Q&A panel within Zoom. Your first question comes from Mike Milligan at Euroz Hartleys. His question's regarding the uplift at Edikan in terms of mill head grades and recoveries.
Mm-hmm.
He's asked, "Is this all attributable to the maintenance completed last quarter? What improvements were made, and should we expect this going to continue going forward?
The short answer is no. It really wasn't related to the main purpose of the maintenance shutdown, which was to replace a worn gear wheel. The improvements are the result of we've moved further down in the ore body, so we've managed to eliminate some poor reconciliation, particularly using you know, tighter grade control methods. The other factor on recovery was that we cleaned out the CIL tanks during that, while we were shut down, and we've managed to make that process a whole lot better. As to it going forward, most certainly, we do expect to see this to be the norm into the future.
Thank you, Jeff. Your next question comes from Reg Spencer at Canaccord. Please go ahead, Reg.
Thanks, Nathan. Good morning, Geoff. Morning, everyone. Congratulations on a fabulous quarter. It's just great to see. My first question relates to Yaouré Underground. Geoff, I know you didn't necessarily. Sorry. If we go back to that maiden reserve announcement, very deep in the JORC Tables, you did outline some production param there, which include a 720,000 tons per annum throughput, which based on that initial reserve, would give you initial three-year mine life. That material in that JORC table also highlighted all-in sustaining costs of $1,250-$1,300 an ounce, all-in sustaining costs. Are you able to give me an idea of how we should think about Yaouré Underground?
Yeah.
how it will be scheduled relative to the open pit, given the open pit all-in sustaining costs, while being lower grade, are actually also lower costs.
Well, no. Let me address that point. That's a good one that you raised, actually. That cost incorporates the capital cost of development of that underground operation. All of the costs on the underground operation have been attributed to that first 200 m. As we go further deeper into the structure, the infrastructure will already be in place, and those ounces won't carry that incremental cost. As we go deeper, that cost is gonna average down, you know, quite significantly, I would think. That's point one. As to when it's coming into the mine plan, we're working through that specifically at the moment.
What the thinking is this in broad terms, in the original mine plan for Yaouré, I think the higher grade ore from the CMA pit started to decline around year five or 5.5. Then we'd move over to Yaouré pit, which is lower grade. As a result of that, the production profile would have fallen. However, what we'll be doing now is opening up that underground operation, bringing back high grade material from that, and then blending that with the lower grade material from the Yaouré pit. We'll be able to maintain the current levels of production, which broadly are in the range of 250,000- 300,000 ounces a year. I mean, it's closer to 300,000 last year, for instance.
We'll be able to maintain that sort of level of production for quite a few more years to come, certainly out towards the end of the decade. As the underground development continues, and as we continue to find more satellite pits adjacent to the infrastructure, and I think there's a very high chance of that happening, you know, the Yaouré operation as a whole, which will combine both open pit and underground mining, will continue for quite a number of years to come.
That's very useful, Geoff. Thanks very much. You guys released some exploration results with some of that deeper step out drilling at the underground there at CMA, the results were very good. Is there any more updates with respect to your ongoing depth extensions or down depth extensions?
Not that I can really, you know, recall specifically off the top of my head. I mean, there's clearly something down there, some alteration that we are getting grade in various intercepts. I mean, you know, we weren't expecting to, you know, make a bonanza discovery off it. What we are doing is collecting very valuable information that will feed back into our structural model, which will then inform, you know, future drilling programs. So look, you know, we're not gonna be, you know, announcing bonanzas every time we make an announcement. This is all part of a long-term plan, and I think that the results overall will speak for themselves. It is gonna take a bit of time to pull all this together.
It's certainly looking extremely promising right now.
That certainly is. Thanks, Geoff. Next question relates to Block Fourteen. Are you able to let us know how much expenditure is planned for Block Fourteen? 'Cause that's quite a large drilling program, granted a lot of that's sterilization drilling. Expenditure might be at Block Fourteen between now and FID?
Well, actually that drilling program is 100,000 m, and it's over 18 months, so you know.
Okay.
It'll continue for a while there. Look, the amount of expenditure is going to depend on the level rate of progress that we make. I mean, the sort of things that we would like to do before we start construction, for instance, would be to put in the water pipeline and borefield. So that's about, I think it's about AUD 20-odd million, if I remember correctly. Also, we'd need to upgrade the camp, because once we start constructing, we're going to, you know, need to be housing quite a lot more people than we're housing through these exploration phases. Now, you know, the decision to invest this incremental capital will be strictly related to progress that we make in country.
Now, we are making very good progress, as I said, but, you know, we'll sort of hold fire on those commitments until we're absolutely certain that this project is going to go forward in the way that we envisage. Because if we've learned nothing else over the last 10 years, what we have learned is that once you make a commitment and start spending money, you certainly lose any leverage that you might have in terms of negotiating with local communities and governments and things of that nature. We're working through this methodically, and we'll make appropriate announcements as we make those steps forward.
Great. That's very useful. Thanks, Jeff. Congratulations again on a great quarter.
Thank you, Reg.
Your next question comes from Patrick Collier at Credit Suisse.
Go ahead, Patrick.
Thanks, Nathan. Hi, Jeff. Congratulations on the strong quarter. My first question, just on the decision not to change guidance. I appreciate there's probably some conservatism there, but is there anything you're expecting that could change in the second quarter that might mean it's not quite as strong as the first quarter? Or is that just all conservatism?
Oh, conservatism. That has a negative connotation, Patrick. Look, you know, no, look, I mean, we've been around this business long enough to know that things can go well and things can go poorly on a turn of a dime. So there's no mileage in us, you know, going out on a limb on this. We are expecting to, you know, to have another good quarter, but we're not gonna be, you know, making massive promises that we may struggle to deliver at the end of the day. There's no point in that. We've given the market guidance. It's been out there for a long time. We've said we'll achieve it, and we will.
Okay, thank you. Just on Yaouré, you mentioned in the report there's been a bit of an issue with truck availability, which says it's temporary, but just wondering if that's had any flow on effect into the December quarter.
No, it hasn't actually. I mean, the interesting thing is that we had in the June quarter and also March, we'd been mining ahead of schedule, expecting that we may be slowed down in the September quarter due to wet weather. Now, the wet weather certainly came, and it certainly slowed us down, as did the truck availability issue coincided with the wet weather. It didn't really have any impact on us in the long term. In fact, we're you know, we're traveling pretty well now that the rain at Yaouré at least has started to abate a bit. It's actually started to abate at Sissingué too, which is a major plus for us up there as well.
No, the truck issue hasn't really knocked us around in any shape or form.
Okay, good to hear. Then, yeah, on Sissingué, that's my next question. I mean, a good quarter and all, you know, certainly cash generative, but just wondering what the broader strategy is, given the group's $400 an ounce margin target, you know, where spot gold is, where Sissingué all-in sustaining costs are. Just kind of what you're thinking there.
Yeah. No. Okay. Well, look, I should say that knowing full well that we were going to go through a higher cost period now. Thank you for asking me this question, by the way. Knowing full well that we were going to go through a higher cost period now, while we were developing, you know, access roads and infrastructure for the Fimbiasso deposit and later the Bagoé deposit, which we'll progressively develop and mine and bring back. We did actually take out some hedging at around, I think it was $1,950 an ounce to cover production during this period of high costs.
In fact, the margins that we've locked in through the hedge program, you know, are pretty darn healthy given what we're actually producing at and what we're selling at. Of course, $1,950 looks pretty fancy when you line it up against the spot price today.
Yeah. No, for sure. Thank you. Just lastly, on, you know, on the M&A front, I guess valuations have probably come off a little bit and just wondering, you know, what you're seeing there and any opportunities that you're looking at or just, yeah, the broader strategy.
Yeah.
Block 14.
Our broader strategy is this. We would actually like to have about 3-4 mines in our portfolio with 10-year mine lives ahead of us, which, you know, relates to 10-12 million ounces in reserve. At the present time, Yaouré and Block 14 certainly fall into that category. You know, with some success, Edikan exploration, more exploration success, Edikan could. But I think we do need, if we want to achieve that objective, we're going to need to bring some more assets into the portfolio. Now, you know, the fact that the market is down at the moment doesn't necessarily mean that the management teams of the companies whose share prices are struggling are any more motivated to transact than they were before.
That is, you know, the social issue is something that always stands in the way. The other thing I would say is that, look, you know, from outside, a lot of situations look very, very good because the people who are promoting them make sure that all of the good things are known in the market. What they don't always share with the market is some of the things that are not so good.
As a company, we do very, very detailed bottom-up due diligence. Quite often we have, you know, been quite enthused about opportunities only to find out that things weren't quite as good as we had all hoped. Look, we will continue to look at opportunities. We are very open to opportunities.
We have the financial and human capacity to execute opportunities as they come through. We will maintain very strict financial discipline in choosing how we deploy our capital going forward.
Okay. That's all from me. Thanks very much for the answers and congratulations again.
Thank you. Thank you. Your next question comes from Andrew Bowler at Macquarie. Go ahead, Andrew.
G'day, Geoff and team. A lot of the questions have already been asked. I think just a couple of times it was mentioned in the quarterly about, you know, seasonal wet weather and that sort of stuff. In the past, that's been troublesome for Perseus. Can you just fill us in with a bit more detail, more broadly on how Perseus is preparing differently for wet seasons or if it's just a result of getting deeper in those pits?
Yeah, look, it largely is the latter. I mean, you know, if you take, for instance, last wet season at Yaouré, we didn't have an awful lot of, you know, hard material around to sheet roads. We were able to sheet some of the roads, but not all of them by the time the wet season hit. We're in much better shape this year. Same thing. I mean, Edikan has, you know, when it rains there, provided we've got pumping capacity, which we do, we're not impaired in any major to any major extent. Sissingué, we had dreadful trouble when we first opened that up back in 2019, I think it was, when we were in oxide, and it rained like blazes, and we had no material to sheet roads.
you know, since then, material has come available, and the roads and ramps, et cetera, et cetera, have been able to be managed more appropriately. It really is a case of you know, having the right materials available to build your roads properly and to make sure that your vehicles can move safely at all times, irrespective of the weather conditions.
Thanks. Just last one from me. Obviously, you mentioned the large bullion build over the quarter. I think from your comments previously, you said part of that might have been approvals to get money out of country. Can you just elaborate a little bit on that and what's the process there, and how long's that sort of expected to take? You know, are you expecting it to all flow through to in this quarter or some of it into next quarter as well?
No, it'll all be done this quarter. In fact, I think most of the approvals are already in place. I mean, Lee-Anne could correct me on that. But I think we're in pretty good shape. Look, it's just a case of making sure that everybody knows what's happening and that everyone, you know, is aware. I mean, if you were to, you know, if we, for instance, were to bring money in and try to move it out, well, every time you bring money in and out of countries, you experience exchange risk and potential leakage depending on the rates that you're getting.
Of course, if you're sitting with lots of cash and you've got intercompany debts to repay, but you then dividend money, then you're paying withholding tax on dividends, et cetera, et cetera. This is really just about prudent financial management. It's about making sure that we move our funds around as efficiently as possible and in the full knowledge of our host countries. Because everything that we do is 100% transparent, and we wanna make sure that everyone's comfortable with those things. Now, this was just a situation that we needed to manage. By the end of the year, there will be a lot more cash on the balance sheet as a result of having closed out those hedges.
No worries. Sorry. Just a final follow-up as well. I guess just more broadly, you haven't seen nearly the cost inflation of say your Australian peers. Can you just comment a little bit more about how that's played out over the last, you know, few months or so, and how supply chains in and out of Africa are going and, you know, labor constraints and that sort of stuff? Or are you still having a good time of it, I guess, compared to peers?
Well, I don't know about, you know, that necessarily. Look, it's, you know, it's a daily battle and we work very hard at keeping a lid on our costs. I mean, I don't think we have had the same labor issues in West Africa as perhaps Australia, where, you know, fly in, fly out has been an issue for a number of the West Australian mines and loss of the workforce. I think in Africa, the African countries where we operate, people are very pleased to have their roles and wanna keep them, and they're keen to keep working. That's one factor working in our favor. I mean, that said, our workers do, you know, wanna be compensated appropriately for their labors, and they are.
We do see some cost inflation from time to time. The supply chains are reasonably good. There have been periods in the past where we perhaps had to hold more spares than we might have otherwise done, just to make sure that we don't run out. But generally, that's okay. Fuel, we are the beneficiaries of a subsidy of fuel in Côte d'Ivoire. The government subsidizes diesel right across the board. The price we're paying in Côte d'Ivoire is not as high as it is in Ghana, for instance. Ghana's about $1.50-ish a liter, and I think Côte d'Ivoire is about $1-ish a liter at the present time.
Now, that subsidy won't last forever, I'm sure, and that, you know, ultimately, we will be seeing some cost inflation on the fuel side of things. I guess the other area where we've been shielded to a degree is in consumables. We have been operating under some long-term supply contracts, and inevitably, in the future, those contracts will run off and need to be replaced. Now, at that particular time we'll be in the market for product, and we'll be, you know, facing the same issues that some of our competitors are dealing with. Look, the point is this, that there is cost inflation out there. Anybody who says there isn't hasn't looked recently at their financial statements.
You know, the task for us as managers is to do everything we can to make sure that we're operating as efficiently as possible and that, you know, at best we, you know, we can maintain our position. We may see some inflation into the future.
No worries. That's all from me. Thanks, Geoff and team.
Okay. Thanks, Andrew.
Thank you. Your next question comes from Alexander at Citi. Go ahead, Alexander. You're on mute.
Hi, Jeff and team. Congratulations on another strong quarter. Can you remind me on the next key milestones for Block 14 ahead of FID?
Ooh. The next key milestones. Well, there'll be progressive drill results come through, and the results from the bore tests and things of that nature. I think, I guess the next milestones will be when we make decisions around starting to invest in infrastructure. There's, as I say, a lot of work going on in the background. Probably, you know, this is a period where I guess there isn't an awful lot of news and, you know, photographic evidence of progress, but a lot will be happening under the surface, I can assure you.
Perfect. When can we expect an updated life of mine plan for Yaouré, including the final integrated CMA underground ore reserve?
Well, look, You know, I'd like to say that that'll be sometime in this year. It really depends on how well the infill drilling goes and things of that nature. There's not a lot of point in putting out an updated life of mine plan on the first 200 m, but we could do that. Certainly, we could do that now, I guess. One of the issues that we're not 100% clear on is the exact timing of the starting of the underground mining. That's something that we're trying to work through at the moment to figure out exactly when the optimal timing for that would be in terms of the trade-off, you know, on pushing deeper into the pit versus doing development and moving into the underground.
They're things that we're working through, but you can be certain we'll inform the market as soon as we have got the right answers, but we won't be coming out half-cooked.
Perfect. Thanks. That's it for me.
Thank you. No further questions, so I'll now hand back to Jeff for closing remarks. Okay. Well, thanks, Nathan. Thanks listeners for tuning in and for those people who have asked questions. It has been a strong quarter. We're very pleased with it. We would like to think that, you know, we will continue in this vein going forward. I do make the observation, though, that, you know, there are headwinds out there, both in terms of gold pricing, we're reasonably loaded on that front with our hedge book, and on the cost front as well. On that area, we're working furiously to hold the line.
Look, things are going well and certainly we're you know fairly consistent in our performance and we're comparing reasonably well to our peer group. I think on that basis, we've had a good quarter and we're reasonably comfortable with this. Thank you very much, and we look forward to talking to you again in a couple of weeks on firstly on sustainability and then you know on our next round of results in about three months' time. Thank you very much.