Thank you for standing by, and welcome to the Ramelius Resources quarterly teleconference. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Mark Zeptner, Managing Director. Please go ahead.
Good morning, everyone. Thank you for taking the time to dial in this morning. With me, as usual, is Chief Financial Officer Tim Manners. We will follow the standard course of events. I'll run through the operational highlights from the quarter, referencing the quarterly activities report released earlier this morning before passing over to Tim to go into the numbers in more detail. We will then open the line for some questions. As you will have seen, we announced solid group production of 61,244 ounces for the September 2022 quarter, which is in line with our internal forecasters' forecasts and leaves us well on track to meet our FY 2023 guidance range of 240,000-280,000 ounces.
All-in sustaining costs for the quarter came in at AUD 1,930 an ounce, towards the top end of guidance, with a scheduled mill shutdown at Mt Magnet taking place in the quarter, as well as some significant sustaining related development costs influencing this figure, which Tim will talk to soon. The split between the two production hubs was 28,440 ounces recovered from Mt Magnet at an all-in sustaining cost of AUD 2,043, and 32,804 ounces recovered from Edna May at an all-in sustaining cost of AUD 1,833. During the quarter, we made the decision to remove a number of subcontracted double road trains from the Edna May-based haulage fleet.
These units had been in place for several months but were higher cost per ton than our preferred triple road train configuration provided by our main haulage contractor. This removal did result in a short-term reduction in capacity in September, particularly. Pleasingly, the haulage rate with our preferred, less expensive configuration has improved significantly since. October is currently on track to achieve a record of almost 138,000 tons, which will bring us back above the rate planned at this stage in FY 2023. Hopefully, the graph in the quarterly backs up what I'm saying here. With regards to COVID-19, we recorded 183 positive cases in the quarter, which was a 40% drop from the June quarter.
In accordance with government advice, we have seen certain requirements such as social distancing, pre-commute testing, and screening being relaxed late in the quarter, along with our contact tracing system being switched off. It has been switched off, but we can easily turn it back on again if required. From a safety perspective, it was pleasing to see a further 13.4% drop in our total recordable injury frequency rate during the quarter. Our safety programs instigated over the past twelve months begin to bear fruit. The trend is positive, but the two recent fatalities on WA mine sites are a painful reminder that we can never be too vigilant in this area when it comes to ensuring a safe workplace. Our thoughts do go out to the family and friends of those two men.
Regarding production, although Mt Magnet was slightly below that of Edna May in the September quarter, that balance will change over the course of the year as ore from Penny starts to factor into the mix in a bigger way. At the midpoint of guidance, we expect Mt Magnet to contribute 150,000 ounces this financial year, while Edna May will contribute the remaining 110,000 ounces. Development at Penny continues to progress well, with our quarter seeing commencement of the first ore drive level on the 1,390-meter RL. By the end of the quarter, the 1,390 north ore drive had progressed well past the known resource boundary, with grades averaging 11 grams per ton in the core of the resource and visible gold noted on a regular basis within the quartz lode.
Decline development has continued, and we're now down to the second ore drive level and expect the ore body to get better as we get deeper. Decline rehabilitation at the Galaxy underground at Mt Magnet now has us at the end of the quarter, nearing the point where new development commences to access the Mars ore body. We have constructed a new long section for the Galaxy mine that shows Mars, Saturn, and the historic Hill 50 decline we're using to access. Hopefully, you can see that more clearly. As usual, several mining studies were advanced during the quarter, and we recognized that the greatest interest is probably on Edna May Stage 3. We have provided an open pit data package to several reputable mining contractors that we expect to hear back from during this December quarter.
We'll make a final decision on the development from there, as essentially the rest of the PFS is complete to a satisfactory level. Of course, we are well aware that work must commence sometime next year to meet the production schedule provided in 2021. The Hill 50 underground scoping study is in the final stages of review and will be released this quarter also. Starting at Mt Magnet, Vera's is shaping up nicely as another potential means of adding mine life at Mt Magnet. With all the assay results from recent drilling now received, which involved a large proportion of diamond drilling, which typically takes longer due to the core cutting requirements.
These results included an updated resource model and mineral resource that grew over 800% to 230,000 ounces in total. The higher grade core likely to be subject to bulk underground mining in the future constitutes some 150,000 ounces of this. We will look to accelerate work at Bardoc, both more drilling and studies, as it looks at this point to be a better underground option than Eridanus, also given the fact that we are not mining an open pit at the same time. Finally, with our advanced exploration project, Rebecca, we continue to receive encouraging results, where drilling is ongoing with between one and two rigs at any one time. Similarly, we have reported some nice results at Hesperus, 11 meters at 55, at Magnet and Symes' Find, including 5 meters at seven and 14 meters at nearly six near Edna May. Further detail on those can be found in the body of the quarterly report itself. With that, I'll now hand over to you, Tim.
Thanks, Mark. I think it's fair to say that the new financial year has gotten off to a solid start for Ramelius, with gold production for the quarter being 61,244 ounces, which, as Mark said, was in line with internal forecasts and leaves us well-placed with regards to our FY 2023 production guidance. This production was achieved at an all-in sustaining cost of AUD 1,930 per ounce, which is within our cost guidance. While at the high end of the range, this was expected with a scheduled mill shutdown in the quarter and significant sustaining development costs at Mt Magnet with the development of the Orion pit, which will provide valuable oxide feed to the plant. The Orion development costs themselves added AUD 275 per ounce to the Mt Magnet all-in sustaining costs for the quarter.
That translated to AUD 134 an ounce to the group all-in sustaining costs. Given the relatively small size of the Orion pit, the development costs under the guidance note for the all-in sustaining cost standard tells us we have to treat those costs as sustaining capital. Moving on to the revenue side of things. Sales in the quarter were 59,750 ounces at an average price of AUD 2,460. This price was slightly lower than it was in the prior quarter, with the spot price trending lower in the back end of the September quarter. However, during October, the spot price trended back towards the price level seen in the prior quarter.
From a cash flow perspective, cash and gold increased AUD 4.3 million over the quarter, with an underlying cash outflow of AUD 2.2 million after investment of AUD 19.4 million and AUD 7.1 million in mine development and exploration respectively. RMS remains well-funded with a healthy cash balance, approximately 130,000 ounces of gold contained in ROM stocks and GIC, and an undrawn corporate debt facility of AUD 100 million. Lastly, just a quick update on the hedge book. The committed ounces remained fairly static over the quarter, with 193,250 ounces being committed at quarter end at an average forward price of AUD 2,549 per ounce. With that, I'll now hand back to Mark.
Thanks, Tim. Andrew, if we could please open the line for any questions.
Thank you. If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star and then two. If you are on a speakerphone, please pick up the handset to ask your question. Our first question will come from Alex Barkley of RBC. Please go ahead.
Thanks. Morning, Mark and Tim. On that Bardoc resource, you keep getting to a pretty good scale there. What sort of timeline are you thinking progression through studies and maybe when you could get into production? And is it possible to give a comment on the grades you're seeing there? It's 1.7 for the whole thing, 2.1 for that central higher grade area. It's obviously early days, but, you know, is that sort of good enough on the economics to get it over the line? Thanks.
Thanks, Alex. Yeah, it is pretty early days. It's the wonders of geostats and resource models that can turn, you know, a mixture of results into a grade that perhaps is slightly lower than you think. We like to think that our models are conservative, and that's a baseline for achievement. In terms of the timeline, I'd like to think same maybe by the middle of next year. At the end of the financial year, we sort of have some economics and sort of some mine designs and some additional answers through new drilling. We move into sort of later next year into development decisions. It will need an open pit over the top of an underground to have access for a portal. It's really an underground target that, you know, we like to think is still open at depth and is gonna grow from here.
Okay. No, that's very helpful. Thanks for that.
Thanks, Alex.
Thanks, Alex.
The next question comes from John Macdonald of Argonaut. Please go ahead. John, your line is open, but you're mute on your end.
Doesn't seem to be coming through, Andrew.
The next question will come from Richard Hart of Top Wheel. Please go ahead.
Thanks very much.
Thanks for the presentation, Mark and Tim. As always, very enjoyable and congratulations in these hard times for the results you got. In terms of ongoing all-in costs, I'm just wondering how is your situation? Well, there's two issues. I mean, there's power, there's fuel. Do you have any hedging or contracts in place that give us any protection for those, or are you just at the whim of the market?
Richard, Tim here. We are at the moment looking at whether a component of diesel hedging is appropriate. The diesel price looking forward is in backwardation, so forward prices are lower than spot prices. There is the potential to save a bit of money, if you like, versus our current internal estimates on diesel price. It is a timely point we'll be discussing with the board tomorrow. At the moment, no, we don't. We are fully exposed on those fronts, but it is something that we are actively considering.
Well, sort of from my point of view, that's great. You know, I've always liked your modest hedging policy. Some would say over the top and some would say not enough. Looking at it from the outside, it seems to me that the more you can at least get a handle on some variables, the more helpful it might be. The other question, if I'm allowed, is just about Rebecca. I know we're talking a couple of years ahead for production. Are we relying on acquisition in that area for processing or maybe that's something you can't answer. What I'm sort of saying is, at the moment it would seem a long way from anywhere, so at some stage we ought to look at processing. Is there anything that can be said about that?
All I'll say about that, Richard, is that we acquired Rebecca on the basis that it could be a standalone project. We run our numbers on that basis. Ideally, we'd like to grow the project, you know, with exploration success in and around the tenements to get it to that sort of critical mass that we believe is a million ounces mineable. At the moment, we've got a million ounces in indicated. Not all of that will convert, but we're still partway through our exploration program to build up what we believe can be a standalone project.
Oh, that's impressive. So the standalone is still an option. Thanks.
Thanks [crosstalk].
I won't take any more of your time. Lovely to talk to you, and thanks for your presentation.
Thanks, Richard.
Thanks, Richard.
The next question comes from Larry Hill of Ames Asset Management. Please go ahead.
Morning, Mark and Tim . Well done on the quarter. Can you just maybe run through a bit more on what's critical path at Penny? Just bringing together the sort of infrastructure and, you know, the decline, is that critical path and sort of where would you sort of like to be to be scoping out first ore? Thanks.
We described in the quarter. Thanks, Larry. We've mined effectively the top ore drive, and we're down on the second ore drive level now. So, you know, the method is top down, and we are also in the process of upgrading the haul road to a standard where we can put, again, our preferred 100 ton capacity triple road trains on. And that's happening this quarter. So there won't be a lot of tonnage come through in the Q2 . There was zero tons in the Q1 . You'll see stoping in the new year once you string a couple of levels together, and you can then set up, you know, your first stoping fronts. In terms of the infrastructure, you'll see the airport's complete, all the surface infrastructure, a primary fan going in as we speak. It's basically all done. The camp's been built for some time, so we're ready to rock and roll at Penny.
Good. Is the ventilation at a sort of capacity for, you know, your maximum sort of tonnage or that ramps up as that comes on?
My understanding is the primary fan needed for the whole life of mine, as you currently see it at Penny North. We will obviously have to extend our electrical reticulation system. The first underground substation's going in shortly. In terms of ventilation, it's not a very deep mine. It won't have a massive ventilation requirement. The primary fan we're putting in should be good for the life of mine.
Okay. Just also exploration spend, maybe sort of to guidance. I suppose you've only had one quarter, but is that maybe sort of going to be sort of as you spelled out, that doesn't change with the sort of softer gold price?
It hasn't changed at this point. It's still on track for AUD 25 million. We're still hitting gold. We're gonna keep drilling holes. One thing I do know, if you don't drill holes, you won't find anything. We're gonna keep at our budget at this point in time, Larry.
Good. Okay. Thanks, guys. All the best.
Thanks, Larry.
Thanks, Larry.
The next question comes from William Barlow of Ord Minnett. Please go ahead.
Yeah. Good morning, Mark and Tim. Thanks for taking the call. Look, just following up on the questions on Penny, I was hoping you could provide just a bit more detail on the forage roadworks and I guess where- Alongside the, I guess, being able to use your preferable triple road trucks, whether the haul road would be probably a bit more capable of withstanding any future inclement weather.
Yeah. Thanks. Thanks, Will. Unfortunately, of the 160 km route from Penny to Magnet, about 100 km of that is gravel. It's not realistic to make that all weather. There will be times when we have a storm or tail end of a cyclone go through that will curtail haulage for a short period of time. The upgrade that we're talking about is related to that 100 km. Of the 100 km, I think about 70 km of that is already rated at the right level to be able to run those road trains. There's a short 30 km section which will basically have to be brought up to the same standard and then get the tick from the shire and main roads. You know, we have the trucks available. It doesn't need a lot of trucks because it's such high grades. Only, I think two trucks will service this requirement. It's just running through that upgrade works, getting the sign-off and get going, which we expect during the quarter.
Okay. Excellent. Thanks, Mark. Is there any detail you're able to provide as to the amount of ore that's
From the development, I think it's about 10,000 tons. You could argue that potentially that probably could have been in the mill, and it might have boosted our quarter one result a little bit, but we prefer to get the road upgraded so that we don't have to haul with a shorter road train, which effectively costs you more per ton. We try to avoid that situation where we can. We have got a small stockpile, but we'll typically run it going forward like we do at Vivian, where at the end of the month or particularly end of the quarter, you don't have any stockpiles of high grade material at the mine.
Okay. Wonderful. Thank you very much.
Thanks, Will.
Thanks, Will.
Once again, if you would like to ask a question, please press star then one and wait for your name to be announced. There are no further questions at this time. I'll now hand the call back to Mr. Zeptner for closing remarks.
Thanks, Andrea. To wrap up quickly, Ramelius has posted a solid quarterly result and has seen its cash and gold reserve actually increase from what is not expected to be our best quarter in FY 2023. All-in sustaining costs and CapEx for that matter are both expected to reduce in the second half as the high-grade Penny operation moves into stope production, placing the company in a very strong position moving towards the end of the calendar year. We continue to have exploration success across the portfolio, and we'll keep the market abreast of our mining study progress as always. Thank you for listening in this morning, and enjoy the rest of your day.
That does conclude our conference for today. Thank you for participating, and you may now disconnect.