Welcome to the Resolute Mining Limited quarterly conference call for the period ended 30 September 2021. Throughout the presentation, I would like to remind attendees there is an option to submit written questions via the Q&A tab in the top right of your screen. I'll now hand over to the conference's Mr. Stuart Gale, CEO. Please go ahead.
Thanks, Ollie, and good morning, everyone. Thank you very much for joining us for September 2021 quarterly results call. I'm joined on the call by Terry Holohan, our Chief Operating Officer, and Doug Warden, our CFO, and very pleased to have Doug on board for his first quarterly conference call. Both Terry and I are in Dakar at the moment. I've been in Senegal now for a little over a week, and had an opportunity to visit the Mako mine site earlier this week. Yeah, it was a very positive visit. Great to get down to the site and speak to the people and see how things are going. The team at Mako are doing a wonderful job there.
As you can see from the quarterly, we continue to hit all of their production targets, as we'd expect. I've also spent a couple of days in Dakar with Terry, and we've met various officials in the government here to just present the case for Mako and Resolute more broadly. What we'll do today is, I'll just give a quick introduction, and then hand over tO Terry and Doug to run through the operations, financials and balance sheet components of Resolute's results. Then we can hand over or go to questions from there. I guess as we look at the quarter all up, it was very consistent with the previous quarter.
We produced a little over 76,000 ounces of gold during the period. Our all-in sustaining cost was higher than we'd anticipated or expected. As noted in the quarterly, that was driven very much by a well above average rain period in Mali. That had some significant impacts, particularly on our oxide performance, and resulted in the drawdown of some higher value stocks which flowed through into our all-in sustaining cost. We're also hampered a little bit by some ongoing maintenance issues, and we see those flowing through just into the October period. The shut coming up, there's a 7-day shut coming up fairly shortly and I'm sure that we'll resolve some of those things.
The gold sales and our average price, I'm sure Doug will touch on, but continues to improve so that overall hedge book is looking pretty reasonable at the moment. As we announced, it was very, very pleasing to conclude the sale of Bibiani during the quarter. We received $30 million of cash for that, and there's another $60 million which is receivable on Bibiani in February and September next year. With that, net debt was reduced during the quarter to $213 million. We continue to be very focused on our balance sheet and how we manage that. You'll note a couple of weeks ago, we also announced that the shutdown of the roaster would be deferred.
We've got confidence in the deferral of that shutdown because we've deployed a number of monitoring technologies across the plant. The information from that technology is certainly pointing to the fact that the roaster's working very well, and we can see from the processing performance of the roaster that things are progressing well through that. From an exploration side of things, we continue to be very near-mine focused, and we had some really very good drill results, particularly at Tabakoroni underground, and also in a couple of the northern areas for oxides, and we're in actual fact have started stripping at the Beta satellite deposit.
That's actually a fairly recently identified oxide satellite deposit, has good grades, low strip ratio, so we're looking forward to getting into that. Before I hand over to Terry to walk us through the operations, I think it's really important just to highlight that, you know, we continue to work really well with the governments in both Senegal and Mali to vaccinate our workforce and our contractors. You know, we've delivered over 1,600 doses. Well, in actual fact, 1,600 people had double dose vaccinations and another 300 or so on single. That's progressing well and it's good to ensure that we have our people vaccinated so they can get to work and keep things moving along.
With that, I'll hand over to Terry for an update on the operations.
Thank you, Stuart, and good morning, everybody. I will take you through the Syama underground, Syama open pit, and the Mako mine key highlights from an operations point of view. Before I start, I would like to make a mention of the fact that we have managed to fill by far the majority now of our key positions in both the operational and the technical support roles and teams. We've got some good people brought in, and we're starting to see the benefits of those people already. At this point in time, there are two positions vacant, but we will expect to fill them in the next six weeks. To get to the Syama underground, as we previously mentioned, we backed off a little bit on tonnage compared to the previous half year.
The grade, as a result, did improve to 2.46 from the 2.33, and this is mostly because we opened up more draw points, and it gave us a lot more flexibility and a lot more grade control went in there, so we can actually control the grades coming out. With that improvement, we expect to continue over the next 6 to 9 months. This material we did mix with about 10% of our stock material that is typically ranging from 2.3 to 2.5 grams a ton, and we maintained that grade of 2.46 through the plant. You notice we did have slightly better recoveries, but generally, the performance was reasonable on that side. We are continuing with our cave modeling.
The cave modeling is going to be completed early next week, and this will be able to give us our outlook and underline our budget going forward for the next couple of years, so we should be able to first of all predict the grade more accurately going forward and put our budgets together with a lot of confidence over the next two weeks. We did consolidate the owner operator of the underground, and we are improving the mining techniques going forward. This is driven by the fact that we've got three new caving experts within the teams, one on site and two in support now. So we're actually improving the techniques underground and monitoring the caving in close, far closer detail.
On the surface infrastructure, we did hand over the new power plant to the operations, and we fixed all the bugs in the system. There were a lot of bugs originally causing stoppages. This was in the SCADA system. We did parachute a couple of people in there, and we fixed that, and now that plant is operating reasonably well. We've also completed the construction of the new cleaner cells and the on-stream analyzer for the float plant. This is designed to give us fine sulfur control in the feed to the roaster, but we also are expecting slightly improved recoveries going forward and a slight decrease in tonnage as a feed to the roaster. Traditionally, we feed about 7% of our mill feed to the roaster.
We're expecting that to come down to 6% or even 5%, which is significant given that the roaster is the bottleneck in the circuit and should give us opportunity to squeeze more material through that. Going forward now, we are focusing on the scheduled maintenance and improved productivity on the plant. As Stuart has highlighted, the roaster area is the area that we're putting a lot of work into, but we're also working on the crushing and the milling circuit. We do have a short 7-day stoppage, as we mentioned, because of the improved condition monitoring on the roaster. We've delayed that till February, and we've got a major shut in February, and we're doing some of the tie-in work right now as we speak with the short 7-day shut. October will be a busy month for us.
We'll be commissioning the new float cells, the OSA, and as I mentioned, we expect to see benefits of that over the quarter with the slightly improved roaster throughputs. Again, when we do the shutdown in February, we're expecting another significant step up in roaster performance. If you look at the sulfide circuit, we would see this as a quarter of consolidation. If I move to the open pit operations, this is one of the quarters. Remember last month, last quarter, I did mention that we shut down the Cashew pit, and we moved all our, we're moving all our equipment to the Tabakoroni area. Unfortunately, this was not a good time to move equipment to Tabakoroni. We're operating in laterites, and we had to get down into the bottom of the pit, and unfortunately, we had significant rains.
It's not the first time it's rained. Obviously, we do operate open pits in this type of weather, but normally we have plenty of planning time, so we can operate around the peripherals of the pits and the sides of the pits during the rainy season and use stockpiles. However, we had to try and get some of the material out of the bottom of the pit, and this proved very difficult. As a result, we did mine and haul some materials from the Tabakoroni pit, typically at about 1.8 grams a ton, but we also had to use some of our stocks, which are typically 0.8-1 grams a ton, close to the oxide plant, and this gave us about an average grade of about 1.2 grams a ton. Not where we want to be.
However, in that same time, we followed up with some recent discoveries at the Beta pit with a lot of great control drilling. If you remember last time I said that we were looking for flexibility and having several pits available to start with all grade control drilling. We've done a lot of that, and the Beta pit we started last week stripping, and we're expecting to start taking ore out of that over this weekend. We are expecting our grades in the oxide circuits to start climbing up back to the two grams a ton in the near future, sorry. The oxide circuit has been a tough quarter, but again, we do expect significant improvements going forward. If we move to Mako's operating very well. We've almost finished the cutback on schedule.
While we are cutting back, we had to treat some expected lower grade material, but we're now moving back into the higher 2-gram a ton ores. We have improved the mill control, and as I previously mentioned, the mill typically ran at 6.9-7.1 MW. We're now in the range 7.1-7.5, and expecting to go into the mid- to high 8.7s. We have commissioned the MillSlicer, which is a virtual window into the mill, and this has given the operators the ability to control far better the loadings inside the mill and the power usage. We're expecting systematic improvements from that circuitry. In Senegal, despite the heavy rains there was no material impacts on the mine, despite the fact that the pit is now water.
a net water collector, as it's for the first time below ground level. Just on an environmental note, just as I say, Mako is ticking all the boxes. We are very happy to catch on film chimpanzees for the first time walking through our waste dumps since construction. Mako, again, performing as planned, and we expect more of the same going forward. In summary, it's been a very busy quarter for us, and we think that we're gonna see significant improvements going forward over the next two, three quarters. Thank you, Stuart. I'll hand that back to you.
Great. Thanks for the update, Terry. I'll hand over to Doug now to run through the financials and balance sheet. Thanks.
Thanks, Stuart. I'll just take a few minutes to walk you through the cash flows for the quarter, the net debt position at 30 September, and a brief update on the hedge book. Starting with cash flow, the waterfall chart I'd refer to on page 5 of the quarterly. Operating cash flow for the quarter of $43.6 million benefited from a $23.3 million drawdown in bullion, which helped drive strong gold sales for the quarter of 89,326 ounces. Royalties were higher than previous quarters at $5.5 million due to these stronger sales.
VAT and taxes thereof -9.1, some of which was due to a legacy tax payment in Mali, with the majority of that relating to VAT leakage during the quarter. Fairly capital-intensive quarter, so it is up on previous quarters in terms of that VAT leakage. CapEx of 11.5, which was largely sustaining capital of about $7 million in underground development for Syama of about $4 million. Exploration at 3.7, related to the resource drilling at Tabakoroni underground, as well as oxide exploration drilling at Syama North. Stuart's already mentioned this, and you would've seen the results of these drilling programs in the late August announcement.
Working capital just slightly negative at $2.6 million with a small reduction in creditors during the quarter. The Bibiani sale proceeds we've talked about. The reason it's not quite $30 million is we actually received $1 million in the previous quarter and $29 million in Q3, with the balance being around three-quarters of a million US dollars from the sale of our tenements to Toro Gold in Côte d'Ivoire. Debt repayments of $53.6 million comprised $25 million for the first installment of the term loan and $30 million paid off the revolver from the Bibiani proceeds, with the small difference being a small drawdown in local overdraft facilities. Interest of $3.1 million, fairly self-explanatory. The government dividend and withholding tax of $8.2 million.
That comprised of a dividend installment payment of $2.4 million to the Senegalese government for their 10% stake, as we dividended cash flow out of Senegal. The balance is withholding tax of 10% on the payment of that entire dividend. Turning to net debt, after taking into account cash and bullion balances, net debt reduced by $6.9 million for the quarter to $212 million, or $212.9 million, sorry, at 30 September. Finally, just to touch on the hedge book, a reminder that under our banking facilities, we are required to have a minimum of 30% of the next 18 months' forecast production hedged.
At 30 September, we had a total of 176,000 ounces hedged, comprised of 123,000 ounces of US dollar gold forwards at an average price of $1,783 an ounce, 23,000 ounces of euro gold forwards at $1,501 an ounce average, and 30,000 ounces of zero-cost collars with an average put price at $1,700, and an average call option at $2,059 an ounce, which expire over the course of the final quarter of this year. That's it really from me, and I'll hand back to Stuart to wrap up.
Great. Thank you very much, Doug. Look, just before we get into the Q&A, there are a few questions that have flowed through
As the guys have alluded to on the call, it's great now to have what we think is a pretty full complement of people on board. Clearly, we're done joining. We've rounded out our executive team, but I think just as importantly, you know, we've been able to get those key management representatives and technical expertise into our site-based businesses over the last, you know, 3-6 months or so. Feeling pretty comfortable that we've now been able to round out the people side of things. There's still one or two key roles, but we're in much better shape now than what we were on our last quarter. Our focus continues to remain on the systems and process that help to give us productivity and efficiency gains.
You know, there are a number of initiatives that have just started to take hold, and that will take hold over the next 3-6 months. We are expecting to see, you know, improvement from a cost and production perspective. I'll just touch very briefly on exploration. Again, no change there from an exploration perspective. It's around near mine. It's around making sure that we capitalize on the Syama gold legacy, and we're looking for other opportunities at Mako to extend the mine life there. They're key things for us as we look to the future. With that, I'll just jump across into the questions.
Our first question is around cost savings potential from the switch to owner-operators and any other opportunities to save costs on that. Yes, look, we are. We haven't seen the full cost savings benefits from that switch come across. You know, it's a reasonable amount of money. I'm not gonna go into it in too much detail, but it's part of a process of looking how we can be more cost effective in the way that we run our business. That doesn't just translate to the actual dollar value of the cost savings initiative. It also has an impact from a VAT perspective as well.
Because, you know, as we've discussed on these calls previously, every time we have an invoice that we get from a consultant or a contractor or we buy supplies, we get VAT added to that invoice in Mali. We don't with our employees. That's 18%. To the extent that we can look through our operations and see where we can take service in-house, that's what we should be doing. That's what we've done in this case. There's a couple of other areas, particularly, you know, from a maintenance standpoint, that we think we can also get benefits from in service of that transition. 80%, when are we gonna get 80% recoveries through the sulfide circuit? Are we nearly there? Well, I think we are pretty close, Terry.
We were at 79.5, getting pretty close. You could have just about rounded that up, but the number was 79.5 for the quarter, and that's obviously an improvement from the previous quarter, which I think was around 77-78%. Pleasing to see the performance through there. You know, as we continue to tick off on a number of these initiatives that we're speaking about, then I would expect we would continue to see improvements in recoveries. Why I should stop talking about that and ask Terry to give his comments on.
Yes, certainly. Thanks, Stuart. Recovery is something that we're doing a lot of work on. Recovery doesn't seem to be a function of grind too much in the sulfide circuit. What seems to be very important is obviously stability in the whole circuit. Something that we're spending a lot of time on right now focusing on that. What will improve is when we put the cleaner circuit in there, because what will happen is we can actually, as a classic flotation circuit, we can pull harder, get a higher initial pull, and then clean it back down to lower. With anything that's rejected, swing it back to the mill.
Because obviously coming across with some gangue material on it, let's give it a chance to re-mill it, and then when it comes and presented the second time, it will come through cleaner. We are expecting an uptick over the next couple of weeks as we commission and get to know that circuit. Remember, it is linked to the OSA, so it won't be an operator intensive operation. It will be an automatic system. We've got three or four experts on site as we speak now working on that to show us how to optimize that circuit. I'm looking at an improvement there, with the lower throughput being going then through the roaster and then going through the leaching circuit in the roast. After the roaster, again, that's going to improve residence time.
I'm expecting systematic improvements going forward.
Excellent. Thanks, Terry. I guess in keeping with the efficiency initiatives, our next question is around the MillSlicer and what benefits that will bring and whether we have any scope to improve the throughput and the mill's performance. I can say that, you know, I had a really good opportunity to have a look at the output from the MillSlicer when I was at Mako a couple of days ago. It delivers a really good visual for someone like me to understand the importance of how we manage that particular mill. You know, I think we'll continue to get benefits from that as the team get better at monitoring and managing that.
Again, Terry, would you provide some comments on the output from the MillSlicer?
Certainly. The MillSlicer is a huge improvement on any SAG milling operation. Obviously what you do need is a variable speed motor, and we do have that on the Mako mill. That is allowing us to throw the balls and the rocks. If you look at a cross-section of the mill and think of it as a clock and rotating clockwise, the balls normally fall on the wall somewhere between four o'clock and six o'clock. If they throw at four o'clock, then that power is wasted because metal is just hitting the metal wall of the mill. What we're able to do is control the speed of the mill, and as a function of the wear on the liners, throw those balls between five and six o'clock, which is where you need it. We're not...
We're starting to absorb more power into the ore, which is where you want to put it, instead of throwing it into these side walls. We're already seeing improvements on that. It is a manual system at this stage because we're determining all the algorithms, but we are installing the control system, which is called MillSTAR. That's being commissioned as we speak. With that we'll go into automatic mode probably in about another 3, maybe 4 weeks. We're expecting big things from that. What I'm really keen on is the mill was originally running around normally 7 MW with some wasted power. What we're looking to do is get it close over time to 8 MW, which is a significant step up with more efficient use of power.
I'm hoping for some significant increases in throughput as a result of that.
Great. Thanks very much, Terry. I think with that, it's probably time to wrap up the call. Many thanks for everyone for joining the call today. Hopefully it's given you a little bit more of an insight into how things are going at Resolute, particularly through the September quarter, and where our vision is as we look forwards. If there are any other questions, please feel free to reach out to James Virgoe at any stage, and we will attend to them. In the meantime, look forward to catching up with you all at some stage in the near future. With that, I'll sign off. Thanks very much.