Thanks, Nathan, and welcome to all of our shareholders and listeners for the June 2024 quarterly call for West African Resources. Thanks for dialing in. It's been another busy and productive quarter for West African, as we continue our path to becoming a 420,000 ounce plus per annum gold producer. Firstly, I'd like to discuss production at our Sanbrado operations in Burkina Faso, which continues to be in line with our expectations. Later this month, we'll also be producing our millionth ounce from operations, which will be a magnificent achievement. But for last quarter, we produced 51,049 ounces of gold at an all-in sustaining cost of $1,158 an ounce.
We achieved gold sales, unhedged gold sales, of 52,445 ounces at an average price of $2,314 per ounce. Our gold sales continue to be fully unhedged, allowing us to benefit from the record high gold price environment that we're currently seeing. For the first half of 2024, we achieved gold production of 107,644 ounces at an all-in sustaining cost of $1,223 per ounce. And this means that we're tracking towards the higher end of 2024 production guidance, which we've set as 190,000-210,000 ounces at an all-sustaining cost of less than $1,700 per ounce.
Also, we're well on track to meet our full year cost guidance, about halfway through the year. Breaking down our production for the quarter, our M1 South underground mine produced more than 34,000 ounces at a head grade of 8.7 grams per ton of gold. The underground mine ounces increased 24% this quarter, compared to last quarter, with underground production continuing to ramp up. Nearly 62,000 ounces of gold have been produced in the first half of the year. In addition, we completed over 740 meters of development during the quarter, including nearly 100 meters advancement of the decline. The vertical depth of development increased 14 meters to nearly 600 meters below surface. In parallel, open pit mine ounces decreased 15% in the quarter compared to the March quarter.
We produced 18,700 ounces from the open pit mining in June. The reduced head grade and ounces are due to the completion of the higher grade M5 South open pit the first quarter of this year. Open pit production for the first half of the year stands at 40,636 ounces of gold. Processing continued to perform at a steady rate during the quarter, with 844,000 tons milled at an average head grade of 2 grams per ton gold and recovering 94%. The closing ROM stockpile inventory of 30,267 ounces of contained gold was marginally lower than last quarter.
We also continued exploration during the quarter with infill drilling at M1 South, and the northern shoot returned high-grade gold, including results of up to 110 grams per ton gold. We completed an 18,000-meter resource definition drilling program at M1 South on the main zone, targeting inferred resources. This program is complete now. We expect to have results released during the September quarter. As we look towards the growth of West African, early in July, we released an updated ore reserve and production target for the company, following completion of a feasibility study at our second gold mine, Kiaka. The ore reserve for Kiaka increased to 4.8 million ounces of gold, and this in turn increased our group ore reserves by 4% to 6.4 million ounces of gold.
We also updated our production plan, so for the ten years from 2024 to 2033, West African is forecast to produce 4.2 million ounces of gold, with an average annual production of 480,000 ounces of gold from 2026 to 2031. Our gold production is set to peak in 2030, when we are forecast to produce just under 500,000 ounces of gold from our two operations at Sanbrado and Kiaka. It's an exciting outlook for the company, and we will be working hard over the years ahead to achieve these goals.
Of course, bringing our Kiaka mine into production is a major part of this plan, and progress on this continued on track during the quarter, with construction now past 50% complete and over 75% fixed on costs. Early in July, following the release of our updated ore reserves and production target, we completed an AUD 150 million placement via book build to progress Kiaka development. We're using these proceeds to purchase our own mining fleet, pivoting from contract mining to owner mining, and establishing our own mining facilities and acquiring additional exploration drill rigs. These funds will provide West African with sufficient financial flexibility to fund the project construction and ramp up, supporting our path to production at Kiaka.
During the quarter, we also drew down the remaining $100 million under our secured loan facility from Sprott and Coris. This facility is now fully drawn and will go towards Kiaka development, as well as other corporate purposes. So key milestones achieved at Kiaka during the quarter included successful delivery of the largest concrete pour on the project. So we're about 50% complete on concrete as of last week. All major mill components have arrived safely on site, and the first structural steel has been put in place. Also, our resettlement program is also progressing well. We remain on track to achieve first production at Kiaka in Q3 next year, or just over 12 months from now. So Kiaka remains on schedule and budget, which is really pleasing.
I'll now hand over to our CFO, Padraig O'Donoghue, to discuss our financial performance for the quarter.
Oh, thank you, Richard. In terms of cash, WAF closed the quarter with a healthy cash balance of AUD 425 million. This balance excludes the funds raised from the AUD 150 million equity placement completed post-quarter in early July 2024. WAF generated AUD 75 million in operating cash flow in the quarter after paying AUD 13 million in Burkina Faso income taxes. Capital investing activities in Q2 used AUD 132 million in cash, which was mostly comprised of the AUD 120 million of Kiaka construction. Financing activities provided AUD 144 million cash in Q2, significantly reflecting WAF's final drawdown under the Sprott Coros loan facility of AUD 151 million.
Richard covered the strong gold sales of 52,445 ounces of gold in Q2 at an average price of $2,314 per ounce. This equates to AUD 184 million of gold sales revenue in the quarter, and the company remains unhedged. I now hand back to Richard for his closing comments.
Thanks, Pedro. So in summing up, it's been another terrific quarter for West African. I had the pleasure of being on site during the quarter with Libby Massey and spending some quality time with the team, both at Sanbrado and Kiaka. We're working well towards achieving our goals. Looking forward to producing the millionth ounce out of Sanbrado this quarter and seeing Kiaka keep progressing over the year. We're starting to see structural steel going up now, so by the time we get to Diggers and Dealers in about a month's time, you know, Kiaka will certainly start to look like a gold mine. Pretty sure all the tanks are nearly finished and being tested at the moment, so we're making really good progress there with our team.
Very pleasing as well that we've had a quarter of a very safe quarter with no significant social or health or safety incidents recorded for the quarter. Well, thanks again for your interest in the morning call. Look forward to taking any questions that we might have.
Thank you, Richard. Just a reminder, if you would like to ask a question directly to the company, please use the Raise Hand function within Zoom to give people... Actually, your first question comes from Andrew Bowler at Macquarie. Please go ahead, Andrew. Just on mute, Andrew.
Sorry, I figured it out now. G'day, all. Just looking at the recent drilling intersections from the M1 South Northern shoots, some pretty good results coming in there. Are you thinking that's likely to help you get extraction rates for the M1 South underground above the long-term run rate, or is that likely to be a mine life extension story there?
Yeah. Thanks, Andrew. Look, I think it's the former. So I think that, you know, having more flexibility underground gives us the opportunity to get more tons out of up the decline. So I think we'll get a bump towards the end of this year and early next year from the northern shoots. Interestingly, it actually is hanging together quite well, so we'll keep drilling that down below the current intercepts. We also can follow that back up to infill beneath the open pit as well. So there's definitely upside there. I think it'll bump the tons per annum. So obviously bump production out of M1 South.
No worries. And last one from me. In the updated feasibility study for Kiaka, from what it looks like, you bumped up the processing throughput steady state from 8.4 to 8.7 million tons per annum. Can you just chat through the key changes there, if there was any, you know, material scope changes that allow for that? Or is that just optimizations and more study work being done?
Yeah, just a bit of optimization, really. We think it's actually conservative still. So I mean, we, you know, like I've said previously on calls, we've oversized the crushers and mills, and tanks. So, you know, we think it'll probably run steady state closer to 10 million tons per annum, but we just want to get up and out of the blocks first. The first couple of years, we are running it close to 10 million tons per annum because we've got a higher oxide blend. And then, you know, we'll just see how we go after that. I'm quite confident. Yeah, even 8.7's conservative, given the experience we've had at Sanbrado, which is run at sort of 50% above nameplate, consistently from day one.
No worries. Thanks very much, guys. That's all from me.
Thanks, Andrew.
Thank you. Richard, we've had some questions come in from Mike Millikan at Euroz Hartleys. I'll just read those out. First one: M1 South underground grades are currently above reserve grade, so do you see this continuing for the next few quarters?
Yes, I think. Thanks, Mike. I think it will. What we've managed to do through our detailed grade control drilling program is just sharpen up some of our stope shape, stope shapes. So we are sort of managing to reduce waste, increase ore. So, yeah, slightly less tons coming up from the shapes that we had designed for the reserves, but obviously, that means higher grade, which is very positive. And then, just as you mentioned on the previous call, given the flexibility we've got with new areas opening up, you know, we are gonna be able to optimize and inc- kind of slightly increase tons coming out of M1 South over the longer term.
Thank you. Second question: Any options to improve the schedule since it's extending at high grade at Northern Shoot of M1 South?
Yes. So I think we kind of answered that in the previous question as well. I think that'll continue. We've seen on all the deposits at M1, M5, they've all got very strong vertical continuity, and I would expect that to continue for the northern shoots.
Thank you. Could you please provide an update on adding Sanbrado to the national power grid? And if so, what would the anticipated cost savings be?
So no, no relap at this stage, but, you know, we've got a feasibility study, we're working on, on site. So I think it's likely to happen in the next 12-18 months. There are some infrastructure upgrades being undertaken in Ouagadougou by the national power company. So I met the director of SONABEL, which is a national power company, a couple of weeks ago when I was in country. You know, so CapEx on that, probably it's around sort of $10-$15 million, and we can expect that sort of annual savings will be in the same order.
So, you know, as long as we can get access to the right area of the grid and the government's upgraded it, then, you know, we can put Sanbrado on the grid and obviously reduce our carbon emissions because we're making power on site using HFO and a substantial decrease in power costs as well. And then, obviously, we've got that full power station as backup if there are any issues with stability of the grid.
Thank you. Last one from Mike. Also on the recent move to owner-operator mining at Kiaka, obvious mining cost savings, do you anticipate some VAT savings?
Yeah. So I mean, it's a problem in Africa generally, not just Burkina, that, you know, return of VAT is pretty slow. By moving to owner mining, we reduce our VAT exposure over the life of the project by about $300 million. You know, so it's in the order of $15 million or $20 million per annum in reduced exposure to VAT. So, obviously, that means that, you know, we've got cash availability for other things, which is paying down debt or eventually paying dividends.
Thank you. Just a question that's come in, just asking for an update on the political situation in Burkina.
Right. So it's pretty much steady as you go. No changes. You know, we still see the northern and eastern regions of the country are becoming more stable, and we're seeing local people returning to their villages and I guess being reestablished in those regions, which is really positive. Trucking routes have opened up towards Ouahigouya, which is in the north, central north of the country, and then off to the northeast, where Essakane's. Sorry, I mean Essakane mine is located. So both of those trucking routes have opened up again recently, which is really positive.
The president has been—I think he's been put in place for another five years, so we're not expecting elections in the short term, which I think is positive. It gives us stability from a political perspective as well. My recent trip into country, I managed to meet with, you know, Minister of Mines and Finance, with Director Generals of various state companies, which is positive. So, you know, from a day-to-day perspective, you know, we're not being impacted by any of the political situation in the country. Sanbrado has just had another cracking quarter. You know, we're tracking towards the top end of guidance, and we're well below our average all-in sustaining cost of $1,300 per ounce. So operationally, things are going well.
We've got our 1 millionth ounce being produced later this month or early next month. So, you know, from an operational perspective, we're not being impacted.
Thank you. There are no further questions at this time, so I'll now hand back to Richard for closing remarks.
Thanks, Nathan, and, and thanks to all our shareholders for listening. We look forward to another positive quarter at Sanbrado with production, another quarter full of milestones at Kiaka with construction, and we look forward to updating all of our investors in three months' time for the next quarter. Thank you.