Good afternoon, and welcome to the Gold Fields full year 2022 results presentation. I'm joined by Paul Schmidt, our CFO, and we'll be taking you through the pack. Maybe before we transition, something we're really proud in Gold Fields is the picture in front of you, and it's 101,000 reasons why to believe in renewable energy at our South Deep mine. Avishkar, we could just progress. I'd just like to draw your attention to the forward-looking statements and ask you to take note of those.
Thanks, Avishkar. The focus today, just the agenda, and I don't wanna go through it point by point, standard agenda, but where we ended the year, a bit around our safety and ESG, and we'll deal with the conclusions at the end.
I think in terms of Gold Fields as a value proposition, I think what's important is that we've got a very clear, defined purpose and vision, and importantly, a strategy that has been set, is in place, supported by management and the board, and we're on track delivering that. Importantly, we've got a good track record of delivering and meeting production and cost guidance, and we've done that again this year. In terms of capital, a strong balance sheet, we've ended the year with a net debt to EBIT ratio of 0.29. Importantly, this year going forward, we've committed to dividends of between 30% and 45% of normalized earnings. Of course, we continue to invest in our sustaining capital. We think that's an important part of our DNA. That helps us maintain this strong performance.
Importantly, the question about the future. We've got a leading near-term production growth, both with Salares Norte coming on track, which will give us close to a half a million ounces in the short term, ramping up to 600,000 ounces per annum, and then South Deep on its continued growth trajectory up towards 380,000 ounces. In terms of opportunities going forward, we certainly need to look at inorganic opportunities, and our focus going forward is gonna be rather on incremental growth in our regions rather than big transformational transactions. Thank you. We've lost the slides. I think just some key salient features from our results. Unfortunately, we've had to report one fatality at our Hamlet mine at St. Ives in Australia.
We're all very saddened by the loss of our colleague and will use this as an opportunity to learn from, but also to reinforce our safety activities. Positively, the South Deep Gold Mine in South Africa, for the first time since Gold Fields has owned it, has gone for a full calendar year without a fatal incident. We've commissioned both the solar projects at Gruyere and South Deep this year. Year on year, 3% increase in attributable gold production and Adjusted Free Cash Flow of $431 million, albeit that our costs are up 2% year on year. Our balance sheet stays in a very strong place with a net decrease of $265 million of net debt, despite paying dividends and the Salares Norte capital.
Importantly, for all our shareholders, we're declaring a final dividend of ZAR 445 a share, bringing our total, ZAR 4.45 a share. My apologies. Taking a total dividend declared for the year to ZAR 7.45 a share. That's a payout of 47% of normalized earnings. It's important to note that we felt it was only right to share some of the proceeds from the Yamana break fee with our shareholders, and we've put $100 million of that fee into this, into this, dividend this year.
Management changes, Kelly Carter is from our Australasia region, who is the Group Head of Legal & Compliance, has been offered the position, accepted the position as Group Head of Legal & Compliance. The recruitment for the remaining executives is at an advanced stage. Some not so good news is that Salares Norte, we plan to commence initial production now in quarter four this year. The project has been impacted by some delays related to skills, weather, and the lingering effects of COVID. I think the key message on this side, this slide, is that we've landed our full year production and cost guidance again. Just the company at a snapshot. I'll just focus in the top right-hand block, but nine producing mines, the one project in Salares Norte in Chile, operating in five countries.
Our production for last year, just short of 2.4 million ounces, growth of 3% year-over-year. All-in cost at $1,320, just up 1%. Free cash flow from operations, a strong operational performance at $855 million. Marginally down, impacted by inflation and a slightly softer gold price. The adjusted figure, which I spoke about on the previous slide. If we go to the pie graph in the bottom left corner, it's important to note that Australia makes up over 50% of our revenue or cash, mine cash flows and 44% of our production. They're a really important part of our business, and we need to nurture and look after them.
We can go to our ESG performance for the year. I'm not gonna talk about the targets. We know what those are. We've spoken about the one fatality that we've had. Less than desirable for us. Five serious injuries for the year. We're well on track with our gender representation, now sitting at 23% and on track for the year. Stakeholder value creation, the team has done really well, sitting at 27%. Importantly, at the bottom left, with decarbonization, in terms of our net emissions increase, it's gone up 1% in line with our plans, as we growing and getting deeper.
We've seen a 18% absolute emission reduction off the 2016 base. It would be important to note that last year, just shy of 14% of our electrical consumption across the globe was made up with renewables. We're well on track with compliance to tailings management standards at GISTM. In water, we're well on track. The teams in the operations have done great work. Just to touch on our decarbonization journey. I've spoken about the South Deep and Gruyere Solar plants being commissioned this year. Cerro Corona is on a 100% of hydroelectrical power. This year we've commenced the work to develop the feasibility around the St. Ives microgrid in Australia. Public consultations have been held. It's planned for board approval in the back end of this year.
Concept study work is under way with our Salares Norte project. I think importantly, we don't, we don't rate ourselves without some third-party judgment of what we're doing. This is just some detail around the transparency of our disclosure and peer benchmarking. I think that helps us ensure that we remain on the right track. There's lots of positive recognition, and I think gives us assurance that we're doing the right things in this space. In terms of our operations, we've had strong operational performance across the group, and importantly, met both production and cost guidance. We've seen a 3% growth in production. We've also seen some pressure come onto our all-in costs, and largely as a result of inflation, which Paul will talk to you a little bit later.
We've got attractive production growth going towards 2024. Thank you. I'll leave. In terms of Australia, as I said earlier, the mainstay of our business, they've again seen a 4% increase in production year-on-year. They've kept their costs flat, helped a little bit by exchange rate. Very importantly from an Australia point of view, reserves that were mined in the year will replace post-depletion, which is a positive story for us and just reaffirms our belief in that asset. In South Africa, again, great performance from the team out at South Deep. They've seen a 12% year-on-year growth in production. The exchange rate has helped them with their cost in dollar terms, seeing a 2% decline. Very importantly, $129 million of free cash generated there.
That's the fourth year in a row that the South Deep team have generated positive cash flows. We're on track with the build up to 380,000 ounces. Importantly, as we look at flexibility at South Deep, the South of Range study work is well underway, and initial development towards the South of Range will commence this year. The team at South Deep have also been fortunate that they've managed to conclude a two-year extension to the current three-year wage agreement, which will give us labor stability until 2026, which both looks after the employees' interests, but also after our interests.
If we look at just some of the productivity trends which you've seen before, I'll go back to the longhole stoping drill rig performance at the end. We continue to see positive trends in the right direction with gold produced with development in destress rig performance, which is what unlocks the stopes and generates the reserves for us. I've touched on the free cash flow generation, both depicted on this graph in dollars and in ZAR. Something the team at South Deep are really proud of. If we look at the longhole stoping tons per rig per month, there's been slight regression. That's just linked to mine layout. As we go on with the buildup plan, we've been forced to introduce an additional longhole stoping drill rig during the course of the year.
That is not fully optimized yet, but as we increase stoping volumes in the coming years, that will come back as that drill rig gets properly utilized. In Ghana, again, great, you know, team has performed really well there. We've seen a marginal decline in production as the main pit at Damang has reached the end of its life. We're now mining in the Huni pit, which is a satellite pit, and treating dumps. The costs have gone up by 10% year-on-year, impacted quite severely by inflation and obviously the reduced volume, but still a strong cash flow generation from the region. We remain in discussions with the government regarding tax issues.
Tarkwa, we believe, remains a cornerstone asset for our business, and the team in Ghana are busy with studies how we can further optimize that asset. During the course of this year, we plan to land a way forward with both Damang and Asanko, and we will update the market when we're ready. In the Americas, in Peru, we've seen a material improvement in production with a 5% increase in output. Linked to a decrease in all-in costs, which we pleased about. Still strong cash flow generation of $76 million, and the team there are looking at how do we further optimize the asset as it approaches, it's getting a bit aged now.
I think very pleasingly from a Peru perspective, the mine hasn't been affected by the social unrest in Peru, which is largely limited to the Southern part of Peru. I think also a testament to the great work that our teams on the ground do in terms of our social interactions and social responsibilities that we have a healthy and a respectful relationship with our communities there. If I can hand over to Paul to deal with the financials. Just push up there.
Thanks, Martin. Good afternoon to everybody. I think the highlights page, Normalized Earnings $860 million for the year. The rest of the numbers all positive, good numbers, but they've got slides coming down.
I suppose the only negative for the year was the impairments we had in Ghana and Peru, mainly driven by increasing the discount rates, again, due to increase in the risk-free rate as well as country risk premiums. Just want to emphasize that the rates that we used for impairments, the circa 9% for Peru and 16% for Ghana, do not reflect the investment rate, the investment hurdles we need, we use in Gold Fields. They are the rates we have to use for accounting purposes. I suppose this page is one of the highlights for Gold Fields. I think we're one of few gold mining companies who managed to meet our all-in cost guidance for the year, $1,320, 2% up year-on-year, despite us facing circa 11% inflation during the year.
Even if we normalize for exchange rate, we ended up at 1,381, right at the bottom end of our all-in cost guidance. If we look at our cash flow, operations made $855 million. Just want to emphasize what Martin said, $129 million from South Deep. If we go back 4 or 5 years ago, who would have dreamed that this is the kind of money South Deep would be generating for the group. Adjusted Free Cash Flow, $431 million. This excludes the net proceeds from Yamana of $127 million. At the back of this presentation, there is a recon slide explaining how we get to the $127 million.
We look at the balance sheet, net debt down to $704, over $200 million down year-on-year. My net debt to EBITDA, 0.29 times, down from 0.4 at the end of last year. I think this is really the highlight for us. It's ZAR 4.45 final dividend, giving us a total of ZAR 7.45 for the year. We look at an average share price of just over ZAR 170 for 2022, this gives us a dividend yield of 4.3%. I think it's one of the best in the industry.
Thanks, Paul. Martin, Carl. We look at Salares Norte, I'd like to stay on the picture if I could.
You know, we have a mine built there. We have announced today that we envisage that first production will move into quarter four this year. It however remains a great asset. It's a high grade, low cost producer. We've suffered some setbacks related to the skills shortage in the country. On the back, during COVID, a lot of projects were put on suspension in that region. They've ramped up making the battle for skills quite tight. We've had a fairly severe winter again. For those of you interested, I was up there in December just before Christmas. One of the things I learned that the average temperature for the full year is 0 degrees up there.
The winters are particularly severe, and at the stage of construction where the teams were working outside before we'd got all the buildings done and trying to do lifting operations in blizzards just makes it really difficult. The mine is well designed. Commissioning's in progress in line, in parallel with the remaining construction, and that we believe will go some way to mitigate commissioning challenges later in the year. If we look at the total project. If you go back 1 please, Avi. Sitting at 87%. We've spent $758 million CapEx, of which $286 million was spent last year. I've touched on the weather and the skills. Overall construction progress at 86%. The plant at 77%.
I think importantly, and this is to me, a highlight, is that despite struggling a little bit with the construction, there's a mine in place. We've already mined just shy of 51 million tons of waste, primarily from Brecha Principal, and ahead of the mine plan. The first ore, we struck first ore in Brecha Principal in October 2022, and to date, we already have 422,000 tons of ore on stockpile containing just shy of 80,000 ounces of gold sitting on that stockpile. As the plant comes on stream, we've got a lot of ore ready to go in. We continue to explore. Last year, drilling just shy of 19 kilometers into the ground, spending $32 million.
That certainly in our mind is a real opportunity if we can add on to the life of this great asset. Thanks, Avi. These are the big numbers, and I think this just explains, and Paul will talk to the bottom half of the slide around what a good asset this is. We envisage first production in quarter four this year. We guiding between 15,000 and 35,000 ounces for this year. Next year, up to 500,000 ounces and then back to the original guidance of 600,000 ounces from 2025 onwards. Average production for the 6 years from 2024 to 2029, we envisage 500,000 ounces. Then 2024 to 2033, so over the life of the mine, 355 ounces. That is not new.
It's largely aligned with the original design and scheduling of the mine. Project capital has escalated to just over $1 billion, and Paul has got a recon in the pack, which we'll talk to that. As I said earlier, we still committed to this low cost, high grade asset. We look at our all-in costs for the first 6 years, still forecasting $660 per equivalent ounce, and then for the full life of project, up to $745 per equivalent ounce.
Paul, if you wanna talk to the bottom half.
Thanks. I think these last three lines on this slide was just almost a reality check for us as to what is Salares Norte still worth to Gold Fields. Going back to February 2020, when we announced the project at a $1,300 gold price, 7.5% discount rate, we had a NPV of $620 million. We ran it again now in January. All capital sunk up until the end of last year. Same numbers, 7.5%, $1,300 gold price. We got to NPV of circa $1.1 billion. If we use spot prices of $1,850, we would have got to just over $2 billion NPV. Saying this is still a solid asset and got a huge worth to Gold Fields. Still believe it's a 2-year payback from 2024 onwards. This is a world-class asset.
Thanks, Paul.
We've just included some pictures. This is the project, taken a few weeks ago. I think you can see there's a process plant in place. You'll see water in those tanks, they've started commissioning the water circuits. They're busy commissioning the crusher stockpile circuits and hopefully in the coming weeks we'll start kicking into the mill. The bottom right-hand corner is the infrastructure in place for tailings deposition. We're ready at the back end of the plant.
Importantly, the two pictures in the diagonal top and bottom, you can see that we've got a mining place with that 51 million tons of waste mine and 400,000 tons of ore, which we will continue mining during the course of this year, to build up that stockpile and allow us to be ready for when the mine comes on track. I think just lastly, in conclusion, just the full year guidance, we guiding attributable ounces between 2.25 and 2.3 this year. Paul has put a pack in that talks about the cost and the CapEx guidance for the year and the exchange rate.
The longer-term guidance, excluding Asanko, is also listed there, between 2.7 and 2.77 ounces, and 2025, from just shy of 2.8 to just north of 2.82. Lastly, focus areas for this year, right at the top of our list to deliver Salares Norte on time or in Q4. To deliver on our organizational culture initiatives, asset optimization, to find a mine within the mine, continue on our great decarbonization drive, and then to continue looking and focusing on upgrading the quality and the value of our portfolio. If I can stop there and hand over to Avishkar.
Thank you, Martin. I think let's go to the conference call first for questions. Irene, can we start with you, please?
Thank you, sir. Our first question is from Catherine Cunningham of J.P. Morgan. Please go ahead.
Hi, guys. Thanks for the call. I just have two very quick questions. The first one's on Damang. Just with the mining moving to the Looney Pit and the stockpiles, would it be possible to get some guidance around where you expect the grade to be from here on out? Also just a quick one on Salares Norte. Would it be possible to get some idea or color on what the sustaining CapEx intensity is expected to look like beyond 2023? Yeah. Thanks.
Okay. Sorry, I couldn't hear.
The question's about Damang.
Yeah.
With Looney Pit and stockpiles, where we see the grade going.
I have to get back to you because there's a mix at the moment. Sorry, we'll have to get back to you on the mix, but I think it's about 0.7, if I think I'm correct, the grade going forward.
Yeah.
Catherine. I mean, on the sustaining capital, going forward, we have provided a recon at the back of the pack on the sustaining capital for why the all-in costs, all-in sustaining costs are up, and a lot of it relates to the sustaining capital. There's an anomaly with Salares Norte, as a lot of capital is being attributed to sustaining in terms of the build-out and the drop-out for accounting purposes. As Martin spoke, very little ounces. Going forward, I think you can look at taking into account inflation that we've experienced in 2022. There's probably between $350-$400 an ounce of sustaining capital going forward for Gold Fields from, it's probably 2025 onwards.
It's elevated, this year because of the Salares Norte anomaly. Going forward, those are the numbers you can use.
I'm sorry, just to be clear, that's at the group level. That's not at, like, Salares level.
Group level. That's the group level we're talking about. $350 per ounce to $400 an ounce.
Okay, thank you.
The next question is from Adrian Hammond of SBG Securities. Please go ahead.
Good day, Martin and Paul. Martin, I have a question for you and perhaps for your team and the board about the group strategy. Since the attempt to acquire Yamana, stock's derated from 20%-30% relative to peers. You've made it very clear today in the commentary that M&A is still a pillar in your strategy. Could you perhaps explain to us a bit about the lessons you've learned over the last couple of months and how you intend to rerate this share? Because given your cost on growth profile, you should certainly be better rated. Secondly, you furnished us with some nice long-term production. Could you perhaps give us the associated costs and CapEx for that?
I think the expectation was that last year was your peak CapEx year. Seems like this year is still quite heavy. What should we be expecting going forward? Thank you.
I think let Paul start with the CapEx, or I can start with the. Let's start with the transformational project. I think the lessons that we learned through the transaction is that clearly the market doesn't like a significant premium being paid on a transaction. They weren't favorable to the large transformational transaction. We still, you know, I think the CIBC valuation I think confirmed what we believed. I think the other important lesson for us is that we maintained our discipline and didn't get into a bidding war. What are we gonna do forward? I think we've stated it in the book, Adrian, is that we're gonna continue doing analysis. We're gonna continue looking at opportunities.
When it involves M&A, we're certainly gonna be a little bit more circumspect. I think look at more incremental growth, focusing on our regions rather than big, large transformational projects. That's something I think Gold Fields has done over many years very successfully. It's something we know and understand, that certainly would be in the immediate term, what we are gonna be immediate and medium term, what our focus is gonna be, is how do we look for the right opportunities at the right price, maintain discipline. As I said this morning, we're not looking for ounces. We're looking for profitable ounces, and ounces that are gonna upgrade our portfolio. Not chasing ounces for the sake of chasing ounces.
Adrian, in terms of long-term cost guidance, we don't give it. You know, we give long-term production. We've done it. I have, on the earlier question from Catherine, said you can work on $350-$400 an ounce on sustaining capital. However, we must understand, from 2024, we do have Salares Norte coming in, which is coming at the guidance of around $600. In that year, it's gonna be very a lot lower. That will obviously have a major effect on decreasing the cost as that comes in. That's what I can give in terms of the long-term guidance on costs.
CapEx?
Between $350-$400 an ounce sustaining. Remember, Salares Norte is the only true growth project we have, so there would be minimal non-sustaining capital coming over and above. In 2024 there should be almost no growth capital, bar a couple of smaller projects. They are a small amount in the regions. Salares Norte is the last of the true non-sustaining big capital numbers.
That's clear. Thanks.
The next question is from Jared Hoover of RMB. Please go ahead.
Afternoon, Martin and team. Thanks for the call. A few questions from my side, please. I just wanted to start with the dividend, and I know you did talk to it at the beginning of the call. We know that you paid out about half of the break fee that you have already received. I'd really like to understand what's changed, because at the back end of last year, you guys were guiding to almost keeping the break fee on your balance sheet potentially ahead of future M&A. From my perspective, I'm trying to understand, have you paid this out merely as a goodwill token to shareholders? Or is it a case of you have better line of sight around what your plans are for reinvestment or divestment of some of your Ghanaian assets?
Potentially you've got better line of sight to some of your M&A targets, which you already know aren't going to cost you that much. Just a little bit more clarity on what's driving the payout of that break fee. My second question is just a point of clarification on Salares Norte. I know you talked to $660 per equivalent ounce between 2024 and 2029. Are those nominal numbers or are those real numbers? It does look like inflation is coming down in Chile. I'm just trying to get an understanding of how much fat is built into those cost numbers. Very lastly, on South Deep, I know it's still early days and you're talking to the South of Range feasibility study.
Can you give us any early indications of what you might potentially be concerned about with regards to the South of Wrench, because the way I look at it, South of Wrench is a bit deeper in the mine. Potentially, that would mean more stresses and therefore more seismicity, and it could mean another period of experimentation to get the orientation of the mine right. I'll leave it there for now. Thanks.
Jared, you know, let me talk to the dividend first of all. You know, I've always said to shareholders, we've got a couple of stakeholders that we need to keep us comfortable in terms of our capital allocation policy. One is our debt providers, one is our shareholders, one is also reinvesting in the business. When we completed the year-end results, we thought it's fair to kind of share the proceeds from the Yamana one. Some of the money's been kept back for investment into the business. We decided to give half of it to the shareholders. It's not a change. At the end of the last year, we got it. We just said at that stage we hadn't got a commitment on what we're gonna do with it.
Early in January, when we saw our results, we looked forward to the year. We decided to almost split it equally amongst our dividends. I mean, our debt has come down substantially, so no need to pay more there. We allocated it basically between half between dividends and the rest reinvested in the business. Bearing in mind, as Adrian alluded earlier, we do have a heavy capital year this year. What was the second question, Avishkar? Sorry. What was your second question, Jared? Sorry, I'm getting old and forgetful.
No worries. Just on Salares Norte there. I just wanted to confirm whether that $660 per equivalent ounce is a nominal or real number, and how much fat is actually built into that, given inflation seems to be coming down in Chile.
That is a real number. you know, as I said to you this morning when I spoke to you know, from the original guidance in 2020 when we came out, this number basically almost to the dollar, if you take inflation in Chile, we got to the revised number. That is a real number. It's in today's money.
Jared, just on South Deep and South of Wrench. Fortunately, the fault, the Wrench Fault actually throws up. Net-net, we'll be about 250 meters closer to the surface when we go other side of the fault where we start. It's certainly an opportunity for us. So that answers hopefully your stress condition that we should be marginally better off. I think the other important sort of aspect of South of Wrench, it was only envisaged to start going there in the 2030s. We believe that, you know, we're not manufacturing motor cars, we're mining, and so adjusting time principles maybe aren't appropriate. We wanna slowly start going towards South of Wrench.
Now, what it does do, it allows us to understand the ground conditions earlier and particularly the ground conditions as we navigate that fault. It also allows us to put drilling platforms closer to the ore body there, which allows us to get our definition drilling done a whole lot cheaper and a whole lot faster. I think lastly, and I think most importantly, you know, we wanna be a learning organization. The school fees that we paid in North of Wrench, we are taking those and investing the learnings there into how we design and will operate South of Wrench. I think that would summarize what our intention is, slowly going towards South of Wrench over the coming years.
Okay, great. Thanks for that. Just one quick follow-up on dividend. If you do get that cash back from the Canadian tax authorities, should we be expecting that you would share that, half half with the shareholders?
What we said to you, it was half. The $100 million that we included in the dividend was half of the $202. That is assuming we get the $75 back from the Canada Revenue Agency.
Okay, thanks for that.
The next question is from Leroy Mnguni of HSBC. Please go ahead.
All right. Good afternoon, guys. I've got three questions, please. The first one is, do you have a sense of what the closure and rehab costs would be for Damang if you are unable to sell it? The second question is, given the generous provisions in yesterday's budget speech for renewable energy, would that have any bearing on whether or not you're going to look to expand your renewable power capacity at South Deep? Lastly, I know we spoke about Asanko quite a bit earlier this morning, but we don't talk a lot about Cerro Corona and some of your options and maybe buying out your JV partner there. If you could please just share some of your views around that as a potential option to the Boltons acquisition.
Leroy, on the Damang rehab provision, when we bring out the glossy at the end of March, we give the base case rehab for all our mines, and you'll be able to see it there. I don't have it on hand at the moment, but obviously we have a base. Pardon? Approximately 20. Okay, thanks. Okay.
It's $20 million, approximately, Leroy.
I think the second question on the renewables, Leroy, as we discussed this morning, you know, we're doing renewables to be part of the solution and not part of the problem. We see a very strong sort of value accretive proposition about doing it. Are the incentives gonna help that in South Africa? We'll certainly evaluate that. I think the much bigger imperative with renewables in South Africa is reliability of feed.
When you operate in a country with an unreliable feed, you're putting your business at risk, you're putting your employees' livelihoods at risk, that they can't continue earning a good wage. We see it as value accretive. We see it as a opportunity to ensure business continuity. If there's further opportunities through incentives, we'll evaluate that, but that wouldn't be the primary driver for us, continuing our investment in renewables.
Thanks for those. Just the last question, potentially buying out your JV partner at Gruyere?
We always explore our alternatives. As we discussed this morning, when people asked about it, we always looking at alternatives. You know, if we, if we come to a decision, we'll announce it to the market. We've got nothing on the table at the moment, but we always explore alternatives, as with Asanko, as with all our other, you know, JV partners that we have as to how we would progress.
Maybe just a follow-up on that. When you talk about bolt-on acquisitions instead of big M&A, are you able to share with us some of the criteria that you apply in assessing alternatives?
Ideally it would be in the countries where we operate, where we have a presence. It would be life of mine. It would be the ESG footprint, and it would obviously be the all-in cost. We're not gonna buy something that's got a high all-in cost. If we would do something, it would have to improve our all-in cost. I suppose the main, two main criteria, lower all-in cost and at least a circa 10-year life of mine.
I think, Leroy, it talks to the point I think I made earlier. We wanna upgrade the quality of our portfolio, so we need better quality answers into our portfolio. That's the sort of strategic intent in pillar 3. How do we upgrade the portfolio over a period of time?
Got it. That's very helpful. Thanks.
The next question is from Cameron Needham of Bank of America. Please go ahead.
Thanks. Just 2 questions from me. Firstly, on Salares Norte, what are the key milestones you need to meet from here to actually hit first production in Q4 this year? Secondly, just on the disputed tax bills in Ghana, what does the path looks like from here? Could you just give us a quick reminder how material amounts we're talking about here? Thanks.
I'll start with Salares Norte. I did touch on it in the presentation. I think the mining milestone has been achieved. We've got a mine in place, we're digging. The camp is in place, and with the plant sitting at 70%, 77% to sharp 80% complete, where we are. Right now, key milestones up to H1 is we need to commission the primary. In fact, before H1, the primary crusher, the stockpile, the mill, and the leach tanks. You've seen they've got water in already. In parallel with that, we need to go to the back end of the plant and get the filters sorted out for the tailings disposal. You'll be aware it's a dry stack tailings facility.
We're running that in parallel so that when we start up the plant, we can get going. Part of the plan then is once we get that comminution circuit up front running and the tanks running, we're going to run barren ore or barren material through that plant to commission and get that filter plant and the tailing circuit working as it should. That we're aiming to sort of get done sort of during the H1 this year. The second big part is to get the Merrill-Crowe process up and running. 85% of the metal comes through the Merrill-Crowe process. We're aiming to get that ready for commissioning during August.
That'll give us a couple of months to trial it and get it running as it should. The carbon pro process, which is at the back end of the Merrill-Crowe, which is accounts for 15% of the metal, we're looking to get that up and running in September time. Those are the big sort of high-level milestones that we'll drive. As I said earlier, importantly, 85% of our operational staff are recruited and in place. As the project team completes and hands over sections of the plant, they're getting in there, they're commissioning it, they're getting it operational, so that when we switch it on altogether, we are in a position to start running at full speed. I hope I've answered your question.
Yeah, very clear. Thanks. Just on this, the second question in Ghana as well, I just wanted to get your thoughts around what the path looks like from here as well. Just a quick reminder, sorry, about how material the amounts we're talking about here. Thanks.
You're talking about the tax issue in Ghana. you know, in the Yamana circular, we said we had received a assessment of $120 million. Of that, it's $60 that relates to our DA, $60 million. That's the one that's under debate. The other $60 million, it's normal queries we receive that we are busy resolving with the Ghanaian tax authorities. It's the $60 million that relates to the DA, and it relates to the upfront deduction of our stripping. It's $60 million that are gripe with the Ghanaian Revenue Authorities about.
Sure. Thank you very much.
Next question is from Tanya Jankowski of Scotiabank. Please go ahead.
Great. Good afternoon, everyone. Thank you for taking my questions. A lot of them have been answered, but just back on the tax question in Ghana, you mentioned $60 million related to the deductions you were doing in stripping. Is that for just one specific year, and we are just being reviewed for one year and then potentially additional years to come on? Is this a total aggregate number over a period of time?
Aggregate number over quite a couple of years. If our memory serves me right, it's either three or four years that the assessment related to.
Okay. it's an aggregate number and.
Yeah, I'm not. No, no.
Well, I guess. Okay. Okay, that's great. Thank you. I just wanted to turn to your portfolio, and you were talking about upgrading the portfolio and potentially Asanko and Damang do not fit your criteria, so those are gonna be reviewed. I guess those are for sale. What about Cerro Corona? I mean, that mine's just going on till 2025, and then we're going into stockpile. My question is, do you have anything there that you wanna keep because there's potential to add, or is that also a possibility to go on the sale block?
I think, where we are, Tanya, is we're looking at optimization studies there. The team will hopefully land that during the course of this year. You know, the one thing I've learned with our colleagues in South America, they are very passionate miners. They've got huge pride in what they do, and they are doing a lot of work to make sure that we can love that asset for a little bit longer. We'll know later in the year where they've landed with those optimization studies. Once we know where we're going, we'll be happy to update you.
Okay. I mean, you have a processing facility in that area. I mean, I think there's quite a number of junior companies all around there that some of them seem to have something. Would that be something that you would consider as, you know, a potential, you know, not bolt-on because it's smaller but, you know, increasing your exposure in that environment with juniors?
We won't, look at, you know, exclude any options and, that we will look at everything that's on the table.
Okay. Just maybe, just in Australia, I think that when we talk about St Ives and what you're doing there that, you know, could potentially impact, costs, should you go forward. Just a bit more detail on that, please.
I think just Paul will add to it, but the element this year on St. Ives that's gonna impact on costs is the team is busy with a study around our renewables to install a microgrid there. That study they will hopefully bring to the board most probably at the August board cycle. You know, as I've said, we believe our renewable projects are value accretive. They ensure business continuity. If that project comes back to the board in August and they've got a project that makes sense for us, we would want to consider letting the team get going with that. At that stage, they will come to us, I suppose, with a capital number they would need to get that work going in the back end of this year.
Yeah. I think, I mean, you know, from the days of Chris, we've said when we're doing especially our decarbonization, it's obviously about being good corporate citizens. More important, it's got to be a business case for it. This St Ives microgrid will have a huge business case. We pay around $0.20 a kilowatt to the current provider. In terms of doing the microgrid, whether we go 100% on our own or we bring in a partner, it's anything between $0.06 and $0.10. It's at least half of the current rate we will be paying. It'll definitely have a business case. Stuart and the team, as Martin said, will come back most probably in August, give us the final numbers, we'll be able to say.
We gave indicative numbers in our guidance saying, "If we decide to do it, this is what the implication could be for this year." It all depends on when they come to the board with their final feasibility study for approval.
Yeah. It could move, that number could move into 2024.
I think, you know, the guys are confident they're gonna get a case. Some of it will, some early start CapEx potentially this year, and then I think a lot of it will move into 2024.
Yeah. I think it'll be 2023, 2024, 2025. If we don't do anything this year, it will be 2024, 2025. I'm looking at Stuart behind me. Yeah, Stuart's behind us. Yeah, he's happy with that. Yeah.
Okay. We should consider some capital then over the next three years, including this year.
Correct. Yeah.
Okay. Thank you.
Ladies and gentlemen, just another reminder. If you would like to ask a question, you're welcome to press star and then one. Next question is from Stella Cridge of Barclays. Please go ahead.
Hi there. Afternoon, many thanks for all the updates. I wondered if I could ask a couple of things. The first one was just a follow-up on Ghana. I noticed in the release today you'd said that the process of claiming certain rebates around development agreements had become more onerous. I just wondered what they were and whether those were material sums as well. The second question was in relation to the bond, which is maturing next year. I was just wondering what your thinking was around that at this stage. Obviously, net debt's quite low, but, you know, would you like to stay in the market, you know, perhaps keep a bit more flexibility or, you know, maybe pay it down? It'd be great to hear your thoughts on that. Thanks.
In terms of the rebates, it relates to the diesel rebates that we get in Ghana. The number's not material. It's around $8 million, which at the moment we are in debate with the Ghanaian government, so it's not material, and it's about $8 million a year. In terms of the bond, current thought of management is that we will probably not be refinancing the bond, and we will pay it either out of our RCF and the balance will come out of the cash generated by Salares Norte. Next year will be a big cash generating year for Salares Norte as it moves closer to the 500,000 ounces. That's the current thought process. Don't intend going to the market next year.
Okay. That's it for six months. Ladies and gentlemen, just a final reminder, if you would like to ask a question, you're welcome to press star and then one. We will pause a moment to see if we have any further questions from the conference call. It seems we have no further questions from the conference call.
Irene, we got a couple from the webcast. Paul, this one's for you. Can you elaborate on the refinancing plans for Q2?
Well, I think this year is going to be quite a heavy year in terms of refinancing. We're in the process of finalizing the ZAR 2.5 billion facilities in South Africa. They will be bilaterals, and they should be done this probably by April. We're meeting the banks in March to refinance the $1.2 billion group RCF. Later in the year, we'll be in Australia to refinance the AUD 500 million RCF. Quite a heavy year in terms of refinancing. As you know, we've always had a history of refinancing ahead of time. We're probably a little bit later this year because the proposed Yamana transaction that put a hiccup on our financing arrangements, and it's probably delayed us by about six or eight months.
We intend to have completed those 3 refinancing by fourth quarter this year.
Okay. Next one is an ESG question. We've seen a slight improvement in your ESG disclosure over the years. Given the current energy crisis, what is your strategy regarding renewables, and has there been any progress on increasing focus on health and safety of the workforce?
I think, on renewables, you've seen our commitments. We've just been talking a short while ago about where we're going at St Ives. At South Deep, the team there is busy with the wind study to supplement the 50 megawatts of solar. Looking at a conceptual study already at Salares Norte to put in some solar up there. I can tell you that solar will work there because I was out with sunblock on for a few hours and it, I got sunburnt. We know that it's gonna work up there. We're fully committed to this. Again, I wanna reiterate, we consistently seeing improvements in that space, be it silicosis, be it what we're doing around diesel particulate matter.
I think the other really important health and safety aspect that we're driving right now is mental health and safety, where we're trying to create a workplace where people feel safe to come to work, both emotionally and psychologically. Remains our number one value. It's an area that we're hugely committed to and focused on because we again believe that it's as much as we're a mining company, we're actually a people business, and without our people, we won't achieve the magical things we achieve. Right at the forefront of everything we're trying to do every day.
Okay. Thanks, Martin. There are no other questions. Any closing comments?
Just, thanks, Avishkar. I'd just like to thank all the participants and thank you for your engagement and good questions. I think most importantly, to thank the women and men around the globe who work for Gold Fields and allow us to sit here today and present results on their behalf. Thanks a lot, Avi.