Thank you for standing by. This is the conference operator. Welcome to the Equinox Gold Corporate Update And Second Quarter Results Conference Call and Webcast. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, there will be an opportunity ask questions.
Questions. I would now like to turn the conference over to Rai Lynn Bailey, Vice President, Investor Relations for Equinox Gold Corp. Please go ahead. Thank you very much on the station. Thank you very much joining us today at the Equinox Gold Second Quarter Update.
We will of course be making a number of forward looking statements today, so please do take the time visit our website and our continuous disclosure documents on both SEDAR and EDGAR to be fully informed. I will now turn the conference call over to our CEO, Christian Milo.
Yes, thanks, Rylan, and welcome everyone to the 2nd quarter call. Just to note here, Peter Hardy, CFO is with me today, as well as Doug Reddy, of technical services soon to be COO and Nati Roo, our current COO was here as well. And Scott Heffernews, Head of Exploration. So, the whole team ready for at the end as well. As a quick summary, we had a very good quarter despite the challenges of COVID that we know all the industry and other industries have been dealing with Los Filos in Mexico was temporarily suspended for most of the quarter, but is up and running again.
And we had 2 of our Brazilian mines suspended for a little less than 2 weeks. And overall, we had a very strong cash flow performance and very strong cost performance for the quarter. We're really pleased with. And that gave us the ability to repay a little bit of our debts. And as we sort of transition here after a reasonably smooth integration during the COVID crisis, I'm very happy with how things gone since March 10th when the 2 companies, Leo Gold And Equinox came together and the management team really has gotten on to the same page here.
And I'd say it's gone as well as it could be expected. And, I really want to say thanks to Atti Rou who has been the COO, since the merger. And I worked with Ati for about 5 years at Endeavor Mining as well. And he made the transition here very smooth and really, it was a challenging time as COVID came on literally within days of us completing the merger. So Thanks, Daddy, and he'll be retiring at the end of August.
So hopefully he'll enjoy a little more downtime in his, I would say, semi retirement and pleased to welcome Doug Ready to the team as a COO, worked with Doug again for 5 years at Endeavor. So feels like a fairly seamless transition. And I think shareholders should be very happy with the results here of this kind of transition from one experienced leader to another So looking forward to the future, there's lots of exciting stuff to come and we'll run through that here today. And just starting on Slide 3, with health and safety, we did have 3 lost time injuries over the 2,600,000 hours for the quarter, respectable performance there. And with COVID, the impact was a little disruptive at Los Filos being down for most of the quarter, but all the mines are currently operational.
But let's not forget here. The risk hasn't gone away COVID. We're finding a new way to operate a new normal for now until a vaccine is found or or things change, we certainly are operating with a lot more testing at our sites. We've implemented quite regular testing in California. We're doing the same in both other countries as well.
We're even instituting potentially some labs on our sites and we're using the local labs that are in the regions So we're taking it very seriously and, we've integrated a lot of those costs. And as you can see, we've had about $16,000,000 of temporary costs for the quarter. So overall, a good performance, and I'm going to actually pass over to Peter Hardy to run you through the rest of the financial results
here. Thanks. So we had another record quarter with production of 127,000 ounces. And on the back of that, we sold just under 126,000 ounces of gold at a realized price of $1712 per ounce. I'll note that the sales for the quarter are more than 40,000 ounces more than over Q1, and that was with Los Filos down for most of the quarter.
Due to government mandated, temporary standby due to COVID. Our mine cash costs, our costs for the quarter were also quite strong with mine cash costs of $7.76 an ounce and an all in sustaining of $900 an ounce. Those costs are driven by, 1st of all, good cost controls by operating teams, on the ground, favorable foreign exchange and of course, low fuel prices. Also influencing the costs for the quarter, where it was, adjustments for purchase price accounting. Our consolidated financial results, we had revenues of 2 $15,000,000 and mine operating earnings of $85,000,000.
Adjusted EBITDA was $83,000,000 and our adjusted net income was $27,000,000 or $0.12 a share, Including in those adjustments, as Christian has mentioned, were, adjustments for our gold hedges and warrants liabilities, as we have Canadian dollar denominated warrants. For the gold hedges, it was $38,000,000 in warrants $49,000,000 and then also an adjustment for foreign exchange. All of these non cash charges are unrealized for a total of about $90,000,000. Our cash flow from operations after changes in working capital for the quarter was $84,000,000 and would note that before changes in working capital was 61,000,000 On to Slide 4. For our corporate highlights, we received $157,000,000 in exercises on warrants and options during the quarter.
Those warrants are predominantly, legacy Bria warrants that came in through the legal merger We were added to the GDX and S and PTSX composite indices. And in addition, of note, Solaris Resources, which was the copper spin out from the company in the summer of 2018, listed on the TSX V. They came out with a strong news release yesterday of good drill results And our 30 percent investment in that company is now worth at a market rate of 70,000,000 On our balance sheet, of course, we carry that at cost. And so that market rate is not reflected there. With respect to our liquidity and capital position, of course, the warrant exercises from the quarter and option exercises, really strengthened or continued to strengthen an already strong balance sheet.
Our cash is $494,000,000 at the end of the quarter, that was after repaying $22,000,000 in debt. Our net debt, which includes our in the money, convertible notes is $244,300,000. And if you exclude those because they're well in the money at an average convert price of $6.50 a share, we actually have a share price or share liquidity and volume, since the merger, we've experienced a huge increase in both with an average daily trading volume of over $48,000,000 recently. Going to Slide 5, Noting again, we had our 2nd consecutive quarter with record results. That was on the back of First of all, of course, having a full quarter of results from post Leagold merger and having the assets now in the portfolio.
Maseke had a very strong quarter producing just shy of 40,000 ounces for the quarter and 76,000 ounces in the first half of the year at very good costs. The Brazil assets, despite all of the difficulties with COVID in that country, and thanks to very strong management on the ground is meeting expectations for where we thought they would be from the beginning of the year. So they had a strong quarter. And Los Filos, even though it was down for the quarter, still produced just shy of 18,000 ounces at quite low costs. The rationale or the basis for those costs is first of all, with the mind being on temporary suspension, we postpone sustaining capital and expenditure activity to the second half of the year.
And you'll see that in our guidance in a minute when Christian walks us through it. Of course, we had favorable foreign exchange there and the activity of residual leaching in and of itself is fairly low cost. And finally, purchase price accounting also contributed somewhat to the low cost as well.
Just going back to the operational results and walking through each mine in a little more detail, Los Filos First in Mexico. Mining and development recommence in June. The ramp up took place probably midway through June. We retested the whole workforce for COVID. So we took a very cautious approach to restarting.
One of the impacts from actually the quarter delay in developments has been that the higher grade ounces that we expected from the Guadalupe open pit in the Bermejal Underground are being deferred to 2021. So we did have a delayed quarter and essentially of production in Q2, but we also have a knock on effect in Q4. Moving those ounces into next year. So that's why we've reset that guidance. And our all in sustaining costs benefited from the FX rates in fuel fuel rates that Peter alluded to.
We're still seeing those nice depreciated currency rates helping us in Q3 as well. Arizona and Brazil, it was the 1st full rainy season, had good production. The only thing I think we're a little behind on our waste mining for the quarter and we expect to catch that up here in the dry season benefited from having a nice stockpile of lower grade ore that we were able to draw upon as needed during the rains. And we plan to have the same going into next rainy season at the end of the year. Again, FX rates in fuel helped our costs.
And what we're really focused on now and Scott spending a lot of time on is, as we come out of this rainy season, how to extend the mine life. Drilling is ongoing. We're looking at obviously advancing to a pre feasibility study for the underground potential there and there's drilling going around on at depth as well as satellite pits and a long strike. So keep an eye on that space. We plan to have some news obviously as we get results from that program.
Mesquitea, as Peter said, was really kind of star of the first half. It was ahead of production, a little below our cost targets. We were definitely prioritizing the oxide ore from the historical dumps, which we continue to find more and more of as Scott's programs continue to bear fruit. For the second half and part of June, we're starting to stack more and more non oxide ore. So there'll be a longer leach curve, slightly lower recoveries.
So we have sort of tempered our expectations for the second half. We don't expect exactly the same sort of results. We expect slightly lower production. But what's really exciting there is the exploration is ongoing and we've had really good results to date. Remember, this mine was acquired for $158,000,000 in 2018 when gold was $1200 an ounce and it had a 3 year mine life We now have been mining for almost 2 years and we still have almost a 3 year mine life.
So we're really pleased to see that exploration bear fruit We're also excited. Obviously, it's a very sort of leverage to gold operation where it has a very good margin right now. And when you look at it on a potential EBITDA basis here, these types of gold prices we're seeing, even with the big fall today in the gold price, potential EBITDA generation on an annual basis could be in excess of actually the purchase price. So the free cash flow from that operation is very exciting. And the other added benefit now is we're just ramping up Castle Mountain into production here in the near term and we'll be able to smelt the goals and share some of the actual back office in services between the two mines.
When we turn back to Brazil and Fazenda on the next slide on Slide 7, Fazenda basically was affected slightly by COVID. The mining workforce was reduced for a short period there. The local mayor had put in place some restrictions to manage the COVID situation in local communities. So we were impacted slightly by that, but it's now operating at full capacity. Grades were slightly lower for the quarter.
We do expect to see ourselves through that period and probably into late Q3 and into Q4. We'll be seeing return to sort of the normal grades we're used to out of Fazenda. Again, good costs, slight deferred expenditures for the quarter into later part of this year. Then when you look at RDM, the other Brazilian mine of some scale, had a very strong first half. We're very happy with the grades and the mining performance slightly better than plan.
And what's exciting as well is there's been a lot, capturing of water and the storage of water has been very good for this year, where we expect to make it through the full year with the water sources that we have available to us. Again, costs were good, some slight deferred stripping spend from the first half. And what we're planning to do is actually have a big pit extension, once we receive the permit for that, and we'll be able to access some higher grade ore later this year. So overall, very pleased with RDM performance and Pilar, the smallest mine in Brazil, had a pretty respectable first half It was affected slightly in April. There was a temporary suspension there as well for a couple of weeks, but had an overall good performance and benefited again from FX and fuel rates.
Looking on Slide 8, our cost guidance and our production guidance for the year, we have updated it despite there still being some risks out there in all three countries that we operate in due to COVID. Los Filos has been the biggest adjustment. We've come down from about 170,000 to 190,000 ounces to about 100,000 ounces of expected production for the year, again, impacted by quarter 2 COVID impact and temporary suspension as well as the pushing of the higher grade ores in quarter 4 into next year. Cost performance has been good there, so we've moderated that down a bit. For Aurizona, we've increased our guidance by about 5000 ounces and reduced the costs after a very good first half performance.
Mesquite, we've increased the production guidance by about 10,000 ounces and Fazenda, we've reduced it just slightly by 5000 ounces after slightly slower first half. But overall, our guidance for the whole year is about 4.70 to 530,000 ounces, which is down about 12% overall. And our costs are down slightly to $9.75 to $10.25 per ounce. And on a capital basis, we're about the same as we at the beginning of the year, about $90,000,000 on a sustaining capital spend basis and about $144,000,000 on expansion capital. Interestingly in there we've added a few $1,000,000 for early works at Santa Luz.
We turn over to the growth and development projects on slide number 9, Castle Mountain is the first one, which is very topical today. Phase 1 construction is substantially complete. I think as yesterday, we were 95% or 96% complete. We've commenced stacking ore in June. Commissioning is underway.
Certainly expect to meet guidance for this year. We're slightly delayed with COVID slowing down a couple of the contractors and getting the final completion of the the physical construction, but we don't expect that to cause us any major delays or issues this year. So to be conservative, we did sort of delay the gold ore by a couple of weeks into early Q4. And we expect to produce about 50,000 ounces on average there per year. And then in the background, we've been working on the phase 2 feasibility study, which we still expect before year end, which will basically demonstrate the 200,000 ounce per year mine potential of this project.
And in the background, we've also been drilling for water on-site for phase 2, also in the nearby town areas. So that's all ongoing. And of course, we'll be giving you results when that comes to light in the next 6 months here. Switching back to Los Filos in Mexico, despite the temporary suspension that had actually some very exciting been happening at Los Filos behind the scenes. This is a project producing on average 200,000 ounces a year, but we really do see the potential to 350,000 plus ounces in our near future here.
And in addition to developing the Guadalupe open pit and the Bermejal Underground, we've been looking at upsizing the carbon and leach plant size. So Doug and the team down in Mexico have been working on, moving from a 4000 ton per day plant up to something like 8000 tons per day expandable to about 10. The plan is to make that study public in the next sort of about 3, 4, 5 months here in early Q4 or mid Q4. Hopefully, we should have that result out. And the really exciting part on the back of that, it's allowed us to look at the actual mine plan and scheduling of our actual mining.
And obviously with the new gold price environment, it really does change things. And so we have a 4,500,000 ounce reserve there. We have 6,000,000 ounce resource base and we really do see the potential to increase the reserves in the short term here. So sort of watch this space and when we come out with those results, you'll see the whole new brand new plant, the upsize overall production capacity. And we should be able to convert some of that resource as well.
And then secondarily, on a little bit smaller basis, Santa Luz in Brazil, we're excited about that restart as well. It's a little bit ahead of Los Filos in Mexico. We're just finalized the CapEx And Economics on it. We should be able to get that study out here in the second half of the year as well. We've already given the go ahead to start some early works and small construction works and maybe a few orders in advance of that full construction announcement, but we fully expect to be announcing that in the second half of this year.
And remember, that's 100,000 ounce producer with an initial 11 year mine life. And similar to sort of Aurizona, we're pretty excited about the upside potential on surface and underground there. So we're pretty excited about having these 3 fully financed projects in our portfolio mean, you think about Castle, it's got 2 phases to it. So we've got 4 projects in the pipeline here and it's pretty unique compared to our mid tier competitors here. We've got funded internal growth profile.
And when you slip on to or flip on to page 10, we kind of illustrate that projection over the next couple of years here. It's a funded organic growth profile towards 1,000,000 ounces a year of annual production It's roughly a 20% per annum growth rates and really what peers have that kind of growth internally. We really think that the opportunity here from a valuation perspective as well is that we've been trading a little bit on a single asset to maybe now a multi asset producer around the 0.7.8 times priced in an asset value range. A lot of our peers are now in that 1 to 1.5 times. They're more established.
They've been around for a number of years at a little more steady state. Our market cap is below CAD 4,000,000,000 and a lot of peers that are producing about a 3,250,000 ounces per year are in that $6,000,000,000 to $10,000,000,000 range. So if we can execute on these projects and deliver on that sort of goal of meeting that sort of 750,000,000 to 1,000,000 ounces of annual production. We really think there's an exceptional potential here for a rerate And the leverage to gold is outstanding. When you look at our portfolio now, we've got 20,000,000 ounces in resource.
We've got over 12,000,000 ounces in reserve. We've got a 20 percent per annum growth rate and key to us now is really executing on this profile of growth. And turning on to Slide number 11, just to summarize and bring it all together, we've had a good first half of the year. Despite the disruptions, we're very happy with the performance of the mines and the integration of the team and the assets. Second half of this year is very catalyst rich.
So our long term plans are on track to despite some of these disruptions, the teams in place to deliver on it. And so Los Filos and the CIL plant construction is looking to start in the second towards year end this year and get that study out, which will give you a lot more detail on it. Santa Luz construction is already sort of underway in terms of early works and we plan to get that study out in the second half of this year. Castle Mountain Phase 1 gold pour should be in the first half of quarter 4. Castle Mountain Phase 2 feasibility studies in quarter 4.
And as well, we're going to be starting the Aurizona underground pre feasibility with an expectation of completing that in 2021. On the exploration front, there's probably too much to talk about here, but we certainly got our eyes focused on extending the mine lives at our core mines, but also looking at a mid tier exploration plan, which Scott and team are looking at right now and plan to set the stage for the next 2 to 3 years. Corporately, as Pete said, we've We've been included in the indices. We've completed the merger. We've just got out some sustainability reporting, information on our website.
It's now operational if you go to our website and look for that. And as I mentioned, the rerate potential here is exceptional. So we'll continue to focus on the fully funded growth platform internally. We've got a strong balance sheet We've got about $500,000,000 of cash. And as Pete said, we're pretty much net debt free when you exclude the in the money convertible notes, which Mubadala holds, who are a long term partner and shareholder, ultimately.
And our net debt is below one time. EBITDA. So we're in a very strong position to deliver on this profile. So I think I just want to say, thanks to the team and you as shareholders for support for the first half of the year. It's not been an easy half, although the gold price is made up for some of the challenges we faced in our business on a day to day basis in country.
But the teams reported very well despite, all the in country disruptions from COVID and the new normal that we now live in. So With that, I'll conclude it and maybe open it up to a question and answer session.
Certainly. You. We will pause for phones, I will ask a question from our online listeners. How will the development delay at Los Filos affect your production in 2021 at that project?
In terms of Los Filos for 2021, I mean, obviously, we're just starting our budget process. So I don't have detail information on that yet, but what we do expect to see here is, as we move towards the higher grades at both, Guadalupe and Bermejal, we expect to see the production increase incrementally into next year. Obviously, we won't have the benefits CIL plant probably until the end of 2021 or into the first half of twenty twenty two when it becomes operational. So you'll see an incremental improvement and increase in the production rates and levels. And obviously, 2022 will show an improvement beyond that because of obviously the CIL plant coming into play.
So it'll be a nice sort of, call it steady upward trend here over the next sort of 18 to 24 months.
Certainly. Our first question comes from Avay Sabib with Scotiabank. Please go ahead.
Hi, Kristen and team and congrats on a good quarter despite the COVID impacts that we saw in Q2. A couple of questions for me, Christian. Number 1, starting off with Arizona, obviously production was lower as a result of the rainfall. Which reduced access to some of the high grade areas. How have you increased your guidance at the mine as well for the year?
Now grades are likely the reason of the increased guidance. Can you give us a ballpark of what the grades you're expecting in the second half? And also are you looking to do anything else to mitigate, any sort of risk in the, for the next rainfall or rainy season? Going into 2021?
Maybe I'll take part of that and let Scott comment a little bit where we're focused for grade and etcetera. I think we were trying to be fairly prudent and conservative going into the rainy season being the first one for us. So We did factor in some potential less mining in a sense, maybe not be able to access all the higher grade ore. We had a good stockpile, which is obviously lower grade. And I'd say we slightly outperformed that.
The plant operated well and performed well. We see it going into the dry season here, the potential to slightly outperform in terms of throughput going through in the second half. And I think in terms of grade, maybe, Scott, if you want to just comment on that,
Yes, grade is slightly lower in the first half, largely due to sequencing in areas that we could access during the rains. And then of course, keeping that managing of the rain's strategy in play to keep production up, drawing up from the stockpile during the rain, setting ourselves up for the the next rainy season as well. So we expect to see the grade come up as the team has been able to access the more central areas of the pit grades in the 1.5,1.6 range. There'll be much more of that in the mine plan for the 2nd half.
And again, Ovais, we plan to move the mining rate up significantly. We plan for sort of half the rate during the rainy season. And obviously, I think going to be quite a bit higher here in the dry periods. It was just like we experienced last year and we'll be making up for that stockpile again so that going into the range, we have that stockpile in place and we're ready for it.
Okay, that's great. And just, on just sticking with Arizona, you're looking to modify the processing from CIP to CIL, to basically, I guess, to enhance recoveries. Was this conversion in the works since you started production in Arizona, or was this something new that, has come up? And also, if you can just comment on the cost of this conversion?
Yes, I mean, don't know if actually you want to comment on it generally. I can comment about the history and the cost if you want, but do you want to comment on it generally?
Yes, I think, if you look the change in, in, the order characteristics at, at Tarizona, it's moving to areas where there's a little bit more carbonaceous material and also more sulfuric material. So that's more suited to a CIL rather than a CIP circuit. So Christian, maybe you can comment on the cost structure.
Yes. I mean, in terms of the cost base, I believe it's less than a $1,000,000 So it's pretty minor and it really has no disruption to the operations that can be done sort of in the background as we operate here and it'll kind of seamlessly happen people even notice it. What it will give us is a little bit more stability and probably those recovery rates along the way, but overall pretty minor impact.
Most of the equipment is already on-site. Like the interstate screens, to be able to modify the tanks, So as you said, it's not been over the issue.
Perfect. And just switching gears and just to Casa Mountain. Chris, you were mentioning that you've started drilling for water at site. Can you comment on any sort of, I mean, is this going according to plan? Can you give us some color on that fact?
Yes. I mean, obviously, I can only give you so much color on that at this stage. I can tell you we're we're drilling. I think we're on hole number 4 or 5. There's water in all the holes.
You gotta do our pump test. We gotta do work to actually see the recharge rates than that. But good news is there's water there. We're being, I'd call it, prudent by also drilling and going out to sites that are give or take 15 or 20 miles away, private lands that we could access as supplemental, backup, oral alternative water sources. So we're taking all options into play here.
And as we hoped and expected, we are finding water and it's just a matter of doing the work now to prove up that which site it's coming from, but there are multiple sites. I think we'll get that out in the next few months here. We just need enough time to actually go through the pump test and the recharge rates.
Sounds good. So that's it for me. Thanks for taking my questions, Tristan.
Our next question comes from Ki Bin with S And P Global. Please go ahead.
What's the strategy or view on shareholder returns? I know you're still in a growth phase here, but as you come into more cash, assuming gold prices remain elevated for some quarters or years. How might you approach that?
Yes, it's a good question, actually. And we're getting that question much more often nowadays in this current gold environment, despite our growth profile. So, In terms of our cash sheet. So one of our plans is here in the next few weeks, actually probably to repay $200,000,000 on our revolving credit facility to pay that down. And then, I think secondarily, we're just starting the budget process here.
And we have to entertain the thought of a dividend. I've had a few people ask about share buyback certainly a dividend or share buyback for next year. Despite the fact we're in heavy growth phase at the moment, we just feel that at the moment, if we continue with these sustained high levels of gold prices, we will have the cash ability to start returning some capital to shareholders, in some form or another. So sort of watch this space, I think, for this year, let's get through this end of this year and the COVID sort of stabilization and then in next year with our guidance and coming out, we should be having be able to comment on that a little more detail, but dividends are coming up the radar screen and, we're certainly getting a lot of those questions. Today.
Okay. Thanks. And just to follow-up on another question, in terms of, your operations and staffing levels, have you made any changes, say at Aurizona or Mesquite, in terms of staffing levels sort of pre versus post COVID, any savings there or are things essentially the same?
I mean, I'll comment generally and ask you, please jump in if I miss anything. But, overall, I'd say staffing levels of state fairly similar. There's few places where maybe we actually look to add a couple of people, because we have to modify shifts or rotations in that. We've actually added a little extra in terms of testing and that, for sure, in terms of the regularity of testing of people and physical distancing, etcetera. So it might cause a slight increase, but not that significant.
We're obviously being completely offset by FX rates and fuel etcetera. So in terms of net net cost, it's probably actually down at the moment despite some frictional costs, if you want to call it that, from slight changes to the way we operate.
Okay. Thanks.
I think one of the other things we did other things we did was also, but of course, training you know, to make people, mortgage skilled, you know, so they can be used elsewhere, you know, to cover the shortages, you know, resulting from from COVID. And in one instance, we had a contractor come in to do some of the work in place of our own people but that's a daily minor.
Okay. Thank you.
Thank you. We've got a question now a shareholder online in Saudi Arabia. When do you expect the company to be profitable on GAAP measures?
Yes, I mean, at the moment we would be, but the gold price and the share price have been outperforming. And, we have those non cash losses that are coming at us, from an increased share price, which obviously re values our warrant liability on the balance sheet and as well. From the gold hedge from the Leagold merger is actually gets revalued at higher gold price. So I mean, I think this quarter, if things stay flat on both the share price and a gold price basis or they happen to drop back a little bit, which we've seen happen today, you have a potential for minimal to no impact or even a positive impact from those 2 factors. And if that is the case, we're going to be seeing profitability here this quarter.
So really we're on the cusp of that right now.
Thank you.
Another question from online, you mentioned in your catalyst slide that you have accretive M and A in 2020. Is that still the plan despite rising gold prices?
Yes, I mean accretive M and A is probably it's not item number 1 on this list anymore. It's kind of down the list. We're still opportunistic and keen to grow the business even externally. We've got a lot of growth internally. We've got our focus on executing on that and we'll kind of keep an eye on the market and keep an eye on opportunities.
And we will look at things. We would love to to grow and expand the portfolio in the Americas if possible. But I would say we don't need to get bigger for growth sake anymore. We've got the diversity scale, the liquidity now. But if there's something attractive, we'd love to add it to the portfolio, continue to up tier the portfolio, looking for lower cost, longer life, good restriction mines along the way, but we don't need to do it.
It's something that would be a nice add on.
Our next question comes from Dalton Baretto with Canaccord Genuity. Please go ahead.
Thanks guys. Question, the online call actually beat me the Freedom M and A question. But I do want to follow-up on that, though. Yeah, and it's one you didn't touch on when you were talking talking about the rest of the catalysts there. So just in terms of the current gold price, like how are you thinking about the portfolio right now in terms of the number of assets you have the quality of the assets.
And then as you look externally and try to up tier the portfolio as you said, what is it you're looking for? Are you looking more for greenfield type stuff? Is there something you want else you want to build? Do you think you'll get the assets you're looking for in this environment at the pricing you want? Just any comments on that?
Yes, I mean, it's certainly harder to find those opportunistic deals at, 2000 gold from 1200 and gold. That's for sure. But, again, it's quite often to be on a relative basis when you look at these. So we will look on a relative basis. We do need to execute, continue to get our rerating to allow us to to be a little more opportunistic on these opportunities.
But, I'd say that underway at the moment. We're focused on things that are ideally it's producing assets in the Americas 150,000 ounces plus type value production, but obviously a number of those are getting a rerating in terms of, because of the gold price and they're trading at a higher value today. So they may not be as attractive or as accretive as they used to be. So we may pass on a number things like that. So I'd say that the door is opening.
I know Ross has certainly said before that the discount between producing and development assets wasn't big enough in the past. I would say maybe now it's starting to open up a little bit where producing assets are being rerated and revalued. And, maybe we're going to look at some of the development assets as well. And because over the next twelve months here, we should be executing on 3 of our growth projects. We'll continue to look at that development pipeline in the long term.
So I'd say we're a little more open to a development asset than we were a year ago or 2 years ago.
Okay. Great. And then just given where Solaris is trading now, what are your thoughts on your holding there?
Yes, I mean, we're the we've loved that asset as individual investors as a company for years now and it's kind of hidden in our portfolio until what is it mid-twenty 18. Great to see it get the light of day and Richard and Dan. I've done a good job, obviously, so far, for a short life on the stock exchange again. And I think our value right now is 70 $75,000,000 for our 3rd of it. And we have no plans to be selling that in the near term.
We believe it's worth a heck a lot more in the longer term. And We love the Morint's asset in Ecuador. I know Scott's sitting beside me and he's in Greg who are both here, love that asset and then there's 3 or 4 more assets in the Americas in that portfolio. And so we see the potential there in the long term of creating significant value, this is just the start and we're a core shareholder and we plan to be there supporting them.
Okay, great. And maybe just one last one for me. Are you able to comment at all in terms of what, move other is thinking now, just given where your share price is versus, the exercise price on the converts?
Yes, it's been a great partnership since they got involved. I think if there is sort of a win win and it's kind of been that with them and they've gotten some good returns. We've gotten a great stable long term partner and shareholder. And we really do view them as a shareholder. They did come in through a hybrid instrument.
They're such a large fund and depool of capital. I think they manage about a $1,000,000,000,000 that they normally don't do deals of the scale and small size that they did with us. So they came into a hybrid convertible and we're now at the liquidity and scale where I think it's a really interesting opportunity for them to long term to be a partner with good sized gold mining company that will be a 1,000,000 ounce producer. And, we see them as a long term shareholder alongside Ross Beatty. So great support.
And I think you'll see them convert that into some point in the next few years here, but there's no urgency to doing that. They've still got 3 or 4 years left on their convertibles and But what I do see them as a long term partner supporting our growth.
Thanks, Elv.
Our next question comes from Kerry Smith with Haywood Securities. Please go ahead.
Thanks, operator. Christian, I apologize if this question got asked and got jammed up on another call. But could you just go through with me the permit status for Castle Mountain Phase 2, the expansion at Los Filos and the restart at Santa Luz just so I understand which permits you need, if any, for each of those and just the timing.
I'll comment maybe on Castle, maybe I'll let Doug count on the other 2. So for Castle, basically, we've got our permits for phase 1. It's going operation here. The thought is on the back of the feasibility study for phase 2, which should be out in quarter 4, we'll submit that, use that ultimately as our plans for a phase 2. And we'll submit an amendment application ultimately to the regulators in California there on the back of that.
So give or take, quarter 4 quarter 1 next year. We'll be able to submit an amendment to upsize the area of disturbance within our current EIS boundary. So we assume that'll take us at least a couple of years to do it is the U. S. And California.
So it's a methodical, permitting process. But remember, it's an amendment to an operating mine. We've been very successful so far with both Castle in terms of permitting as well as an Imperial County with, Mesquite. So we see it as a process of time and resources, but, we need to do the right thing first and show that we're a good citizen and operator, and then we'll go and amend it. In terms of the other 2, maybe Doug, do you want to comment on Los Filos in Santa Luz?
Yeah. Los Filos, obviously, the optimized feasibility study work is is underway at the moment. We previously we had the, permit for the plant location. It was conditional on confirming the final footprint for the plant. At this point, we will be moving that to a site that, when we did our geotechnical program, we made it quite comprehensive covered some other areas that we thought would be superior.
And, looks like we will be moving the plant site So we would revise that, permit, which my understanding will take about a 6 month period to go through that. Revision of just the outline. It's still permanent. It's just a revision of where the footprint would be. The other ones would be the filter tailings deposition, which, in the, permit, again, it was final confirmation of the outline.
We, previously had been putting, planning to put the filter tailings on to the heap leach pad. So line facility. Nothing changes there. So it's just a matter of confirming the outline. We may shift it slightly because we anticipate that the heap leach pad will ultimately be a bigger design.
Which is a good thing.
And then for promotional ground I'm sorry, Doug. What was that permission?
Doug, when would that permit for the filtered tails be put in then? Is that going to happen this year? Is that after the fees is done or how does that work?
It'll go as soon as the study goes in. It'll be, it'll be submitted, but that will come through before. And that, that is just a confirmation of the footprint. So, it should be a straightforward revision. And, that would happen while we're in the midst of the, detailed engineering and moving into construction.
And then the final one that we have have had all along was permit for the Bermejal Underground. We will be using the currently permitted portal and ramp. We do have additional sites for, extra portals that were already permit And so we are just looking at one of those as being a, additional opportunity in the future. So we just have to revisit that and confirm that all the permitting is lined up for that one. So no change there anticipated.
So all of those permits for Los Filos, and it sounds like they would all be in hand by middle of next year. Would that be reasonable then?
That would be a reasonable time frame.
Okay.
Beyond that, for Santa Luz, we have all the permits with, there is one thing that we're doing at the moment, which is a geotechnical drilling program to do a design for the next phase for the tailings impoundment. So when that geotechnical design is finalized, that will go in for for a permit for that particular, lift for which will be, a a longer life, lift on on Santa Luz.
And other than that, all permits are in place then?
Yes.
Okay. Okay. And then, okay, that's great. And then maybe just on the on the amendment at Castle Mountain Christian, do you is it only a state approval that you need for that amendment then? So there would be no federal involvement in that process for phase 2?
Yeah, it'll be BLM in San Bernardino County will be the lead agency.
Okay. Okay. So they're just a BLM is the only federal agency then. Okay. Great.
Thanks very much.
Thanks, Carrie. We have another question from a listener online in Vancouver. Could you please provide a bit more color on your comment about sharing resources with the Mesquite and Castle Mountain? And to what extent this can be done in a way to reduce costs and increase efficiencies?
Yes, sure. It's a good question. Now that we're coming to operation, the first key one is, we didn't build the very back end of the plant there at Castle. We're actually trucking loaded carbon, high grade gold on the carbon down to Mesquite, which is about a 4 hour drive on a paved highway directly down to site effectively. So we'll be able to smelt it down there.
There's excess capacity. So we've been able to save up about, say, 10% of the capital by doing that. We're using, obviously, an experienced team and process there. So need to commission the back end of the plant in a sense. There'll be back office staff.
There'll be reporting there'll be IT systems, there'll be HR support, there'll be permitting support. There'll be tax consolidation between the two sites any startup losses versus profits in Mesquite could potentially be offset against each other. Things like joint purchasing in the mid term here when we're buying either cyanide or tires or spare parts, etcetera. We'll be able to do that jointly. And something like a fleet, Mesquite, if we continue to extend the life there, maybe we need to be replacing part or all of that fleet in the long term, it could be moved up to Castle if need be or it'll just stay at Mesquite if we continue to extend life there.
So, it was all those kinds of opportunities.
Perfect. Well, at the moment, there are no more questions online or from the phone, so I guess we'll wrap up the call. Thank you again for joining us today. If you do think of any other questions, please don't hesitate to get in touch. I understand there was a bit of an audio glitch at the beginning of the webcast, but the audio was on the conference call.
So we'll be able to fix that up in the archive, which will be available on our website in a few hours. I'll now turn it back over to Christian for closing remarks.
Thanks for Lynn. Thanks again everyone for attending and for your support during these challenging times. The business is in a great place. Growth is intact and the long term plan here is exceptional. So stay tuned.
Second half of this year is going to be pretty exciting. Lots of good news I think coming, as we manage in this new environment that we live within. So please stay tuned. Thanks.