All right. We're ready to begin. We're assuming that the webcast is live now. For the next few hours, we're going to walk you through the slide deck, which is available on the webcast link for those of you that are on the webcast. Welcome everyone to the 2019 Investor Day for OceanaGold. It's a pleasure to be here with you guys today with members of the OceanaGold executive team. We've got a few that are also online as well. We want to keep it somewhat interactive. We want to go through quite a bit of material, but we do want to spend some time answering some questions that you guys might have. The agenda is fairly standard. Just going to run through the key areas of the business.
Obviously, do a quick introduction, go through just some of the performance we've had and the highlights over the past year or so. We'll get straight into it when we talk about financials, around growth, which obviously has been a big theme for OceanaGold in the last couple of years and will continue to be. Organic growth, that is. Exploration operations, and then we'll wrap up. We expect that this will go about three hours, and then we can send you home. I'll turn it over to Mick Wilkes now.
Thanks, Sam. Welcome, everybody. It's good to be back here in Toronto for another Investor Day. When was the last time we did it, Sam?
It was June of 2017.
Two years ago. With me today, of course, and Dan, is Michael Holmes. Michael's on the right-hand side with the Colonel Sanders. Michael's our Chief Operating Officer, and he's been with us since 2012. Beside him is Cody Whipperman . Cody is our Corporate VP for Corporate Development. Joined us about June last year, I think. Well, even that, Cody used to work with Barrick before that with 3M. Beside Cody is Mark Cadzow , our longest-serving employee in the company, and Michael's our Chief Development Officer and looks after all things technical and projects related. In Australia, we've got Scott McQueen. Scott's on the phone. Scott's our CFO, and he's been with us since 2016. Sharon Flynn, our EVP for Social Performance and External Affairs. Sharon joined in 2017 and has made a big difference to our company and the way we operate since she joined.
Of course, Craig Party, who's our Head of Exploration, EVP for Exploration. He joined from Gold Fields in 2015. Got a lot of international experience. I'll just check with the team in Melbourne and Brisbane if they're on the line.
Yes, I'm here in Brisbane.
Good morning.
That's good. Also in the room today, we've got Marcelo Ramos, our VP for Business Development, and Brian Martin. Where's Brian? Brian is Manager for Business Development. Brian and Marcelo are both based in Denver, working for [Cody], and very busy. As I told an investor the other day, they're busier than a piccolo in Baghdad. A one-armed piccolo in Baghdad. It's very busy. Many of you know the company's business profile. Just to reinforce the point about 4 operations in 3 countries working across the Pacific. We have a solid operation platform, operating platform in New Zealand and the Philippines, and we are building a solid operating platform here in North America through Haile and other investments. The establishment of the office in Denver was really a strategic move about 12 months ago to make that our base over here.
It's a good mining hub. A lot of people like living there, with experience, with consultants. It's a good time zone for us, back on the other side of the Pacific. We have a very solid reserve base of 6 million ounces and resources of just under 12 million ounces or 12 million ounces of resources. At our run rate of 5 to 600,000 ounces a year, which we can achieve every year for the next 5 years, I think, we've got a good long life business that we're building. We continue to invest heavily in exploration now. We're spending $50 million on exploration this year across the business. It's a good time to be finding gold. Moving on to the next. The achievements and the highlights, I guess, over the last 12 months.
For the seventh year in a row, we've achieved production and cost guidance. I think that's given us a degree of credibility in the market that we're very proud of and well-deserved. We've had exceptional performance at our Macraes operation. Last year, Macraes did 200,000, 23,000 ounces, the second time in its history for 28 years. And produced over $75 million of free cash flow. An outstanding performance from what many considered to be our weakest asset. It just demonstrates the quality of our portfolio and the diversity of our portfolio and really gives us a strong company. Of course, the strong environmental and social performance. I mentioned the impact that Sharon's having on the business, we really are institutionalizing the way we deal with our communities and our governments and manage our environment.
That's a big difference between what many people do, which is rely on one or two people. This is becoming very much part of the way we do business. On the financial side, again, another positive return on invested capital, every year since 2011, 8 years in a row. The only gold company on the planet that can say that. The only gold company on the planet that can say they've got a return on invested capital every year for 8 years. When investors see that, they are quite amazed and quite pleased. It often comes up in conversations that I have with investors. Return on invested capital is a really important measure, particularly for the generalist. Of course, between voters in our industry, in our market.
$121 million of free cash flow generation across the business, that is operating cash flow minus core capital. Interest margins really strong again. Cash balance and growth in net debt reduction over the past 12 months. On organic growth, we have some terrific potential within the company and we got through a lot of that today. You would have seen the resource in our news release this morning about the increase in resources at Martha Underground. It is real life. It is a seriously good grade. The operation is going to continue for a long time. Of course, it is one stage, it is 3 stages. We envisage 3 stages, taking this operation up to over 200,000 ounces a year in about five years' time. It has the potential to be the best asset in the company. Better get on the bus.
The Haile Plant expansion is going well. Many of you were down there just last week, seeing the progress we have made. The focus plant is really starting to hit its straps, which is wonderful to see. When we are ramping up the open pit, we have had a few challenges with the open pit over the past six months, we have turned the corner there. Recruitment and labor is not a problem for us now. We are getting lots of interest from people working in Nevada, coming to work for us. Some in South Carolina, we have employed some recently, but it is a lot of places anywhere. The permitting for the larger open pit and the underground is on track. That is our pathway to 200,000 ounces at Haile. Of course, the underground at Sudbury is also progressing.
On exploration, a big focus of ours over the past two years, I have mentioned about the increase in the Mark II Underground resource, which is now up to 1 million ounces, we are only about halfway through the drilling program. Significant initial resource at WKP, which is, I will have a test on this at the end of the day, Wharekirauponga. If you can remember that, you will get a bonus. 635,000 ounces at 14.1 grams per ton. Initial resource, we have only just started. That is a sensational start to these greenfield discoveries, 10 kilometers from the existing processed ore with capacity, which is going to be a great pit mine in the future. Further exploration success at Macraes, since we have extended the mine life here, we are now looking at developing a second underground mine at Macraes. That is in the Golden Point deposit.
Last year, we had a good year. We certainly came home with a full sail and knocked it out of the park in the fourth quarter with our share price. I think we were oversold in the first half of the year for whatever reason, people started to really realize the potential, not just the performance of the company, but the potential of the company. With the rising positive sentiment towards gold, which really did get a good go at the end of last year, it continued at the fourth quarter fairly well. Next slide. Thinking about consistent performance, this is not our data, this is from our friends at RBC. Out of all those companies, there is probably, I have encountered about presumably about 30 companies there in the gold space.
We come number one in terms of delivery on production and cost guidance. It's one point for deliver on cost and one point to deliver on production. Every year for eight years, we've got 16 points out of 16. Even companies like Agnico Eagle have missed on a couple of occasions. We feel very proud of that. This is well deserved by the team. Now I'll hand over to Scott to go through some of the financials.
Thank you, Mick, and good afternoon, everybody. Pleasure to be here. It's early in Melbourne, but afternoon over there, I believe. Just flicking to slide 10, please. Here, starting off here, we've got a slide that's a recap of 3112'18 for those of you who are on the recent webcast call, but it's certainly worth a quick review. Across 2018, our strong cash flow drove a material reduction in net debt and put us in a solid liquidity position at year-end. You can see there at the top left that we ended the year with $158 million of liquidity and a 59% year-on-year reduction in net debt, down to $69 million. That included a prepayment of $50 million off our revolving credit facility and paying $24 million of dividends to shareholders. Also note at the bottom there, the board has approved a further dividend in early 2019.
With regards to a bit more information on our current bilateral facility with our six bank group, which includes Citibank, CBA, HSBC, Natixis, BNP and Scotiabank. Our current facility limit is $200 million, and it's due to step down to $150 million at the end of 2019. We've obviously prepaid that $150 million already. The final pull-up is $150 million, which is due at the end of 2020 on the 31st December. We've always maintained a fairly aggressive amortization schedule that's consistent with our approach to prioritizing the repayment of debt and maintaining low gearing. Given, I guess, the expanded organic growth opportunities that we'll talk about throughout the presentation, and you're probably already well aware of, especially in New Zealand over that period, no doubt we'll probably revisit that schedule in due course. Moving to slide 11.
Again, this is a familiar slide, and we've been highlighting this for a while, but it remains important, I think, because it illustrates the delivery of several key elements of our approach. Those being that we like to run, obviously, a high margin business and with a focus on disciplined capital allocation. Now, when combined, those will deliver solid return on capital, which I think is probably the best measure of performance over time. Specifically on the left, you can see the EBITDA margins that the business has generated over the last eight years. Those remain strong and consistent and well above the peer group.
When you combine that sort of performance with quality underlying earnings, you may recall, we have put a slide up in the past that shows OGC to be the top of the industry in unadjusted NPAT, so in terms of what I would call quality earnings. If you have quality earnings and strong capital management, that will manifest itself in good return on capital results. We can see that on the right, where like EBITDA margins, our return on capital over the last 8 years has been consistent, positive, as Mick mentioned, the only one that can claim that technically, and above the peer group.
I think it's always worth revisiting those 2 key measures, we focus on those as a business, and they'll be important to focus on as we continue over the next 3 years in what will be a fairly significant capital growth period for the business. Moving, talking about capital, we've got a couple of slides here which will talk a little bit more about our capital profile to give you a bit of a sense of where it's headed beyond what we've provided already. If we move to slide 12. This, as I said, provides a bit more of an indication of what our forecast capital profile looks like. I'll point out at this point, obviously, this is to give you a general sense of the trend and profile of our capital and doesn't constitute specific guidance beyond what we've given in 2019 already.
The first graph to highlight the one on the top left there, certainly gives you an overview of the general profile of the total capital spend, which you can see indicates a steady decline over the next few years, which is peaking in 2019. That covers obviously the organic growth projects, which you can see down on the bottom right, which is the Didipio underground, which sort of rolls over the next 2 years before completion. Haile expansion, which runs across that whole period but is heaviest in 2019/20. There's a little bit more on the next slide on that. There's continued development and progress in the Martha project over the next 2 to 3 years through there. You can see that profile certainly is driving the overall profile more so than the sustaining capital of the exploration.
In terms of exploration, it looks pretty flat, as you can see. We've got a strong commitment to exploration as a key tenet to growing the business in the medium to longer term. That period over the next 4 years includes continued drilling at Martha, also Macraes, where we're working steadily on life extensions there, and also our organic growth-- Sorry, our greenfields program, which includes drilling at WKP in Argentina and also in Nevada through various joint ventures. A strong commitment forecast there in terms of retaining our exploration efforts. In terms of sustaining capital in the top right, forecast to be fairly flat. About 50%-70% of our sustaining capital over that period will be pre-strip at Haile and Macraes.
As we transition through the various pits between Macraes and up and down the strike at Macraes, at Haile, the pit at Haile and the strike at Macraes. That's probably an area that's increased a bit at Macraes in particular, where we've through sustaining capital have managed to extend the life substantially there with our current plans looking to move out to 2024. That comes out of that, the cost of some sustaining capital. Also included in there is probably the other major element, which is the additional equipment that's raised. We've run that equipment pretty hard for a long time, and that needs to be replaced over time to support that expanded life also.
A declining profile over time, but we have a couple of years, particularly 2020 and 2021 in front of us, where we've got some exciting projects that we then have to invest in the growth of the business. In slide 13, this one, as I said, to give you a little bit more definition around what's happening at Haile. As illustrated, you can see the bulk of the expansion spend of Haile is concentrated over the 2018, 2019, and 2020 period. We've already obviously committed and spent the 2018 bar shown there. The key element to this has been previously discussed. It includes the plant upgrades to support the higher throughputs, including the AG and tower mills, which are in late stage as we speak. The pebble crusher, which has already been completed and commissioned.
Moving on, there'll be detail, thickener feedwell upgrade and the cyanide destruction unit, et cetera. Includes TAG expansion, TSF upgrades, and other infrastructure works, weigh and permitting, et cetera. I think Craig and others will cover that a bit later on. Mark. The key element, I guess, there with the slight change in profile compared to what we had forecast several years ago, actually, in the NI 43-101, where we had a bit of a steeper profile and a higher total capital forecast. The big change there is adjusting our plans around the fleet, which we've moved to leasing, where the original NI 43-101 assumed we would be purchasing that fleet. We're going to be leasing that fleet. There's more details provided on that later, but those leasing efforts will kick off this year.
As Mick said, all of those projects are tracking as per plan and as per budget, which is good. With that, I'll hand back to Mick to provide some more information on where we're headed. Thank you.
Thanks, Scott. We'll have a bit of a discussion here about strategy. Our vision is basically to be a larger mid-cap company with six or seven mines producing over 1 million ounces, give us more robust business, more diversification, but importantly, driving the efficiency of our current operations, making every asset sweat as much as we can, and applying the discipline capital. We put a lot of work into technical excellence through Mark and his team and Michael's team, and recruiting people with really good mining skills and giving them leadership training. Leadership training is a big part of our focus as a company. Last year alone, we put 135 people through leadership training. On the technical side, we're boosting performance through the use of technology, and the Didipio underground is our first foray into this.
Not that it's new to the business, there's a really strong push, I think, from us to really upgrade the way we operate underground. There's a 30% increase in productivity opportunity if we automate key parts of the process for underground mining. We'll talk a bit more about that. Talking about automating jumbos, automating production drills, automating the loading units, things that can operate through foot breaks and through blasting and all that sort of thing, which can really improve the performance. In addition, we've got analytics. Some of you would have seen what we're doing across our different business sites, pulling data together from all of our sites and using the IT from the whole company to improve the performance of our operating plants and indeed our underground operations.
Organic growth, we are very focused on organic growth. I think you're starting to see, well, I know you're starting to see the fruit of that effort. Now, particularly at Waihi, the numbers are starting to come through. It is a big focus of ours to drive it. We've got three underground mines to build in Oceana once Didipio is done this year. We've got three undergrounds to build in the company in the next five years. They're all things that are very much in focus. The fourth aspect of it is, of course, the M&A piece. We do intend to reduce our business further, make it more relevant to the generals and the bigger scheme of things, and give us a more robust asset base for further diversifications, both geopolitically and from a production perspective.
All of that is underpinned by having high-quality assets that deliver margins, deliver true cash flow. Effective management and organization. We work on that a lot as an executive group, how we manage the business, how do we manage across time zones. That whole philosophy of decentralized business, where you're pushing the accountability out to the sites, and you're holding those people who we consider the most important people in the business if it's you, we're holding them accountable for the results. Maintaining a robust balance sheet to support all of that. It's pretty simple. Mining's not difficult, right? You don't need to overcomplicate it. But you do need to have really good people with great technical skills, and you've got to have the assets that can deliver the cash flow. Okay.
This is the result of that same strategy that we've been applying for the last 8 years. 10% increase in production per share, 20% increase in EBITDA per share, 190% increase in earnings per share since 2012, and time when the gold price has gone down 24%. We have delivered, and we're going to just keep doing what we're doing. Okay? Thanks, Sam. All right, now we'll get on to the M&A piece, David.
Sure. Look, this company has a great history doing good M&A. Two examples that we have on the board are the 2015 acquisitions that OceanaGold did. You can see in the first bar, basically, the purchase price. In the case of Romarco, it has the purchase price plus the cost to build in there. So it's basically our full cost to build the asset. The second bar, it shows sort of the present-day value of that asset. In Waihi's case, we pulled CAD 180 million of free cash flow out of that. And despite Sam's efforts, we've still only got CAD 130 million of NAV on Waihi. We think that's going to go up considerably over the next few years. On Romarco, there's good value add to our shareholders through M&A, through deals and M&A.
You can see the similar charts on resources and reserves in the case of Haile. As Mick pointed out, one of the reasons we've been successful in M&A is because we have a highly skilled technical team. Our exploration group is world-class, and our project team is world-class. And that's one of the competitive advantages we see for ourselves in doing M&A. We've looked at a lot of projects, and we continue to look at a lot of projects. We transact with the ones that we see we can really bring value to shareholders, and that's sort of what our M&A strategy is going to continue to be going forward. We have some strategic investments in Nevada. Craig will speak in a little bit more detail on our exploration portfolio and our pipeline. But we made two acquisitions of equity interests in GSV and NuLegacy in Nevada.
These have been very good investments for us. They're strategic. They're a good story that we continue to support. However, we review these things periodically, and they're definitely an option. Lithium is an option value for us as well. Craig will talk about some of the joint venture work that we're doing in both Argentina and Nevada. We prefer joint ventures to strategic interests, equity interests, because it allows us to get more ownership in these companies if they do run in value. Our current structure is basically investing CAD 1 million a year or thereabout over a time period and turning into equity interest of 75%. So that's sort of our structure, and we view the current marketplace as an area where we can This wasn't available for us a few years ago.
Now there's proper breadth up in that space, and we view this as a time to be a countercyclical and invest when we have some leverage for ourselves.
Thank you. The organic growth, just an overview. The three big hitters. Here, the Martha Underground project. You just saw the resources on Waihi. We bought for 400,000 odd ounces, 470, I think, thousand ounces when we bought it. We produced 430,000 ounces. Well, mined 430,000 ounces since then. Now we've got a pit column over 2 million. 2 million ounces as of this morning and growing. It is a real story. That picture on the left-hand side, we'll show you a slide later on, what it was like in August last year and what it's like now. We can see this picture starting to emerge around Waihi Underground. There's a lot of gold beneath that pit at Waihi. The WKP, what a sensational discovery. I've already talked about that.
We're putting another 8 or so million dollars, up to 10 million dollars, I think it is, US, into drilling and finding the real extent of this resource. Which I think, no, I'm not being too bold in saying it's a multimillion ounce discovery. Of course, the expansion project at Haile. Very pleased with the progress and where we're in the process. They're making some good steps in terms of getting that open pit ramped up. We've had pretty terrible weather over the last six months, which has affected our mining, and we will talk about that. We have turned the corner, and we are determined to see the open pit and underground at Haile, which is progressing very well. Now we'll go into the exploration piece. Craig, you there?
I'm here, Nick. Good afternoon, everyone. Can you hear me okay?
Yep.
As Mick mentioned, we've directed significant resources towards our organic growth opportunity, as well as building an increasing exposure to discovery through early-stage projects in highly prospective gold belts with a track record of production. The figure that you see in front of you there, it's one you've seen before, but shows that we're active around the Americas and Asia-Pacific. The results of the work have been adding ounces and building the resource base at Waihi, as Mick mentioned, through the Martha Underground Project, and more recently, the discovery at WKP. The growing resource at the Golden Point underground target down at Macraes, part of the Round Hill project, and through extensions to known mineralization at Haile. Each of these I'll talk to in more detail later in the presentation.
In addition to our operations, we've actually set about the past two to three years establishing a pipeline of projects in highly prospective gold belts with a track record of production. Focused primarily on high-grade vein deposits, principally low sulfidation epithermal and orogenic systems. With this approach, we entered two joint ventures in the Deseado Massif of Southern Argentina, which is highly prospective for high-grade epithermal vein deposits, just like those that we're mining at Waihi. We've completed several drill programs with our joint venture partner, Mirasol Resources. In both JVs, we have been drilling gold mineralization, and we continue to look for exceptional projects in this extensive gold belt.
In April 2018, we also established an exploration office in Reno, Nevada, close to our equity investment in GSP and NuLegacy, and have today entered into 3 new joint ventures, again, focused on high-grade epithermal vein systems. We'll continue the first round of exploration on each of these in the coming summer. Overall, we're excited with the results we have been achieving across our sites, and more recently, the ability to build a pipeline of new joint venture projects. With the momentum we've achieved, we're now increasing our resource base through substantial drill programs across each site, and importantly, we're exposing ourselves to significant value creation through discovery.
In 2019, we've again budgeted between $40 million and $50 million, as was highlighted earlier. We'll drill approximately 150,000 meters of drilling, which has been fairly consistent over the last few years. For the first time, we'll have more than 20 drill rigs turning on our operations in addition to those rigs on our joint venture projects. Can we just move to the next slide 22. For those of you familiar with the areas, our joint ventures are located in the Great Basin, centered on Nevada, on the left-hand figure, and the projects are highlighted by the red triangles. The Highland project is a joint venture with Nevada Gold, whilst Spring Peak and Fat Lizard are both with Renaissance Gold.
While on the right-hand figure, Santa Cruz province in Argentina, our two joint ventures are with Mirasol Resources, as shown in the brighter red colors. I'll now hand over to Sharon.
We're gonna stop right there, Sharon. Can you hear?
Sure.
Yeah. We're gonna just take a couple minutes to see if there are any questions on the floor here before we move on with the presentation. Raj?
Yeah. Just a couple of questions. First one on the capital estimates that were shown. Does the gold capital include the capital you need for the Waihi open pit for phase 1 at this point? The second question is on your JV agreement that you have with the companies. Does your exploration capital spend over the next two to three years include your commitment to what you need to spend on those projects?
Scott, do you want to cover the first question there on the capital?
Yeah, sure. Yeah, Raj, the forward estimates cover what at this point we believe will be required, including the Martha Phase 4 cutback.
It's important to understand the difference between phase 4 and phase 5.
Craig, on the joint ventures. Now that's a question for Scott, actually.
Was that just make sure I got that one. The question was does the capital estimate includes the potential earning on the JVs? Is that correct?
Yes, sure.
No, not beyond 2019, we don't include that because we don't have an absolute commitment to do it. In the grand scheme of the total numbers, it's not that material. As Tony said, it's in the order of $1 million a year or less per JV.
I think the way to describe that is we have an option to cut indubitably. They're very early stage, and we would look to do that if we got any indications. That wasn't what we were looking for. I mean, Craig needs to talk to this, but I think the point is we have an option to get to 75% on a whole bunch of these that we've screened down from a much larger number to these ones that we view as highly prospective and what we're chasing.
Yeah. First phase is up to 50% in five years, up to 75 in an additional four or something, and it's income each of any time, right? One year at a time. Roughly. I mean, they're all a little bit nuanced from that, but generally that's a good monthly rolling.
Any other questions? Well, you have more opportunity to ask questions. We'll take one more before we move on. Andrew?
I think we're really well-positioned to do something. We've got a great balance sheet. We've got a lot of depth in the company now. We're certainly aware of whatever opportunities are out there. We've got to be ready to act at the right time. What we've done for years now, we have a very thorough approach to due diligence and assessment and screening process. Some of those things just won't make the grade. We've got to be really focused on what it is we want, what we're targeting, and go down that path. It's obvious. There's more things becoming available. I think some of these will be, you've got to wait to get the phone call as opposed to knocking down the door. Tony, do you want to add to that at all?
No, I think the answer to the question is we are being quite proactive. I doubt there's going to be an opportunity that would make sense to us that we wouldn't get a phone call, right? I mean, people know that we're active, we're in the space, and we're talking to a lot of people. I would say, yeah, we're going to look to do good deals for our shareholders. Definitely it's a great time to do this, and there's still a few cards that need to play out before you can kind of see what's happening competitively too. So
We've looked at a lot of things, Andrew, over the last several years. We've only transacted on two major acquisitions, a couple of strategic investments in PNG. Where it makes sense, where we're going to create value, we execute. If the value isn't there, we will not execute.
Yeah, I think important to us is our costs, right? All-in Sustaining Costs. We're not looking to buy the mines that have All-in Sustaining Costs of $1,200 and things like that. Just because they're for sale doesn't mean they fit our portfolio. We do, like I said before, view ourselves as having our technical expertise as an advantage, and we do model that in our due diligence effort. I think if you look at our portfolio, we have four assets that, in our minds, are kind of 200,000-ounce producing assets, or will get there. We're working on that. In the case of Lihir, keeping the copper, and 52 as kind of a free cash flow is worth a 200,000 ounce producer in the group. We would love to bolt on one or two more of those. That's sort of asking about size.
All-in Sustaining Costs and not destroying our cost base by blending assets that are higher cost. Jurisdiction-wise, I don't think we've made any secret about wanting to diversify away from the Philippines. That doesn't mean sell the Philippines. It means water it down, the percentage of our portfolio, through responsible acquisitions. We'd look to be transacting in safe jurisdictions. In the event that we got into Latin America or something like that, we would have to see very good value for our shareholders. I think it's very much on the radar. It's got to make sense and you got to Yeah. I mean, we're looking at those things. In the interest of time, I'm going to move on.
For those of you that are on the webcast and want to ask a question, you have to queue up on the telephone, and I think you have to press star and one, you wait for instructions. I do have the queue in front of me. I do see when people are queued up. I promise we will take your questions.
We're going to move on. We're going to move on to Sharon, who's going to walk through some of the good work that we're doing on the ESG front. Sharon, over to you.
Thanks, Sam, good morning, good afternoon to everybody. Mick mentioned in his first introduction that OceanaGold is committed to institutionalizing our environmental and social performance, and we do that through a set of governance arrangements and policies that we refer to as our responsible mining framework. Responsible mining to us is not just a tool to manage risk, which is an excellent way to figure out where you need to focus and prioritize management of our impacts. It's also an opportunity to build trust with communities, with governments, and other stakeholders in how we do manage our environmental and social impacts. A focus on risk and opportunity really gives us the ability to engage consistently with the stakeholders who have concerns or who live next to our operations. For example, an example of how we balance risk and opportunity is around water.
We have strong focus across all of our operations to managing water to ensure quality and quantity. At the same time, we also participate in initiatives around watershed management and watershed protection that require us to be outside of our operations and work with other stakeholders to figure out better ways to preserve and conserve water. The same can be seen across how we approach rehabilitation. Very strong commitment to rehabilitation, rehabilitating land successfully. At the same time, for example, in Macraes, we're engaging in conversation to understand land values with local farmers and with local governments. Moving on to the next slide 25. This commitment and governance structure is really embedded throughout the business, from the board, from the sustainability committee at the board level, all the way across the sites and operations.
This, as Mick pointed out earlier, is about driving accountability across our operations for ensuring this performance. This responsible mining approach has been an excellent way also to deliver on ESG ratings. ESG ratings companies and agencies take a look at how institutionalized sustainability commitments are across mining companies. The structure that we have in place and that we're working to strengthen has resulted in some excellent ratings. We point out on this slide that MSCI, which is one of the top rating agencies, we sit in the top 3 against the 10 largest precious metals peers. Those ratings result from the rating agency going through all of our policies and standards and taking a look at how we actually manage performance across the business. Next slide on 26. Environmental management, fundamental. We have a comprehensive set of environmental management standards that we've been strengthening.
We have ISO certification on our Didipio mine, but we also just launched a new set of integrated management standards that have an independent statement of conformance to ISO. We're always looking to align with benchmarking best practices across the industry. We also have a focus on understanding what our material environmental risks are. Those are not new issues in the mining industry, primarily around water, biodiversity management, closure, cyanide, climate change, greenhouse gas emissions, and also tailings storage facilities. I'll pass it in a second to Mark, who can talk a little bit about our TSF approach. In addition to the focus on the key top environmental material risks, sites can also choose use risk assessment to identify particular material risks for their sites.
For example, Waihi in New Zealand really focuses on noise and vibration due to the location, which is right there in the town of Waihi. Mark, did you want to talk a little bit about our TSF approach?
Yes, thanks, Sharon. Just briefly, of our four operations, all our current tailings impoundments are downstream construction. Some of them aligned, like the one at Haile, is aligned downstream construction. The other ones at both Macraes, Didipio, and Waihi are downstream construction. We do have some upstream construction at Macraes, but both of those are being decommissioned at the moment. We haven't actually placed any tailings on the upstream portions of the downstream construction at Macraes in the last four or five years. We're just in the process of actually recapping those at the moment so that they basically become inert. In terms of also the embankments themselves, most of the embankments are more than the actual safety. They're all water-retaining structures, but we also generally buttress those impoundments with waste rock as well. We're very confident in our tailings impoundments at the moment.
That's the way we go forward. We're in actual fact looking at various other options like dry stack tailings and things like that in the future. Thank you, Sharon.
Yep. Thanks, Mark. Slide 27. Mick mentioned earlier that we have a leadership development program at OceanaGold, and 135 people last year participated in that program. That program reaches not just the senior level, it drives down to the superintendent and supervisor level, and it's an excellent way to align the values and principles that OceanaGold has with the performance of our people. We have also started a new focus, or a renewed focus, I should say, on diversity and organizing an exco-level diversity committee to really focus on increasing the number of women in the business and also taking a broad approach to diversity so that we understand what it means to operate within societies and communities that actually have a different set and diverse set of people, and that we need to actually make sure that those diversity is represented in our business. We're going to be having some particular focus on the diversity issue over the next year or so. I'll pass this then over to Michael. Michael Holmes.
So we're going to be having some particular focus on the diversity issue over the next year or so. I'll pass this then over to Michael. Michael Holmes.
Thanks, Sharon. For the Waihi Gold Mine, I've already talked about the increase in resources there. So we've gone up from just over four hundred thousand ounces to two million ounces after completion in the three years since we've opened. These measures have indicated and got up to the inferred resources and do include the numbers that you saw this morning in the press release. So a million ounces now in the Marpa underground, or nine hundred and ninety-eight thousand, to be precise. And of course, the six hundred and thirty-five thousand ounces in the return pit. One number I'd like to quote is it's cost us twenty dollars an ounce, discovery cost for that gold. That's pretty cheap. So credit to Craig and the team at Waihi for their work there. I think we've got eight rigs at Waihi and two out at Karapiti.
Ten rigs working flat out around the clock at Waihi. Market consensus, analyst consensus are ranging from a low of -$2 million, put your hand up, who's negative? To $429 million, with an average of $130. I think you can see there's a great opportunity for investors to get on board the train that is Waihi. The guidance for this year, 60,000-70,000 ounces. AISC, $875-$925. On the back of lower production, we are coming towards the end of the Correnso mine and the tons that come off that over the next 12 months will be winding that up. The tons mined, 500,000 tons of just over 5 grams, 5.3 grams. Unit costs, without the underground mining cost there, $55-$60 a ton.
That's down about 20% since we bought the mine from what Newmont was costing them. Site, G&A and processing, really those costs are a function of the low tonnage rate in the mine. Then we've got the capital going forward. Can you just move on to the next one? Is this me?
It's Craig.
I can fly. Thanks. Yeah, thank you. It's good to be the host. The picture on the right was August last year. This is the targeted stops from geological information, previous drilling, old workings, and drilling to date. Of course, the gold is what we've converted to resources. These are the two exploration drives in the 920s and the 800 level. This morning we announced a resource of 1 million ounces at the Martha underground. You can see how the gold is filling out and increasing. The Rex vein is starting to fill out nicely. The Edward vein is filling out nicely. Look how much it's grown. The exploration target has grown, and this is based on geological information. We're very excited about the success we're having at Martha underground, and the intercepts certainly support that.
Our strategy for development at this early stage, development of the Martha underground is to go through virgin areas first. A rapid development plan to get into these virgin areas like Rex or maybe deeper down. 70% of the resource so far, next slide. Thank you. I'm on page Can you just go to page 32, Sharon, please? Thank you. 70% of the resource so far is in pristine ground that hasn't been touched before. The raw unmined there. 30% is in and around old workings. Our plan is to actually start some selective face cutting. That's the current concept. We're doing some test work on that at the moment, which should give us a clear sighting on that. That way, we can maximize the resource abstraction around those two intercepts. That's not doable. This is really exciting.
Next is just exciting, the Royal vein and this Edward vein. We don't know the strike extent of that yet. Now I should hand over to Craig to talk about the geology around this. Maybe go to slide 22. Okay. Thanks, Craig.
Thanks, Nick. You've done a very good job describing it. I'm not sure what there is to add to this, except for, as you all described, we're very excited about the potential that still remains within the geology. These are very large teaser veins that are labeled there on the left, the Martha Empire, Royal, and Edward. These are the major structures, and there's a significant amount of mineralization in between these, which are important veins in their own right, both in width and the grades that we're seeing, and you can go and check those in the press release. A lot of those are listed there. There's a long way to go here. I think we're very excited about the prospects, and there's still a lot of potential to keep adding resources.
I think it's been exciting the last few years, but certainly the next few years are going to be even more exciting from an exploration perspective and adding ounces. I think we could just move on to WKP, Nick. Is that okay?
Yep.
Next slide.
Slide 33.
Slide 33, I think. Yep. Okay. this is an overview of our tenement holding from Waihi extending 70 kilometers or thereabouts to the north, and the tenements are shown in the various colors. These areas cover approximately 30,000 hectares, so quite a big holding. Importantly, the Hauraki Goldfield has produced over 12 million ounces of gold and 52 million ounces of silver and remains, in my opinion, very underexplored. Most of that gold has come out of Waihi, Karangahake, and Golden Cross. WKP, I think, will be the next major center there, as Mick mentioned with respect to his expectations.
Our pipeline of projects in the different levels of exploration and understanding from extensive areas of sinter outcrops at our Dawn Field project in the very north, indicating centers of preserved hydrothermal activity, and drilled mineralization at both Ohui and White Cliffs, and two, of course, our newest discovery at WKP at Hauraki, which is only 10 kilometers north of Waihi. In February, we were very pleased to announce a growing high-grade resource at WKP, which includes 234,000 ounces at 18 grams per tonne gold as indicated resource and 421,000 ounces at 12 grams per tonne gold as an inferred resource. Of course, there are a number of significant drilling intercepts, as listed here, that supported those resources. If we move to the next slide 34. This is a plan view of the geology at WKP.
The dark beige color around the river in the north is the host rhyolite lava. Overlying this or moving out from that color is younger rhyolite pyroclastics predominantly, and younger still andesite flows shown in green. Now, there are three major teaser veins that have been identified to date and are shown as the pink traces. The East Graben vein on the right-hand side of the figure, Tea Stream in the center, and the Western vein to the west. Historical drill traces are shown in light gray. That might be a little bit difficult to see there. drilling by OceanaGold in black, with a focus on the East Graben vein. The red arrows represent strike extensions based on field mapping and ground geophysics. It's important to note we've only just started to realize the potential of these three veins and the prospect in general.
We know, for example, that all three veins have economic widths and grade of mineralization intersected in drilling to date, with a quickly growing resource of exceptional grade on the East Graben vein. Really, this is just a little window, a little area of focus that we've been working on. We've had our hands full drilling the East Graben vein. We drilled a few additional holes into Tea Stream and the Western vein late last year. We're very excited, as Mick demonstrated earlier, at the potential of this area and what lies along strike as well. Next slide, please. We're looking here at an oblique view of the resource model on the left and a long section of the East Graben vein, looking from the east to the west.
Of note, the majority of mineralization currently defined is on the East Graben vein and parallel structures in both the foot wall and the hanging wall.
Tea Stream also contributes a small amount of the resource. In the long section on the right, the main lithological units are shown with the rhyolite lava as the preferred host. That's the light beige area where all the drill pierce points are seen. This has not been drill tested up dip and remains open for about 100 to 200 meters, as well as areas in between the drilling and the long strike at both ends of the structure. On this long section, the drill pierce points, about 20 in total within the rhyolite, are shown as grade times width. The significance of the pierce points greater than 50 gram meters continuing along strike approximately one kilometer in this section. The high-grade indicated resource is located in that cluster of holes on the left side of the long section, the cluster of purple holes.
This year, we've allocated 14,500 meters to continue drilling this vein in particular. Although we'll put several more holes into Tea Stream and Western vein as we proceed. Obviously, the expectation here is that we increase this resource by the end of the year. Now I'll hand it over to Mark, I think, to talk about our plans for Martha and WKP.
Thanks, Craig. Firstly, you would have noticed, and we put out a press release a couple of weeks ago, that we did receive the permits for the Martha underground project. That big announcement is there for us to explore. We're currently planning rapid development down to those virgin areas that we've talked about, and also continuing to drill the extensions of those virgin areas. Basically detailed planning is underway now, and we're putting together a team of people to actually move that along as quickly as we can. It's a very exciting project for us. Also, with WKP, we're continuing to do the exploration work, but also, we're applying for a mining permit over that area. At the moment, it's an exploration permit, but we have eliminated enough resource to allow us to apply to the government for a mining permit.
That's the first step in the process of developing this mineral model. We're continuing to do studies on it. We've done a pre-feasibility study on WKP or a scoping study, I should say, on WKP. That's the level of work that we need to do to get a mining permit. The exciting thing about all this is how do we put these things together? We've got Martha underground, we have potential around the Martha open pit, and we have WKP. What's that going to look like for the company moving forward? This year we're doing a pre-feasibility study on putting those three deposits together, what that would look like as a pit strip. With WKP only being 10 kilometers away, then processing the WKP material through the Waihi processing plant makes all the sense in the world.
We have the capacity to be able to do that. We have the ability to actually expand that with our current equipment, both at Waihi, but also our Western processing plant as well, which is in here in Macraes..
Thanks, Mark. One last slide on Waihi, and then we'll get some queries. We'll stop there to take some questions on the New Zealand operations. Obviously you just got through a few slides where we talked about the exciting things that are happening for us at Waihi. It is a fantastic asset. We talked about how much free cash flow we've generated so far, having only spent $100 million in the acquisition with Newmont. There is a lot of value already at Waihi that we've generated. There's a lot of value we've created, and there's more value we expect to create. Mark and his team are working on the feasibility study, and we'll have more information in the second half of this year. We can see that Waihi, in five years' time, roughly, could be a 200,000-ounce a year producer.
We do believe that at that point, it would actually be the best operation in our portfolio amongst the four. When you look at this slide here, when you look at the analyst consensus, we sort of give a flashback to some of the previous companies that have been acquired over the last few years, Lake Shore, Richmont, Intrepid and Probe, and the valuation that these companies and their assets were given during the takeout. You compare that to where Waihi is trading at in terms of consensus valuation. We're showing a growing resource that continues to grow, production that will get up to 100,000 ounces initially just from Martha underground, and then grow to what I just articulated, which is basically in five years, getting up to north of 200,000 ounces and a cost structure that will move down. You make that comparison.
If you look at Lake Shore, for example, it was worth $685 million, is what Tahoe paid for that. You look at where Waihi is sitting at, and there's definitely a disconnect between the valuation for Waihi and these other companies and projects that are out there or have been out there.
From my perspective, this is an important slide, and this is something for you guys to consider going forward. We're going to move on now to Macraes. Like I said, we'll stop there, and then we'll take some questions. I'll turn it back to Mick to actually drop on Macraes.
Yeah. This is the range of consensus for Macraes, from 60 million dollars up to 373 million dollars, with an average of 256. As you know, Macraes has been going now for 28 years. It's produced 14 to 4 million ounces or thereabouts. Nearly five million ounces over that time. Last year, it had a very good year, 200,000 ounces and 55 production on record. It produced 75 million US dollars from cash flow. It's the best contributor to our portfolio after capital. We continue to have exploration success there. We're now eyeing a mine life going out to 2024 at production levels around 160 to 170 thousand ounces a year. There is a big resource there.
Measured and indicated resources of some 3.5 million ounces at $1,500 gold US, or I think it was 2,100 New Zealand. We're almost at NZD 2,000 gold today. Which sounds right helps, and we're getting close to that magical number. I think, Macraes is going to be here for a long time, and we need to think about that in the current market and where gold's going. Nobody knows, of course, but it does feel like it's on an upward trend. Over to you, Mike.
Thanks, Nick. Good afternoon and good morning, everybody. Just looking at 2019 metrics for Macraes. As Mick said, it's 175 to 190 is the guidance. Slightly down on performance for last year, and that's just due to the grade at Coronation North. It's fairly solid on sustaining costs. With the exceptional year last year, backing that up again with, from the open pit with about 50 to 55 million tons mined and underground around that 1 million ton mark. You can see that the strip ratio of the open pits is still quite high. We mine that for a very aggressive dollar per ton mine of $1.10 to $1.20. The grades, as I said, mentioned the open pit coming off a bit, and that's due to some of the other pits that we've been mining through the year.
Last year was predominantly Coronation North. This year will be Coronation North with Coronation, as well as some of the material out of Frazer. The underground still producing at that 2 to 2.1. Still going strong there. And we're processing that 5.7, 5.8 million tons at the combined pit grade for that covering between 82 and 84. So another solid year for Macraes and really exciting. If we go to the next slide. This just shows you the top northern part of the trend. So it's a 35-kilometer shear where the ore is, based along that shear. We're onto our thirteenth open pit. As Mick said, in 28 years, we've mined out 13. So predominantly mining from Coronation North to the north there. The next one down is Coronation. We'll be taking some out of that going forward.
We'll be looking in detail and continuing that project as well as from open pits, looking at the Frazer to Webster East mills area. And then looking from the underground point of view, at Frazer's underground, which is just off the Frazer's West area there, boundary. And then, looking at the Golden Point underground, and Craig will be talking a bit more about that. So again, still targeting that organic mine life extensions, which we've managed to do year on year since the seventh year of operation. So for 21 years, and as we just mentioned there, for another five at least years for that. Still looking at unlocking the reserve and additional mine life both open pit and underground.
Really good still, continuing ongoing success and the Round Hill project, which is the area, which we'll be talking about shortly, which is that Golden Point, Innes Mills area that's beneath the process plant at the moment. Handing over to Craig, just to talk about Golden Point.
Thanks, Michael. I think we're on slide 40 now. This figure's a cross-section of Golden Point. Golden Point's a part of the Round Hill project, as Michael just highlighted there. It's just north of the main and very large Round Hill resource, where most of that has been measured and indicated. We've recognized that Golden Point, a zone of extensive mineralization that extends 500 meters down dip along that controlling Hyde-Macraes shear. It's defined, or the shear's defined by the drill intercepts shown here, those gram meter intercepts. Mineralization here is some of the better mineralizations here at Macraes. Some of the better intercepts are shown there in this figure on the right. 15 meters at 4.3. Those kind of grades with that kind of width are somewhat exceptional.
We're excited about the potential of Golden Point and how this may impact on the economics of the Round Hill project in general.
The results point to a possible pit layback, and we have flexibility there with the new underground mine, the area shown in the dotted box on the left-hand figure. Both of which, as I said, have potential to impact on the economics of the project. We've allocated over 16,000 meters of drilling in 2019. We're well on the way to drilling this, both extensions and infill, to convert resources, as well as test further potential down dip, and both to the northeast and southeast of the known mineralization. I think I'll hand over to Mark to talk a little bit more about Round Hill itself.
Thanks, Craig. Look, I think this is probably the best that we've ever invented. Once we finish all the mining that we want to do and exhaust all the other pits, then we have the ability to then move the process plant. We wouldn't move it beforehand. While the guys continue to find good resources and good reserves in the other pits, and also things like the underground at Golden Point, we can mine that underground at Golden Point without affecting the process plant, or we can certainly mine a significant portion of it. The guys are continuing to expand and continue to increase the life of the mine. Right at the very end, we've got 10 years mine life. When it's all said and done, give us another 10 years. That's what the Round Hill project's all about.
It's an extremely interesting project. The gold price is in and around that level that we need for this project. We continue to study it, we continue to understand it. A lot of the guys are still doing a great job of finding other resources and reserves. It's one to keep on the back burner with. As I say, it's a fantastic
Well, thanks, Mark. We will pause there on New Zealand. We'll take some questions. There is one queued up. Michael Siperco from Credit Suisse is queued up to ask a question. Michael, we're going to go over to you to ask your question.
Yeah, thanks very much. My first question is with respect to the Martha underground. I think the target was one to one and a half million ounces. You've delivered one. Wilkes is pretty convinced that he wants to penetrate. He's saying a lot more extensive than what was assumed. Has the target increased beyond that one to one and a half million ounces?
Greg, could you answer that question please?
Sure. Hi, Michael. Thanks for the question. Obviously, with all the drilling that we've done, the information's fed back into the models. We look at those again. We look at further extensions, either along strike up or down dip, or the potential for adding more ounces in between the veins. In the press release this morning, we put out an exploration target of five to eight million tons at four to six grams. The target is growing. We have high expectations. As you said, we've put about a million ounces into the resource and still 50% of the drilling to proceed. My expectation would be that when we finish that program, we then revise our targets again, and we'd continue to test those. I think that in general, the answer is yes. We have increasing expectations around the ounces that we can deliver.
Great. Thank you. The second question, with respect to Mark's comments about the expandability of the plant, so cannibalizing bits of old plant and care and maintenance and so on. That's the first time I've heard you talk beyond filling the existing plant. Can you sort of scope out what you're seeing, what conceptual volume you might think of ultimately processing out? Or is it too early to suggest that?
Michael, it's probably just a wee bit early. As I said, we're hiring a feasibility or pre-feasibility study manager at the moment. It's a bit difficult for me to do a lot of arm waving. We have got a very good mill there at Winston, also good flotation cells, et cetera. It'll certainly have a greater capacity than what the current one has.
Great. That's useful. Thank you. Now, I wonder if you can sort of just step us through what that conceptual plan might be to get to in excess of 200,000 ounces and how contingent that is on the Cutback Five at the Martha pit.
Again, this is a rapidly moving feast, Michael, as you'd appreciate. We just put out the Martha underground, the million ounces there, a couple of weeks ago. We put out the 600,000 ounces or less than a couple of weeks ago, the 600 plus thousand ounces at WKP. We haven't put out anything on the Martha open pit yet, except for the 7,000 ounces at the stockpile call, and also we have around about 120,000 in the place being kept. I'd just put it on the table a little bit, if that's possible. You can, and as Mick and Sam alluded to, it's potentially our best asset. We could see this quite easily ramping up to 200,000 plus, in that side into-
Michael, if I could, if I could just add a quick comment there. Each of these stages are independent in terms of permitting and development. One is not dependent on the other. We also look at the economics of all of that. The 200,000 ounces is achievable, even with just Martha underground and WKP alone.
Right. Thank you. One last one, if I may, please. With respect to Macraes life extension. To achieve, I think you mentioned four or five years is now what you've got line of sight to achieve that, is that sort of accepting a higher all-in sustaining cost than the $1,000 an ounce? Are you sort of compromising grade, strip ratio, to extend that life, to maintain that sort of option on the gold price?
Historically, the margins at Macraes have been pretty constant as the gold price changes goes up and down. The last year, we had an exceptionally good year, with a higher exceptional grade of 1.3 grams and, which showed how much torque there is in it. obviously, if the gold price goes up, your cut-off grade goes up a touch and the margin stays about the same. it's really about mine life extension with similar margins. as you see from our costs for this year, our production was 10% and the costs are back to 1,000. we are investing in the future of the mine.
Yeah. Okay. Can I just take another very last one, and that's with respect to exploration there. If I recall, maybe it was from our strategy day, Craig was talking about, maybe it was the day before the strategy day, prior to that, about the discovery at Price from the change in the direction of the mineralization and how that sort of reopens the productivity of the region. Has that come to any improvement or was it just a one-off?
you're referring to Coronation North discovery in 2015, which has a different strike direction to the other deposits. Craig, do you want to comment on that?
Yeah. Thanks, Nick, and thanks, Michael, again. Macraes is obviously structurally controlled by the shear, but there are a number of other structural complexities to how the mineralization presents itself, both in the hanging wall shear and the footwall. there's variation along those, as I think it was Michael mentioned, those 13 pits in terms of their specific controls. we've continued to look more closely at the data. We're obviously still looking to generate new ideas and new targets, in terms of cracking the nut for understanding this better, we're not there, but we still have a very good, obviously, appreciation of controls on mineralization and where we should be putting the drill holes.
Okay. Thanks very much, Craig.
you can always come back or queue up again for additional questions. I do want to appreciate that you are on the call. It looks from the guest list that you're the only Australian analyst that actually woke up at 5:30 in the morning for this investor day. we do appreciate your support and Mick's as well, since we see he's online as well. we do want to move on to the U.S. because I do want to see if there's a question on the floor on New Zealand.
Just very quickly, a lot of my questions were answered. Just in terms of near-term, in terms of Martha underground and developing, but also in terms of development of the deposit. How do you see Correnso kind of dying off and then Martha coming on in the next, let's say, a year?
We were having this debate earlier about how fast you could bring on Martha underground. and of course, I said it wasn't fast enough. really Correnso and what are the other mines there, [Hanji]-
Daybreak. Christina.
Yeah. There's [Hanji]. Day is off it. Sort of we're picking up sort of different pieces around the mine as well in and around other deposits. Probably, middle, third quarter of next year, we'd likely run out of resources there, run out of reserves from existing mines. There's kind of 18 months, between now and then. As you were saying, once you sort of get into some new areas so. To be honest with you, we got the permit earlier than we expected because there was no appeals for the first time ever. I'd say that speaks something to the sort of quality of the relationship and the work that's done at Waihi to shepherd this through the process. It's fair to assume that there's, it's going to come in early.
We do have a scoping study that's been completed, which has given us a line of sight on how to do it. Remember, we're still drilling it out. There could be a hiatus in production, in next year, say for six months. We are very focused on this concept of a rapid development plan. Using modern technology on six-meter round jumbos, doing 300 meters a month, not 150, which is often done at a lot of mines, including some of ours, we could get into those areas quicker. There's a lot of work to do on the planning side of things, but it is possible that we could be producing from these virgin areas, these new areas like Rex, within 15 months. It's going to be a tough ask.
Yeah, Craig, just wondering if you're able to give us a breakdown of the recent resource at Waihi in terms of those vein contributors to the North Pit.
Sorry, I couldn't quite catch that question. Can someone repeat it, please?
In the recent resource for Waihi underground, you have a couple of veins. What contribution do the South Wing veins make?
Yeah. The proportion of mineralization really hinges off the main fissure veins, so Martha, Empire, and Edward in particular. We need to do more drilling at Rex and Royal. We'll mainly get two off that 800 drill drive, which you can see in those figures. As I said earlier, we shouldn't discount the potential of the mineralization in between those veins, and that'd probably continue to be important as we continue with the drilling.
Okay. Really briefly, you said that you had five-meter average thickness at WKP. What's the thickness range on average thickness for your Empire and Edward veins, just in terms of understanding that evolution?
Again, it's difficult for me to hear. It's quite muffled. Could someone repeat the question, please?
Yeah. Sorry, Craig. The average thickness of the Edward vein, the Empire.
Oh, okay. Sorry. We don't have the exact number, but it's of that order of five meters or thereabout. They can swell considerably. But all of these main fissure veins are up around that number, if not more, in places where there's significant vein dilation.
Question on the WKP, Mark. I think you said you started initial permitting on it. I'm just wondering if that contemplates surface or underground approach.
It certainly will be underground. Definitely.
In terms of the approach to the deposit, it would be like a 10-kilometer-
No. Well, we're looking at a number of options there. It is on Department of Conservation land, and as with Blackwater, when we went for our mining permit with Blackwater, we turned in off private land and tunneled underneath the Department of Conservation land. We're doing exactly the same thing or that's the proposal for WKP. It'll be somewhere in the order of a four to five-kilometer decline in. The legislation does allow you to have ventilation shafts on Department of Conservation land. Certainly, that would be in the early part of the mixed stage.
Just to add that Blackwater was permitted for the mining permit just last year. Within the last six months, we got the mining permit for Blackwater, and that's now under a joint venture, earn-in arrangement, with a junior company called Tasman Mining.
Just a quick question on Macraes, looking at the Coronation North. Can you just give a sense of your model mine life if it has a model for Coronation North?
It's about two to three more years.
Yeah. Similar to Macraes. what's the gymnastics you're doing right now?
Well, Coronation North, it's just following the shear down. that into the higher grade. I think it's going to be more material from the other pits in terms of overall sort of production.
Thanks.
All right. Last one. I think we've reached the Macraes quota, Brad.
Just wondering what the capping factor was that was applied for Martha and any potential for upside on the grade, and targeting some of the higher-grade areas. In terms of Rex, is that a higher or lower grade or in line with other resources at the moment in terms of timing of grade and profile potential?
That's over to you, Craig.
Yeah. Rex. We only got 12 holes into Rex currently. We've still got a fair bit of drilling to do. Again, it's a reasonable vein there in terms of continuity of geology. The grades, again, vary between four and 10-plus grams. The width of the veins are several meters, again, in width.
We feel this is an important vein. In terms of its contribution, we still need to do quite a bit more drilling to understand how many ounces that would deliver.
Similar grades to what you've been modeling around, which is around five and a half grams.
Yeah.
Yeah. Do we still apply a top cut to the orebodies with wide hinge grade? That's the question.
Yes, in the models, there is a top cut applied, but it's done on a domain basis. We look at each domain in the model and then obviously the statistics and apply a cut.
Do you know what it is?
Well, it varies across each domain. No. It's variable numbers depending on each domain and the geostats that drive that.
All right. We are going to then move on to the U.S. and specifically to discuss Haile. We're going to turn it over back to Mick to get things started on the Haile discussion.
Okay. Haile has been in commercial operations now for 17 months, and it's got a NAV of, since then, $728 million and $533 up to $1165. Since we purchased the project just over three years ago, we built what turned out to be a $350 million or $330 million purchase price and infrastructure. We've produced over 250,000 ounces of gold in three years from going from site and basically a standing start. When you look at it from, 10,000 feet, it's been a pretty good effort. We have had our challenges. We had our challenges with the process plant, and as I said, we're on top of those now. Martin will talk you through those. We've had our challenges with the mining conditions there, particularly in the last six months. We've had our challenges with labor and skills.
We've certainly turned the corner on all of those, and we've got things heading in the right direction. We've also had some difficulties with the exploration of depth. Early on around the underground, we see a lot of potential for more underground resources and reserves at Haile, and we'll see lots more attempts at that through the year. Andrew.
Yes. For 2019, the metrics which we put out, so 145,000 to 160,000 ounces, with an all-in sustaining cost of between $950 and $900. Tons mined getting up there, ramping up in the process. This year is a transitional year for the mining side of Haile as we ramp up from last year's around that, 8 million tons up to 12 to 15 million tons. That's the run rate that we want to be running at by the end of this year. That will be done by the purchase of new equipment, which I'll be talking about as well. Strip ratio 5 to 1. Grades around that 1.45 to 1.55 mined. The mill as Mick said, we've had our challenges, but that's performing exceptionally well. Last couple of days, we've sort of broken our records with 13,100, 13,400 tons per day.
So over 350 days, we're running at a run rate of about 3.6. So performing very well in the improvement projects, which Martin will go into, tracking exceptionally well. And for those guys that went out and saw it last week, we can verify that as well. You can see there, the head grade, sorry, head grade mined is milled is higher, and that's because of just ore grade presents itself. So we're mining a lot more ore than we are processing. So we're mining around about 4.5 to 5 million tons of ore this year. So again, the recovery is up to 82% to 83%. Mining costs are slightly higher, as you see, with $230, $240. And part of that is, as Mick said, working through some issues that we had and utilizing specialist contractors to certainly move some of that clay and saprolitic material.
So as we open up the pits and open up the different ore bodies, you can see with some of the pictures there, you can actually see the barriers between the saprolitic clays and the more competent material. Processing cost at the moment, at that level, and we will see in further slides on, we'll talk about how we manage these storage costs going forward with the reduction of the usage of [DFND] fine grinding, as well as the improvements that we'll go through. And then the capital, as we said, the operating there and the growth capital that we've got with the mining, the finalization of the projects in the mill, but also with the Inter-Pig and the POX that will be put in the second half starting that this year.
just for everybody, and people that saw it last week, from the opportunities point of view, we just sort of showed, and Mick's mentioned there, the rainfall impact. average rainfall around that four to six inches per month and historically, and you can see there from the end of September to December, we got drenched. an important part for us, particularly going through a permitting process, is to ensure that no contact water left site. to manage that, we did some things that didn't help from the mining perspective. we did let the pits fill up with water, and we also diverted water from the PSM.
the benefit of that and the opportunity for that is that we can oversaw that we exactly managed the water effectively, and that has ensured that they have grown and cemented in confidence that we can manage the site with no contact water discharge, which has been great. the workforce, you can see it's exceptionally buoyant in America and particularly in South Carolina, so the lowest unemployment rates ever. we're dealing with some of that. we have self-imposed some of the local hire sort of that we have done through the ramping up of the mine.
we also, I suppose now, have a look at the opportunities for the disruptiveness of the emerging giant, as well as over the period, and that's just recently, but over the period of the last year, we did a series of job fairs out in the West and really targeting experienced people, particularly the experienced people that the East Coast is their home. through the ramp-up of the mine in South Carolina, they had to go to the East to look for labor, and a lot of labor from the East Coast been now willing to come back, and Jim coming back has helped in a tight team, which is great for us. that continues, and I say the interest there as we're ramping up, we are getting 300 CVs through the door per month.
our losses as opposed to our gains, the losses are greatly reduced and the gains of employment are showing great recovery and great processes. also targeting ex-military as well. we've had some great success over there. productivity, still working through that, still upskilling simulators on-site, replacing the mining fleet as I talk about and just looking at our own training as well. just moving on different skills with that. also utilizing the contract miners to ensure that they're good at their job and they know how to move the clay material with the equipment they've got, so utilizing that as well. from a consultant point of view, just continuing to infill some of the areas that aren't as well covered in the whole resource and Craig will be going through some of that through the presentation.
For us, for this year, it's just a plan on a page for 2019. We will complete the Mill Zone Phase One, and that's a, where there's a picture of Mill Zone there. Into the last couple of benches and the people that were there last week saw that. Open pit mining, we've commenced that, so that's the third open pit that we're starting up, and so that's, we're progressing along with that, and that's some of the areas that we're using the specialized contractors to move the slate material. Slate pit, we're coming down to, we've sort of gone through the head and the neck and we're coming down to the shoulders of the ore body.
The ore bodies are standing out, and we're coming into that probably a little bit later than what we'd hoped for, and that's just due to managing the water in the site. Larger equipment, we've made the selection there. We're converting the 100 ton 777 Caterpillar to a Komatsu fleet, 730E, which is a 190 to 200 ton. And we've put an order in for one PC3000 and two PC4000s, which will be coming. The PC3000 will come here on site soon, within this month. PC4000 is in a trade show in Germany at the moment, so that will be packing itself up and making its way out to us by August. And then at the end of the year, we'll have the third excavator, as well as the pieces of equipment will start arriving on site this month as well.
Contract is what I talked about, and then just some further core drilling in the upper zones around the Red Hill, Ledbetter and Haile deposits, just for improved understanding. That is to ensure and to understand those short-term, more of the short-term issues moving forward. Some pretty pictures there on slide, the next slide, of the fleet that we're working towards. The reason going for the electric trucks, I suppose, for people that know, it's just basically a trade name with a plug-and-play components. And so it's electric drive motors. So you basically got the engine of the truck, which just drives a, basically a very large generator, an alternator that just drives electricity through the wheel motors.
The reason we've got from that is that, the East Coast isn't a-- got that much experience with large type mining equipment, whereas agreement with these guys is most, all of this component will actually be going to dedicated rebuild facilities. So the engine goes back to Cummins, and the electric motors go back to Komatsu's centers for rebuilding as well. 13 trucks over the next 12 months. We do have still have Caterpillar support here so that we have the dozers, the graders, and the wheel loaders as well. News also coming up as well. Upgrading the mining fleet to get us up to that 46 in the coming few months, which is around those figures that we're mining at the rates in a sort of safe class.
From the plant performance, we talked about this before, and you've looked at some of the costs that have been impacted from the processing plant with the labor requirements, the regrind maintenance, as has been mentioned. We're looking at the SMDs. Basically, they're costing us about $40,000 a week. Sorry, the SMDs. A reduction in that will be a reduction of about $2 million, which should make that 50, 60 ton of the price for the million. Reaction costs have gone up, and we've seen that just due to the nature in the U.S. as well in terms of the consumable costs with the tariffs as well.
Looking forward, manning, we're getting experience, and as I've said, the process and plan is improving every day and the targets and the record that we've hit today will be our standard operating practice tomorrow and we'll achieve over that as well. We're currently running at a run rate of around about 3.2 to 3.6, and we want to continue that. We've had a couple of days, but we want to try and make that consistent. Major shut in April to tie in the itema. Working through the higher throughput will reduce the costs as well as I mentioned, the regrind opportunities that we have got there and the automation process. Mark will go into a little bit more of the technical side of the automation process in the next slide. Thank you.
Absolutely. This just gives you an overview of what we've been doing to the process plant over the last two to three years. We're pretty much using that much of the plant that we haven't touched at some point or other. Initially, before the process plant was touched, we changed a couple of things around the grizzly and the coarse ore bin and the flash flotation units. Last year, we put in the pebble crusher. This year, we put in the tower mills. Last year, we put in the tailings thickener to upgrade. This year, we'll be doing Carbon Scout and automation in the CIL circuit and putting in the dual screens. Towards the end of the year, we'll be fixing up the tail end. You can see that we've been working pretty hard.
I was trying to remember back when it was, but I think we were standing here probably two years ago, probably a little bit later than this, maybe May or April or June, two years ago, and I was sweating bullets. I can tell you now, this is going to be one of the best plants that was actually put in. We've made a hell of a lot of changes to it. The automation is fantastic. The guys are now starting to come along. We've actually got a great bunch of new guys and young blokes that actually embrace automation. For those who went on the tour, it's worthwhile. I'm very proud of as what Justin and Quentin before him and our young metallurgist has done, and my chief metallurgist, Dave Carr, a real workhorse in actual fact, making this plant work well.
We said that we would do 3 to 5 to 4 million tons 18 months ago or 2 years ago. We're getting there. We've had availability issues. Availability this year is around about 95 to 96. We're licking all those problems. Very happy with the way the guys are going, and I think you will be amazed if you come on the tour next, you'll see how well we've done. I just talked a little bit about the expansion, but I guess we're in the final phases of the regrind. We've installed the pebble crusher. The front end of the circuit is doing. Sorry. One second. The front end of the circuit can do 3.5 million plus. The tower mill has been installed. The regrind, the IsaMill is being commissioned as we speak.
I'm pretty confident with the installation of a few things at the tail end of the plant that we're going to hit this profile. We're looking here at hitting around about that 3.2, 3.3 this year, moving it up through towards 3.5 next year, and then slowly inching our way up to 4 million. For those of you who have been following the story of OceanaGold for a number of years, this is exactly what we did at Didipio. Exactly the same process. Exactly the same process as what we did at Macraes, took that from 1 million to 2 million. Exactly the same thing we did at Macraes before that, took it from 1.5 million all the way through to almost 6 million. This is the formula.
Maximize the grinding capacity at the front end of the circuit then get everything else to match. You don't spend a heap of money upfront putting in extra capacity when you don't need it. That's really maximizing your asset. This is just a picture of the IsaMill for all those metallurgists in the room, 2 or 3. Greg Bryant, put your hand up. It's a very efficient unit. We're extremely happy with the power that's been installed at the moment the support that we've got from Greenhill to date. That will, as Michael said, the tower mill and the IsaMill, that will get rid of our baghouse , which has been the SMD, and will decrease our operating cost by about $0.50 a ton. I can see it probably improving even on that.
Yes, more stability and also taking the supply to grind. Now we'll be targeting a grind of around about 30 microns, and that'll give us a consistent recovery in that 84%-86% recovery range. Just for those who didn't go on the trip, just proof that we're actually doing it. A couple of nice pictures there. Once again, where the resources all started. This is just a couple of graphs, just basically going through the step changes that happened, even when we installed the tower mill, with the SMD, but alone install the IsaMill as well. What we're seeing is, we've seen the flotation tailings grade. Sorry, the final tails, which is the final tails. We've got much steadier tailings and also a decrease in the tailings because the grind was finer and more consistent.
These graphs are just verifying basically the stability of the process plant. As I said, there's a couple more projects we've got to complete this year, and that's around cyanide destruct. So basically, the tail end of the plant. After we get the region going, we have to increase the cyanide destruct, just from a capacity point of view. We're also looking at some pre-aeration in the picture. We will be producing more concentrate because we're moving towards four million tons. So we're just reviewing that at the moment and also some ancillary works. The exciting thing is installation of things like the carbon circuit automation and things like that. Less reliance on people and meddling fingers and more to do with science. And this is the way plants ought to go.
Automation's a big thing within the processing industry at the moment, and we're certainly trying to be the fastest following we can. Just going on to the Haile expansion now. We've commenced the permitting and it's on track, as Mick and Michael said. We're looking to get the permit extensions by the end of this year or early next year. To flow on from that is the Horseshoe underground. I've appointed Ian Pearson. For those of you who have been to the Didipio, you would have met Ian. So Ian headed up our construction and commissioning of the Didipio underground for three years and is now the project director on the Haile underground, the Horseshoe underground. He's already taken up the mantle and has been over here in the States for two weeks and so that's moving along very well.
In terms of the resource and reserves here, this picture's a pretty quick development. We can rapidly develop down because it's not very far into the first stope. Also, we're coming in off the Snake pit. We're coming in off stage 2, and some way into the hard rock. So development into ore will be reasonably quick. What we have done here is we've drilled out the top part of the ore body into reserve status. And the resource is predominantly down in this bottom leg here. And as we develop into that, then we'll drill that out to reserve status as well. I'll hand you over to Craig, and you'll see from the I'll just leave the slide on.
You'll see from this slide that there is actually, once we get down there, the exploration potential depth is substantial and it gives us a really good opportunity to extend beyond the seven years or eight years that we've got currently. Over to you, Craig.
Okay. Thanks, Mark. Yeah, on this slide, following on with the underground theme at Haile, the extended program of drilling continued since the acquisition in late 2015. The figure here is an oblique view from the southeast with the open pit and the drill intercepts. The grade is indicated in the legend on the left there. The reds represent quite high grade, greater than five grams. It obviously highlights several of the underground opportunities drilled to date, commencing with Horseshoe and then Palomino. As Mark just described, we've drilled off the upper portion of Horseshoe, and we reported the resources, as we've highlighted, tested some of the deeper extensions around Horseshoe and also completed framework drilling at Palomino. We're now looking at progressing these deeper opportunities once we have the decline completed at Horseshoe.
That allows us access via a dual drive, taking a similar approach to what's been described at Waihi. We can more effectively test the deeper targets underground and effectively a kilometer of known mineralization between Horseshoe and Palomino. Moving to the next slide. This slide is not all the drilling, but it's the highlighted drill results of more recent drilling. Figure shows the reserve pit outline, mineralization within a 0.45 gram per ton gold shell, and the main geological units. The favorable Persimmon Fork metasediment host, that's shown in beige, and the overlying Persimmon Fork metavolcanics are shown in green. It's now apparent that mineralization at Haile is strongly controlled by several prominent structures that have offset mineralization and puts in place the favorable Persimmon Fork metasediments close to surface along those three trends shown here with the red lines.
The offsets will become more apparent in the cross-section I'll show you a bit later. But they're critical in both our modeling and targeting offset portions of known mineralization. So the understanding of the geology here has come a long way over the last three years, and probably more particularly since we got into the pit and we could do in-pit mapping. It's not to say that folding isn't important here, but really, these major structures are proving important in terms of controlling the mineralization, both post-mineral, but also during mineralization, where we see some concentration of higher grades in some of these more favorable structures. If we move to the next slide. You should be looking at a plan view again of the reserve pit, along with drill traces and selected intercepts in August 2018. We've drilled around 12,000 meters over that period.
The exploration program's focused on drilling in and around the footprint of the existing deposits. The results continue to demonstrate the opportunity to add further resources in these areas and obviously replenish reserves. We had an 18-hole diamond drill program completed outside the $1,300 per ounce reserve pit design and within the resource shell in that Snake West area on the right. It gave us positive results, and I'll show you a section along that dotted line, AA, in a moment. I should draw your attention, though, to a couple of the other intercepts that were south of Mustang, north of Red Hill. In that area there's two labeled, 15 meters at nine grams and 20 meters at seven grams. So it just demonstrates there's still quite good mineralization in the pit walls outside of the current pit mine design.
These are the expansion opportunities we continue to talk through. I'll just take you to a cross-section, which is AA, that I just mentioned, through Ledbetter and Snake mineralization. You should be on the next slide now. The relationship between gold mineralization, shown in light red shapes above the 0.45 gram per ton gold shell or grade, and the favorable metasediment host in beige, that relationship here is obvious. Also shown is the reserve pit outline in black and the major faults in blue, resulting in these block faults rather than fold noses, such as that centered on Snake Pit. You can see the beige blocks rising up to the Snake Pit that are obviously mineralized there. The blue lines represent faults and movement along those, as indicated in general by those arrows.
The mineralization shown as red from the drill traces is in places intersected outside of the reserve pit, below Ledbetter and Snake West. These are most likely going to contribute to additional resource ounces in model updates. I'll now hand back to Nick, I think, to move on to the Philippines activity that we're doing.
Thanks a lot, Greg. It's Sam here. We're through the U.S. now. We're going to pause again. We'll take a few questions from the floor. Please, as you still come back in the queue as well. We will take your question as well, or questions I should say, for the floor. We're going to start with the floor first. Over to you, Raj.
Thank you, Sam. Just a couple of questions first on the cost structure at Haile. What do you expect? For example, the optimization study that you ran in 2017 had a life of mine average cost of AISC of $700 an ounce. Given the changes in labor costs and taking the current inflation there, what's your estimate of the cost that you can get to? Second part of the question is, you mentioned about the initial investment of Romarco and the capital that is spent and that Haile contributing to that. What would be your target payback on Haile based on the new numbers and the capital that you invested for Haile to date?
I'll give you some overall comments and I'll ask Michael to comment on some of the more detailed stuff. We have seen an increase in input costs. Labor has increased. We've gone from a three-panel roster to a four-panel roster to attract experienced miners from the West. We have seen an increase in the hourly rate, also, as a result of both the need to attract from the West and the general high demand for labor in the U.S. generally. We've also seen an increase in consumables costs in the process plant, and we've currently got a higher cost in the process plant than we expected, mainly to do with maintenance at this point. A lot of the things that Mike talked about, we should be able to engineer those issues out as we have been. Okay. There is a higher cost profile overall.
The mining cost is up. We're looking at around $2 a ton with the larger equipment, up from about $1.60, from where we were before. That's a 20% increase in the mining cost. Processing costs are up also from about $10 to $12. That would suggest that we will be something in the high sevens in the longer term. Over.
Interesting. That's right. I suppose what we're looking at is the dollar per ton will come down from the current rate at the moment as we sort of get into the harder rocks. At the moment, we're sort of moving the sticky little clays with the bigger equipment and just the total amount of tonnage. As we said, you're looking around that $1 mining to $2 per ton mark. We have gone to a four-panel roster. At the moment, with the amount of fleet that we'll have, we believe we are ramping up, but we'll get a lot more efficient with that. There'll be a reduction in overtime with the additional people. At the moment, two panels and three panels contain the overtime.
The labor rates, even though dollar per ton is slightly higher, we believe that some of those costs will be coming down because we'll have more people, therefore less overtime. Yeah, it's around the figures of the high 700s for the dollar per ounce is what we're targeting as we pursue drive 1. There is still a lot of further improvements that we see. We are focusing a lot on dewatering as well. The drier the pits in the winter it is, the clay moves over the dry months is cheaper to haul through. It's just been hampered a bit by the wet nature of the clay at the moment, which is driving costs up when it's dry. It's $1 to $1.50 a ton to move because of this reason.
In terms of the return on investment, the return on investment we calculated when we did the investment was about 18%. We have seen a bit of a higher capital cost than we did predict. We went up to $50 million. We have seen this sort of 16% increase in the operating cost, thereabouts. Yeah, of course, the return on investment is lower. We also have seen some success with the exploration and increasing the resource base and extending the mine life, and we see a lot of potential in that underground development. We are very happy with the investment to date. Notwithstanding the challenges that we have had with the contingencies, and I think it's looking pretty good, this 200,000 ounce plus. Sam doesn't like me saying plus, but 200,000 ounce plus target in 2022 and 2023.
Thank you. A couple questions on Haile. The technical prints that you were going to replace will bring in 18 trucks. You've got 13. Is your plan still to add five more in addition to that? How does that change your capital lease payments relative to what they were for fourth quarter 2018?
Yes. Here is the plan. The plan, they'll have the 18 trucks. They'll come as we get deeper. At the moment, as we're moving the material, it's all near surface. As we get further into the pits, as you see by the diagram, you'll just need to cart longer distances, so don't get up to that number. The lease plan-
The 43-101 assumes 785, which is 150 ton class truck. We're now going to 200 ton class truck. It's a bigger size.
That's been in the lease arrangement. Scott, hop on here.
Sure, Michael. I think the plan currently has us taking about 10 trucks across 2019. The capital lease of those will be incrementally added on to what we've currently got, I think. Then the other three in the near term, in 2020, is the final group as required, not till I think well after that, so the 2023 plus based on the plan at the moment.
Any idea in terms of magnitude, though, relative to where they were for fourth quarter, what the quarterly cap lease rate payment would be?
Off the top of my head, honestly, I'd have to dive a little bit of that data.
I wasn't on the tour to Haile on Friday. I was there in August, and I recall the water treatment plant wasn't running. Is that something that you would expect to be bringing on?
The water treatment plant is now running.
Yeah.
We are discharging from it. That thing, the water treatment plant, will be continuing to run from now until the end of the life of the mine, probably.
That's it. Thank you.
Any other questions from the floor? We do have two people queued up here on the call. Nothing further on the floor, so we'll turn it over to Hugh and Spiro. You're up. Just three questions.
Thank you. I was just interested in, when you look forward at Haile, the weather events you've just experienced. It strikes me that everybody designs around historic data sets, but demonstrably been sort of flawed in terms of weather patterns. Does the design sort of have sufficient freeboard for what future weather events might be rather than that historic data set? What's changed that might see future disruption being less than what it was in the last quarter? With respect to maybe more voids available to dump water in rather than compromising production, less clay. I'm just trying to understand why future impact mightn't be as great.
I'll start answering that question, Spiro, and then pass it over to Michael. A couple of things. One is, there weren't enough bores installed around these new pits at Snake and Red Hill, dewatering bores, and some of the ones that were installed were actually collapsed at the bottom because of the deluge. 16 inches of rain in two hurricanes at the end of September and early October was pretty significant for that area, which doesn't have a lot of relief. The water basically filled up the water table. Remembering that the North Zone, which we haven't mined out, we didn't have any problems with water as we went down through that. There were deemed to be sufficient dewatering bores. Of course, an exceptional event like this was quite challenging.
The second thing is this is only the water table sits above hard rock, and it's in the saprolite and in the sands above that. There's not that much water down below the interface with the hard rock other than the few fault positions. Once that pre-stripping is completed, virtually the problem is removed in terms of the impact on the mining operations. In total, there's 20 million tons of pre-strip, of which we've completed about what? 5, 6 of that order. Over the next 18 months to two years, we'll finish off all of that pre-strip. The biggest one to come is at Red Hill, which we will start next year. Red Hill is the largest pit in the sequence. Once the pre-strip's finished there, we've basically got the risk of this sort of impact is greatly reduced, certainly from a mining perspective.
On the tailings facility, we've just got to make sure that we keep as much water out of that tailings and keep it as dry as we can in terms of the water treatment plant. There's plenty of freeboard there now. We'll make sure that that will stay the case. We've started the increase on the next lift on the TSF this year. That's in the capital program, and that'll continue for the next five or six years.
Thanks, Mike.
I suppose when you're starting off areas and you've got two small working areas and you have deluge like we did, and with a mandate not to release toxic water, you have to manage the water with the smaller as you've got. As we expand the mine and expand the pits, you've got more working areas, and we'll be finishing North Zone phase 1. Phase 2 of North Zone, phase 2 of Snake, and then opening up Red Hill. You're actually opening up areas that are above big dumps, so they should be less impacted. So with the dewatering that we're putting in, so this time at the moment, we've planned 26 depressurization wells, and that's around Red Hill, Snake, and then moving into the first phase of Red Hill.
We'll have the depressurization wells that we're putting will be in the middle of the pit, and as we then take the pit down, we'll expand more depressurization wells. So current program's 26 dewater wells. We'll be expanding that. But as you open up more areas, you give you more contingencies to be able to manage the water, and that's what we're looking for going forward. So not only in and out from the underground with more that we've got, so when the rain does come, we can handle it better. But also the way that we mine with some of the areas, you can actually divert the water better as well. So that's why we believe we can manage it and manage those events.
Great. Thanks, Sam Pazuki?
Thanks, Michael. We have Adam Baker who's on the line. I guess Adam's an analyst, so we obviously just spoke to recently to tune in. Adam, over to you for your question.
Thanks, Sam. Yeah. The whole expansion, just wanted to ask, are you still expecting approximately $255 million for that? Just wondering how far through the spend you are. That's from the technical report in 2017.
Adam, the slide that we showed earlier on in the presentation. If you come back to the slide at the beginning. Basically, we'll be spending less than the $225 million, and the profile is a little bit longer in the tail than what the NI 43-101 suggested. I think it's about slide 13.
All right.
you can see there, the technical report had us spending around about 100 million this year and next year. we're really spending around about 60 million for the next two years. then there's around about 30 million spend in 2021 and then some more in 2022. it's a bit more spread out, and some of that's due to the fact that the capital spending that had us buying the fleet upfront rather than the finance lease, and also they had us building the tailings embankment all in one crack, and that will be spread over pretty much the life of the mine.
Okay. Thanks for that. I was late for the call, so I missed that one. I've just got a couple other questions. Given that, I guess, there's been change to mining plans and whatnot since the 2017 technical report. Just wondering if there's any update on the life of mine strip for the pits. Given it's changed in 2019 quite significantly. If you've got any updated number or are you expecting to release a new technical report at all?
We're not expecting to release a new technical report. What the drilling has done is probably identified some of the inferred material inside the current pits that was in either inferred or in mineral inventory that we probably brought into the resource. yeah, post strip or the, what do you call it? The strip ratio has probably gone down a wee bit.
Sure. Perfect. Yeah, that's about it for me. Thanks a lot.
All right. There was one other question queued up, but that's disappeared. Sorry, one more question here from the floor. Just give us a second. Get you a mic here.
Changing the life of mine cost return. Is there any potential impact to the life of mine costs for the tailings plant?
No, they're independent. We use a contractor to build that facility to deliver material to that, like waste material to the facility, and then the contractor build it. Not really related, I don't think.
All right. We'll move on. Next section. We've got about 10 slides. If you do need coffee or refreshments, please help yourself. We're going to continue with the investor day. Next section's on the Philippines. I'm going to turn it back to Mick and the technical staff to discuss Didipio.
Sorry everyone at Didipio we're really proud of what's being done at Didipio. It's been in operation now for just over six years and hasn't missed a beat. If I just go back a slide to this one. There's a lady running the control room there. One of the secrets of Didipio that very few people understand is the talent of the workforce we've got there. Absolutely exceptional. We've moved people from Didipio over to consult commissioning with the process plant at Haile. It wasn't that lady, but another lady who turned the lights and village at Didipio. It was her. Sorry. Didn't recognize her. She's there as well. She actually taught the first control room operators at Didipio. She's a mother of two. She'd never worked before, and she's picked it up, and she's absolutely nailed it. It's a really good story.
We've got mining engineers being developed on site who are doing a fantastic job, transferred from the open pit to the underground. All women. And we just lost three of them to Australia. One went to Evolution at Cowal, one went to consultant with MX, and one went to [Cash Money]. They're highly sought after. The people that are coming out of the Philippines, and it really is a credit to the team on site and for all the work they do. But we see this as a very valuable asset for the company. Our longer-term plan is to bring people from the Philippines into New Zealand and other states in North America as part of our way to always have this constant supply of high-quality people running our operations. So I just thought I'd throw that in.
It's good to see so many women coming through our workforce down in the Philippines. It's a more valuable asset. It's valuable in more ways than one, than just the NPV. So here's the consensus, 265. Probably a bit on the right side, guys, but anyway, it's a range. And 105-106, probably a bit on the high side. And an average of 492. Would we sell it today for 492? Absolutely not. Wouldn't pay for itself. So, it's worth a lot more to us than that. Would we sell it for the right price? Maybe. It would have to be a pretty healthy number, because it would be just a redeployment of capital from one place to another and reduce the risk profile.
It's a very valuable asset to us, so we're not strategically looking to sell it. The resources and reserves have held up pretty well. We've still got a mine life going out to 2032. Reserve grades of 1 gram gold and 14 on copper. Sounds low. A lot of that is stockpile, which the underground picks it up. The mine plan going forward is pretty solid. I will point out the mining cost for Didipio, the underground is about $40 a ton, and we are delivering on that. There's a good rule of quality for you guys to remember. 1 gram of gold is $40 a ton in the ground after recovery. It's $1,200 an ounce. If $1,200 an ounce, you've got 5 gram dirt, it's worth $200 a ton.
If you can't make money out of $200 a ton, there's something wrong with you. All right? Now think about that when you look at other mines here in North America. So, Michael.
Didipio metrics for this year, 120-130. This is a combination of both the underground phase, so we're getting that up to the 1.2, sorry, the 1.3, 1.4 mine. That's still a ramp-up process, and we're targeting that up to a run rate of 1.6 million tons by the end of the year. So 1.6, 1.2, 1.4 from the underground and 3.5, which is through the processing plant. So around about 2 million tons will be coming from the open pit stockpiles, of which we've got around about 19 million tons left. You can see there the grades mined, both gold and copper, and the grades milled, both gold and copper, with the recoveries sort of working through that.
As Mick said, that $35-$40 per ton for underground mine processing, very aggressive there. The 6 to 7, which is what we're achieving at the moment, which has been a great effort by the guys on site. The capital profile growth is mainly underground decline, which we talked about earlier. The underground, as you can see, going down with the decline. We've got the two accesses into the portal. The fresh air rises all the way down. We've commissioned the water stope. We've had the capital pump station two. We're now looking, putting in reverse. The capital pump station three is in the pit, two is down at the 2180, and one is down at the bottom, which we're going to put down at the sorry, 2280, and one is at the 2160.
one, two, three as we go up. The stope methodology, the open stope, long hole open stope in both the Red Shoe area and the monzonite. The Red Shoe stopes are smaller and we're successfully taking out a few of those stopes. Other smaller size, NI 43-101. We talked about, I suppose benching and maybe even cut and fill, but we're striking out a 10-meter wide by 15-meter long by 30-meter stope and that's been well supported and well taken out backfill, and we're just currently mining one of them at that stope at the moment. That's how we're going to progress the Red Shoe stope. There should be a little bit of a cost saving in that from the NI 43-101, which has been good.
As mentioned, for last year, 627,000 tons from the underground up to the 1.2, 1.3 to get up by the end of the year to 1.6. Panel C construction is underway and the important point is to get down to that pump station and we're going to do the same process there with regards to our water storage stope. We put a stope in there. We'll just get the sludge out of the water and just pump clean water up. We're pumping around about 500 liters per second as control pump station number 2 at this point in time. We will continue the decline beneath that area and get down to the pumping out from beneath it, and then continue drilling at depth as well. Technology, as Mick mentioned, not only in the Philippines.
We've been backfill the policy now that we've lost three female engineers. We have a project there that we've named Project Bicar, which is basically taking the graduates through and backfilling the roles that we have and, as Mick said, get the experience level up by leveraging the value proposition of the Philippine mining engineers. If you're looking at mine engineers in Australia, I think Queensland University is pushing out about between four and four graduated last year. Putting about five universities in the Philippines, graduating around about 25 per person. They're producing 150 engineers, where Australia is only producing about 40 at this point in time. That's where we see a great opportunity. As you can see here, we have a program called ADaPT, so automation, digital, and process transformation, and the Didipio is our test case.
What we've got here is two screens, or two shots there, one showing the Didipio optimized production information, which we'll show a video in the next slide. That's our equipment partner, Sandvik. This basically tracks the filling of trucks, as well as tracking the production drills underground. This diagram shows you the truck filling, as it's being filled real-time, and then where the trucks are in the system as it goes up the decline, and just a few metrics there on how we're tracking hour by hour. The second photo is our surface controlled remote bogging station. That fellow can actually operate two loaders underground, obviously without a shift change.
In the trial, we had to evacuate the mine to full produce and take the ore out of the stopes and put it into the stopes. The next slide just gives you, I suppose, a roadmap of the digital transformation. This is just some optimized monitoring. It's basically fleet management and how you manage that utilization, and it also gives you a predictive maintenance. We've signed up to My Sandvik, which basically is a program where Sandvik can operate and monitor all of our equipment and then tell us how we're going with every other Sandvik piece of equipment, probably every piece of equipment in the world. The tablet rollout is basically giving that information in real time back down to the supervisors.
We have Wi-Fi underground, so they can actually get it on their phone, and we actually had a BlueJeans call with guys underground the other day. We can actually send information straight down to them, and they can pick it up, put it on their tablet, understand what's happening, calibrate it, improve training and all that sort of stuff. If there's a new procedure or change in procedure, they go, "Well, what does that procedure say?" They just pick up their tablet and can understand what the procedure is and instruct that through. Mine operating system, so that's just your improvement. That's your short interval control and continuous improvement with regards to how we're tracking what's up there, how do we actually manage the meetings better, what's the actuals of offline versus the KPIs, it's accessing all that information.
Location tracking is more from a safety point of view, so we understand where all our people are, we understand where all our equipment is. If there is an emergency, we can understand where they are. If they go to the refuge chambers, which we'll talk about down the bottom. Obviously, the electronic tagging and smart refuge chamber, so we can actually understand through emergency where all our people are as well. Just a business intelligence point of view. All this can be then put up into a PI system, so people that were on the tour last week could see that in the process plant, we run the PI in the background. We can actually pull up the trucking at the Didipio from that control room center at Haile.
The idea is that in different locations where we are, we can actually pull up all the real-time information as we go through. PI is the database platform for all our business intelligence and allowing us to see that cadence operation. Mike's group, with the chief metallurgist, the chief geologist, and the chief mine engineer can sort of have a governance view over the whole site as opposed to yourself and whatever clearance they want. Just to add another comment to that, this provides us visibility throughout the whole organization on how underground's operating, right? Indeed, process plants are going this way as well. No matter where you are in the world, you can have real-time information and data on every single mine and process plant in any time zone, from any airport, from your home, wherever.
This is the kind of visibility that we're looking for, and this is how you operate in multiple jurisdictions with high quality systems and people and fully connected. That's the vision. I suppose for planes that allow Wi-Fi, we have the chief metallurgist at 10,000 feet actually talking to the operators, looking at the information. He has the ability to change the controls on the process plant from 10,000 feet. Matt, you were going to say something, too?
Yeah. We're gonna just show you just a very quick video or demonstration of what's happening at the Didipio in the underground. For those of you, unfortunately, on the webcast, you'll hear some nice music, but you won't actually have a chance to look at the video. We will provide that to you on demand. We'll play the video now, and I think it's just a couple of minutes.
This is a training video we give our operators just to understand what the system can do. Hit play.
Yeah. Just another thing to point out, Michael mentioned that we're sort of rolling this out in the Philippines. Don't necessarily want to call it a pilot, but it's sort of like a pilot. Mick mentioned earlier that we are, over the next five years or so, building three brand new underground mining operations. What you just saw there very quickly in the video and what we talked about in terms of technology and the capability of technology and how that's really going to improve things going forward, we are looking to then employ that at each of these new underground operations that we're looking to build over the next few years.
Those of you who came out to Haile, you did see the technology in the process plant there, where you can basically access all the process control centers for the four operations that we have. This is something, again, Mick pointed this out during the strategy slide. It's something that will really the future, it's going to lead towards efficiencies, cost reductions, increased productivity. That's the way of the future. There are other mining companies who are investing heavy amounts of capital into these technologies, so we're basically fast followers. We're really piggybacking off of the real champions of the world, for example. Just, we're almost near the end of the investor, but I just wanted to walk through a few of the sort of investor overview slides. Investor overview. We're very happy and proud to have the shareholder registry that we do have.
We've got very strong shareholders across the world, who are very supportive of Oceana, have been for a number of years, who support the strategy but obviously are very happy with the performance of the company, who have a lot of confidence in Mick and the executive team, our people on the ground. We do appreciate your support. There's a number of you that are on the webcast right now. Thank you to all of you and to those in the room as well. Obviously, liquidity has been in Toronto for a number of years now, so strong liquidity here, with some nice diversity in terms of geographic distribution of shareholders, with the U.K. actually being one area where we've seen a lot of buying gold stocks. A lot of that money's come south.
We've also been very general investors have been drawn to the Oceana story for a number of years now. They obviously like the return on invested capital, which a lot of gold companies don't discuss, let alone put in the slide deck. We are committed to creating value for shareholders. I hope you gain that appreciation from the slide deck, that we are focused on that, we are committed on that, and we'll continue to drive towards delivering consistent, strong returns and maintaining our robust margins. Unfortunately, there's only a couple Australian analysts that are on the call right now. This is something that we continue to face in terms of challenges, in terms of the discrepancy between methodology of analysts, you guys here in North America, and methodology that is used by the Australian analysts.
This is unique to OceanaGold because we do trade in Australia, we do trade in Toronto, we're dual listed on two exchanges. We've got a large number of analysts. I think we've got six or seven now in Australia. We have another 15 or so here in North America. We are unique in that we have these different groups of analysts, and they value the business very differently. For example, in North America, when you're setting target prices or looking at NAVs, premium is applied to that target price. We're using discount rates of 5%, whereas in North America, everything, all the target prices are just typically one times NAV. We're not advocating for one method over the other. I'm just highlighting the discrepancy in terms of valuation. Australian analysts tend to use higher discount rates as well.
I think most of our analysts are using anywhere from 7% to almost 13% in some cases when they're evaluating the company. You can see on the, probably should have labeled it, but on the left-hand side of that vertical bar, that's where the Australian analysts are sitting in terms of their target prices. On the right-hand side is the Canadians. You can see there's a big discrepancy. Obviously, global consensus, this is all in Canadian dollars, CAD 4.70 on average as a global consensus, with Canada being CAD 5 as a consensus NAV or price target, and Australia sitting at CAD 2.29. I think the Australian investors, they've taken notice of this.
They know that Oceana trades predominantly in North America, and share price has driven up and down by the trade that happens here when it sort of picks up in Australia when the market opens there. We are we are a Canadian corporation with Australian management and American management and American office as well too, operating a global business. The share price is really driven out of North America. When you look at Bloomberg to look at valuation, you do need to look at that as well too, because we are being driven down by the Australian valuation. Again, this is not right or wrong, I'm just pointing this out. Just to my last slide here, just on some of the things that we discuss and we engage on. I actually have to change the slide in two different spots.
These are just some notes, some general themes where when I engage with you on going through modeling assumptions, where I've seen issues consistently from analysts, whether it's here in North America or in Australia. So these are some of the key things just to keep in mind when you do go back to your models and you do up the valuation for Waihi, for example. Unit costs, when we report unit costs for mining, we always include the capitalized portion of it. Pre-strip, the capitalized underground mining cost is always included in our unit costs when we quote it. What I've seen in many cases where it's basically the costs are double counted. You've got the mining cost, and then you add on the capital cost as well. Keep that in mind, royalties are always included.
I know some of our peers don't include royalties amongst those things that really the World Gold Council has defined that should be included in your cost. We've always included that. The sustaining capital, some of the capital estimates that I saw toward the end of last year and the beginning of this year were shocking. Sustaining capital, so pre-strip, maintenance capital, capitalized underground mining costs. We've historically, in the last three, four, five years, have spent anywhere between $80-$100 million on that. From the slide you saw that Scott went through earlier, that is expected to continue from the four operations, $80-$100 million. We hope that you put that in your models for sustaining. Exploration obviously is going to vary depending on how much money we're going to spend. Growth capital, we've given you some guidance on that as well.
Didipio, FTAA, this is a lot better than it was five years ago in terms of how invested in analysts were modeling it. Before, and even still today, we see double counting of, for example, corporate tax, which is a 30% corporate tax rate. That's included in the revenue share. The revenue share, the 40.60 split includes all taxes, includes all royalties, excise, business, everything is included in that 60%. No double counting. Then depreciation costs, again, I've seen some very large ranges. It's fairly simple. It's on a unit of production basis. Just revisit your models again, and that's that. Yeah, those are just some notes. Helpful notes, hopefully. You don't have to hear from me that often. We're basically going to wrap up now, and then we'll take some questions.
I know we haven't stopped after the Philippine section, but we'll just do a quick wrap up, and then we'll turn it over to you for some additional questions.
Thank you, Tim. I'd like to point out the handsome guy in the middle there with the pink shirt on and all those attractive women around him. If you look closely, there is one guy that snuck in right up the back with a big grin on his face. That's the infamous David Wade, our general manager at Didipio, who does a fabulous job up there. The support of our picture is really about diversity and really encouraging leading, coaching, and mentoring our women into the workforce and we take it very seriously. Our priorities for 2019, a continued improvement of safety leadership and a real focus on safety, as I mentioned before. We see safety leadership as a real driver to performance. Leadership is about becoming a culture, right? Coaching teams, coaching people, mentoring people, doing better than we did it yesterday.
This is how we improve our safety performance. We've sort of plateaued out at around four on a backward-looking TRIR per million man-hours. How do we break through that last four? The way to do that is change behaviors. Interestingly, the best operation we have for safety performance is in the Philippines. They are exceptional because they get it. The worst operation is the newest one in terms of safety performance is Haile, and that's because the culture there is still evolving. We do have a strong focus on mine productivity and planned improvements at Haile. We have to get that right this year, and we've certainly turned the corner, and we're on the way up. As you've seen, a big focus on implementing technology to improve our operations, make them more and more efficient. Not just in productivity, but make them safe.
Take people out of the workplace, take them out of the line of fire. That's how you do it. On the growth front, we've talked at length about the Martha underground project, and I hope that you really do believe that this is real now, that this is a 10-year plus operation, and it has the potential to go to 200,000 ounces in five years' time, and it has the potential to be the best asset in the business with really low all-in sustaining costs and a long life. We're going to keep going. We're going to keep drilling our hearts out at Waihi, at WKP until we can't find anymore, which is probably a long time away. We're going to keep building that reserve base at Waihi. We're going to continue to advance the expansion plans at Haile, which are going well.
Personally, it's critical to that. It is on track for the end of this year. And we have growing confidence in that. We've started the implementation plans for the underground, as we have with the open pit, a larger open pit with the new trucking fleet and upskilling the workforce. The other base piece around construction of panel two for Didipio. So that is to get us to 1.6 million ton per annum from the underground and really let that settle into a good, long decade of gold. On the exploration piece, we're going to focus on increasing the reserves at Waihi, as I said. To increase the mine life at Macraes. So we do see more potential to increase mine life at Macraes.
Last year, we only spent about $7 million on exploration at Macraes, and we more than replenish reserves, and we keep coming up with new ways, better mine plans to bring more of those ounces into reserve as well. Expanding our reserves at Haile, we've got a long mine life there, and we're spending about $67 million to just replace whatever reserves we have. And importantly, try to, in the longer term, look for more underground reserves as we go underground there. Finally, on exploration, we do see a real opportunity to continue to establish ourselves in new gold provinces, hence the go big strategy, which is the time to put gold ounces in the bank, because in five years' time, like I said, it's going to be really pushing hard to get ounces in our reserves. On the financial front, we'll maintain a fiscal discipline.
Everything we do in terms of capital expenditure has to give us a return on investment. Maintain our low leverage. We do have this policy or philosophy of leveraging up when we're in growth mode, leverage down when we're in production mode. You heard Scott talk about very short ample production periods. That's what we want. The banks like it. We give certainty. We give confidence to them. And we've got a very supportive bank group that's supported us on this journey with us, have been since 2012, coming on this journey. So they'll be there with us when we want to grow. They've been there with us when we've had some hard times. You remember two years ago with the suspension order coming out of the Philippines, the banks were right there beside us. They didn't budge an inch. That's the importance of it.
We're going to continue to focus on return on invested capital, because that's what our investors want. That's what our shareholders want. That's it. I'll take questions. Over to you, James.
Any questions here on the floor? We've got one on the queue. All right. I'm going to turn it over to you, Michael Slawski.
Yeah, thanks, James. Just a couple of very quick ones on the Philippines. Can I please on the license limit extension from three and a half to four million tons, that seems to have been near term for quite some time, and certainly with respect to the suspension order, where both those things sit, please?
Yeah, okay. Sharon, are you still on the line?
Michael can speak for the first question. I'm happy to speak to the second one.
Thanks, Sharon. The ECC will back out to public comment, and as I was, what is today? Seventh, today? It's fine. In the Philippines, we'll be held in that session. I suppose the involvement with the Environmental Management Bureau, which is running that session as well. We've done a few already information, education presentations to the community. This one is involving the EMB as well. For us, that's an important step in the process for the Environmental Management Bureau, which is part of the Mines and Geosciences Bureau, which is the regulator. The regulator actually running this process now.
We believe that's a really positive step forward for getting that ECC from the 3.5, which we've been limited to over the last couple of years, to one that we're actually applying for is up to 4.3, which will give us a bit of wiggle room. That's what we're going for. We're seeing some positive steps forward for that. Sharon?
Yes, On the suspension order, our appeal still sits with the Office of the President. To our understanding, the Office of the President works through appeals on a first come, first served basis. They are behind a couple of years, just speaking broadly, about any appeals that would go to the Office of the President. We're just waiting our turn to be processed by them. The DENR did release, in the case of the different suspension and closure orders, companies either filed with the DENR, the Department of Environment and Natural Resources, or with the Office of the President. The DENR just cleared through the 13 or so motions for reconsideration in about December last year. We're hoping that the Office of the President will make the time to, they'll get to us sooner rather than later, to be able to address the appeal.
Great. Sure. then simply with respect to exploration potential still at the Didipio depth potential, what do you have to see from the Philippines to sort of reinvigorate some exploration, or is that going to happen as you dig deeper anyway? And if you do have success in sustaining that 1.6 million ton production rate from underground beyond the depletion of the stockpiles, how economical does the site look at that rate compared to mill capacity?
Michael, we are still doing exploration in and around the site. We have drills operating at a thing called the Radio Prospect, which was discovered, or target was discovered about a year ago, and Craig's team is on the ground there. So we are looking for future feed. There is potential at depth at Didipio, and we have had some success with some deeper holes. And as you get deeper and withdraw the water table down, we're going to be in a better position to do more drilling at depth. So there is potential for a panel 3, but we're not putting that one on the wall just yet. We've got more exploration to do there. In terms of the broader Philippines, we're not doing any exploration outside of Didipio.
Didipio is a safe tenure, and there aren't any exploration teams that are really moving forward anywhere in the Philippines at the moment. So what we've got is what we've got, and we'll continue to explore the immediate mine area.
Thanks. Well, team, thanks very much for the session. It's been most useful, and thanks to all the team for your contributions. Been great.
Well, thanks for getting up so early, Michael.
Yeah, well, that wasn't a pleasure.
All right. There's no questions on the queue. Any questions here from the floor? No. All right, so I think we are complete here. Thank you everyone for attending. Thank you for those who are on the webcast. I hope you found this to be informative. We are making decisions for the long term. The market is the market, and we're doing our best to manage the market. The decisions we make are for the long term as we take the things we're running. Hopefully you've got a glimpse of all the things, the good things that we're doing here. More importantly, you've been able to interact with Mike and the team and seen the bench strength that OceanaGold has. I know a lot of you have been to the operations and seen the high-quality caliber team we have on the ground as well too.
Thank you again. Thanks also to Mick and the team. Those who woke up at 4:30 A.M. and 5:30 A.M. in the morning from the OceanaGold executive team who were on the call, thank you to you guys as well. Thanks to most of the analysts for your support over the years.