Good afternoon and welcome to the Orezone Gold Corporation Quarter Two 2025 Results Webcast and Conference Call. I am Franz, and I'll be the operator assisting you today. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Patrick Downey, President and CEO. Please go ahead.
Thank you. As the operator said, welcome to Orezone' s Q2 2025 Financial Operations Webcast Presentation and Conference Call. With me today will be Peter Tam, Executive Vice President and CFO, who will go through the financial operational highlights and financial operational highlights for the quarter later on in the presentation. As you see, this is an important notice including forward-looking statements. Please take time to read these at your leisure. Straight into the Q2 2025 highlights, which were another solid quarter for Bomboré . Gold production was 27,548 ounces, and on track to achieve our 2025 guidance of 115,000 ounces- 130,000 ounces for the year. Gold sales were 28,265 ounces for the quarter at an average realized price of $3,338 an ounce, resulting in $94.5 million in revenue. All-in sustaining costs of $830 per ounce sold.
Costs were somewhat impacted by external factors, including royalties, grid power, and foreign exchange, which added $236 per ounce to the budget. Royalties added $92. The grid power interruptions added approximately $99, with FX contributing $45 of that $236. However, I'm happy to state that operations were very solid and all costs were generally within budget for the quarter. Strong financial position for the quarter. We ended the quarter with $72.6 million in cash. We obviously added, with the Australian listing, we'll talk about that later. Undrawn senior debt of $31.3 million. Available liquidity of $103.9 million at the end of the quarter. Excitingly, our hard rock expansion remains on schedule and on budget. Stage I commissioning is scheduled for Q4 2025, and I'll go through that a little later in the presentation.
Importantly, subsequent to the quarter, we commenced trading on the ASX under the ticker ORE, and we closed an AUD 75 million IPO to accelerate stage two to bring us to 220,000 50,000 ounces a year. That stage two hard rock received board approval and final investment decision to proceed, which we'll talk about again later in the conference call. I'll now hand over to Peter Tam to take you through the production and financial operational highlights.
Thanks, Patrick. For production and unit costs, for mining, we mined 6 million tons in Q2, which is comparable to the 6.1 million tons mined in Q1. As mine volumes year to date are slightly ahead of plan, early preparation of Hard Rock mining is taking shape as the main mining contractor is in the process of mining and mobilizing additional equipment to site in the third quarter to handle the added material movement upon the Hard Rock startup. For processing, 1.56 million tons were treated in a quarter, an improvement of 3% over the previous quarter and 20% above nameplate, while head grade declined to 0.62 grams per ton, consistent with the mine plan. Grades are anticipated to improve starting in Q4 once hot commissioning of the Hard Rock plant commences.
Unit cash costs were negatively impacted in Q2 from a stronger XOF currency, which rose on average by 7% against the US dollar when compared to Q1 averages. In addition, the seasonal impact of lower grid availability was experienced again this year with grid utilization at 50% in Q2 when compared to 90% in the second half of 2024 and 75% in Q1 of this year. Importantly, grid utilization has seen a steady improvement starting in July with utilization at 76% for July and over 90% for August to date. Next slide. Financial and operating highlights. Record gold prices realized in Q2 drove Orezone's quarterly financial performance with earnings from mine operations of $40 million, adjusted EBITDA of $45.5 million, adjusted earnings attributable to shareholders at Orezone of $20.6 million, and adjusted earnings per share attributable to Orezone shareholders of $0.04. Gold sales remained unhedged.
From a cash flow standpoint, the company continued with its reinvestment and expansion of the Bomboré Gold Mine , with $43.5 million spent on investing cash flow as the company advances towards first gold on its hard rock expansion later this year. The heavy investment in this quarter led to free cash flow being a -$27.2 million. However, available liquidity remains strong at $103.9 million, as stated earlier at quarter end, which was further bolstered by the successful closing of AUD 75 million Australian dollar equity offering in early August. The company is well funded to execute on its growth initiatives for the remainder of this year, including the recently board- sanctioned Stage II hard rock expansion. With that, I'll hand it back to you, Patrick.
Thanks, Peter. As noted, 2025 is really a significant transition year for us. We're in the middle of the Stage I hard rock expansion, which will add 2.5 million tons of hard rock to the existing 6.2 million tons of oxide. Construction as well. Advanced commissioning plan for Q4 of 2025, which will drive us into 170,000 ounces - 180,000 ounces as we exit 2025 into 2026. Obviously, at current gold prices, that would drive significant additional cash flow. We're accelerating the Stage II hard rock. We were originally planning to do that in 2028 going into 2029. We're now going to commence construction in 2026. The board has approved the final investment decision. We'll pull forward that expansion by two years, with construction in Q4 2025 into 2026, with commissioning in 2026, which would bring us into a production level of 220,000 ounces- 250,000 ounces a year starting in 2027.
With very little debt, current debt on the balance sheet is around $68 million. Again, extremely low debt on the balance sheet with 100 and after the financing, about $150 million of available liquidity. In the next 16 months, Bomboré will become one of the larger mines in West Africa. Just quickly on where we're at with the Stage I expansion. Currently, we're on schedule and budget for the CapEx and startup in Q4. Project completion reached 63% by the end of Q2. We continue to advance that. Engineering and procurement is now fully complete. Jaw crusher installation is underway, and I will show you some photographs here as we go through the presentation. Ore bin and structural steel commenced. SAG mill installation is now well advanced. CIL tank installation complete and tested, and structural steel installation on top of the tanks has commenced. The TSF expansion is well in hand.
As I said, commissioning in Q4 of 2025. I just want to alert you, there is an updated video on the website, so you can get on the website and look at that. It's a very, very good video of where we're at with the construction and what's been happening over the past few months and weeks. The jaw crusher and dump pocket, which is the last major concrete pour, is in its final stages. We're starting to install steelwork and equipment there now. The ore bin lime silo, et cetera, is well in hand in terms of erection. We'll start putting in the connection conveyor, feed conveyor to the SAG mill next. SAG mill is well in hand. Concrete is complete. Installation is well advanced, as you can see from this photograph. Trash screen leading into the CIL circuit is up and installed.
We've started installing pipework, et cetera, into those various distribution tanks for the CIL. Next, photographs of the CIL tanks, which have all been water tested. All the intertank laundry is in place. You can see the top of the tank steelwork on the ground, and we'll start lifting that and erecting it on top of the tanks in the coming days. The TSF expansion is well in hand, and the video really shows how much work's been done on that, and that'll be finalized in essentially Q4 of this year. The next stage i s a very simple expansion. We're going from 2.5 million tons to 5.5 million tons per annum. It'll drive the overall production to 220,000 ounces- 250,000 ounces a year. Essentially, in the next 16 months, we will double our production.
We'll add four additional CIL tanks, which are identical to what we have: a ball mill, which we've ordered; a pebble crusher, which we've ordered; an oxygen plant, which we've ordered; a thickener and water tank; a gold room expansion. The elution system is exactly a replica of the existing oxide circuit elution system, so no changes there. Engineering is well advanced, and as I stated, procurement is underway, and we're in the final negotiation with the existing contractors. Those contractors will stay on site and ramp straight into the construction of phase two, which gives us great economics in terms of MOB and utilization of those contractors going forward. Finally, to close out, strong quarter again, costs essentially affected by outside factors. Our completion of Stage I is well in hand. That'll bring our production to 170,000 ounces- 185,000 ounces.
It will also give us operational flexibility as we have a current standalone oxide and standalone hard rock. We've completed our Australian listing and began trading on August 8. We'll increase the trading liquidity, new investors, access to mining focus funds, and that recent financing allows us to really ramp into Stage II expansion right away. We will have drilling results next week. Very excited. We continue to add to the current resource base and drill outside of that resource base. We're getting a significant understanding now of the structural controls. I think you will see that in this release coming out in the coming week. We've drilled approximately 30,000 meters in the first half of this year, successful on many fronts, including the North Zone footwall extended by 200 meters beyond the reserve pits, 800 meters along strike, P17, 300 meters down plunge.
These have all been big step outs. We're not taking small step outs. We believe this is a big system, and that's been proven out to date. Finally, we continue to have strong community and government support with the expansion. More jobs, more investment, more growth, and it's been a very strong relationship with both our local communities and with the existing government. We continue to look forward to doing that in the coming months and years. Thank you very much for that, and I'll hand you back to the operator.
Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one on your telephone keypad to join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your handset and phone are not on mute when asking the question. Your first question comes from Jeremy Hoy from Canaccord Genuity. Please go ahead.
Thanks, operator, and Patrick and team. Appreciate you taking my question. First one for me is on costs, obviously impacted by some external factors this quarter, but otherwise, as per plan, as you said. Do you see any risk to achieving the AISC guidance for the year?
Yeah, good question, Jeremy. We'll likely relook at that in Q3. Obviously, we're really at 90% power now. The royalties and the Forex, we really can't do anything about at this point. Obviously, the power interruption, as Peter said, was seasonal, but really also affected by a fire in the substation, which was nothing to do with us. It was on the SONABEL substation. We really want to look at it when we get into the end by the end of Q3 because we'll be ramping into the hard rock expansion, and that'll really tell us when we're by that point, how well that'll be and how much that will add. We'll have a better understanding at that point where that will be driving costs towards the all-in sustaining.
As you know, in 2023 and 2024, with the Q4s and whatever that we had, we were well on track at the end. Q2 didn't look great in either quarter, and Q3 and Q4, we drove it all back again. That tends to happen on this project because of the seasonality of the operation.
Yeah, and you've been consistent about expecting those grades to go up in a bigger Q4. On that note, you know, how is sequencing progressing towards the hard rock?
Very well. Actually, I'm heading down there next week, but very well. Contractors are performing extremely well. As you know, we do all of our own construction management. That's our job, our team, and they've been driving it. We got a lot of equipment, steelwork, whatever deliveries. Sometimes we even looked, do we need to air freight stuff in this construction point? No, it's all going very well. All the mechanical pieces, which really happen quite quickly on these types of projects, will really start occurring in August and September of this year. We're already mined out at hard rock and various areas, including P17 South, which is our high-grade zone. We'll expect to start commissioning that jaw crusher sometime early Q4.
That's good to know. Thank you. Next one for me is on the, you had a note on the government free carry interest. You're currently in negotiations and looking at moving the government interest to 10 %- 15%. Just wondering, are there any other points up for discussion during these talks, or is it just that increased free carry interest?
No, it's just the free carry interest, the main one. I think everybody else is pretty much on it. You know we have our meetings in the coming weeks, so we expect to be on it. There's no reason why we wouldn't be on it. We expect that to happen in the coming weeks. We will be at that 85%, like IAMGOLD and Endeavour and WAF and everybody else.
Yeah, understood. Do you see this as being a good, stable place to be in terms of where the mining industry in country sits with relation to the government?
We've always had a very strong relationship with the government. I think everybody else would say the same. You know the government, you know the Minister of Mines, Minister of Finance, Minister of Environment, etc., are all very well-run ministries. Even now we're starting to see, I know that various companies are getting their VAT back, which is quite unique in some parts of West Africa. You hear about it, but we're actually in Burkina ; it's reasonably well run. We're seeing that happening right now. As you saw, people are dividending out of the country. I think IAMGOLD declared a large dividend recently. Overall, the government, in terms of running the operations, have been very helpful. Even when we're doing our hard rock expansion and getting our permits updated, it did not take a heck of a long time to get that done.
They generally work reasonably well with you in that regard. Big thing for them is also good relationships with your communities, which we obviously have.
Yeah, that's clear. Thanks, Patrick. On the exploration results, you guys have been stepping out and you've been proving out this theory of deeper mineralization. Can we expect to see progressive mineral resource updates, or what might the timing be to see an update resulting from this exploration program?
I don't know how much of this drilling we'll get into that, but we will do an update and likely be ready Q1 of next year. That's what we're doing. We just started that right now, and we expect to have that out and ready by that time. A lot of work on that, obviously a new gold price, et cetera, et cetera. We do expect to considerably expand our reserves, but we'll see where it all lands late this year, early next year.
Thanks, Patrick. Appreciate you taking all my questions. I'll step back in the queue.
Thank you.
Before we proceed, again, if you would like to join the queue, simply press star one on your telephone keypad. There are no further questions at this time.
Thank you.
Okay. I would now like to turn the call back over to Patrick Downey for the closing remarks. Please go ahead.
Thank you very much. Okay. As I said, another solid operating quarter, very much in terms of plan, advancing our Stage I. Extremely excited that we're now in the Australian Securities Exchange and also got approval to ramp up to Stage II. As I said, look forward to some further exploration results in the coming days, and it should be another solid year for Orezone going forward. Thank you very much.