Ladies and gentlemen, thank you for standing by. Welcome to Orezone first quarter 2026 results webcast and conference call. All lines have been placed on mute to prevent any background noise. Thank you. I would like to turn the conference over to Patrick Downey, President and CEO. Please go ahead.
Thank you. As the operator said, this is Orezone's Q1 2026 results conference call and webcast. I'd like to welcome you all to it. With me today is Peter Tam, Executive Vice President and CFO, and Kevin MacKenzie, Senior Vice President of Corporate Development. These are important notices and disclaimers, please read these at your leisure, we'll go right into the conference call. First quarter's been very, very busy. Very busy start to the year, I want to thank the team at Orezone in that regard for a lot achieved. During the quarter, we acquired the Casa Berardi Gold Mine and a portfolio of exploration assets in Quebec.
This is a strategic and transformational acquisition into a Tier 1 jurisdiction for Orezone and positions us as a diversified multi-asset producer, adding material scale, production, free cash flow, and we believe significant upside in the exploration front as well. At our operating mine of Bomboré in Burkina Faso, we completed a 2.5 Mtpa Stage 1 hard rock expansion, again on time and on budget. We also achieved commercial production in January the 16th of this year, and we're already 10% above nameplate, which is really a tribute to the Orezone design and construction team here. Stage 2 hard rock expansion has been initiated and is scheduled to be completed in Q3 of 2026, and this will further optimize the hard rock throughput and recovery.
We also were included in the VanEck Junior GDXJ exchange-traded fund, added on March the 20th, which has significantly improved our liquidity, which is very important for our shareholders. We've strengthened our management team. We just recently announced the three key appointments to the senior leadership team, a COO, a VP of Exploration, and a VP of Investor Relations, which I will expand on in the next slide. Obviously, as we grow, it's extremely important to attract high-quality people to the team, and we have definitely done that here. Marc-Andre Pelletier will be joining us as Chief Operating Officer. Marc is a mining engineer with greater than 30 years experience, most recently as President and CEO of Bonterra.
Prior to that, most importantly, he was COO at Wesdome Gold Mines, where he was instrumental in restarting the Kiena Mine nearby Casa Berardi and increased production of the Eagle Mine to approximately 100,000 ounces a year in a very short period of time, all done with an extremely exemplary safety record. Prior to that, he was VP of operations at St Andrew Goldfields until its acquisition by Kirkland Lake Gold. He brought three underground mines and one open pit into production in under five years. Another great achievement. We're very happy to welcome Marc-Andre onto the team, and he will be joining us on June 1st . Jean-François, or J.F., Ravenelle, he's a PhD in Structural Geology. He will be our VP of Exploration. He is already on the team, started this week.
Over 20 years experience, formerly VP, Geology of New Gold, where he is instrumental and led the team in the discovery of the New Afton K-Zone and the expansion of the Rainy River Mine prior to New Gold's sale to Coeur Mining. Prior to that, he held senior positions at BHP and Yamana Gold and SRK Consulting and has an excellent track record of discovery. His PhD in Structural Geology will be very, very important here as we really try to start to continue to unlock the value at Casa Berardi. Amanda Mallough, VP, IR. Over 10 years of investor relations and corporate communications experience within the mining sector. Most recently, Director of IR at Andean, where she led the company's investor relations function during a very hectic period in corporate transformation, exchange uplisting, and actively increased institutional market visibility.
A lot of you guys on the call might remember Amanda Mallough when she held senior investor relations roles at Marathon and prior to that at New Gold. We welcome all three to the team. Amanda Mallough will be joining us on May 18th. I'm obviously very pleased to welcome all three to the team, and I know that they will add significant value as we continue to grow. I'd now like to hand over to Peter Tam, who will walk through the financial and operating highlights for the quarter.
Thanks, Patrick. As Patrick has mentioned, first quarter of 2026 was an impactful quarter with two major accomplishments that will help drive improvements in company revenue and earnings in future periods. Firstly, we achieved commercial production on our brownfield hard rock expansion at the Bomboré Mine, allowing the mine to now process hard rock reserves. The mine is no longer an oxide-only operations, as both the oxide and hard rock plants are operating in parallel, contributing to the production and sale of more gold ounces. Secondly, we closed on our acquisition of the Casa Berardi mine in Quebec, Canada. This new mine into Orezone's portfolio will result in a step increase in the company's consolidated production on a go-forward basis. Q2 will mark the first quarter of production from Casa Berardi under Orezone's ownership, and we look forward to sharing those results with you next period.
In terms of financial results, we recognized record earnings and operating cash flows this quarter with net earnings attributed to Orezone shareholders of $39.6 million and operating cash flow of $175.6 million, aided by a $100 million gold stream deposit from Franco-Nevada. In addition, we had two positive developments with our Bomboré operations. In Q1, we received $5.1 million in VAT refunds, with further refunds in April and May, increasing VAT refunds received to $23.9 million year-to-date. With our major capital programs behind us, we have also commenced earnings repatriation back into Canada with $52.5 million repatriated so far in 2026, with more repatriations planned later this year.
Reported all-in sustaining costs was $2,245 per ounce sold, which is within our 2026 guidance range despite lower head grades in production and was entirely attributable to Bomboré as gold sales from Casa Berardi only commenced starting in April. Next slide. On Bomboré operations in Q1, the company produced 38,789 gold ounces, with 37,563 ounces from Bomboré and 1,226 ounces from Casa Berardi. Bomboré production in Q1 was held back by the shortfall in emulsion deliveries that commenced in late 2025, which necessitated a change in our short-term mine plan as mining access to higher grade ore at P17 and other pits have been delayed with mining redirected to lower grade transition material.
Emulsion deliveries are now more consistent and matching our needs with better grade ore within reach. Hard rock gold production for the remaining quarters of 2026 is forecasted to rise from the Q1 levels. For Casa Berardi, the mill operated for five days post-acquisition in Q1, producing 1,226 ounces. We plan to provide our 2026 guidance for Casa Berardi in June. With hard rock operations, the harder nature of the ore requires full drill and blast, more crushing and grinding, and higher consumption of cyanide.
This will result in higher processing costs per ton when compared to our oxide-only operations. This was seen in Q1 when cash costs per ton processed jumped from $ 19.64 per ton in Q1 of 2025 versus $ 23.22 per ton in Q1 of this year. With that, I'll hand it back to you, Patrick.
Thanks very much, Peter. Just before we walk into the Casa Berardi operation summary, I really wanna tip my hat to the team at Bomboré. Despite significantly lower grades due to the emulsion delays in Q1, which we've now essentially resolved, we were able to keep our costs under control and keep our all-in sustaining costs within guidance. I think a real testament to the team. We are looking to continue to look at costs, and we are in advanced studies to look at the installation of a fairly large solar plant, which will give us more reliable power at a significant lower cost going forward, and I expect to provide some data on that later in the year. Casa Berardi, as Peter said, gold production was at 1,226 ounces, just essentially five days of production post-acquisition.
Since then, we've really ramped things up. We've got an underground mine contractor has mobilized to site, not fully, but certainly well up there to increase the development rates and really ramping up underground production. We've more than doubled our development rate since we started, so it again, a testament to the team there. We have placed purchases for some strategic mining equipment, which will start getting delivered. I think one piece has already been delivered. Several more will be delivered during the year, which will also add to our productivity underground. We've commenced mill optimization studies to improve throughput and recovery, and we are seeing the benefit of those already, and that's been very encouraging. You expect to see some of that in the near future.
We've also advanced permitting process for additional open pit expansions at the F 160 and the F 134 pit, and they'll come in line in 2027 and 2028. We have reinitiated exploration drilling. As we said, J.F. has come on board as VP of Exploration. In the meantime, I tip my hat to Kevin here who's been driving the team on site who are really not an exploration team. They're the mining geology group. We've now got four rigs turning on site. We'll have a fifth rig in early June and a number coming after that, and we expect to rapidly ramp up to 80,000 m- 100,000 m per year.
I will say that you should expect drilling results in the very near term as we have been drilling for the past month. We'd also like to say we'll be commencing a life of mine production cost summary for Casa Berardi, which we will expect to initiate in the coming weeks and have out into the market later this year, which will really set the platform for where we see Casa going to in the coming years. It should be quite exciting doing that as well. Production guidance, we just 2026 production and cost guidance is reiterated. As we previously stated, gold production is weighted towards the second half of 2026, and that remains. Our lowest gold production is Q1 2026, and that was due to those temporary shortage of explosive deliveries.
We are happy to see we kept the costs well within our target. Stage 2A hard rock expansion is well in hand, and all growth projects are on budget, that will enhance the hard rock operation. All-in sustaining guidance is based on an assumed gold price of 4,500, which makes the royalties at approximately $ 540 per ounce. If you really look at that and how we're operating, it's, you know, we're around $1700 per ounce. All-in sustaining without royalties. Casa Berardi, we will issue guidance in June, followed up by a life of mine summary. Casa Berardi guidance will include our capital expenditures and our drilling plan for 2026. Our outlook 2026 gold production forecast 220-240.
Casa Berardi operations, we're doing a mine plan re-rescope and optimization really centered on increasing underground production, which will be tied in with open pit production as we go forward. Updated life of mine plan, as I stated, Q4 2026. Exploration is ongoing with four rigs turning, two of which are really focusing on near term mine plan and the other two on exploration. We expect to ramp that up to around seven rigs with an incremental ramp up to about 80,000 m-100,000 m per year. Stage 2A will be completed in late Q3 2026 at Bomboré. Ongoing exploration is targeting higher grade centers of mineralization, and again, expect drill results coming out of Bomboré here in the near future. We're also looking at adding to our oxide portfolio target there as well.
We will also importantly evaluate the exploration portfolio that we acquired with the Quebec assets, and I would expect to issue some updates on that in the coming weeks and months. We're quite excited about some of the other acquired assets within that portfolio. With that, I'll hand it back to the operator for questions.
Thank you so much, Patrick. Quick reminder before we start the Q&A. If you would like to ask a question, please press star one on your telephone keypad to raise your hand and enter the queue. If you would like to withdraw your question, simply press star one again. We will pause for a brief moment to wait for the questions to come in. Thank you. We would also like to kindly ask you to please limit yourself to one question and one follow-up. We will take our first question from the line of Jeremy Hoy from Canaccord Genuity. Please go ahead.
Hey, hey, Patrick and team. Thanks for thanks for taking my question. Congrats to Marc-Andre Pelletier, Jean-François Ravenelle, and Amanda Mallough on the new appointments and to Kevin MacKenzie and Peter Tam on their promotions as well. Looking forward to working with everybody. I guess my question is on Casa Berardi Gold Mine. You guys have now, you know, you've owned the operation for a short period of time. Is there anything that has surprised you to the upside or perhaps challenges that were unexpected that you could, you know, provide some detail on? Also with appreciate that you got your guidance coming out in June, but that initial estimate of 80,000 ounces-90,000 ounces from underground, does that still sound about right to you guys?
You know, are you able to give us any sort of preview on what numbers we might expect with guidance and the mine plan coming later in the year?
Yeah. I would stick to that guidance at this point. I think we've been very pleased with the ramp-up of how we've gone, particularly around development that, you know, we definitely needed to get into that quickly, and we were lucky in a lot of ways to locate a contractor just coming off another contract in the region so we could mobilize equipment and get his team to the site quickly. We were sort of aiming for sort of 12 meters per day. We're getting above that now in many days. We're opening up new areas. We're able to drill other areas, which has been quite pleasant to see that, you know, where areas that we thought stoping would likely end is definitely not the case. Near term, that's been great.
I really like the team there. They're very engaged. They're very enthused. They really want to show that this is a mine that's going to, you know, remain open for many, many years. They've jumped on board with how we want to do things. Even the exploration team, I mean, it's they truly are mining geologists. You know, we've sort of transformed them into doing other things for us and testing other targets while we awaited J.F.'s appointment. We're excited about what we're seeing already. Yeah, I'm really pumped about Casa. I think, you know, we're starting to unlock and unfold some of the other assets in the portfolio. I'm again very excited about what we're seeing there. Expect some news on that in the near future.
You're referring to Hébécourt?
I didn't say that, but yeah.
Okay. I just noting it because they had the resource there. Okay. I will look forward to more detail there.
Okay.
If I could ask one more, Patrick.
Yes.
The Stage 2 expansion at Bomboré, the full expansion. What's the latest in thinking there? I saw the disclosure. It said, you know, the timing of it is still under review.
Yeah. I think we obviously, you saw the WAF announcement. I was down there two weeks ago. A lot of the feedback from our shareholders, our major shareholders, is to hold back and defer that until all the dust truly settles. You know, the other key thing is, you know, we were awaiting VAT refunds, which we are now getting. You know, there's, you know, a lot of the explosives and sort of supply issues was because of this new phase of transportation and logistics set up by the government. You know, we basically said to them, "Unless we see steady state deliveries," which we are, again, we are now seeing, you know, how can we build a bigger mine if we can't get all our supplies for our smaller mine?
I think we'll wait for all of those things to settle. It's still a great expansion, and we will continue to work on it. Let's get Stage 2A under our belt, see where we can go with that, see what happens, we'll figure it out probably early next year.
Okay, Patrick, appreciate the call, or even though I wasn't able to bait you into giving me more numbers for my cash priority model.
Yeah.
I'll step back in the queue 'cause I think I've reached my question limit. Thank you.
All right.
Thank you so much. The next question comes from Mohamed Sidibé from National Bank. Please go ahead.
Hi, Mohamed. Oh. That was an easy question.
Oh, sorry, Patrick. I was on mute there. Hi, hi Patrick. Thanks so much everyone for joining. I'm at the airport, and I've been on mute in order to not disrupt your conference call.
No problem.
Jeremy asked my question on the Bomboré and your thinking on Stage 2A given what happened in Kiaka. On the Bomboré grade profile and how we should think about the sequence going into the rest of the year, could you maybe help us a little bit on the modeling front at that asset? That would be pretty appreciated. Thank you.
Yeah. Well, the real juice to this hard rock is P 17. You know, we're obviously significantly higher grades, more than double the average. We haven't really got down to the hard rock there yet. You know, we had to do a fair amount of stripping at the top end, and we had to dedicate whatever explosives we had to that. You know, I would say you will start to see significant uptick from that going forward. You know, the actual to date overall is 0.75 in Q1. Q1, I mean, 0.75, our budget was 1.14. There's nothing wrong with the reconciliation. I can tell you we're doing very detailed grade control.
It's coming out the way it should do. It's just the fact that we were delayed. We were getting one delivery a week instead of four deliveries a week. Now we've got two suppliers now that we've sorted things out with the, with the FASO Transportation and Logistics Group. Things are starting to ramp up fairly quickly. I think we're blasting three, four times a week right now.
Thank you for that.
It's basically 0.75 versus 1.14. That's a massive difference once we get there.
Thank you so much. There are no further questions in the queue. I will now turn the call back over to Patrick Downey, President and CEO, for closing remarks. Please go ahead.
Thank you very much. Okay. Well, again, I want to just tip my hat to the team for a great quarter under a lot of circumstances and getting an asset put to bed and started up and integrated and ramping up our hard rock expansion. Welcome our three new, you know, employees to the team. Looking forward to a very busy 2026 into 2027. I'm sure we'll all speak later, but look out for a number of press releases and announcements in the coming weeks. Thank you.
Thank you so much. This concludes today's call, and thank you all for joining. You may now disconnect.