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Ladies and gentlemen, thank you for standing by, and welcome to the September 2018 quarterly conference call. [Operator Instructions] I must advise you that this conference is being recorded today, 23rd of October, 2018.I would now like to hand the conference over to your first speaker today, Mr. John Welborn, Managing Director and CEO. Thank you. Please go ahead, sir.
Thanks, Rochelle, and welcome to everyone to Resolute's Quarterly Activities Report Conference Call for the September 2018 quarter. I'm joined here in our Perth office by Lee-Anne de Bruin, Resolute's Chief Financial Officer; and Peter Beilby, our Chief Operating Officer.And you will have seen the quarterly we published this morning which promoted very strongly the successful pathway we have to commissioning what is the world's first fully automated underground mine at Syama and the excitement that's building within Resolute. The quarterly report also published production and cost figures, which represent the challenges we're currently facing at our operations as we work on the transformation of our asset base. And in addition to the disclosure made in the quarterly around production of just over 55,000 ounces at an all-in sustaining cost of $1,560 an ounce, I did want to spend some time in this quarterly putting it into context.So we have an ambition at Resolute to run long-life, low-cost mines, and we've spent a lot of time working on feasibilities, studies that demonstrate that our mines can produce gold. And our target is to do so at an all-in sustaining cost in the region of USD 750 an ounce. And our life-of-mine numbers on the mines that we're building at Syama and Ravenswood and the work that we're doing on our Bibiani gold mine in Ghana demonstrate that, that is our long-term goal and it is achievable.Clearly, when you look at this quarter, there's a reality check on our current operations. And I'd remind anyone who's been following Resolute, and particularly our shareholders, and it's been very pleasing to get feedback this morning from people who do follow the story, that we're exactly where we thought we would be. We're investing in building great mines. That investment program, both in our existing operations and in our development pathways, is very exciting and very positive.When I reflect on the 3 years that I've been CEO, this is the fourth September-ly quarter, the activities report that I've been responsible for. In 2015, in the September quarter, we produced 80,000 ounces at an all-in sustaining cost of AUD 855 an ounce. In 2016, we produced just under 80,000 ounces at AUD 1,173 per ounce. And last year, we produced 76,000 ounces at AUD 1,397 an ounce. And this year, we've dropped 20,000 ounces and the costs have gone up by AUD 200, and we've produced 55,000 at AUD 1,560. That's not a great progression. However, it represents the reality, particularly at the Syama sulphide operations.And so we knew when we started building the Syama mine 3 years ago -- and I'd remind people that we stopped mining activity at Syama, in sulphide open pit in May of 2015. And ever since, we've been challenged by finding ore for that plant to continue to produce gold in a cash flow-positive manner while we're building a long-life, lower-cost mine. And we're now at the end of that process. And the excitement in the quarterly is around the fact that during this quarter that we've just announced, we started long hole stoping activity. It is, unsurprisingly, a record quarter for underground ore production at Syama because we've started the underground mine. And I can guarantee that the next few quarters will also be record quarters as we continue to ramp up that mine. And so we are turning a corner. It was a very challenging quarter, particularly at the Syama sulphide.Before I talk about what I think is the more important results in the quarterly in terms of our development pathway, I'll just break down that 55,000 ounces of production in the quarter. At Ravenswood, poured 18,400 ounces of gold, and our guidance at Ravenswood was to produce approximately 70,000 ounces this year. Our Queensland operation is also going through a transition. We have been producing either around or more than 100,000 ounces a year, and the team there are doing a great job. And if you look at our guidance there, they're on track.At the Syama oxide processing plant, during the September quarter, we poured 21,400 ounces. And that plant is running at capacity. We aim to produce 80,000 to 90,000 ounces a year from that oxide plant. So on a breakdown on a quarterly basis, you'd expect us to produce between 20,000 and 25,000 ounces. So again, that operation is on track for the quarter.At the Syama sulphide processing plant, we indicated to the market that we were doing a 40-day roaster shut. We do those once every 2 years. If you think about roughly a 90-day quarter, that means that the main engine of our Syama sulphide processing plant was actually nonoperating for half of the quarter. If you look at our guidance, you would expect us on a linear basis to produce 30,000 to 35,000 ounces a quarter from the sulphide processing plant in this year. That will increase significantly when we start the full steady-state operations at the underground mine.And that's the story of this quarter in that, for a variety of reasons, not just associated with the shutdown but also the significant rainfall we've experienced at Syama and the focus of our tie-in work, we produced 15,000 ounces or poured 15,000 ounces from the sulphide plant during the course of this quarter. And that's really the difference between our previous quarters, obviously, the denominator factor has driven the costs up, and that's something that we're managing. Importantly, we've maintained our full year guidance at 300,000 ounces of production at $1,280 an ounce. And that's based on our current forecast where we expect that the refurbished and operating roaster, the Project 85 tie-in and, significantly, our ability to process increasing amounts of high-grade ore from the underground mine as it ramps up will allow us to, one, maintain the operating performance at Ravenswood on a quarterly basis; maintain the operating of the oxide plant at Syama where we're very successfully, as usual, commissioning a new open pit mine at the Tabakoroni project; and improve the performance, throughput, recovery of the sulphide process over the course of the year.So yes, our quarterly results are disappointing on any basis, either referring to previous similar quarters or the last quarter, but they are expected and they are part of our operating plan, and we maintain that we are on track to guidance and working hard at making sure that we generate cash flow from our operations while we're building Syama. And I'm sure we'll get some questions on that, and I look forward to identifying any areas of interest.Obviously, the quarterly focused very strongly on our Syama underground ore production and the landmark milestone we achieved there. Along with our peers, and I mentioned it earlier, we have experienced significantly more rainfall this wet season in the south of Mali than any of the 15 years that we've been operating at Syama. And that's an interesting challenge when you're building an underground mine underneath a very large open pit. And I wanted to particularly give credit to our General Manager at Syama, Jon Gaunt, and the members of his team, Geoff Stapylton, and [ Kerry Barker ] and Neil Hepworth, who have been working incredibly hard to make sure that we remain on track and on budget on the Syama underground. And clearly, that's the key message of this quarterly, in that we are progressing a very complex project towards the start of sublevel caving in December. We're building the first fully automated underground mine. It is a mine that has allowed us to aim for and achieve a globally competitive all-in sustaining cost over the initial 14-year life of that mine of USD 746 an ounce. It's a very exciting time at Syama. We've put some pictures of the development, the decline, the fan chambers going in, the infrastructure arriving, the automated fleet arriving on site and the ongoing installation and commissioning of that mine. And I look forward to continuing to update our shareholders and the market in relation to that project. We also have, obviously, recently released our annual report. We've got our Annual General Meeting on Friday here in the Perth office. And I look forward and encourage shareholders to attend. It is an opportunity to come in and, obviously, participate in the Annual General Meeting. But we're also holding that meeting in our offices and happy to host shareholders and meet some of our staff here. And I will be giving a presentation on the status of our operations and the future.We've included some information on safety in the quarterly, and it's an area that's gone through significant focus. All mining companies need to regenerate and continue to reinvent their focus on safety. We've gone through a very important and improving safety journey at all of our operations and, during the course of the September quarter, have launched a new program, titled Our Care, aimed at making sure that we're doing everything we can in very complex and changing operations to make sure we keep our people safe. It's an area where we're doing well and continue the need to focus.In addition to the excitement of the underground mine development at Syama, we're also opening up a new open pit south of Syama at the Tabakoroni zone and the Namakan open pit. The team at Syama, as well as building an underground mine have significant experience and significant success in the operations of our satellite open pits. And that program, in the context of the seasonal activity at Syama, has gone incredibly well. It is also a key area of our exploration focus. And we remain very actively exploring both Nafolo, immediately to the south of Syama orebody, and underneath the plant oxide pits, at Tabakoroni, 2 areas that we believe will significantly grow our already impressive resource and reserve inventory at Syama.During the course of the quarter, we drew down the very flexible revolving debt facility we’ve put in place. We are investing off our balance sheet in the development of our mines and specifically and mainly at the Syama Underground Mine. That is an investment that we prepared for 3 years ago and, from a balance sheet and cash flow perspective, where we always intended, with significant flexibility and significant confidence that the pathway ahead of us is clear and that we're fully funded to commission the Syama Underground Mine and continue our expansion activities at Ravenswood while we look around for new opportunities both at Bibiani and within our investment portfolio.I look forward to questions, and I'll pass the call back to you, Rochelle, to receive any.
[Operator Instructions] Your first question comes from the line of Warren Edney of Baillieu.
I was just wondering if you could give me a bit more specific commentary about mining costs and stockpile adjustments. Just struggling to reconcile some of the numbers, in particular, the costs at Ravenswood.
Thanks for your question, Warren. So one thing I skipped over at Ravenswood is the successful commissioning of the beneficiation circuit there. We've put a photograph. And I have mentioned in my comments on the quarterly how significant that is for Ravenswood. In relation to the stockpile and the specific question you're asking, it relates to the Nolans East completion of the open pit there and the fact that we're drawing down on stockpiles, though there are a number of adjustments there, it's probably easiest to run through those specifically in a call later today. The reality is we've finished the Nolans East open pit. And as we draw down stockpiles, those existing stockpiles have costs embedded into them that were then applied and disclosed in the table that you're looking at.
Yes. Sorry, I can see that. But it's just more a matter of the quantum doesn't seem to match. But perhaps if you can just give me some guidance or give us some guidance about, I guess, how you see the -- we know it's a year of transition, but what's the pathway to achieving your cost guidance given where you've been in the sort of June and September quarters in terms of operating costs?
Thanks, Warren. Well, the -- I sort of ran through that breakdown. The main contributor will be increasing quantities of gold poured from our Syama sulphide operation. So breaking down our September quarterly, if you just replicate the Syama oxide performance in the quarter and you replicate Ravenswood in this quarter for the other 3 quarters, and it's -- which is not an inappropriate assumption, and then run the numbers on increasing the grade, recovery and throughput on a more regular basis at the Syama sulphide operation, you'll see how we can make guidance. And in reality, to make guidance annually, if it was a linear operation, we would produce 30,000 to 35,000 ounces every quarter from the Syama sulphide mine. This quarter, we produced 15,000. However, the roaster was shut the past quarter, so I mean, it's slightly more complex than that. But to keep it very simple for shareholders who are asking the question you are asking, which is how can you do -- if I times 55 by 4, I get 220, and how do you get to 300, that's the answer. We're going to produce more gold from the south Syama sulphide plant.
Yes. I guess I don't have a problem with you reaching your production target. It's more the degree of step change required to reach your cost target.
Well, obviously, there's the denominator effect in terms of producing more coal -- of producing more gold. In addition, we've got a project at both Ravenswood and Syama, titled Project 900, and the 900 reference is USD 900. So obviously, depending on what the Australian dollar rate is, our annual guidance this year is under -- just under USD 1,000 an ounce. And the focus of that is to look at cost savings across our business and continue to look at efficiencies. And we're seeing some benefits from that. Obviously, the main benefit in terms of cost is the obvious thing around gold mining, which is throughput and recovery. And so the argument around production is the same argument around how do our unit costs change so radically from this quarter to the whole year. And the reality is it's the same answer, which is pour more gold. And if you -- you've, obviously, studied Resolute for a while. You'll notice, even in the historical quarters that I've mentioned here going back to 2015, because of the nature of our operation, specifically the operation of the roaster, when that roaster is operating efficiently, and we've just refurbished it and we've just tied in some new high-recovery float tail circuit additions, that's when our unit costs bounce around and we achieve positive results. And that's what we're aiming for, and that's what we're expecting.
The next question comes from the line of Paul Howard of Hartleys.
Just on the 40-day shutdown every couple of years, given you guys have a big emphasis on technology and sort of then moving with the times, is there anything you can do to limit that shutdown or sort of change things in any way?
Thanks for the question, Paul. I'll add some comments, but I'll let Peter Beilby, our Chief Operating Officer, describe a little bit about how we run the roaster shutdown and why.
Thanks, John. I think it's important for listeners the journey we've been on with that roaster over the last 10 years, originally, that we were having major shuts at that roaster about 18 months, and we've gradually, through continuous improvement, extended that. So this current shut was actually nearly 2.5 years since our last shut. And that's all about continuing to look at the way that we manage that roaster, the way we maintain it and extend it out. And we continue to do that to further extend those lengths of time between those major shuts.
Thanks, Peter. And there is a lot of continuous improvement and focus going in on the sulphide processing circuit. Looking at our simple flow sheet that we published in a recent presentation, it's illustrative to look at how much of that circuit is brand new. So the Syama mine was originally built by BHP in the 1980s. It was operated by Randgold. If you look at that sulphide circuit, the only thing that is actually unchanged or, in fact, represents existing infrastructure from the mine we bought in 2004, was the mill. Everything else has either been refurbished or totally replaced by Resolute. And we're now confident that we've achieved the -- the P85 project, which has just been commissioned, is dedicated to achieving the recoveries that we've forecast. We're confident that, that processing plant now represents and will achieve those outcomes. There was, obviously -- to answer question around technology, we continue to look at refinements and/or other opportunities. And there is a separate body of work going on around about what the ultimate and optimized state is, matching what we believe the capacity of the underground mine is to the opportunities to further refine and debottleneck the sulphide processing plant, so the journey is certainly not over. But in terms of your question around the roaster, the reality is, and the challenge at Syama has always been, it is a double refractory sulphide orebody. Increasingly, we're proud of the operations of that. If you look at our exploration focus, we've started to look for more double refractory sulphide ore because we're confident we can process it, and we're confident we can pour gold in it and we're confident in the circuit.
Yes, that's good. I suppose, suffice to say we could expect that sort of 40 days every couple of years which, in the greater scheme of things, isn't a huge amount of time. But I suppose, in managing other people's expectation to who I will speak to about that, we can't just simply divide 300,000 ounces by 4 every quarter. I mean, it's not that simple. So it's just we need to be cognizant about that.
Yes. Look, and that's a very good point, Paul. Analysts, I think, will be aware of the change I made to the way we report our gold production. So previously, Resolute used to report gold recovered. And in an environment where we would report gold recovered, you didn't see this swing because when the roaster was shut, we were still processing ore through the mill, and we were still applying a recovery factor to that ore at the mill. And so if you go back historically, you'll see that gold produced, as in recovered by Resolute, didn't have a swing around the roaster shut. My own belief is it's far more accurate and represents full disclosure to actually release gold poured. And so consequently, you're correct. During quarters where we signal that we're having a roaster shutdown, you will see gold poured out of the sulphide plant be reduced. It doesn't represent a miss to guidance, and we will catch that up in the operations in the other remaining quarters of the year. So it is actually related specifically to moving a production metric from the front of our processing circuit to be more appropriate at the end when we actually pour our gold into doré.
Your next question comes from the line of David Radclyffe of Global Mining Research.
So I've a couple of questions. Firstly, post the shut at Syama, is there any read-through here in terms of the P85 result and, really, what you're seeing as you started it back up? And thinking here about the future need you were talking about for investing in a low-carbon roaster. Would that still be the case? Or is it just too early to make that decision yet?
Thanks, David. So we have included some commentary in this quarterly that answers the first half of that question in this and also confirms our confidence in the Project 85 output. So the key element of Project 85 has been the building, commissioning -- installation and commissioning of a float tail circuit at the front end of that sulphide processing circuit. And the good news is that during the September quarter, due to the fact that we mined 80,000 tons of material, both in development activities and the commencement of stoping activities underground, we have had periods of time where we've been processing higher-grade ore through the circuit. And in looking at the daily results of those periods of time, we can see that we're getting 80% to 85% recovery from the float circuit, and we're getting the sort of 4% to 6% extra recovery through the float tail circuit. So that's an overall recovery at the front end of that circuit which, if you extrapolate out to how the circuit works, would relate to recoveries in that 85-or-above percent overall range. So that's initial findings support what we expected, and the circuit is operating as we intended. And the initial results indicate that we will get the recoveries that we expect and potentially more once we get steady-state ore from the underground. During the course of the December quarter, we're going to have opportunities to actually batch some of that higher-grade underground ore. And in our December quarter, we will seek to be more demonstrative in terms of breaking down some of the recovery numbers. Obviously, when you look at the September quarter, our overall recovery from the sulphide plant is 69% which, again, a bit like the overarching results at the front end of the quarterly, look to be in conflict with what we're doing, it's not at all, it's part of our plan. Anyone who's listened to me talking over the last 2 years will know that we have been doing everything we can, and the on-site team have done a wonderful job at finding ore to feed the sulphide plant when we haven't actually mined any ore since May of 2015. And we're at the end of that process. We now start the ramp-up of underground ore, and you will be able to track and see our recoveries improve completely in accordance with the grade and metallurgical qualities of the ore that we put into that plant. In terms of the low-carbon roaster, we -- that opportunity is actually tied to the roaster shutdown. The next opportunity we have to build and commission the low-carbon roaster would be the next time we do a major roaster shut and refurbishment which, listening to Peter, would be 2.5 or perhaps 3 years' time, who knows, it's depending on how efficiently and how productive we can make the mill. We still believe that, that will drive additional recovery. It also will allow us to extract the gold we have from some of our stockpiled gold in circuit inventory at Syama. So that remains something we're committed to. There's a lot going on on-site at the moment. We're very pleased with the improvements we've made to the circuit. And the final investment and upgrade to that circuit will be the low-carbon roaster, which will be programmed and built in once we've got to steady-state in the underground.
Okay. And the second one, I mean one of the market concerns is the very high development rates that you need to maintain for the sublevel caveat Syama on an ongoing basis. So given the 20% increase in that underground rate you reported for this quarter, do you feel you're now at that rate of being able to maintain and achieve that target that you need to be at?
Yes. And you're right, David, it has been a very pleasing quarter in relation to being able to demonstrate that we're achieving those required development rates, and we're working on it. If shareholders are online and they're looking at the quarterly, you can actually click on the visualizer tool and go into our online visualizer, and you can actually rotate around in 3 dimensions an up-to-date picture of the underground development. Actually, it shows by color the development we've already completed. And I think the darker blue color is the development we continue to work on or is ahead of us. And then, in green, you can see the ore that we're going to be extracting to the sublevel cave. It's -- I think it's a very interesting and useful demonstration. And if you're not online, you can go to our website and look at that. And it does demonstrate what -- the answer to the question you are asking, David, which is we are on track for the commencement of sublevel caving. The key thing for the rest of that -- for the rest of this financial year, in the last 6 months of the ramp-up -- and clearly, I mentioned earlier in the call that gold mining can be very easily reduced to throughput and recovery if you're looking at making money. And so our success at Syama is tied to quickly and efficiently getting as much underground ore as we can into the mill, particularly in the short term in terms of looking at our ability to meet guidance and the short-term financial outcomes of this year. The longer-term picture is a lot simpler. We're building a mine that greatly simplifies our operations at Syama. I'm absolutely convinced that the industry has already and will continue to adopt the automation that we've had the advantage of applying in a customized design sense, which has been used elsewhere, and it will allow us to greatly simplify and reduce the cost of our operations as we do the same in our aboveground processing. So yes, we're very confident. Byrnecut, our contractor, have done a good job in their contract to do the decline. We're working very well with our partners at Sandvik in the automation project. And the key message of the quarterly is that those development rates and our ability to prepare for and commission the mine is on track.
Your next question comes from the line of Paul Hissey of RBC.
John, just a couple of questions on the -- I guess, the reporting. It looks like you've dropped the amortization deferral of stripping costs from your quarterly reports. Is there -- or what's the driver behind that, just that change in reporting?
Yes, it's really just a simplification, Paul. As you know, we used to put those above the line and then take them off below. What we've done is, I think more appropriately, include them in the mining cost, yes. So we can split those out for you, if you want. I think what we're now doing is a more accurate and simpler picture.
Well, I -- yes, I suppose. Yes, numerically it's the same, but maybe it is a bit simpler. Just nice to understand the difference between, I guess, what you're capitalizing or what you're depreciate -- or amortizing versus what's kind of real and gets expensed in this period when it comes to forecasting your P&L. Second question for me, you spoke about a -- or you've given guidance to $150 million of CapEx this year. You've spent $100 million of that in the first quarter. Can you just break down sort of where you've spent that and what the CapEx profile looks like over the next 3 quarters of the year because, obviously, you've spent a huge lick of that right off the bat straight in this first quarter? So can you just break down the -- I guess, what you've spent it on to date and then what the next 3 quarters looks like?
Thanks, Paul. So just on your comments around the stockpiles, I mean, what we're trying to do is avoid the confusion and complexity that you have identified previously on big swings when we're closing off stockpiles and making those adjustments. But -- so your points are noted. In relation to capital spend, look, I don't provide a more detailed breakdown. What I can do is answer the nature of your question. We're on track for our capital guidance. And the nature of the mine we're building and what's happened during the first quarter of this year is that all of the fleet has arrived on site. And a lot of the investment we're making in these mines, right down to the infrastructure that you can see photographs in the quarterly, is an upfront investment. So we're currently around 75% through -- sorry, more than 80% through the capital spend of the Syama Underground Mine. And that is actually advanced in terms of the actual percentage of completion because of the fact that, obviously, a lot of the capital investment is upfront to get gear on site. And yes, you're correct that in terms of our annual guidance, a lot of that capital spend, particularly at Syama, is front-ended. That's to be expected.
Okay. If you won't break it down, then can I assume that the spending this year is still -- or sorry, this quarter, is approximately prorated between the guidance you gave recently with the updated DFS for both Ravenswood and Syama?
Certainly, at Ravenswood. At Syama, obviously, when we move into commercial production, we stop capitalizing the activity that's driving our development ore. So that -- in relation to actual capital cash flows, that's why you'll also would not be able to just pro rata that across the year. There's a front-end capital investment in the equipment, in the automation and the development of the mine, and then there's also the accounting treatment of what effectively becomes operating expense once we're at commercial production.
Yes, yes. Just trying to understand the cash flow, John, make sure you got enough of it. So I guess the last question from me then is just regards to another reporting item. It looks like you've got a negative mining cost in your oxide quarterly result. Is that -- can you just explain how that arises, please?
Where are you seeing that, Paul?
Minus $54 an ounce Syama oxide as a mining line item.
Thanks. So that's the -- we're opening up the new open pit at Namakan, but we actually didn't have any mining activity during the quarter. And so that represents the drawdown on existing stockpiles and adjustments between those stockpiles and the fact that we've capitalized the activity in preparing for the next 2 to 3 years of activity down at Tabakoroni.
Okay, I might have to give some more thought to that one. And just lastly then from me, I guess, obviously, you're stoping now at Syama underground and looking to sort of commence sublevel cave in this next quarter. Just around -- I guess, there was an earlier question around grades and cost and production. Correct me if I'm wrong, but your response was effectively that it's the grade that comes up which helps you to meet not only your production outcomes but also your cost outcomes. Is it fair to expect, though, that the sublevel cave is perhaps going to provide a slightly lower grade than the stoping, which you're currently doing now given I'd expect the cave to be sort of broader, bulk scale? I mean, I can understand how that's going to give you more efficient mining. I'm just trying to understand, I guess, the reliance upon the transition from where Syama is now to where Syama is going to get to make sure we can meet this year's goals?
Thanks, Paul. I understand, and we're doing the same thing as you could imagine. So the specific answer is we don't expect great dilution from the cave. And in fact, go and have a look at the visualizer, this is a big spec orebody, it's a kilometer long, it's 200 meters thick. And the longitudinal lateral cave, where we're confident will be similar metallurgical qualities and similar grade to what we mined in the open pit with a dilution factor. So we do expect that the grades from the underground, whether they're from development or whether from the cave, will be in that range of 2.7 to 3 grams a tonne.
Your next question comes from the line of [ Brad Seward ] of Macquarie.
Just a couple of questions from me. I just wanted to know firstly how much longer do you expect to be producing from the underground at Ravenswood. And then, secondly, I just wanted to get a little bit more information on the weighting of the next few quarters out of Syama. So you're obviously on track for -- to meet guidance for the financial year, but you're anticipating that next quarter will be fairly soft as well? Or do you think that it'll be a lot better than this previous quarter and sort of pro rata to the next 3 to meet guidance?
[Technical Difficulty]Sorry, you've missed my answer. I was muted. Are you still there [ Brad ]? Hello?
The participant just disconnected. [Operator Instructions]
Well, I'll follow up with [ Brad ] later. I'll answer the question anyway. So I was actually -- it's one of the rare calls I haven't actually described that at Mt. Wright, we mine a 2.5-gram orebody for 900 meters underground, and we've done so at an average life-of-mine cash cost across the almost 10 years we've been working there at AUD 850 an ounce, so it's a phenomenal achievement. Specifically, in answering [ Brad's ] question, when I joined Resolute, we had between 9 and 12 months life left at Mt. Wright, which is, in fact, 9 to 12 months of life left at Ravenswood. And just over 3 years later, I can inform [ Brad ] that we still have expected between 9 and 12 months of life left at the Mt. Wright underground mine. So from a modeling perspective, if you're matching us, you're expecting us to continue to get that higher-grade ore from the bottom level of that sublevel cave through to the end of this financial year. The team there are operating very safely and very efficiently, and we continue to effectively deplete more than the reserve model that we expected to get out of that mine. And it has allowed us significant flexibility in developing the Ravenswood expansion plan. But Mt. Wright will close unless it's turned itself to the world's largest beneficiation plant. So at this stage, we expect that it will continue to produce in its current form for the rest of the financial year. And at that stage, we'll update on what the closure plan is, and that will allow us to time the expansion of the mill and the capacity as part of the Ravenswood expansion plan. In terms of [ Brad's ] question in relation to Syama guidance, other than the advice and information I've provided in this call, we don't break down our guidance by asset and by quarter. However, if you understand the basis of our operations, you should expect that the improvement at Syama will be incremental during the course of this financial year. So the specific numbers you see for Syama in this quarter at the sulphide plant relate to the roaster shutdown. And the second quarter and third quarter and fourth quarter, we should see improving grades and improving associated recoveries. And so therefore, there won't be a sudden and massive swing around in terms of performance at Syama sulphide during the December quarter. And in fact, as we incrementally increase in development ore and stoping ore, the really big increases will come in the third and fourth quarter as the sublevel cave commences and the tonnes from underground ramps up. So if you're modeling how we meet guidance, effectively, we expect improving -- incrementally improving quarterly results on production and cost for the rest of the year.
We already have you on the line, [ Brad ]. Please continue for your questions.
That was it.
[Operator Instructions] Currently, we don't have any more questions on the line, please continue.
Thanks, Rochelle. And thanks, everyone, for listening. Thanks for your interest in Resolute. We look forward to improving our production and cost performance, but much more positively look forward to continuing to achieve the clear milestones we have in building one of the world's great gold mines at Syama, a mine that will produce more than 300,000 ounces a year. And I look forward to the upcoming key milestone of the commencement of sublevel caving. Have a good day, and thanks very much for your interest in Resolute.
Thank you. Ladies and gentlemen, that does conclude our conference for today. Thank you for participating, you may all disconnect.