Operator: The next question comes from Arun Lamba with TD Securities. Please go ahead.
Arun Lamba: I think you might have just answered this, but in terms of an updated life of mine plan, the feasibility study somewhat dated, could we maybe expect one in 2025 or it’s kind of focused on the ramp up and then we’ll do 2025 guidance and maybe update life of mine plans maybe in 2026 or something, just timing on that?
Doug Reddy: I think that’s our overall timing, 2020. Yes, I think — sorry go ahead Greg.
Greg Smith: I was just going to say Aaron, like again, totally focused on getting the mine into production right now. And then we’ve got some luxury to do some of those technical report updates. I’m thinking kind of later end of 2025 before we see a fulsome update like that. So the next sort of guidance coming out for 2025 would be a year from now, focus on that year and then in 2025, we could look to have a longer term mine plan updated to the next quarter.
Arun Lamba: Perfect. And then just on Castle, you mentioned permitting for the phase 2 going into 2026 and then in the MD&A you mentioned you’re going to reevaluate whether there may be slowdown phase 1 or whatnot. Should we get an update on that in the first half of this year or is that probably in the second half of the year kind of similar to our lost fee loss in terms of timing on a decision for the phase 1 plants?
Greg Smith: Yes, second half Doug, yes, it’s in process right now, Aaron. So the permitting, it looks like we’re making some good progress now on the permitting side. The BLM has been very engaged with us recently. We do expect that notice of completion and then this notice of intent coming in the relatively near term. And our estimate is that the process beyond the notice of intent will take around two years. So, that puts us into that mid-2026 timing for the permit for the expansion. And phase 1, as Doug kind of mentioned, it’s a bit of a development project masquerading as an operating mine to some extent. The point of it is to maintain the permits and to excavate the existing open pits, and that’s what we’ve been doing, and also doing testing on what this mine could look like at the increased production level.
And it’s fairly low-grade material that we’re processing. We’re using a contractor for mining, a contractor for crushing. The cost profile is higher than we would prefer. So, what we’re looking at is what makes the most sense given we probably got two more years of permitting once we build phase 2. Obviously, we’re going to have a much larger fleet. It will be a lot cheaper to move this material. But if it makes sense to continue doing it now, we can get it into a situation where we’re doing it at a reasonable cost that would be sort of first prize for us and we continue on with what we’re doing. But at this point, there’s no point in consuming capital over the next two years for that to any extent that it’s a better deal to do it in two years from now.
So that’s what we’re looking at. And it might just be a situation where we reduce the throughput at Castle Mountain over the next couple of years as we prepare for the expansion.
Operator: The next question comes from Jeremy Hoy with Canaccord Genuity. Please go ahead.
Jeremy Hoy: Hi, Greg and team. Thanks for taking my question. Most of mine have been answered. So the dialogue at Los Filos is fluid. But is there any sort of timeline that we can keep in mind or any dates that we can look to for progress updates on the negotiations?
Greg Smith: I don’t think we want to give yes, go ahead Doug.
Doug Reddy: I think we’ll keep do our best to keep you informed, but given the dialogue, it’s a back and forth. I can tell you that long term, the heap leaks is not the way to go. So, I mean, beyond the I don’t know, this year, next year, it just makes less sense. The CIL is actually a cheaper option for us, because of the cyanide consumption and the pumping that happens on a heap leach. So, it is the time to discuss and to work it through. We’d like to obviously have everything wrapped up ASAP, but we continue to engage and try to be as open as we can to be able to lay out all our cards on the table and to come to an understanding of what makes for the next stage of life for the mine.
Jeremy Hoy: Yeah, I appreciate the color and that it’s a fluid situation. Thank you.
Operator: We’ve got a follow-up question from Wayne Lam at RBC. Please go ahead.
Wayne Lam: Yes, I just had one follow-up. Just wondering on the impairment testing, the carrying value of Filos looks nearly equal to Greenstone now. And just wondering if that year end testing included updated capital and operating costs versus the 2022 feasibility study? And then just curious with the ongoing community negotiations, does it become kind of binary and that there may be a significant write down to be undertaken if you can’t get a deal done?
Peter Hardie: Wayne, it’s Pete. So the impairment test contemplates a CIL being put in. So of course, until the CIL is put in, it reflects current costs, but as Doug just mentioned, a CIL dramatically reduces operating costs there. And so that I think that probably answers your question on impairment. And then with respect to would we incur a write down at Los Filos if the sale did not proceed, we likely would, but we would obviously have to review that given the circumstances when we would have to redo that impairment test.
Doug Reddy: Okay. I guess I should clarify for accounting purposes, I shouldn’t imply we did an impairment test. For accounting purposes, you look first to indicators and if you have an indicator, you do an impairment test. We concluded we did not have any indicators. So, there was no impairment test. Had we run an impairment test, it would incorporate the CIL and it is a better way to answer your question.
Wayne Lam: Okay, great. Yes, hopefully, you guys can get a deal done imminently.
Operator: We have got another follow-up question from Anita Soni at CIBC. Please go ahead.
Anita Soni: Hi. Just another one on Greenstone and this time on the call. The AISC guide is 850 to 950 AISC. I assume from the point is it correct that it’s from the point that it’s going to be declared commercial or is it from the first gold pour that’s the 850 to 950?
Doug Reddy: Yes, that’s right, Anita. It’s from the point of commercial production.
Anita Soni: Okay. So, it’s that and again, that was sometime probably in Q3, right? You got to get to the 80%?
Doug Reddy: That’s right.
Anita Soni: And then just in terms of that number, I was wondering is there any additional costs that may be being capitalized or put into another bucket or would the 850 to 950 incorporate all of the costs at that asset in the quarter and in Q4 if we were to use that as a run rate?
Doug Reddy: So the 850 to 950 the only cost it would exclude and Greg already alluded I’m sorry, you may not have been on, but Greg alluded to it earlier, is the leasing costs related to the initial fleet that we acquired during construction remains non sustaining. But apart from that, it grabs all the costs.
Anita Soni: Okay. It grabs everything. So there’s nothing else that’s okay. All right. Thank you very much. Thank you.
Rhylin Bailie: We do have a few questions online, but I think they were pretty much all addressed with the questions that were asked from the analysts. But I will get back to you all individually to make sure you’ve not got any follow-up questions. So I think we’re going to wrap it up here. Greg, do you have any closing statements?
Greg Smith: No. Just thanks again everyone for attending the call and where to find us. If you’ve got any additional questions, the contact information is on our website. Rhylin, myself or any of us are always happy to engage with shareholders.
Operator: This concludes today’s call. [Operator Closing Remarks].
