McEwen Mining Inc. (NYSE:MUX) Q2 2023 Earnings Call Transcript

Jake Sekelsky: Got it. Okay. That makes sense. That’s all on my end. Thanks again.

Rob McEwen: Thanks Jake.

Operator: Your next question comes from the line of Heiko Ihle with H.C. Wainwright. Your line is open.

Rob McEwen: Hello Heiko

Heiko Ihle: Sorry, I was unmute. I hope you can hear me all right?

Rob McEwen: Loud and clear.

Heiko Ihle: Excellent. Would you be able to provide me with the approximation of your labor cost increases from the past, call it, 6 or 12 months by asset. I assume there are some pretty meaningful differences in what you’ve seen between Timmins or I guess, rather Canada, Nevada and Argentina, please?

Rob McEwen: William, would you like to venture into that?

William Shaver: Yes. I guess that’s a question I’m not totally prepared to answer. But I guess our cost in Canada in terms of labor cost is around 7% or 8%. And I would say our material costs are probably somewhere in the range of 10%. And I think we anticipated that we would see a higher fuel price than we’re actually seeing. So I think there’s some positives there. And I think there’s some other, I guess, consumables that we’re seeing, which seem to have smoothed out to some extent and not being steel in terms of grinding balls and also cyanide. So I think – if I had to say what the cost increase has been on a year-over-year basis, I’d say it’s around 10% or maybe a little bit higher than that. But I think if you use 10%, you wouldn’t be wrong.

Heiko Ihle: Moving on to drilling at Gold Bar a little bit. As per your release, your expiration for the second half of the year is on the nearby resources there. You’re operating two drills there in the second half, if more is correct. And you were talking about the cedar halt. Now what exactly do you think that will do to the ore body? Are your geologists telling you that’s more or less the same type of ore. So metallurgy would be the same? Or is this just creating else? What exactly is the goal, I guess, is what I’m saying. Thank you.

William Shaver: Yes. So the goal of that drilling program is kind of two or threefold. First, we’re defining the parameters for ore that we will mine in the relatively near future, meaning next year and the year after. The second part is to find more ore that will – that we’ll mine into the future. And it’s to — in both cases, we’re trying to get a very good understanding of what the strip ratios are going to be and also where there might be carbon associated with some of these resources so that we’re able to mine that in a proper fashion to make sure we can segregate the carbonaceous ore from the ore that doesn’t have carbon There’s also of – there’s also some deeper drilling that we’re doing there where I would say we’re kind of exploring for perhaps some elephants that are similar to some properties that are just north of us, say, about 20 kilometers away.

So – but the focus of the drilling program is to make sure we know what we’re doing over the next 18 to 24 months.

Heiko Ihle: I appreciate it. we’ll get back in queue. Thank you, all.

Rob McEwen: Thanks Heiko.

Operator: [Operator Instructions] Your next question comes from the line of Bill Powers. Your line is open.

Unidentified Analyst: Good morning. Thanks for setting this up today I just had a couple of questions. I guess, starting in Canada, you – during the AGM, you mentioned that you had a capacity of 1,400 tons per day. And I guess my question would be, is the stockpile has that been able to be reduced at all at the higher rate of mill running? Or is that just – or is that still there? And I guess, are you planning to move towards 1,400 tonnes per day in Q3 and the rest of the year?