Transcription
Foreign [Music] Road Show. Here from here is out in Switzerland, and with me is here today, Victoria Gold and Turbo, the CEO is here with us. Good morning, John. To Canada, how are you doing? Good morning, everyone. Yeah, great to see you. Great to have you here with us. We will start in the second. First, that the attendees here check in, um, and also let me, um, hang on. I'm just looking here on that. Yeah, great. Okay, people are checking in. That is great. So, yeah, first of all, very warm welcome also from my side. My name is Johan Striker. I'm the founder and CEO of Swiss Resource Capital AG and also the founder and chief editor of Commodity TV and host of the file. It's about honor and pleasure to moderate today this session with Victoria Gold. And we are fully complying to the data security laws of Europe, but also Switzerland and United Kingdom. And nobody can see each other. Nobody can see emails or names. That's very important. So everybody is fully protected. And John will start in a second. I really, um, yeah, advise you to use the chat function or the Q&A only function to type your questions in. That would be great because Sean will present approximately 25-30 minutes and afterwards, we want to have a lively Q&A discussion. So let me bring up the presentation here and then I would say, John, the floor is yours. Enjoy the show.
Ladies and gentlemen, again, uh, hello everyone. It's John McConnell, President and CEO of Victoria Gold. I'll take the next 20 to 30 minutes and walk through our corporate presentation, and then we'll have time, lots of time for Q&A. Uh, usual forward-looking statement. Um, investment highlights. Most of these I'm going to touch on in the, in the thing, but really want to talk about growing up to 200,000 ounces per year. I've got lots of photos in the presentation, so I hope you'll get the impression that this is a best-in-class heap leach operation. Um, you know, we generate significant cash flow. As a matter of fact, last year we paid down over 60 million in debt. I'm going to talk about, uh, exploration and the new discovery we've made called Raven, and talk about ESG a little bit.
So here's our location. We're, uh, got a map here of the Yukon Territory. You can see geographically, we're roughly in the center of the territory. A year-round road access. Uh, there's a hydroelectric dam at the community of Mayo, and we use hydroelectric power. Community of Mayo is small, but more, most importantly, it has a full-service airport, which our employees go in and out of with shift change. Uh, the capital city of the Yukon, Whitehorse, is about a six-hour drive away, depending on who's driving. Um, and the port of Skagway is about eight hours away. This is a shot to the mine site. Talk, start in the top right. You can see the open pit here. Um, we come to haul down to the primary crusher, over to the secondary and tertiary crushers, and we have a long, 1.5 kilometer overland conveyor to the heap leach pad here, gold recovery plant. Then down in the bottom is it the cap. From here over to here is approximately five kilometers. So it's a, you know, big site, but it's very efficient. And, you know, in a pickup truck, you can visit all the active areas in a half a day.
Mining. We mine to a pretty rigid plan. We don't have a lot of flexibility. The deposit is well-behaved and very consistent. Um, and I think you can see from the, we're currently mining in phases two and three, and all our hauls, or halls are downhill to the primary crusher. We have short hauls to the waste dumps. Very low stripping ratio at less than one to one. Uh, we have an entire Caterpillar fleet. As a matter of fact, our, uh, two shovels were built in Germany by Caterpillar. We built a new truck shop, last year. We had hoped to build it two years ago, but we were hampered because of COVID, but we're already seeing it make a big difference in equipment availability with a nice dry, clean area for the guys to maintain the gear.
Crushing and stacking. Gain in the crushers, we've used top-quality metal equipment. We crushed the ore to 10 mil, and not a lot of people were very highly automated. Over here is the leach pad. When we started this leach pad, it was the shape of a, uh, martini glass, and in the bottom, we were almost stepping on ourselves. So it was very difficult, the stacking process, and not very, uh, efficient. Now you can see we have a very large area, and it's a very efficient stacking.
Gold recovery plant. I won't walk you through the process. We've produced Doré bars on site. Those Doré bars are about 85% gold, 10% silver, and 5%, uh, a whole bunch of other things, primarily tin. I think, uh, we ship those Doré bars to the Royal Canadian Mint, and they're refined there, and we produce 99.99% gold bars. Um, so we've guided the market that we'll produce somewhere around 160,000 ounces of gold this year, but the nameplate capacity is 200,000. So, how are we going to get there? Well, mining is not an issue. The leach pad is not an issue. The ADR or gold recovery plant is not an issue. The problem preventing us from getting to two hundred thousand ounces per year is availability of the crushing system. Currently, if I take from the primary crusher through to stacking on the pad, the equipment availability is somewhere between 70 and 75 percent, and that gives us a hundred and sixty thousand ounces per year. What we have to do is get that availability up to 85 to 90 percent, and that will give us the two hundred thousand. So how do we get there? One, there are some design improvements, and I'll give you an example of a change we made this past August. We have a conveyor that runs under the tertiary crushers. That conveyor, if it was shut down fully loaded because of an upset, um, we'd spend 12 hours shoveling it off because the motor wasn't large enough to start the conveyor fully loaded. So that happens, say, 10, 12 times a year. 12 hours shutdown, that's a lot of lost production. So the solution was put a second motor at the head end of the conveyor and drive, and now we can start up that conveyor fully loaded and not have that have to shovel it off. So that's one example, and we've got about six that we want to do in the plant, similar to that.
The other issue is, uh, people. You know, we're operating with less than the ideal number of people on site. And I'm sure Germany's the same as North America. There's help wanted signs in every, every store and restaurant. We're no different. We're short people, and we have higher turnover, and that means people just are not as productive as they should be. So how have we addressed that? We've increased our recruitment team and increased our training capacity. The other area is everybody's heard of supply chain issues. It's not unique to North America, I know that. Um, so we've had to adjust our inventory of parts. We've increased our inventory from roughly 20 million to over 30 billion over the past year, and, you know, I'm hearing fewer and fewer complaints about not having the great part at the right time.
We think there's potential still to go above 200,000 ounces per year. The difference here is that to get there will cost us some money. There'll be some capital equipment involved, but again, mining's not an issue, the leach pad is not an issue, and the gold recovery plant is not an issue. It's the crushing and stacking system. So we're going to increase our stacking to 11 months per year. We're looking at alternatives to take fines out of the circuit ahead of the crushing circuit, which would give us more capacity through the crushers, and then the third thing we're looking at is adding a semi-mobile crusher. You could see an example of one in the middle photo there, and it wouldn't have the same capacity as our existing flat, but at least when we shut down for three or four days of maintenance, we'd be able to stack some material on the pad.
Two questions you should ask any new mine operation. Number one is how the grade reconciling. We sample the production blast holes, and we have a belt sampler on the material going out to the leach pad. We ask say those samples, and we reconcile those right back to the original block model, and I'm pleased to say we're seeing excellent reconciliation. So you can tick the box on grade. The second question you should ask is how's the metallurgical, uh, reconciliation in terms of recovery? And I'm pleased to say again, we're seeing recoveries probably higher than, uh, what we used in the feasibility study life of mine. The feasibility study had 73% recovery. We're probably seeing somewhere around 75 to 76. So again, another positive.
We've also, uh, already started looking at expansion of Eagle. We always knew the ore body was open at depth, but we hadn't drilled it off at depth. Uh, the current pit is planned to about 350 meters. We've now drilled 32 holes down to roughly 800 meters, and the mineralization at similar grade continues. So we're now working through the economics of laying back the, particularly the East high wall, and increasing the strip ratio, which would allow us to expand, extend the mine life by five to ten years. We're also been looking along strike from Eagle, particularly to the west, and, uh, earlier this year, we drilled 23 holes, and, uh, indeed the ore body does extend to the west. So we're now doing the engineering and planning required to extend the open pit further to the west, and I, my gut tells me we've added probably two to three years to the, uh, reserve along strike now.
Regional exploration. You know, we've had this property since 2009, and all of our focus has been on Eagle. You know, develop, exploring first, then developing, and now operating it. But we have a large land package in the Yukon, over 550 square kilometers, and we've been systematically doing exploration for the past three years. We started with airborne geophysics where we had anomalies. We followed up with ground geophysics and ground geochem. We're currently focused on an area out to the east. It's another large granodiorite intrusive called Nugget. The reason we focused on it is the intrusive has very similar characteristics to the intrusive that hosts Eagle. And indeed, in 2018, through trenching and prospecting, we made a new discovery out there that we call Raven. It's on the south corner of the intrusive. Uh, we spent, uh, 2019, 20, and 2021. We had modest programs out there because of COVID, but we drilled, uh, 78 holes and 18,000 meters, and a month ago, we announced the maiden resource out there, 20 million tons at 1.7 grams per ton, which gives us just over a million ounces. It's very positive because it's roughly two and a half times the grade of Eagle, and it's still open in all directions. This year, we had a very large program out there. We drilled over 25,000 meters in 90 holes, and you can see the, the red here is the, um, resource currently. We've now mapped this granodiorite intrusive. It's very large. We've put in a lot of step-out holes, and we'll announce a new, or calculate a new resource over the next few months, but I'm certain we're going to go to multi-million ounces out here. And indeed, you know, it's early days, it's encouraging, but I think we may have a tiger by the tail out here.
So I mentioned earlier that we generate a lot of free cash flow. So what are the uses of that cash flow? Well, number one, this year we've reinvested in the business. We've built a water treatment plant that cost us about 30 million dollars. We've added additional haulage capacity. We bought two new trucks at, I think, roughly 6 million each. We put in a fleet management system. I talked about some of the crushing plant modifications we've made, and then of course, there's the drilling, uh, at depth and along strike at Eagle. So we are sustaining capital this year was probably 60 to 70 million dollars. That drops next year to closer to 30 million. So, you know, our focus is always going to be on debt repayment. As I mentioned, in 2021, we paid down 60 million. We'll pay down 40 million this year, and then hopefully, if oil prices cooperate, will pay down a large portion of the debt in 2023. Looking longer term, uh, we'll consider things like share buyback programs and dividends, but also investments in junior explorers.
Foreign shareholders. You can see the registry here. You know, two years ago, we were probably 80% retail. That's really changed over the past 12 months. A lot of institutions have come into the stock, in particular buying out Orion Mine Finance, who at one time held up to 40%. Personally, I own almost 800 million, or 800,000 shares, and, you know, it's important that, you know, I purchased every one of those shares in the market. We didn't IPO this company and give ourselves a bunch of founder stock, so my interests are very much aligned with those of our shareholders, as is our chairman at 280,000 shares, and Marty Rendell, our CFO, at over 200,000 shares. So we're there with you.
Analyst coverage. Six analysts cover Victoria, and there's a couple more, uh, knocking on the door. I think I'm not going to read through this, but you can see their 12-month targets there, and I think the common theme is that Victoria is undervalued. Management team, you know, we've got a great team of people. The team on the left, uh, has been together for pretty much 10 years. The guy in the bottom left, Tim Fish, we just added, uh, at the beginning of October. Jim is a very experienced mine operator with a background in metallurgy. He complements well with Dave Rullo, who is also a very experienced mining operator, but is a mining engineer. Another new hire is on the right-hand side there, Adam Melnick. Some of you will know, uh, Adam. He was an analyst most recently with Sun Valley Precious Metals. We've brought him into the team to bring some discipline to our review of potential opportunities for growth of Victoria.
Board of directors. Also very important. This team of directors, you know, Sean Harvey, Mike McGinnis, Chris Hill, and myself have all been together for more than 10 years on this journey. We felt we needed to add some bench strength and brought in Letha McLaughlin, who is an environmental lawyer, Joe Offenec, who's an engineer and a lawyer, formerly the CEO of Predium, just a great guy, and Steve Scott, who, uh, has spent many years with Rio Tinto on the commercial side. So greatly, great, highly experienced board of directors.
Last but not least, ESG, health and safety is very important to us. Just last week, we reached a milestone of having worked two years without a lost time accident, but it's interesting to point out that we've only had three lost time accidents since we started construction in 2018 and have worked more than 5 million hours. Community investment. We do have a benefits agreement with the local First Nations that have made probably more than three million dollars in payments to the local First Nation. We've also just recently made a payment to the Yukon government under their quartz mining royalty of 8.7 million. So we really are, uh, giving back to both the community and the territory. Environmental stewardship. You know, I live in the Yukon part-time, and I certainly don't want to screw up my own backyard, and I'm pleased to say we've had zero significant environmental incidents. And then a program that I'm very proud of is Yukoners at work. Right from the start, we challenged the HR department with having 50% of our employees from the Yukon. We've achieved that, and a byproduct of that is that the recruitment team have had to look at everybody a little closer, and we have 25% of our employees are women, and 25% are First Nations, and I doubt there's another mining operation in North America that comes close to meeting those metrics. And that brings us to the conclusion, and I think we're bang on time. Absolutely perfect. Thank you.
Yeah, do you want to say something to that, but or is that just a summary? No, that's just the same summary. Perfect. And let me stop that here. So let's go here to the questions. Um, all right. Yeah, first of all, thank you very much for the presentation. And I know why I'm a shareholder of the company. I, I mean, I know you long, long time, but I have a very high opinion of you guys, of the team, but also what you have achieved in that amount of time. And the, um, yeah, let's say the hiccups you had the last months, they are all done with conveyor belts, with, let's say, all transportation, etcetera. That is all fine, right?
Yeah, I should maybe just elaborate on what happened with the conveyor belt. So as I said in the beginning, you know, this is a long conveyor. It moves the ore 1.5 kilometers. So the belt itself is actually three kilometers in length. Um, it was the original belt that we installed in, uh, 2019, and it had seven splices in it. So it was seven pieces, or six pieces of conveyor belt to, uh, give you the three kilometers. And what happened is one of those splices pulled apart. Now, you know, no two conveyors like this are the same, so it's always hard to judge what the life of the conveyor belt is. And a conveyor belt is very similar to your radial tire. And with a radial tire, it's not usually the rubber that causes the problem, it's the steel in the tire that starts to split apart. And that's not, that's very similar to what happened with this conveyor belt. So when we had the, uh, splice pull apart, that was a good sign that we'd probably reached the life of this conveyor belt. So we made the tough decision. You know, we could have spliced it back together again and been back into production, but it would be very unpredictable where it would split again. Um, so we made the decision to replace the belt. It means shutting down for two and a half weeks, and, uh, we had to retract our guidance for the year. But for the long term, uh, of the operation, it was the right thing to do, and for the safety of our employees, it was the right thing to do because when these belts pull apart, it's like taking a rubber band and pulling it until it breaks. There's a huge reaction of the belt. So, right thing to do from safety and protecting our employees, and the right thing to do for the long-term operations of Eagle.
Okay, good. Let's go to the resource expansion. We saw on one slide, and there's also a question from a shareholder here, and what's also my question. Um, you chose now it goes down to a depth of 350 meters. This is what we saw so far, but now we talk about 850 meters. So how do you want to, let's call it mine it, or how do you want to get access to this? Would that still mean that you could do an open pit, maybe to deepen the open pit you have, or would that require underground mining?
No, I, I think that the grades were at underground mining would never be economic. So it has to be open pit, and would mean probably increasing the strip ratio from one to one to one point six to one. Um, so we're looking at the economics of that right now. But, you know, if you look at a mine like, uh, Kinross's Fort Knox Mine in Alaska, which is very similar to Eagle, both in terms of, uh, geology and, uh, size, you know, they've done three pushbacks of the pit wall over the life of the mine. So it has to stand alone. You know, we'll treat it as like any other capital project and make a decision based on economics. But we're fortunate that, you know, it's not a huge increase in strip ratio to get us down, say, another 200 meters.
Okay, and grade-wise, it is stable, or is it slowly but surely getting higher when you go deeper? Uh, it looks very similar, both in terms of grade and recovery.
Okay, and by now, you are, let's call it a one-mine company, but we saw you have 550 square kilometers. And if I remember that back, also with, uh, introduced with Tara Christie from Benjamin, um, I had the feeling that you might expand in the future with Raven, maybe with the Banyan properties, that that it might be a second mine or third mine even in the future. Is that something you would consider?
Absolutely. Uh, yeah, you know, you mentioned Banyan. They're about 30 kilometers south of us as the crow flies. They have a resource now of over 4 million ounces. Um, they've had a significant drill program this year. I think they're approaching 60,000 meters of drilling. Uh, a little different, uh, where they are in terms of weather. They're down in the bottom of the valley, so at a much lower, uh, elevation. So they're still drilling. I drove by their drills, uh, operating yesterday. They've got four drills still running, and I'm pretty sure Tara is going to keep the guys working until, probably the end of November, and then shut down for a couple months and be started to gain early in February. But there's certainly potential there for doubling that resource. They've still got some work to do on the metallurgical side. You know, we've been asked, well, why haven't you taken them over? We've got enough to do. You know, our focus is on Eagle, getting it up and running properly as well. Now we have a, a primary development, or exploration and development project called Braven. So we're quite happy for them to move Ormac, is the name of the deposit, forward, and we'll keep a close eye on them. But I think it points to the fact that this is rapidly becoming a mining district. You know, you've got Eagle, you've got Raven, you've got Ormac. Hecla just purchased the Lex code. They're a big multi-mine company. So, yeah, it bodes well for the Yukon and the Mayo mining region in particular.
Do you see Raven, because you mentioned it also, uh, as a similar open pit mine like Eagle? Then do you think that's possible? I know it's hypothetical for the regulators, but could that be the case?
Yeah, you know, it's early days of Raven. Um, I see a number of scenarios. You know, it could be that we truck the ore across to the Eagle operation. Could be that we put a leach pad out there and, uh, you know, pump the pregnant solution to Eagle for, uh, processing. It could be a standalone mining operation. And the other thing that, you know, we'll certainly look at is because it's of the grades, you know, it may be, uh, but, uh, you may be able to make a good case to put in a milling operation and get 90% recovery as opposed to 75% recovery. So, but it's early days. You know, I think we need probably a couple more seasons of drilling before we even consider, uh, any engineering studies.
Okay, good. Then let's stick with the Eagle mine. We saw that you wanted to bring up the stacking to 85 to the 90 percent. And I understood that is, you have to invest, of course, some capital, like with that semi-mobile crusher. So how about this capital? Is that capital already in the budgets? Do you have to use separate capital from the cash flow? And how much approximately do you think you have to invest so to get the availability up and go from 160,000 ounces per year to 200,000 ounces per year?
Uh, requires no additional capital. So, you know, those ounces go to the bottom line. To go plus two hundred thousand ounces, say to 250,000, will require some capital. And, you know, it's probably something for a mobile crusher within a screening plant, those types of things, is probably something less than 50 million. But, you know, we're working our way through that right now.
Now, okay. Um, hang on. Um, Jodores, you said 85 gold, then the next big part is silver, a little bit of tin, and some other metals. Do you have to pay any fines for the refineries meeting with impurities? Do you have, are you facing any problems on that, or is, let's say, the Doré quite, uh, sober that you do not have to pay any fines?
No, we don't pay any penalties. Sorry, they love our Doré bars, and you left the money coming into your account, that's for sure. [Laughter]
Um, I saw also on your one slide that you have still at that open of 224 million dollars, if I'm correct, and you still have a nice cash situation of around 25, 29 million. Um, you have done last year, I think, over 60 million dollars down payments. Have you done this year also some down payments, or even more down payments, let's say extra down payments on the on the credit balance?
Yeah, we, you know, last year we paid down the debt to about 60 million. I'm not sure where we'll end up this year. It's been a high sustaining capital year. We will probably pay down 30 million in debt. And as I mentioned, uh, you know, there were two items, uh, in sustaining capital. One was the water treatment plant, the other was, uh, two more trucks, haulage trucks. So we won't have those sustaining capital in 2023. So, you know, as long as gold price cooperates, stays around where it is or higher, we'll significantly pay down debt next year.
So you also mentioned the program 250. Already, have you pushed that a little bit out in the timing, or are you still fully in that program? Because I'm, I had the feeling when I read your news releases, either 250,000 ounces, this is something we really want to achieve 2023, 2024, but maybe that's a little bit pushed out time-wise.
Yeah, you know, we've, uh, I've over-promised and under-delivered. And, you know, we've got to learn to walk before we run, so to speak. And, you know, our big target in 2023 is getting up to 200,000 ounces per year. Once we achieve that, then we'll look at options to go up to 250, but it's, you know, pushed out. And, you know, to go to 250 will require capital.
Yeah, thanks for the very honest statement. That's also quite rare that the CEO says, no, we have been a little bit too fast. But that's normal. I mean, that's why we are human beings and not robots, right?
Um, share buybacks. You mentioned that. Wouldn't it make sense to start already because your share price was so hammered? I'm a shareholder too, so I also suffer losses, if despite I even bought early. But, yeah, it is crazy for such a great producer like you are doing the right things, honestly. And your share price is crazy down. But also we just received from Carmike, etcetera, all those researches, and I think all the targets, and we saw it also in your presentation, but the new updates I saw the last 48 hours, we're all calling for, let's say, around 15 Canadian dollars. That's almost doubled from what it is today, right? So, right, would it make sense to restart, to start today with some share buybacks?
Well, it's always a balancing act, right? Um, you know, as I said, a large portion of our free cash flow this year has been invested back into the business. And then it's, uh, you know, you use the money to pay down debt, or to do share buyback, or to give dividends, and we've chosen to focus on debt repayment. Um, you know, I'm a bit old-fashioned when it comes to debt. Don't think my father ever owed anybody money. You know, before he'd buy a new car, he had to save up the money. So I've got that imprinted in my DNA, and the sooner we get that debt paid down, the better I'll sleep at night.
Absolutely, me too. Yeah, because I hate that. Absolutely totally with you.
Um, that's also a question from a shareholder. How does the inflation situation affect you in your balance sheet, or also, let's say, in your daily business? I mean, you said, for example, what I really liked is that you have bought more spare parts, more replacement stuff, that you raised it. So I think you are there more on the safe side, and also then you are inflation, let's call it the inflation hatched, because if you have some storage, you are a little bit more independent. But if you go in general with explosives, with, I don't know, chemicals, whatever, what's the situation for you in the Yukon?
Yeah, I mean, you know, fuel costs drive everything. Our largest cost center is, uh, people, so labor, so we know where that one is. And, you know, we gave everybody, uh, 10% increase last January. We'll probably have to do something similar this January. But, you know, fuel, we were doing our budgets last year at this time for 2022, and, uh, fuel was, a liter of fuel landed at Eagle was costing us about a dollar 15 per liter Canadian. Um, we thought we were being very conservative in our budgets. We used a dollar 45 per liter landed at Eagle in our budgets. Uh, fuel peaked in June at about a dollar 95, and I think it's currently around a dollar 60. So it's come back a fair ways, but it's still above our budget. And fuel affects everything. You know, we burn fuel in the, uh, open pit. You know, you mentioned explosives. Explosives are, uh, you know, ammonia nitrate and fuel oils, so half the price of explosives is tied to fuel. We move our people in and out by air. You know, I don't think there's an airline that doesn't have a fuel surtax in place. Um, you know, our groceries come up by truck. It's a long truck drive up from Mexico where we get most of our fruit and that, so we've seen significant increases in food costs. So, you know, and then you got your lubricants, and all of that is directly related to fuel prices. So, um, you know, we should come in, uh, very close to our guidance for all-in sustaining costs, but, you know, at around 14.25 per ounce. But, you know, three years ago, or four years ago, pre-pandemic, I was telling people we would be around 1200 per ounce all-in sustaining costs. So, you know, that's, uh, the way it's gone, and, you know, you can claw back a little bit here and there, but it's, it's tough to run a mine, and particularly if you use a lot of fuel.
Would it make sense if maybe, stupid question, but wouldn't it make sense to, let's say, hatch some fuel by our contracts and stuff, or is that, is that not possible?
It probably would have made sense a year ago, um, but it's very expensive to hedge fuel. Um, you know, it's not like hedging gold. There's a real business hedging, uh, gold, but fuel, you can, but it's very expensive because the, the volatility and prices.
Okay.
Um, then another, uh, shareholder is asking around on, let's say, he's doing a little statement. He's saying, the Fort Knox owner Kinross Gold has already 19 in Victoria quotes. Is there something cooking? Formerly Kinross was a large shareholder.
Yeah, but, you know, they, they own zero, as far as I know, of Victoria.
Okay, that's what I thought. If you go back to the, you know, the original, uh, startup of Victoria, uh, Victoria Resources was a company that was owned 40% by Bema Resources, and in 2006, I think 2007, Ken Ross bought Bema. So they ended up with this company called Victoria Resources, and then it was, uh, a fellow named Hugh Agro was Executive Vice President of Kinross, and he approached our current chairman, Sean Harvey, and myself, and asked if we repopulate the board of Victoria Resources, and he would join the board as well. And we hired Chad Williams as CEO. And at that time, we were Nevada-focused explorer. We had four greenfield projects in Nevada. Then it was the financial crisis in 2009. We saw that as an opportunity, and with Kinross's help, did a financing in November of 2008, when most company CEOs were hiding under their desks, and that gave us the ability to acquire two companies, a company called Gateway Gold, which gave us more assets in Nevada, and a company called Strata Gold, which gave us the Eagle asset in the Yukon. Then over the next couple years, we evaluated things and decided to focus on Eagle, and in 2010, 2011, we sold off all of our Nevada assets and realized probably close to 65 million in cash for those assets, which we used to develop Eagle.
Okay, so, but then, uh, there was a question from a shareholder, maybe a little bit too far, too out, that you can say that, but I still want to ask you, uh, what is your, let's say, AISC planning for 2023, 2024, 2025? Also, debt repayment for next year, in, in two years.
I think that's how, you know, I love to, uh, talk about those numbers, but, uh, regulators don't allow me to. You know, I think, uh, you can do the math and use something, you know, I've already said our sustaining capital next year will be, uh, uh, half of what it was this year, and our production will be closer to 200,000 ounces per year. So you can do the math and figure out what the, you know, what my thoughts are on AISC in 2023.
Yeah, absolutely. And also with the debt repayment, I mean, if you could do the pace you had so far, I could imagine within approximately four years, that should be done, right?
I might say less than that. I'd say, you know, our goal is by the end of 2024 to have the debt completely paid down. Now, there's lots of factors that come into that. You know, you know, hopefully it's, uh, good problems like Raven has evolved into a 10 million ounce deposit, and we're allowing all our free cash flow into its development. But, uh, yeah, we'll see.
Yeah, but I honestly, I love those luxury problems. Um, but, uh, question is, you are a gold miner. What, how do you see personally, and I don't want to have the statement as a company, but now personally, also because then you can talk a bit more free, um, how do you see the gold price in this inflationary environment we see? Because I think none of our viewers here is really believing that the gold price makes any sense, even inflation above 10 percent. And what is your feeling regarding starting, let's say, commodities, the physical storage is halved already, but what are your thoughts on that? I mean, you are so long in the, in the precious metal markets. I would say, what is your, can you, can you compare this with some experiences you had in the past, or can you give us a bit of a statement, please?
Well, you know, people always think that you're the CEO of a gold mining company, you must know something about the price of gold, and, you know, my answer these days is, I'm, I'm a mining engineer. Go talk to an economist, because I just don't understand what's going on. I read a lot, and I don't understand why gold isn't 25 hundred dollars per ounce right now, considering what, you know, governments around the world are doing. We've got, you know, wars in in Europe, we've got threats of wars in Asia. You know, the North Koreans and the South Koreans are going at it again. You know, it's unfortunate that it takes those kinds of things to raise the price of gold, but I really don't understand why gold isn't much higher than where it is.
Definitely me too.
Um, they're also popped up another question from a shareholder, to what rather, or let's say extreme weather extend or event, you still can produce your gold, meaning still the leaching is working, as we we had the last two windows were very tough because of the of the La Niña effect, and this year it looks a little bit like that, maybe the winters might, uh, yeah, become a little bit milder. Is there something where you can say, okay, if it's not going, let's say below minus 10 or minus 15, we still can work, or is that something you, you can say, no, it really depends on how the stacking and, uh, leaching is running?
Yeah, we've got, you know, three winters behind us now, and, you know, we spent a lot of time at Kinross's Fort Knox Mine prior to building Eagle, so we have a pretty good, uh, idea how to handle winter. Myself, I've spent my entire career in Canada's Arctic, you know, first the NWT, in the NWT, now I'm in the Yukon. Um, but, you know, we see zero impact on the leach pad of winter. You know, last year, for example, we, we monitor the temperature of the barren solution going onto the pad and the pregnant solution coming off the pad, and it's generally around eight degrees, uh, Celsius going onto the pad, and, uh, the lowest it's ever got was May two years ago. Got down to three degrees. So, and, you know, by May, that's not a concern at all because it's getting warm again. But, uh, so there's no impact of the weather on the pad. You know, we've got more than 25 million tons on that pad, and now it's a huge heat source. You know, and, uh, you know, even in the winter, if you go out onto the leach pad, it's a little bit mushy, so it generates, generates a lot.
Okay, so let me go through that here. I should expand on that though. You know, in the open pit, if the temperature drops below minus 35, we do shut the mining equipment down. And I think we've lost, since we started production, those three winters, we've lost probably eight days of mining because of cold temperatures. But, you know, below minus 35, you just don't want to break things, and equipment breaks at that. But fortunately, we see very few days below that temperature.
Okay, super. Perfect. John, I do not see any additional questions here. I think we have answered everything. Also, my list is empty. That's perfect. Thank you very much for a great hour and a great presentation. And I would say, keep it going. Please get the AISC back on track. I'm pretty sure you can do that next year because you had a lot of one-time events. And, yeah, keep on going to pay back the debts, to make us all sleep very nicely on during the night, and start some share buybacks, maybe, and then by 2025, I want to see some dividends, right? John, thank you very much. Have a great day and all the best.
Thanks everyone. Have a great day. Thank you.
Yeah, ladies and gentlemen, that was our virtual roadshow with John McConnell, the CEO of Victoria Gold. And, uh, yeah, you heard it. Despite some hiccups, things are really, uh, working now the smooth way. That's exactly how we want it. And also the company is still paying that debt back, and they want to have that done by the end of next year. Yeah, and also probably some share buybacks will arise quite soon, hopefully that that is a great tool, uh, yeah, to create some more shareholder value. And also dividends is something which the company really has on the plan. We like that a lot. And, yeah, for next year, 200,000 ounces production would be great. As said, we've greatly falling AISC, hopefully, and making more money in higher margins, that would be great. So far, the company did everything right. And as you know, mining is an adventure. It's not something that you are pushing a button and you are fine. There's always something could happen, but the company managed every hiccup greatly so far. So thanks for watching us today. I wish you all the best. Stay healthy and bye-bye from Switzerland. John, bye-bye.
Thank you very much. Take care. Bye.