Bottom here?, page-598

With the cave mine ramping up in Q3 and projected ramp up UG ore tonnages of ~310kt (low estimate), 355kt (current estimate) we should expect gold mined at Syama UG of 31,819 ozs. Factoring in improving recoveries of say 75-85% that is a range of between 21,196ozs and 23,114ozs at the reserve grade of 2.7g/t (forget about the other rubbish estimates that have been plucked out of thin air).

If we assume oxide production remains the same at Syama, at 34,653oz, in the third quarter and production from Ravenswood is also maintained at the same level (ie 17,484ozs)......

we get a range for Q3 production of 73,333ozs and 75,251ozs.

We don't know where all the oxide ore was sourced for the current quarter but most was likely to have come from the new Tabakoroni open pit. Looking at the images of that pit's development in the last 6 months I think the assumption that this pit will match the performance of this quarter in the next quarter is pretty safe with strip ratios likely falling and grades likely rising increasing. At some stage, I don't know when this pit will reach transitional ore and depending on how much gold is locked up with the sulphides, the ore might also have to transition to the sulphide circuit. I'd say just eyeballing the photo we should have oxide from this pit for a few more quarters to come, definitely the third quarter IMO.

We were told in the September quarterly activities report that at Ravenswood ore would continue to mined at the same levels at Mt Wright through FY2019 and the mine life is being extend by collecting overdraw from the cave mine at higher levels, so the assumption that Mt Wright will produce at current levels for the remainder of FY2019 is pretty strong. Probably more or less a certainty in the March quarter (barring an incident or act of God).

My expectation for Q3 is 70 to 76kozs, not far from yours. I won't make a prediction for Q4 as it will be highly dependent on the ramp up tonnages meeting forecasts at the Syama UG and how much oxide ore we have in the starter pit at Tabakoroni.

What I think will be a continuing drag on the share price is that the market will misunderstand the operating costs. Most mines developing a project like the Syama UG project would not declare an AISC until the mine reaches a state of commercial production. At Syama this is not possible because the mine is viewed as a continuation of an existing operation, so some costs, the capital costs of the development will be capitalised and the remaining operating costs will likely be reported for the entire Mali operation as an AISC and form part of a group AISC. While production from Syama UG remains below the steady state level, which is expected to be achieved at the end of June, operating costs will remain high and the market will read them at face value because the market is stupid. This will continue to provide investors with opportunity to get on board but good luck getting on board after Syama UG hits its straps after the end of June. Esh