Allied Gold Corp Aktie

So let's begin. Ladies and gentlemen, good morning. I am Peter Marrone, the Chairman and Chief Executive Officer of Allied Gold Corporation. I am pleased to welcome all of you who are attending in person and by webcast to the special meeting of shareholders of Allied Gold. Please note that this meeting, as I mentioned a moment ago, is being webcast live via audio and will be available on our website at www.alliedgold.com following the meeting for those who are interested.

I will give a brief presentation following the formal business of the meeting, which presentation will also be available on our website. And so with the consent of those present, I will act as Chairman of this meeting and I now officially call the meeting to order and appoint Sofia Tsakos, our Chief Legal Officer and Corporate Secretary of the company, to act as Secretary of the meeting and Computershare Investor Services Inc. through their representatives, Daniela Munoz and Shirley Tom to act as scrutineers for the meeting.

May I ask if everyone present has registered with the scrutineers? And if not, would you -- I would ask you to please kindly do so now, thank you. So before we proceed, I would like to comment on the voting procedures. Voting on the matter before us today will be by ballot. The ballot -- on that ballot, every shareholder is entitled to vote on the matter, and that vote is 1 vote in respect of each share that is held. Only registered shareholders who held shares in their names as of the close of business on February 23, 2026, or their validly appointed proxies are entitled to vote at this meeting.

If you have already voted or sent in a proxy, there is no need for you to vote today by ballot unless you would like to change your vote. And upon checking in the shareholders or proxy holders attending the meetings will have received a ballot. I'm assuming everyone has a ballot. You should record your vote on the ballot by marking the appropriate box and ensuring that you sign and print your name on that ballot.

The scrutineers will collect all of the ballots once discussion on the arrangement resolution is complete and has concluded, and I declare the voting closed on the arrangement resolution. The results of the meeting will be publicly released and will be available on our website.

I have been advised that the notice of meeting, management information circular, form of proxy and letter of transmittal were mailed on March 9 of this year to shareholders of record as of February 23. The declaration with respect to that mailing will be retained in the records of the company as is usual. The meeting materials were also made available on our website at, again, www.alliedgold.com and under the company's profile on SEDAR at www.sedarplus.ca. I do not propose to read the notice of meeting.

And based on the preliminary scrutineers' report, proxies were received from holders of a sufficient number of common shares to constitute a quorum. And as such, I declare that a quorum is present and this meeting is properly constituted for the transaction of business today. The final report on attendance will be retained with the records of the company, again, as is usual.

On to the formal business. The shareholders are being asked to consider a special resolution to approve the plan of arrangement under Section 182 of the Business Corporations Act of Ontario involving the company and Zijin Gold International Company, Ltd. to pursuant to an arrangement agreement that is dated January 26, 2026 between the company and Zijin Gold. The full text of the arrangement resolution is set forth in Schedule late to the management information circular of the company, again, that circular dated February 25 of this year.

To be effective, the resolution must be approved by at least 2/3 of the votes cast by shareholders at the meeting and by a simple majority of the votes cast by shareholders at the meeting by disinterested shareholders in accordance with applicable securities laws. And I move for the approval of the arrangement resolution. Will someone please second the motion?

I second the motion.

Thank you for that. As the motion to approve the arrangement resolution has been made and seconded. At this time, each registered shareholder and proxy holder will be asked to vote by ballot on the arrangement resolution, and I declare now a -- I direct now that a poll be taken.

[Voting]

Okay. Now once you've completed your ballot, please raise your hand and the scrutineers will collect them from you. Does anyone still have a ballot that they need to submit? It seems not. So thank you for that.

Please be reminded that if you have already voted or sent in a proxy, there is no need to vote by ballot unless you would like to change your vote. I will close the poll on the arrangement resolution shortly. Now as there have been no questions received, I declare that the poll is now closed. And I've been advised by the scrutineers that based on the votes represented by proxy at this meeting, a sufficient number of votes have been cast in favor of the arrangement resolution, and I therefore declare that the arrangement resolution in the case of both votes, is carried. And rather than hold up the meeting for the final tabulation of votes, I direct that the final results of the poll be included with the minutes of this meeting and filed on SEDAR and EDGAR as required.

Now as the formal business of the meeting has now been concluded, I move to conclude this meeting and may ask someone to second that motion.

I second the motion.

Thank you for that. You have heard the motion as moved and seconded, I declare the motion carried, and the meeting is now concluded.

Now as this is perhaps the last official meeting of shareholders of this company, I thought it would be worthwhile we, as a Board and management, thought it would be worthwhile to recap what is the company? Where have we come from? Where are we? Where do we expect it to go? And how does this transaction relate to all of that?

Let me begin by referring to the company and its assets. And while we say here that we're a unique mid-tier gold producer, mostly because we have a large and increasing mineral inventory and production platform, we are underpinned by 2 Tier 1 generational mines, and we're progressing to generate high margins and strong cash flows, increasing and strong cash flows.

I want to add one more thing. And some of you are in this room, some of you are listening on this webcast, some of you will listen to the webcast following the meeting. I would like to thank the Board of Directors, the management. I would like to thank each and every one of the employees in this company. I would like to thank all the local communities and the various stakeholders. Without your support, we could not have achieved the success that we've achieved certainly to date. So thank you.

What makes us unique as a mid-tier gold producer is not only what is shown on this slide, but the strength, depth, competency, capabilities and commitment of the employees that are in this room and those that are listening in or will listen in. So thank you.

In terms of our mines, 3 jurisdictions. That Tier 1 generational mine to which we refer, number one is Sadiola. We have an increasing life of mine production that takes it from a comparatively small production platform and near the end of a mine life in terms of oxide production to an extended mine life is at least a couple of decades, therefore, generational at, at least, 300,000 ounces per year. We have a large mineral inventory of at least 10 million ounces that we carry in our books as total resources.

While Cote d'Ivoire, the complex of Côte d'Ivoire is comparatively small, we also have developed a plan for its extension of mine life. And on a combined between the 2 mines, treating them as a complex of 180,000 ounces per year. This makes it part of that uniqueness of the company.

And of course, there's Kurmuk. We are in jurisdictions that are mining jurisdictions, and I include Ethiopia as a mining jurisdiction, not because it has a history of mining necessarily, but because it wants to become mining jurisdiction. And we lot and applaud that. And we have a project that is fitting for that objective, that stated objective [indiscernible]. Ethiopia will become a mining jurisdiction and Kurmuk is the first mechanized large-scale mine that is in development. It is a Tier 1 generational mine, at least 11 years of proven and probable reserves, and that number will continue that number of years will continue to grow. And we have a life of mine expectation of at least 250,000 ounces of gold production per year.

And when I say at least, it's because we are already planning for the advancement of some optimizations that would take that production to a higher level. Kurmuk is a cash flow generation. It is a big fat cash machine. And we are delighted that it comes into production this year. I think it's important to talk a little bit about the creation of value over time.

In the course of the last several years and certainly over the course of this year, we have in 2026 guided a production level that is 55% over the 2023 levels. We've lowered costs and we've increased our margins. We've seen an exponential growth in operating cash flow, which you see at the bottom of the slide to the right. When we look at the cash flows in 2023 as they compare to '24 and '25 and then, of course, 2026 is a step change as a result of Kurmuk coming into production, that first phase expansion at Sadiola now complete.

We've improved the sustainability framework and performance as well. Kurmuk is in development and undergoing optimization. Sadiola has completed the first phase of its expansion, and we're finding new oxide ounces that will contribute toward that production platform. We have a reserve and resource growth, and that is expected to continue. In the course of the last several years, we've also undertaken several things to improve the corporate construct of the company. We consolidated the Kurmuk minority position and obtained all material permits.

Why operate or develop a mine with a junior partner, why not consolidate it all into one? That was the first act as we took the company public in 2023. We entered into the protocol agreements that provided us for the 10-year licensing under the new mining code in Mali. We enhanced engagements in relations with local stakeholders. We strengthened the license to operate across all jurisdictions.

In the same time, we improved our balance sheet. We executed on a financing strategy that led us to fully finance the development of our growth and as you are aware, from a prerelease of our fourth quarter results in the last several months, we ended the year with $480 million in cash. So we see that we are fully funded in the development of our business. And we improved the shareholder base, adding the New York Stock Exchange listing and improving our trading liquidity. And as you see on the top right, how do we perform from a stock market point of view, from a relative share value point of view. So if we compare ourselves to the GDXJ, we are a part of that index.

The Peers, and we're including here the -- mostly the African Peers. Gold price, Gold price has had a phenomenal run to the end of last year an 85% increase in price, but we were up 3.7x. Our Peers were up 200%. The GDXJ was up 230% and I'm happy to contribute to say that the difference between the Peers at 200% and the GDXJ, of which we are a part, as I mentioned, at 230%, is because of our spectacular performance where we over-performed Peers and drove up the overall index as well.

Now the path to realization. We see this in our information circular, but I think it's important to capture the points. We undertook a strategic review as a Board of Directors in 2024 -- late 2024. The objective was to enhance our geographical diversification to determine what the relevance and scale of the company or at least to better define it, strengthen our cash flow and cash balances, maximize longer-term shareholder value, mostly to reduce risk and ensure growth.

And in that process, as you see again from our information circular that goes into greater detail, we looked at several strategic alternatives, including asset purchases, corporate transactions and other options that were assessed as part of a comprehensive strategic review. This was not a one-shot event. We were more broadly looking at how we could create relevance for the company and how we could capture -- unlock and capture value.

We focused a recent outreach by about the middle of last year on Asian companies that ultimately led, of course, to the transaction with Zijin. In the same period of time, we continued to execute an optimization and growth strategy, optimizing our operations, advancing Kurmuk, as I mentioned, the Sadiola expansion and the extension of mine life by finding new ounces at the Côte d'Ivoire complex. We improved our stakeholder engagement and license to operate. We improved our balance sheet and we improved our shareholder register and trading liquidity.

What's the result of that strategic review? Well, following extensive diligence, detailed engagements and arm's length negotiations with several parties across a range of strategic initiatives and opportunities. The review culminated in the Zijin Gold offer that was made in late January. The Board determined that the offer recognized fair value while mitigating business risk and particularly in a period of highly volatile markets. And as Zijin demonstrated a strong track record of deal execution competency and long-term asset stewardship, the Board suspended its review and discussions relating to other strategic initiatives and other opportunities and recommended the offer to shareholders.

So where are we then as of today? The transaction with Zijin has strategic rationale and benefit for shareholders. We are offered CAD 44 per share. It is an all-cash consideration. That represents a value of $5.5 billion, the equity value of that. It represents a 27% premium to the volume weighted average price of about 30 days to the date of announcement of the transaction. There's no financing condition. They're dealing with a purchase consideration with cash on hand and liquidity. It is a high-quality counterparty with strong -- a strong track record, not only on mergers and acquisitions, but also on stewardship and management of assets.

At the end of the day, we are here for shareholders, but we're also sensitive to the fact that there are other stakeholders, and we want to make sure that those other stakeholders, local communities, employees, local governments understand that we are not handing the baton to someone that we're not confident can competently manage these assets. It does immediately value and realizes the value of our company and it mitigates volatility. We've now convened our special shareholder meeting, and we have overwhelming approval coming from our shareholders.

Now the transaction completion, our agreement provides that we have until the end of May to complete the transaction, and there are 2 periods of extensions for 2 months a piece if we're still in the regulatory approval process. We expect not to be at that point. We expect to be able to close sooner, but the transaction brings certainty and immediate value realization in this period of highly volatile markets with a significant premium to the all-time high share price of the company.

So the path to completion then. We now have shareholder approval to the arrangement with -- we will announce this by press release, but I hope I can say we said that it was overwhelmingly approved, more than 99% approval. So thank you to our shareholders for that impressive support.

The regulatory approvals, filings have been made and we're in progress. The goal is to close as soon as possible. Timing remains subject to satisfaction of the customary closing conditions that includes receipt of all regulatory approvals. And as this is a court-approved plan of arrangement, the final court approval. The approval process has been undertaken cooperatively by Zijin and by Allied Gold. Both companies have demonstrated a strong discipline and a commitment to complete the required regulatory approvals expeditiously with what I would say is a sensible approach to the local requirements and also a recognition, I mentioned the volatility of the period in which we are.

That volatility is not just markets and it's not only gold price, but that volatility has now expanded itself to geopolitical issues as well. And so maintaining a recognition and a sensible approach to that geopolitical environment in which we find ourselves that is different from where we were when we began this process roughly 1.5 months ago.

So let me conclude then. Allied Gold is underpinned by 2 Tier 1 generational mines with imminent and significant growth position it as a differentiated asset class. The strong fundamental value of the company has been validated by the Zijin transaction and is clearly reflected in the transaction terms. The companies are working jointly for an orderly transition, including detailed site visits that have already occurred and continue to occur, management integration plans and then evaluating further asset optimizations and opportunities aimed at unlocking future value for the assets.

We will be publishing our fourth quarter results, our end of year results this afternoon. I am told that we will not be convening a conference call tomorrow in light of the fact that we're in progress on this corporate transaction. But I should mention, in case we are at a point where we will be concluding the transaction after our first quarter results are complete. I should mention that our first quarter completes today. I am happy to say to you that we are on budget, on production. It appears that we're on budget on costs.

We are generating those cash flows, and we'll deliver those first quarter results by mid-May. Our annual guidance is on track. We're generating strong EBITDA margins, and we expect those margins to continue to improve. So the company, as a stand-alone company, is unique, as I mentioned. This transaction with Zijin endorses the value of the company, recognizes that it is a unique company. I am delighted to be here to represent that we've checked another box, which is shareholder approval. And I'm delighted to move forward with business as usual until we've closed over the course of the next month or a couple of months or so. Thank you very much, ladies and gentlemen.

Does anyone have any questions? No. Coffee and refreshments are outside. So enjoy.

Thank you all for joining us this morning. Before I turn the call over, I need to advise that certain statements made during this call today may contain forward-looking information, and actual results could differ from the conclusions or projections in that forward-looking information, which include, but not limited to, statements with respect to the estimation of mineral reserves and resources, the timing and amounts of estimated future production, cost of production, capital expenditures, future metal prices, and the cost and timing of the development of new projects.

For a complete discussion of the risks, uncertainties, and factors, which may lead to the actual financial results and performance being different from the estimate contained in the forward-looking statements, please refer to Allied Gold's press release issued last night announcing quarter 3, 2025, operating and financial results.

I would like to remind everyone that this conference call is being recorded and will be available for replay later on today. Replay information and the presentation slides accompanying this conference call and webcast are available on Allied Gold's website at alliedgold.com.

I will now turn the call over to Peter Marrone, Chairman and CEO.

Operator, thank you very much. And ladies and gentlemen, let me begin this conference call by pointing to the quote at the bottom of the first slide of our presentation, and I would like to repeat that quote. Let's not react to speculative headlines and geopolitical matters. We continue to operate normally. We refer to Mali in particular, and particularly in light of recent headlines.

Let me begin by talking about the people of the country. They are industrious, entrepreneurial, and overwhelmingly in the country across the population, there is support for mining. Similar to many countries, the politics, geopolitical circumstances go on. Mostly, they are stable, sometimes changes occur. But business goes on, and this is especially true for mining. Recent disruptions in fuel supply into the capital of the country, affect only the capital, and there are signs of improvement. Regional governments and internationally support has been offered. And national efforts to counter the factors that have disrupted the fuel supply have received local, regional, and international endorsement.

Prolonged fuel shortages do risk civil unrest and other challenges. But so far, this has not occurred and fuel supplies have begun to enter the capital. While there has been unexpected government change in the country before, and this is true for many countries, it has not been the result of external forces, and that seems to be true now as well. And in those times of government change, I remind everyone that mines have continued to operate normally, production and cash flows were generated. We have no reason to believe that this is not true now, and we attribute that to the industrious and entrepreneurial nature of the people, who support business as usual regardless of political affiliation or affinity and regardless of localized conflicts.

So with that then, our Q3 was certainly ordinary and normal course. We had solid production of just over 87,000 ounces that sets us up for a strong Q4. We had strong cash generation, just under $110 million of adjusted EBITDA and our operating cash flow of just under $200 million. We made significant progress on the Sadiola Phase 1 expansion and the Kurmuk development. Our all-in sustaining costs of $2,092 per ounce were down 11% as compared to the second quarter. As we had indicated with our second quarter conference call, we would expect, and we expect further reductions in Q4 with higher grades at Sadiola, particularly with the Phase 1 expansion completed over the course of the next few weeks into December.

Operations are performing well, we're operating normally at Sadiola, and that carries strong momentum into the fourth quarter. At Agbaou production quarter-over-quarter from Q2 to Q3 was up 43%. We expect that sustained production to continue into Q4 and into next year. And at Bonikro, we're on plan, grades are where we expect them to be, recoveries and throughput improved. And again, we expect that that will continue into this quarter and the quarters to follow.

We had adjusted EBITDA to conclude of $110 million, cash flow of just under $200 million and cash balances at the end of the third quarter of just over $262 million. What to expect then in Q4 and beyond? Sadiola and Bonikro will be notably higher. We indicated up to 40% higher in Q4 over Q3. We are almost halfway through the quarter, and we can see that production ramp-up progressing very well. Our Q4 costs are expected to improve. Momentum from that is expected to continue into the first quarter of next year and throughout the year. And we stand by the guidance of a production level for 2025 that is greater than 375,000 ounces, that sets us up for a consistent 100,000 ounces per quarter at improved costs, leading to improved financial performance and then Kurmuk kicks into production by the middle of the year.

With that, ladies and gentlemen, let me pass the call to Johan, our Chief Operations Officer to go through our production in more detail.

Good morning, Peter, and good morning, everybody. Thank you very much, Peter, for the headlines.

I would like to start off with the -- on Slide 3, the operations, and starting off with Sadiola. The operations were stable and on plan. I was at Sadiola last week and operations are running normally. We're not seeing any logistic disruption and consumable inventories, including fuel remains at normal levels.

The operation is running normally with noticeable improvements. Production is on track to meet the full year guidance with Q4 expected to be 40% higher than previous quarters. Phase 1 expansion remains on schedule for completion in December, enabling us to treat up to 60% fresh ore in the mill feed.

Bonikro was on plan with higher grades, better throughput and recoveries. The stripping and maturity of Pushback 5 and Pushback 3 will provide us access to higher grades at lower cost in Q4.

Agbaou production increased 43% quarter-on-quarter, as Peter also alluded to, and driven by higher grades and throughput and operational improvements. Overall, operations were on plan, positioning us higher production and lower unit cost in Q4.

If we go to the next slide regarding the Sadiola Phase 1 expansion progress. The Phase 1 expansion remains on schedule and continued to advance through Q3 and into Q4. Mechanical installation of the new mill and crushing circuit is complete. The mobile pebble crusher is on site and ready for the December commencement.

Engineering and pre-leach thickener is on its way to support higher fresh ore processing with Phase 1 nearing completion. We expect new commission circuit to be ready to receive ore late in the fourth quarter. At that point, Sadiola will be able to process up to 60% fresh ore through the plant, which will materially lift throughput rates, improved recoveries, and lowering processing costs. This expansion will bring additional flexibility into the operation and pave the way for lower cost and improved predictability. So in short, Phase 1 is on plan, commissioning begins in December, and it will set up structural setup change for Sadiola production and cost base.

Moving over then to the Kurmuk progress. Kurmuk continues to advance on schedule. Engineering and the substantial complete and the site extension is well underway. The plant construction, including the mechanical erection, concrete works, and the key infrastructure such as water, the water dam is advancing.

Logistics are active. Long lead equipment is on site. Initial ore supply has been established from both Ashashire and Dish Mountain. The plant capacity has been approved to the 6.4 million tonnes per year, which enhances the long-term production profile.

Looking ahead, priorities to complete the mechanical and electrical infrastructure works, build up to the 3-month high-grade stockpiles, connect the power line, and advance to the pre-commissioning. Upcoming priorities include the completion of the construction, build the high-grade stockpiles, as alluded earlier, provide the line connection and for -- and the pre-commissioning. We maintain on track for first gold by mid-2026.

And with this, I'd like to pass over to our Chief Exploration Officer, Don Dudek. Thank you.

Thanks, Johan, and good morning. Hello, everybody. One thing I want to emphasize for Sadiola, and it's something we tend to forget because of time. But this deposit has produced over 8 million ounces of gold, and we have 10 million ounces of mineral resources on the books. Because of the robustness of the system, we see the potential or we have an exploration goal to add another 3.5 million ounces of resources within the next 5 years. Including within that is about 1 million ounces of oxide inventory and resources.

Our exploration strategy underpins our long-term production profile for this project and supports mine life extension at attractive returns. The oxide zones are located near infrastructure, and oxide boosts flexibility and profitability within our operations. Our drilling is focused on near-mine targets. And really, we're targeting those zones, which have higher-than-average grades, which again supports the long-term plan. And they also provide an optionality for production that will again service us over the long term. We have 19 years of mineral reserves, and we see this increasing over time, just again based on the robustness of the system.

When you look at these systems in West Africa, a lot of the large gold zones, they really don't -- we haven't found the limits of them, and the limits are more defined by operation cost profile versus running out of mineralization. So that's something very important to keep in mind. In this last year, we've seen significant success at 4 different zones. And again, that was touched upon in the exploration news release. And these discoveries, as noted before, validate the scale and the scope and the potential of this mineralized system.

Going forward, drilling will remain active into year-end, and continue through 2026 and beyond. We are prioritizing the targets with the highest potential, and again, with a focus on oxides. We're initiating new geophysical surveys over a 2.5 kilometer stretch of productive stratigraphy, that already has produced a couple of recent near-term gold deposits. This area has never been systematically tested. And as we march ahead with the drill, we keep on finding more mineralization.

Our results from this work will be summarized in an updated mineral resource estimate in Q1 2026. And this update will capture new discoveries, oxide additions, and extensions. Furthermore, we plan exploration updates for Kurmuk in Ethiopia late this month, and for our project group in Cote d'Ivoire in early '26.

With that, I'll pass things off to Jason to discuss the Q3 financial performance.

Great. Thanks, Don. Good morning, everyone. In Q3, the business delivered another solid quarter of financial results. Adjusted net earnings were $0.29 per share and adjusted EBITDA came in at almost $110 million, reflecting strong operating performance and improving costs across the portfolio. We generated $182 million in net operating cash flow during the quarter and ended with a cash balance of $262 million, giving us strong liquidity into Q4 and as we finish up the construction of Phase 1 at Sadiola and at Kurmuk in Q2 next year.

All-in sustaining costs were $2,092 per ounce, an improvement of 11% quarter-over-quarter despite higher royalties from gold price. So overall, Q3 delivered strong cash flow generation, improving costs and higher margins. More importantly, we're positioned for a stronger Q4 with a combination of increased production, lower unit costs and higher gold prices that will result in a step change in cash flow generation to end the year.

As just mentioned, most imminently in Q4, we have our best production quarter of the year, driven by production increases at Sadiola and Bonikro in the range of up to 40% over Q3. At Sadiola, we wrap up the Phase 1 expansion and have the benefit of new oxide zones to complement higher-grade fresh ore that can now be processed through the new mill at a higher throughput rate than before. At Bonikro, our intensive stripping campaign over the last year is finishing up and the mine starts a higher-grade mining sequence with modest waste removal in Q4. But our improving performance doesn't end there.

As we look to 2026, the operating and financial performance will transition to a higher sustainable platform with the completion of our development projects. Importantly, the predictability and operational flexibility of Sadiola and our Cote d'Ivoire complex improved prospectively.

In Cote d'Ivoire, we moved to more direct ore extraction at higher grades with less waste movement. At Sadiola, we're able to primarily rely on the abundant higher-grade fresh ore reserves as primary plant feed for up to 60% of throughput. Oxides fill the balance of the mill compared with being the primary feed source in this and recent years. Furthermore, new oxide discoveries represent optionality to potentially increase production levels at Sadiola up to 230 ounces per year in the medium term.

And finally, at Kurmuk, first gold is fast approaching. This will be a step change for Allied, adding a new long-life, low-cost asset that significantly increases group production and cash flow. Kurmuk is expected to be transformational to our portfolio and financial profile. On the chart here, you can see the production growth we're expecting in coming years. This will correspond to impressive top line growth in today's gold environment, the more impressive will be the leverage effect we see in EBITDA and cash flow generation, because of our fixed overhead and decreasing unit operating costs or AISC.

With that, I'll hand things back to Peter for his wrap-up.

Thank you very much, Jason. So in terms of -- just to conclude the presentation, upcoming milestones with our Sadiola exploration update, as Don mentioned, we have demonstrated value creation short term and long term, finding more oxides and expanding the already robust inventory of fresh ore. We have updates coming for our other mines. That includes an exploration update for Kurmuk in November and for the Cote d'Ivoire complex in January. Expect that we will have completed the Sadiola Phase 1 expansion late this year, literally over the course of a few weeks now. That has a huge impact on operational flexibility because of that abundance of fresh ore.

We have an analyst and investor site visit at Kurmuk, which is expected early in Q1. We have the Sadiola Phase 2 expansion update, how we intend to progress to get to that 350,000 ounces to 400,000 ounces per year, which we plan to deliver in January next year. We have had a team in Mali and in Cote d'Ivoire last week on our reserves and resources to complete their work, so that we can provide an end of year reserve and resource update, including the impact of Oume on the Cote d'Ivoire complex. And of course, including in that is Kurmuk, which we expect in February.

Our Q4 results, of course, are expected soon after the completion of the quarter, in late January or early February. We will provide an update on Agbaou and its reserves and resources, which we expect in the second quarter. We start Kurmuk operations in the middle of the year. I should say with respect to Agbaou that of course, the objective there is an extension of mine-life.

Ladies and gentlemen, we've committed to improving improvements in block models and mine plans, our mining efforts, our processing, creating organizational effectiveness that begins with hiring senior local persons to manage our operations. All of that is now in place. We do not identify here the results of that, but those results include improving production and costs this quarter, the quarter that we are now in and into next year. New equipment, better utilization, better mine plans, confident operators, access to higher grade ore, enhanced mining access, and flexibility. And that positions us for a strong fourth quarter and an even stronger 2026 across all measures, including production, costs, and cash flow.

Operator, perhaps at this point, we can open the call to questions.

[Operator Instructions] And your first question comes from Carey MacRury from Canaccord Genuity.

Hello, good morning, Peter and team, and congrats on the good quarter. I guess my first question is just on Sadiola Phase 2 -- Phase 2 -- or sorry, Phase 1 is almost complete. It sounds like you're adding more oxide. When realistically -- like how should we think about the timing of when you'd actually commit to Phase 2 in terms of putting a shovel on the ground?

Yes. So let's begin with first principles, Carey. As I said a few moments ago, in -- either with our year-end results or in advance of that, so that would mean in January, we will provide an update on what we intend to do with Phase 2. We have a feasibility study for a new plant up to 10 million tonnes per year, and that gets us that production platform of 350,000 ounces to 400,000 ounces. That would idle the existing plant. We would commit to expenditure by the end of 2026, and we would be in production by late '28, early 2029.

As I mentioned, that would also mean that we will have decommissioned the existing plant. But over the course of the last 15 months to 18 months, we've been looking at an alternative. It's something that we were very familiar with as a management in Yamana. We're looking at how can we take the existing plant, further modify it to increase its throughput, not to 10 million tonnes per year, but something in between the current level to 10 million. How do we improve recoveries so that we get to a similar production level in the range of 350,000 ounces per year, but with 2 improvements.

The first is potentially less capital. And the second is better capital efficiency. In other words, we're not committing to that capital completely upfront. We're just about complete on that technical work. And with the completion of that technical work, we have Board meetings in December, and we expect then that in January at the latest with our fourth quarter results, we will provide you with our take on what is the best course for us, taking all factors into account, what is the best capital efficiency, delivers the best results and the greatest certainty.

And then maybe just reserves and resource price is pretty low compared to -- we were sitting at $4,000 an ounce. I guess within your portfolio, are there any specific assets that really have better optionality at maybe not $4,000, but higher prices than reserves and resources?

Yes. Really good question. And that one really applies to Agbaou. So part of the effort on Agbaou is a 3-part program that we've undertaken to improve mine life. And one of -- the first part of that is can we look at the pit design at a higher gold price. And we're looking at a $2,000 pit design. What does that do in -- and of course, the infill that follows from that and what does that do in terms of extending mine life.

The other 2 components, of course, is a possible underground and regional exploration opportunity. We'll have more to say on that into next year, as I mentioned, but you should expect that for that asset, we will be using a $2,000 gold price for reserve estimation. We're reviewing what our peers are doing more generally to see what they have already done or what they're planning to do. So we are evaluating at this point, where I'm personally leaning, but we have to have lots of discussions with management is a $2,000 gold price for reserves across the board to complement what we're already doing at Agbaou and $2,300 for resources.

And your next question comes from Justin Chan from SCP Resource Finance.

Congrats on the quarter. I'll consolidate. I have 2 -- instead of one question, a follow-up, I'll just -- if you wouldn't mind, I'll ask 2 separate questions. Just one is on -- just on the accounting. Is the 2 prepays that were mentioned at the end of September in the documentation, were those included in cash flow from ops, just to make sure my model is accounting for everything correctly. That's my first one.

Yes, that's right, Justin. There weren't much…

Okay. Appreciate the color.

Hey, look at maybe the EBITDA, they're not…

And then the second one is, I mean, there's a lot of headlines over the weekend, especially just on supply chains and fuel availability in Mali. I was just curious if you guys could give some color on maybe what you're seeing on the ground. Sometimes there's obviously a difference between what media says and what the actual operators are seeing? So yes, could you give us your perspective on the current operating situation?

Yes. I tried to address that at the beginning, Justin. I think it would be wrong for us to talk about what is the geopolitics of one thing or another other than to say that, look, it's business as usual. There is a fuel disruption. There are many reasons for that fuel disruption in -- that it has affected the capital. Interestingly, as that -- the first of these articles was published on Friday of last week, we understand that roughly 200, 250 trucks filled with fuel came into the capital. And that's about a week supply, and that's typically the way that the capital runs.

So the best that we can say at this point is that there is no disruption to fuel supply lines or other supply lines relating to the mines. There has been some disruption as a result of some insurgency activity in and around the capital. It does appear to us as if there is some alleviation of that. And I repeat what I said before, this is a business-as-usual situation. We in the country, those who are familiar with the country, those who are familiar with countries such as this have seen this sort of thing before. But at the end of the day, the best way that I can describe it is regardless of disruptions, business must go on and does go on, and that's what we expect here.

And your next question comes from Mohamed Sidibe from National Bank Capital Markets.

Just maybe to start with the Q4 guide that you gave with Sadiola and Bonikro being potentially up to 40% higher. What would it take to see, I guess, both operations be closer to that 40% mark? What are the key drivers that we should look for Sadiola and Bonikro?

I'll turn it to Johan in a moment, but bear with us, Mohammed. We are ahead of our expectations for the quarter so far. In the case of the Cote d'Ivoire, we're more than 5% ahead. In the case of Sadiola, just a few percentages ahead. But again, on a production platform, we expect to be greater than Q3. So I think you should expect that we will be able to meet the expectations of getting close to or at that 40%. Johan, I will summarize by saying that in the case of Sadiola, it is these oxide discoveries that were made earlier this year that you're bringing into production, going through the development process and bringing into production.

But of course, by the end of the year, it's the Phase 1 expansion that completes and being able to process some of a greater percentage of fresh ore. And in the case of Cote d'Ivoire, all that effort that's been undertaken to date, including, for example, at Agbaou, where we had waste removal that was very significant in the second quarter that increases production. We're going to higher grades at Bonikro as a result of that waste removal. And that's what accounts for that higher level of production. Johan, did you want to supplement that with anything more specific?

Peter, you've summarized most of it. I want to say that the hard work from the team started in January up to now, created flexibility within Sadiola. You've alluded to the oxide deposits and also the mill start-up that will enhance the throughput in Sadiola with higher recoveries. So more predictable, more flexibility was given into the Sadiola as well as into the CDI complex that enable us to move ore to and from between the various plants that set ourselves up to where we are currently. We're ahead of the Q4 numbers. As you alluded, we're halfway through the quarter already and a positive trend. The teams are doing well. The plans are coming together nicely. Looking forward to the end result, definitely very close to the 40% mark, if not slightly higher, Peter.

And then just if I can move on, maybe on exploration. I think you provided a pretty good update at Sadiola with a lot of outside potential on your exploration target there. But I wanted to maybe shift to Cote d'Ivoire and the visibility at Agbaou and Bonikro. I know there's an update that is coming, but how do you currently look at those 2 assets in terms of mine life remaining? And what do you envision them to ultimately be as a potential source of production for you guys?

Again, at this point, we have not completed the work, but Oume contributes comfortably to Bonikro's increase in mine life. We publicly have said we want to get to at least 180,000 ounces per year from the complex. So roughly 50% from Bonikro and 50% coming from Agbaou. Oume contributes very meaningfully to that mine life extension. It looks as if we'll be above the 10 years for Bonikro. Agbaou is a bit more complex, because it's further behind in terms of the exploration effort.

But with what we're doing, looking at and doing drilling into reachable through added reachable underground, what we're doing with the pit shell with a $2,000 gold assumption and what we're doing with the broader outside of the compensated area exploration effort, we'll begin to demonstrate. We won't get with that update next year. I don't believe that we'll get to 10 years of mine life for Agbaou, but we'll begin to demonstrate that it's more than the roughly 2 years of mine life that we currently carry. And we think significantly in excess of that.

I believe in our MD&A with our second quarter, we indicated that we were looking at 4 years to 5 years of extension. That was our objective. We expect that the exploration results and the other efforts that we're undertaking for with technical services will demonstrate at least that. Finally, then, what's our objective? Our objective is at least 10 years of mine life at 180,000 ounces per year. But we're refining that objective. We're trying to get to 200,000 ounces per year at least that 10 years of mine life.

With that, this becomes a meaningful asset, a very meaningful asset. It will not have the prominence. It does not have the Tier 1 status of Kurmuk and Sadiola, but it does -- it is meaningful. It does contribute to the share price. By my estimation, taking the existing mine life as we show it based on reserves and resources and getting to 10 years of mine life at 200,000 ounces per year, by my estimation, it adds somewhere between $8 and $10 per share. I think that's pretty significant.

And then I guess, finally, with -- you've strengthened your balance sheet with the forward sales agreement, the rates post quarter as well as the good cash flow from operations there. As you're heading into the completion at Kurmuk, better 2026 on free cash flow, the sector is getting, I guess, a little bit harder in terms of M&A. Could you maybe share your thoughts on further consolidation down in West Africa or M&A opportunities that you may be looking at from the acquisition side? Or is that more of a 2027 event and Kurmuk remains a main priority alongside Sadiola?

What a question. So if we gone back a year ago, Mohammed, I would have said, of course, we should be looking at acquisitions, what are the opportunities in Africa, in other developing parts of the world, that's where we still think there's the best juice, where that we think the best value. But frankly, over the course of the last several quarters, we've had a bit of an epiphany. When we look at Kurmuk, that's a real prize. It's a Tier 1 asset. I repeat what I said before, it's a Tier 1 asset.

And we're now looking at how we expand its throughput to match the size that we already carry for the SAG mill to that 6.4 million tonnes per year from the 6 million tonnes per year. That gets the production platform to over 300,000 ounces per year. And with all-in sustaining costs, as we've described them, that means that we're generating some impressively robust cash flows. From a production point of view, mine life point of view and from a cash flow point of view, it is a Tier 1 asset.

And the same would be true for Sadiola. I can't think of very many mid-tier companies that are underpinned by 2 Tier 1 assets. And so that epiphany to which I referred is that we're going to keep our eyes on the prize this year. Keep your eyes on the prize. We don't think that there is anything that is as compelling as engaging in the completion of these efforts that we have inside the company that get us to that roughly 800,000 ounces of production beginning next year to 600,000 ounces and then a few years after that to that 800,000 ounces. We think that that is what delivers the best value for shareholders. We've become a real catch at that point as well, and that has not escaped us.

And your next question comes from Ingrid Rico from Stifel.

I have, I guess, 2 follow-ups on Sadiola. And I appreciate the comments, Peter, on the progressive expansion options and how you guys are evaluating that? But I noticed in the press release, I think it was that you will be proceeding with a pre-leach thickener and you're going to be adding that in 2026. So I guess my question would be, one, on what sort of cost budget do you have for that? And two, what would it do with the recoveries or the improvement on the circuit by adding that thickener?

Hello, Ingrid. Its Gerardo. Yes. It's a small CapEx ticket. It's about $7 million to $8 million. What it does is allow us to manage the density better, so we can increase the proportion of fresh rock up to 90%. And depending on the flexibility from oxides also can lead to increased throughput. So the beauty of it is it works -- it's necessary for both scenarios, the full expansion or the progressive expansion. So we decided to go ahead and start engineering and start the construction next year, so we can see the benefits as soon as possible.

And then just, I guess, more near term and sort of the grade expectation that we could start to see as the Phase 1 expansion is completed and you're able to put more of the fresh ore in. Should we think of grades picking up Q4 and into 2026? And what sort of grades should we be looking for with that Phase 1 completed?

Yes, we should -- you should expect to see the grade improves. Gerardo or Johan, do you want to address where we expect the grade to be?

Maybe I can comment long term. Ingrid, if you look at the inventory of fresh rock in Sadiola, that is in the range of 1.8 grams per tonne. Some areas are higher than that, some areas are lower, but that's the bulk of the -- or that's the average of the -- bulk of the reserves, which is the fresh rock. So long term, that's what we should be tracking towards. And in terms of oxide, there is an upside to connect with what Don was describing with the new opportunities to add moderate grade or high-grade oxides, which allowed the plant to increase capacity and recoveries. Maybe Johan can comment on the short term.

Great question, and Gerardo, I think your numbers are spot on around the 1.7 grams to 1.8 grams a tonne. We do find these honeypots around the Sadiola property with higher oxide grades. But if we look at the average over the life of mine, it sits around [indiscernible].

And Ingrid, we're not complete the quarter yet. But if we go over the course of the last couple of weeks, so it's a meaningful part of the short term of the quarter. We are experiencing, because of some of those honeypots, as Johan described it, we are experiencing grades that are better than what we had planned.

And if I can squeeze just one last question on Kurmuk. And I appreciate that we're going to get that update on the exploration very soon. But just how should we think -- and maybe just some comments, if you can, on the infill drilling and how that's shaping up for grade reconciliation and looking into the grades as you start sort of commissioning and ramping up next year?

Don is on the line. Don, did you want -- Don is remote. So if you're available, Don, did you want -- can you answer that?

Yes. So we're not doing a lot of infill drilling. We're mostly focusing on extending the resources down dip, down plunge, along strike. And so really trying to bulk out the reserve pits as we see them today. We are seeing continuations of the mineralized zones, and yet have not found the limits of the system. And then we're also looking for other optionality things. We've talked about [ Sekenke ] before, which is a 7-kilometer long gold and soil trend. We've been drilling at the south end of that for a good part of the year.

And we have a few other targets that we're moving up the list. We've talked about this for Sadiola in terms of optionality. And again, newer close to surface discoveries will provide more optionality for Kurmuk going forward. So the update near the end of this month should -- we'll present all of that.

Maybe to complement Don's comments and addressing your question, Don was referring to what we're doing now looking into the future, but we -- what was done in the past in 2024 and into the beginning of 2025 was to do confirmation drilling, especially around Dish, not much in Ashashire, but heavily in Dish. And that information has been modeled. We have ore exposure now with the mining at both deposits, and we're confirming the interpretation of the geology and the drilling is also confirming the grades and the mineralization as we had it in the plan. So it's very positive from that perspective on risk management and setting us in a good position to the -- start our operations next year.

So looking forward to that Kurmuk update later this month.

[Operator Instructions] And your next question comes from Luke Bertozzi from CIBC.

Just to follow-up on Ingrid's question on the pre-leach thickener at Sadiola. Can you give us any indication of when that pre-leach thickener could come online? Should we be expecting that to impact 2026 production?

Yes. Look, towards the end of 2026, we haven't issued our guidance, so we cannot quantify how much the impact will be or disclose it. We have an idea, but bear with us when we issue guidance, we'll reflect it there.

Luke, we've indicated that we see Sadiola in its current form before the second Phase partial or whole expansion being in a range of 200,000 ounces to 230,000 ounces per year. This is part of the plan to get that higher level of production. We'll have more to say on it as we complete some of the work to the end of this year when we give our guidance for the next year.

The rest of my questions have been answered. So, I'll leave it there.

Operator, are there any other questions?

No, there are no further questions at this time. So I would now like to turn the call back over to Peter Marrone for the closing remarks. Please go ahead.

Ladies and gentlemen, thank you very much for your participation on this call. We look forward to several of the milestones that we mentioned being provided. Any questions or comments, please do reach out to any of us. And we look forward to seeing many of you on -- in-person at our site visit at Kurmuk in January. Thank you very much.

Thank you all for joining us this morning. Before I turn the call over, I need to advise that certain statements made during this call today may contain forward-looking information, and actual results could differ from the conclusions or projections in that forward-looking information, which include, but not limited to, statements with respect to the estimation of mineral reserves and resources, the timing and amount of estimated future production, cost of production, capital expenditures, future metal prices and the cost and timing of the development of new projects.

For a complete discussion of the risks, uncertainties and factors, which may lead to actual financial results and performance being different from the estimates contained in the forward-looking statements, please refer to Allied Gold's press release issued last night announcing Q2 2025 operating and financial results.

I would like to remind everyone that this conference call is being recorded and will be available for replay later on today. Replay information and the presentation slides accompanying this conference call and webcast are available on Allied Gold's website at alliedgold.com. I will now turn the call over to Peter Marrone, Chairman and CEO.

Operator, thank you very much, and thank you to everyone for participating in this call. With me today are members of management, including our Head of Exploration, Daniel Racine, whom you know who will speak to our operations. Johanne is at operations, and so he is available on the call for questions, but Daniel will take the charge relating to the better explanation or at least continuing explanation of production, and Jason LeBlanc is here, our Chief Financial Officer.

Let me begin into the presentation. In the first couple of pages of this presentation, we talk a little bit about some of the things that are fundamental to the mining business and often take a little bit more time to complete. Drilling for high grades in Cote d'Ivoire and in Sadiola refining block models, which will continue into the second half of the year and the importance of it. And that allows us to be able to get confidence into higher-grade areas for forecasting, certainly better short-term planning and more reliability and predictability.

One of the things that we did in the second quarter was we made a decision to do more stripping, more waste removal at Agbaou. We continued with the waste removal at Bonikro. And we began certain cost reduction initiatives in Côte d'Ivoire and Sadiola and procurement improvements.

What's the objective though? The objective, particularly with improvements to block models and the waste removal at Agbaou is to access higher grades in the second half of the year and beyond. We publicly said that we expect production to be weighted in favor of the second half of the year to the tune of 55% to 45% with a whopping increase and higher production with much lower costs in the fourth quarter.

I think it's important to explain a few things that perhaps come out of our MD&A and our financial results, but I think it's important to highlight. Our guidance at the beginning of the year did not consider that waste removal at Agbaou. That added roughly $850 per ounce to its costs, which would have a large impact on the total production given the order of magnitude, roughly $160 to $180 per ounce. This was an executive decision. We did not have to make that executive decision. But without waste removal, our costs for Agbaou would be more in line. However, we developed a plan for Cote d'Ivoire, which includes underground drilling, along with drilling of adjacent areas to our mining tenements.

It also includes maximizing production and mitigating costs to pay for that. Waste removal at Agbaou provides for roughly 4,500 ounces of increased production this year. And we estimate based on drilling alone and based on the efforts that we've undertaken so far with some of the waste removal between 11,000 ounces and 15,000 ounces of increased production next year. Without that, we would be winding down the operation beginning next year.

Now this gives us cash flow and runway to carry out the balance of the program that we've begun and we will continue to highlight to the end of the year and into the first quarter of next year to increase mine life. The worst-case scenario for any operation, as most of you know, is to shut down or suspend an operation, particularly in the situations where there is daylight improvements and increases in mine life. Let me be blunt. This is a decision that this management made in the second quarter. More precisely, it's a decision that I made. The sacrifice was 1 quarter's costs in favor of lifeline and longevity. And more to the point, while that waste removal came at a cost as we disclosed, the reasoning -- my reasoning was that the value of an extra almost 20,000 ounces of production over 18 months, the second half of this year and all of 2026 at that operation by far exceeds the cost. That's in value alone.

And then the value of maintaining a continuing operation without suspension and shutdown and what to do with reclamation and closure costs and employees adds to that value. We are now comfortable saying to you that we will be at 180,000 to 200,000 ounces of production for Cote d'Ivoire in 2026. I anticipate that when we give our guidance at the beginning of the year, we will comfortably tell you that we can get closer to that higher end of production.

I want to make one more observation, and that's this. We should have explained 2 things better. One is the complexity of mining, particularly at these operations. And on that, consider what we refer here as the refinement to the block models. Consider how long it takes to overhaul a block model with all of the drilling and informational data that relates to the operation on so many deposits at current and planned mining areas. It's not just one open pit, it's several areas of mining, particularly at Sadiola and Cote d'Ivoire. I give that just as an example. I'm not defending poor behavior. What we could have done is we could have gone faster. But the decision that was made, the executive decision, my decision was to take time to get it right.

The other is that we are heavily weighted in the second half of the year. And in the second half of the year, we expect to get higher grades, operational flexibility at Sadiola, consider that we can process more of the fresh ore, which is in ample abundance by comparison to the oxides. And just to give you an indication, in July, our production is in line with our budget. We expect to produce, as we've guided, roughly 91,000 ounces in the third quarter comparable to the second quarter, but our costs are coming in at considerably improved levels. Agbaou is already $1,000 below the Q2 level. Bonikro is roughly $1,800 per ounce, and that will trend down through the year, through the rest of the quarter. And Sadiola is at about $400 to $500 better than what we delivered in the second quarter.

So we are -- in July, we're producing gold at approximately $2,000 to $2,100 per ounce, and we expect that, that will continue to trend down for the balance of the quarter and certainly into Q4. Mobilization of new mining equipment, again, critical. The mines that we have in this company were delivered with a former mine contractor. When a new mine contractor took over, it was with the historical mining equipment, and it was coming to its last legs. We were bandaging that equipment. We now have new mine fleets, much of which has arrived. And that improvement means that we have fleet availability that gives us the confidence to be able to tell you that, that second quarter and into 2026 will have higher throughput, operational flexibility, and that will lead to improvements to operations as well.

Exploration. We've been getting some significant feedback on what's happening on the exploration side. And let me begin with the punchline. We've increased our exploration budget from $20 million to $37 million. We're confident in our balance sheet, confident enough that we can spend another $17 million. It's performance-based. On our 3 operations. We are targeting an increase of mine life at Agbaou, as I mentioned before, by a pit expansion, high-grade underground prospects and targets that are outside of the compensation area. Oume is at development north of Bonikro, where we're seeing significant increases in resources that will extend its mine life. We're targeting a large increase in Sadiola of total inventory. But just as importantly, we've made discovery of new oxide ounces. And those new oxide ounces will provide further flexibility on operations and also improvements to production and to costs.

At Kurmuk, we achieved our project milestones for the second quarter and equipment is being delivered to site, and we expect to advance the resource model later this year. Daniel will speak to the operations. He will speak to Kurmuk and go into some of the detail, but I will give you the high level. In terms of the high level, these are the important milestones; substantial mechanical completion by the end of the year, the power line before the end of the first quarter, mining and sequencing, which we've already begun, and we expect to have at least 4 months of stockpile at surface by the time we start operations. And some of that stockpile will be much higher grade. We don't want to process that high-grade material as we commission the plant from April through to the end of the second quarter next year.

And production, production starting formally in June next year. So we're on track to be able to deliver that for the partial year next year, 175,000 ounces of production. At Sadiola, we're near complete on the Phase 1 expansion. And as I mentioned, that will give us increased operational flexibility because we can process more of that abundance of fresh ore through that plant. And in terms of the long term, we've always talked about the second phase expansion, but we're now looking at the opportunities for us to do an incremental expansion that would allow us to get to a comparable production level as Phase 2 without having to spend that full $400 million for that larger plant, and we'll have more to say on that by the end of this year as we complete our technical studies.

I want to make a few other observations that relate to Mali, and these are important points in my view. The environment in the country has significantly improved. There is a better geopolitical environment. There's more support for mining investment and for private investment. We've had improvements to the asset from a geological point of view with exploration, as I mentioned, with optimization and improvements of the asset and with that Phase 1 expansion now nearer to completion. So the result of all of that is that it led us to a further point, which is that we decided that we were in a far better position to deliver value to shareholders by taking a progressive self-reliant approach relating to power and not looking at corporate transactions that would mitigate our engagement in and our ownership of that asset. We listed on the New York Stock Exchange. We completed a share consolidation, and we reduced the holdings of some of the larger shareholders through secondary trades. The result of all of that is that we have significantly advanced from a market point of view as well. And that is just to give you a summary of some of the things that we've undertaken through to the second quarter this year. And with that, please let me pass it to Daniel to talk about our operations.

Thank you, Peter, and good morning, everyone. I will now go through the -- some highlights of the operation and the project in the second quarter. Our production was solid at 91,017 ounces and in line with plan and tracking well with our guidance for the year. All-in sustaining cost was $2,343 per ounce of ounce sold. This was driven by sales lagging production due to the timing of gold shipments, which will reverse and benefit us in Q3. Also, as we've described with our guidance, higher gold price impact all-in sustaining costs due to higher royalties, especially with the Ad valorem component. In general, we have said that every $100 per ounce increase in the price of gold results in $15 per ounces higher and all-in sustaining cost. Our baseline for our guidance was $2,500 per ounces. At an average realized gold price in excess of $3,250 per ounce in the second quarter, consolidated all-in sustaining cost was impacted by over $100 per ounces.

At Agbaou, as part of our revised strategy to access more ore in the future and allow more time for exploration to extend mine life, we prioritized waste removal over ore extraction to better manage storm water in the pit and to secure access to higher grade ore in the second half of 2025 and beyond. Mine sequencing and the increase in stripping resulted approximately $850 more in all-in sustaining cost per ounces in relation to the first quarter of 2025.

While waste movement is expected to continue at similar level for the remainder of the year, ore feed, gold grade and production are expected to materially increase quarter-over-quarter, resulting in reduced costs in the second half of the year. As we discussed earlier this year, we expected production to be skewed toward the back half of the year with a 45-55 split across between the first half and the second half of this year. Q3 production should be similar to Q2, while Q4 production is expected to be meaningfully higher between 118,000 to 122,000 ounces. Costs are expected to trend down as production increase in the second half, driven by higher gold and reduced expenditure. Assuming gold at $3,000 per ounces, we expect all-in sustaining cost to average $1,850 per ounce in the second half of the year with declining costs quarter-over-quarter.

Due to ongoing exploration successes, a further $17 million has been committed in 2025 on an incremental program in Côte d'Ivoire, Kurmuk and Sadiola. The total 2025 exploration budget is now $37 million. For Côte d'Ivoire, we have allocated $7.5 million on new funding to pursue opportunities to extend mine life, including drilling the Agbaou West and East pit extension, the [ ErayAkisiso ] underground target and other new targets. At Sadiola, we are allocating an additional $5.7 million to continue testing and extending structure at Sadiola Main, Tambati, FE2 trend, Seckoto trend and FE4. The exploration is focused on both oxide and fresh mineralization with the preference for oxides in the near term.

For Kurmuk, we have assigned a further $3.7 million in budget with a goal to add new mineral resources and convert inferred to indicated. Drilling will continue at depth and along strike at Dish and Zenke as well as drilling the Urchin target located near Ashashire. This work is aligned with the goals of the company to achieve an inventory of over 5 million ounces at Kurmuk.

At Sadiola in Q2, production was 49,283 ounces with an all-in sustaining cost of $2,471 per ounces. Costs, as previously mentioned, show the effect of higher gold price in the royalty construct, especially at the higher relative contribution from Korali Sud in the quarter, which is subject to higher royalties than Sadiola. It is worth mentioning that we are finalizing the first phase of Korali now. And going forward, the plan focuses with Sadiola mining -- within Sadiola mining license, reducing the royalty impact into the cost structure.

Construction at Phase 1 expansion continues to advance according to plan with expected completion in Q4 2025. And I will speak more in detail about it in the next slide.

At Bonikro, production was 25,775 ounces with an all-in sustaining cost of $1,592 per ounce. This strong performance was driven by higher grade, increased throughput and improved recoveries. First half stripping is expected to result in substantially lower costs beginning in Q4 of this year, which will carry in 2026 and beyond as grades are expected to be higher and waste removal will be minimal. At Agbaou, production was 15,959 ounces at an all-in sustaining cost of $3,104. As I already mentioned, mine sequencing and increased waste removal drove the cost up. And this is expected to result in higher production at lower cost for the remainder of this year, and it allows us to access more ore in 2026, allowing for exploration to focus on long-term target to increase mine life.

Moving to our Kurmuk project. We're pleased to say things are progressing very well. We have achieved several significant milestones in the second quarter. The first picture described graphically what was our focus during the first half of this year and in the second quarter. We went from the planned concrete contractor to the structural and mechanical contractor at the end of the second quarter. We started and ramped up the delivery of key components to the site such as the CIL tank, the ball mill, which we see in the bottom picture and fabricated steel among others. While other major components were on route to the site according to the schedule, the mechanical contractor was mobilized earlier in the year along with the equipment. And in Q3, the focus is on ramping up activities. A very important milestone was achieved in Q2 that is relevant for the start of the operation was the substantial advancement of the key bulk earthwork outside of the process plant area, which we achieved ahead of schedule. This includes the main water dam, which is receiving water as we speak and the tailings facility, which is well advanced. It was key for us to advance these 2 areas ahead of the rainy season, so we can store water for the plant start-up in 2026.

Another achievement that is very important to the execution schedule is the progress we made in the permanent accommodation camp to near completion in the quarter, allowing the project and mining operation to ramp up their manpower requirement as per the schedule in the second half of the year. Speaking of mining, the mobilization of the mining fleet is ongoing with the shovel and truck, which delivery to site occurred in July and mining pioneering was completed during the quarter.

In terms of what comes next, we plan to start pulp mining activity with the new fleet now in Q3, so we can stockpile ore ahead of commissioning. We will complete engineering in Q3, and we expect to make substantial mechanical progress in the plant area by the end of the year. We expect the EEP to energize the power line in Q1 2026, and we expect commissioning and first gold pour to occur in mid-2026.

Turning to Sadiola. Phase 1 expansion is also progressing well. During the second quarter, we completed engineering. The team basically finished the concrete work and added over the areas to the mechanical and structural contractor. And similar to Kurmuk, we took delivery to site of steel and the ball mill. We've also secured the power supply for Phase 1 and the shipping of crushing plant is in progress. Upcoming, we expect the Stage 1 crushing to be operational in Q3, and the new mill is expected to ramp up in Q4.

As a reminder, the Phase 1 expansion is a key development for Sadiola as it will allow the plant to process 5.7 million tonnes per year of ore with a blending up to 60% of fresh ore. And most of the near -- the reserve, 7 million ounces in reserve are fresh mineralization and with higher grade than the oxide in inventory. With Phase 1 in production, Sadiola is expected to produce between 200,000 and 230,000 ounces per year in a sustainable way and in anticipation of the next expansion phase. On this, we are advancing the progressive expansion studies, which is aimed to define a growth strategy with lower capital commitments, leveraging the installed capacity after Phase 1. We expect to finalize the trade-off study by the end of this year, which will include an update on the opportunity to increase recovery using the flotation and Albion.

In Q2, we advanced the second phase of metallurgical testing for Aldeion, and we are advancing the flow sheet development now, and we expect to complete the studies also in Q4 to inform the path for expansion I just mentioned. Last but not least, we spent a significant amount of time and effort in refining our power requirement and updating our power supply strategy for Sadiola throughout its expansion phase. As Peter mentioned, we have landed on a short list of solution we are busy negotiating at the moment and that we expect to be completed by Q4. With that, I'll pass it to Jason.

Thank you, Daniel. We had solid financial performance in Q2 with adjusted earnings per share of $0.14 and operating cash flow before taxes and working capital of $116 million. The balance sheet is strong with cash and cash equivalents of about $219 million at the end of the quarter. We have an undrawn credit facility of $50 million and further liquidity available from future draws on the Kurmuk stream, which totaled approximately $88 million. Aiding in liquidity during the quarter, we closed on a bought deal offering and facilitated a block trade, improving our balance sheet and increasing our float.

Looking forward, we expect 55% of annual production to come from the second half of the year, although more weighted to Q4. More significantly though, we'll have a magnified effect on cash flow generation from lower unit operating costs that are expected for the balance of the year. With that, I'll hand the call back to Peter.

So ladies and gentlemen, let me pick up again on the guidance point, 175,000 ounces in the first half of the year versus expected and planned 210,000 ounces in the second half of the year, that 45-55% split, $1,850 all-in sustaining costs. We are no longer reliant on Korali as of the end of the second quarter. We have better economics with the ore that we process from Sadiola proper. In the mining tenements, we have oxide ounces at Sadiola that come in at lower cost that we process through our existing plant. Phase 1 will be completed by the end of this year, which gives us more flexibility to mine fresh ore, which is in abundance and comes at lower cost. We will have higher grades beginning this quarter and into next quarter at Agbaou through 2026, and that's true for Bonikro as well.

And finally, in terms of the longer term into next year, we're still forecasting roughly 600,000 ounces of production next year at improved costs and that production contributes to better EBITDA. We are now 8 months away from commissioning at Kurmuk.

In terms of upcoming milestones, an exploration update based on the successes to date that has justified that extra $17 million to which Daniel referred for Sadiola, which is expected in October, Kurmuk in November and Côte d'Ivoire in January with a more comprehensive plan in the first quarter next year, by the end of the first quarter for how we intend to extend mine life and the successes we will have had at extending mine life at Agbaou. The Kurmuk reserve and resource update by the end of the fourth quarter this year. We will provide an update for Oume as part of our effort at Côte d'Ivoire later this year. As Daniel mentioned, the completion of the Sadiola Phase 1 expansion later this year. We remind everyone of the investor and analyst tour at Kurmuk in January of next year. The Sadiola expansion update, again, what Daniel referred to as the interim steps or the modified expansion rather than Phase 2 by the first quarter next year. As I mentioned a moment ago, the Agbaou reserve and resource update for the second quarter of next year and the start-up of Kurmuk operations within 8 months with commissioning beginning in April and production in June. Operator, let me hand the call back to you for any questions.

[Operator Instructions] And your first question comes from the line of Carey MacRury with Canaccord Genuity.

So Peter, it looks like you're making good progress at Kurmuk. I'm just wondering with the costs incurred to date, how you're tracking along your budget assumptions.

Carey, Gerardo. Yes, we're tracking well according to cost. We do see some trends like in any project, but also we have levers to pull in terms of what comes next. So we're busy right now detailing the plan for the rest of the project and then making some tweaks obviously, with the aim to remain within the budget allocated to the project.

Okay. And then just regarding the balance sheet, obviously, without the $145 million coming in from Ambrosia, do you think you have enough buffer on the balance sheet to kind of see it through at these oil prices?

Yes. So again, a really good question. And while we touched on it, I think it's important to go into a bit of a better detail. So Carey, we talked about $145 million of upfront payment for the 50% interest of our interest in Sadiola. In the course of negotiations, there was some back and forth of when a portion of that would be paid. Was it paid upfront? When would the closing occur.

Let's call it a full $190 million to $145 million that would be completely upfront, the difference within several quarters, which was what the negotiations were -- where the negotiations were at. I think we have to look at it from the lens of what does it mean from a 12-month or 18-month perspective based on the higher gold price. Where were we in February with gold price? Where are we today? And with the higher gold price, particularly with the floor of the collars that Jason has put in place with at least $3,000 into next year, our conclusion was that we generate at least that much in cash flow for that period. So we're not getting any benefit for selling a portion of Sadiola for that $90 million to $145 million, even at that $145 million upfront amount because we're generating that in cash flow and the balance of the payments were actually made over time over the course of a 5- to 6-year period. So that's one of the reasons that led us to the conclusion that we were in a better position in part because of gold price, but in part because of improvements to the asset. And also in the context of improvements, we're now at the back end of the completion of Phase 1's expansion, which gives us, as Daniel said, a very comfortable, reliable 200,000 to 230,000 ounces at better costs.

We've got an abundance of fresh ore. The challenge for this operation is that it was designed for as an oxide mine with a plant that accommodates oxide ore. That's up until present date with the exploration effort, we're now beginning to see some clarity to that. But up until present date, that's been the challenge, which is finding oxide ore. But with the ability through the first phase expansion to process more fresh ore, we're in a position to more comfortably produce that 200,000 to 230,000 ounces at better costs, generating better cash flow. And at a $3,000 gold price, that cash flow matches what was the upfront payment.

Okay. That's helpful. And maybe one last one for me. Just on the $1,850 cost guidance, you know that's at $3,000 an ounce. Should we still be using the $15 per $100? We've got gold prices sitting just south of $3,400 now?

Carey, Jason here. Yes. No, it's going to be higher just because that guidance was provided, call it, at the margin for movements in gold prices. We've seen gold prices move quite a bit. So the impact on royalties isn't purely linear. There's a curve to it, right, because of step-ups. So I'd put it closer to $20 on a $100 basis go forward here.

Carey, look, it's difficult. We'd love to be able to give like a raw number and say this is exactly what it is, but we can't predict what the realized gold price is, and we do have these ad valorem royalties that are predicated on gold price. Jason's, $20 per ounce is a reasonable number on the back of a $300,000 gold price. Why did we use $3,000? If we look at the average for the first and second quarter, we were roughly a realized $3,000 gold price. So that's the reason for using that as a baseline.

[Operator Instructions] And our next question comes from the line of Mohamed Sidibe with National Bank Financial.

Maybe to start with Sadiola and your decision not to go ahead with the sale of any interest in the mine and the power solution. Could you provide us with some more color on the power solution and how you expect Allied Gold to participate in that? Should we expect some financial investments from you in that? And then how would that potentially impact your cost profile into next year?

Yes. So Mohamed, another really good question and one of the -- amongst the many drivers of why we chose to go down this path. Solar is -- comes across as an admirable solution, right? We had contemplated as part of the corporate transaction, we contemplated 20 megawatts coming from solar with battery backup. But as we look at it from the lens of what's the installed capacity versus the utilizable capacity because solar doesn't work in cloudy period, certainly won't work at night. So when we looked at the installed versus utilizable, and then what is the order of magnitude difference between a smaller solar field, a smaller array of solar panels versus a larger one, it's an order of magnitude difference. So to get 20 megawatts with the installations between 100 and 120 megawatts and the ratio is even greater than that on the battery backup that goes with it. So that's a very large solar field. It's a very large battery backup system. And the cost is not an incremental, hey, what if we go from 8 megawatts to 20. It's not the difference between 40 million to 2.5x that. It's an order of magnitude difference. And that was affecting our costs. And so we publicly said we want to get to an average somewhere in the range of $0.16 to $0.17 per kilowatt hour, but we want to get there from the get-go.

And so the best way to be able to deliver that is with a combination of thermal, some diesel and solar. But solar should be substantially smaller. We're estimating in the range of 8 megawatts, perhaps as much as 8 to 12 megawatts, but also make it scalable. There's one more point that I think is important here. And that is that we do want to make it scalable. The original proposal provided us with the power that we required, but only for the first phase, we still have to go from 20 megawatts to 38. With this approach, we now have the flexibility to be able to do that and to do it modularly. We can actually expand on the thermal with an extra engine. We can expand on the solar with the installation of a greater array of solar and battery backup. And that incremental is consistent then with the approach that we're taking on the expansion to the asset.

You asked the question, is there an upfront amount that we need to invest? And the answer is we're looking at this from the point of view that this is installed, that it's turnkey. We pay an amount per kilowatt hour in the range that I've just described to you and as an average. And that's what we would be doing. However, we do have the flexibility to say that we would be an investor. And that's part of the discussion that's taking place in the context of the broader geopolitical environment in the country.

Power is increasingly important in the country in order to fulfill some of the objectives of government to encourage investment. There is some inflexibility, some challenges on the power grid, as you are aware, or the 2 power grids. So one of the options available to us is to actually scale this greater than what we need to provide us with backup for when we need it, but also to provide power back into the grid. So these are some of the things that we are advancing near complete in the discussions, and we are considering the possibility of having a direct investment, which would give us a stake in the game, not just an offtake from those who install it.

If I could maybe shift to the operations. So Sadiola, specifically on the feed coming from Korali Sud given the fact that it's higher royalties. I know that it's substantially done by the end of Q2, but should we still expect some contribution in Q3 from that, that could potentially impact the royalties and the cost there?

So the answer is no. In the short term, we did not plan any additional ore sources from Korali Sud. The focus is on Sadiola with oxides and then also the fresh material going forward.

Great. And then just on Agbaou, I just wanted to confirm in terms of the CapEx and the waste stripping into the second half of the year. So I understand the higher production with the higher grade and throughput into there. But waste stripping, I'm guessing it will continue at these levels for the second half in order to better gain clarity on 2026? Or should we see that trending lower as well?

Stripping will continue. So the waste removal will continue, but the cost per ounce will become substantially lower because we will be getting into higher grades. And so in other words, the denominator becomes larger, the number of ounces increases relative to second quarter.

Jason, go ahead.

Yes, Mohamed, just to carry on to what Peter mentioned there. Yes, I think so as we said, waste, the total tonnes are going to be similar, but we've got more ore coming from that activity. So the strip ratio drops pretty substantially. So that results in a lower cost, as Peter mentioned there.

And there are no further questions at this time. I will now turn the call back over to Peter Marrone for closing remarks.

So ladies and gentlemen, thank you very much for participating in this call. And we do have a number of presentations to sales desks and meeting with our investors, and we are looking forward to that. And we're looking forward, of course, also to our third quarter results. And I want to reemphasize the importance of why we're saying that, that guidance for the second half of the year and into 2026 is well within our reach as a result of all of the steps and approaches that we've taken through to the end of the second quarter of this year. Ladies and gentlemen, thank you very much for participating on the call.

And this concludes today's conference call. Thank you all for joining. You may now disconnect.