Good morning and afternoon. My name is Sylvia, and I will be your conference operator today. At this time, I'd like to welcome everyone to the B2Gold Third Quarter 2021 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. Mr. Johnson, you may begin your conference.

Thank you, operator. We welcome everyone to our third quarter and interim results call. I'm just going to say a few opening remarks and then pass it over to Mike Cinnamond to walk you through the financials and then we're going to open it up to any questions. As you can see from the release, we had another strong quarter in the third quarter and despite once again, the challenges of COVID and some inflationary pressures on the cost side, so we're pretty pleased with the results of what we're seeing in the third quarter. Leave us in, as you'll hear from Mike, very strong financial position now and going forward, being strong in cash and debt free, and looking to generate some $650 million over the year from cash flow operations. Mike will go through the details on that. The books for the company going forward with continuing to optimize responsible profitable goal production and Mike will talk more about our new guidance, [indiscernible]. And other things, we're going to continue to advance our development projects, so obviously Gramalote, we're looking out a feasibility study by the second half of next year and we've had some positive results from some of our engineering review so far and looking at the capability to reduce capital costs. And also we're drilling away looking to turn some more inferred into indicated, so we can divide the capital potentially over time by anyone [ph] else . So, we think that's heading in a positive direction, program at Gramalote. I think the other thing that has got us pretty excited is the potential we are seeing from the Menankoto in the Anaconda area 20 kilometers north of Fekola. And the excitement there is the ability initially to start hauling saprolite weathered material the 20…

Okay, thanks, Clive. So I'll start - I will walk us through the three - the results for the quarter, some commentary on year to date, and then just how we see the year panning out. So firstly, on the quarter, revenues of 511 million, so that was based on the sale of 287,000 ounces, at an average released price in the quarter of $1,782. So year-to-date, our average released price for sales is $1,794 per ounce, so very close to that $1,800 price that we've been - that we used just to put out our cash flow guidance so really reinforces that we're still on track there. On the production side, good production quarter, we were on a consolidated basis, including our share of calendar results, total production was 310,000 ounces, which is 21,000 ounces, ahead of budget where we thought it would be and the reasons for that are really the same as we talked about in the earlier quarters in the year. Fekola is still a production machine, there's higher melt throughput going through there, closer to 8.4 million tons annually, so far this year versus the 7.7 5 million tons that we assumed in the budget. And now that Fekola is using - are pulling some low grade material from the stock falls into fill that additional production mill feed, so we can see slightly lower grade overall going through the mill but production is up. So for the quarter Fekola, 166,000 ounces beat budget by 10,000 ounces. Masbate, 61,000 ounces in the Q3, 1000 pounds is better than budget. Aain Masbate just continues to outperform the model with better grades and better recoveries than the model shows, so that's a good positive difference. Now there was - but the highlight and we did mention it…

You mentioned the dividend, Mike?

I did.

I was looking at [indiscernible]. Okay, thanks, Mike. We're going to open up to questions soon. Just to comment, I guess, we were very pleased with the third quarter results, as I think many of our shareholders will be as well. And, for the analyst, we know you guys have a tough job and lots of companies to cover and lot to do. And I think for the most part, you get to write and do the job. The one thing that's disappointing is to see when you have a $0.01 miss on earnings per share to see headlines that say Q3 missed, I think you might want to consider a better way. I think you're doing a disservice to our shareholders, your clients and companies when you do that with a glaring headline, how about the cash flow, how about other positive things. So just a suggestion that can trigger the algorithms, it can cause selling, it can cause the investor that reads only headlines to sell shares etc, I just think it's a - there is a better way to do it, so just that's just my comment for the day, bit of advice. So that I think we'll open it up for questions. We have the entire executive team available here so we can pretty much answer any questions. If you are an analyst and you want to go into great detail about the strip ratio three years from now for Fekola or other such things I would ask you to reach out to me and or you can actually contact Bill Lytle directly at blytle@b2gold.com. There you go though, with any detailed questions. We do respect the fact that you've got models and you want detail, but this is not the time to ask too many I think questions of that nature with a lot of people on the line. So with that, let's open up for questions.

[Operator Instructions] And your first question will be from Tyler Langton at JPMorgan, please go ahead.

Good afternoon and thanks for taking my question. I guess maybe just starting with cost, you mentioned that sort of costs were are a little bit higher than budget levels in Q3 but offset by the strong production. Can you just give a little color about sort of how you see cost sort of trending in Q4 and heading into 2022 to kind of just sort of general prices to remain at current levels?

I can give you a very high level thoughts on it. And Bill - maybe pass over to Bill afterwards, because some of the detail but production wise, we are seeing fuel price inflation. Some are of year-to-date, it is probably close to 10%, I would say. But like I say we have fuel derivatives in place that offset probably half of that cost right now. Are seeing some other input costs that are higher, certainly in transportation, some of the input cost. I mean, overall, if I had to guesstimate cost inflation, you're probably looking at 5% or 6% for the year, that's probably in the ballpark. And then you're looking at production increase against budget somewhere in that 4% range, right. So you can see that that manage to eat up quite a bit of that cost overrun to offset.

Yeah, and maybe just to add to that, certainly, shipping costs are a big one, right. The cost of shipping has gone up significantly this year and we'll see those carry into 2022. And then of course, labor - as various economies are seeing inflation, inflationary pressure, of course, the employees are also seeing that so they're asking for a pay raise. We did a really nice thing actually, this year, we locked in, at Fekola, our key asset, we locked in increases for the employees basically about 5% per year over the next three years, basically guaranteeing that can be stabilized and of course, we typically at Otjikoto do the same thing where we have a two or three year agreement, which is - will be up for discussion this year, so that's already started for 2022 but we would see that also in that kind of 5% to 7% range is probably where we'll end up. And so I would say shipping, fuel, spare parts, they are also up. We had a good discussion with Caterpillar here in September. Caterpillar has awarded B2Gold Global pricing. So basically, we get the same price for everything but they have announced that because of production costs and shipping costs that they will be passing along some increases as well in that regard, so those are the main things.

That's helpful. And just with Fekola and production, I know you've been sort of given sort of formal guidance in the next several years, but could you just talk about I guess, directionally how you kind of view production with Cardinal sort of coming in maybe the talk north, a little bit later to sort of the moving parts that could affect production there over the next several years..

We're still obviously working on that. So Cardinal, what I think basically we've talked about, it's an inferred resource of north of 600,000 ounces, we would see that over the next kind of four to six years putting that into production. One of the things we are doing to make sure that we come in line with guidance, is we are drilling off the 2022 production into reserves. So that'll be out by the end of the year, then we'll do the same thing in 2022, at least for 2023. So we're going to try and be a year ahead. I think what we've been saying is we're kind of in that 60,000 ounce plus minus range for Cardinal coming in but then of course you've also got what could be Anaconda at Bantako, we have a mine plan on that right now depending on what happens with Menankoto is how we'll decide to go forward but certainly, we could see a couple of 100,000 ounces over the next couple of years if we so chose coming instead being trucked in from Bantako. So those - all those things are in play right now. What I'll say is that if you remember there was a dip actually in 2022 in production when we did our original life of mine, but we've pulled that dip out of there through some of the work we've done at Cardinal and potentially an Anaconda. We see 2022 not finalized yet, but it's going to be a really good year. As far as the production, I think I'm not going to say it's got a six in front of it, but I'm saying we're going to get up near that number for sure.

Perfect, thanks so much.

Thank you. Next question will be from Joshua Wilson at RBC. Please go ahead.

Thanks. First question is on Cardinal. Earlier in the year, when the opportunity was discussed, there were some guidance about grade for the initial feed being about three grams. I know the resource when that was issued was lower but the initial stockpile that's been built up is also kind of more along that overall resource grade about one and a half grams. What was sort of the difference between the initial guidance and what the stockpile looks like now?

Sorry, I don't understand the question. You mean the grade or -

Yeah, for the grade. Yeah, so the grade, I think initially - I know the overall Cardinal speed was or the resource about 1.5 but I think there was some guidance earlier this year that it was it was going to be significantly higher initially, unless I'm mistaken. And the greatest is 1.5 today. Was there a variance versus expectations there or?

No, no, I think certainly, we've seen really what - everything that was in the inferred is kind of played itself out so far. What I will tell you is that like, in 2022, we're going to see the grade from Cardinal increase a little bit, I think it's going to be - it's above two grams per ton for sure in 2022. And as we bring that in reserve, of course, we'll report that.

Okay. And as a relates to looking at the overall split in terms of processing the guidance for 9 million tons of feed going forward is pretty similar to what the assets doing now. Should we assume a similar kind of split between the sulfides and the oxides that the assets processing today is kind of continuing going forward?

Yeah, well, that, once again, is kind of a - I think John is on the call, so he can correct me if I'm wrong here. But what we've always said is that we don't think that really that the mill can handle more than that 10% to 15% of saprolite material. And so it all depends on what the mind plan has for Fekola and the saprolite that's available at Cardinal and whether or not we bringing Bantako in. But what I'll tell you is that if we can get 15% saprolite, we feel pretty good at that 9 million ton per annum. And once again, that also assumes that the material doesn't get significantly harder as we go to depth at Fekola but that's kind of what we're projecting at this point. I know, John, if you want to add anything there?

Well, that's right, Bill. I think everything you said there is accurate.

Thank you.

Sure. Alright, and then maybe final question as it relates to Gramalote. With a bit of work that's sort of been done since the last update, is there any kind of additional insight into the I guess the extent of the changes and what the permitting, the modifications that would be required for that would be or is it still a work in progress?

Yeah, I just kind of update you on where we're at. So you remember, there's a bunch of things going on here. Number one, there's the engineering work, where we're basically trying to simplify the process and take out some of the confusion, which has happened over 10 years of design. That work is has been very successful and we've certainly seen some uplift in the IRR related to infrastructure, the resource and drilling is ongoing, they actually have a - they have a very significant program there, which I don't think is even going to be done drilling until I think, the end of November or December. And so then, of course, we have to wait for the resource to see where that ends up. And then of course, there's things like the social issues, which include the resettlement, which is really one of the key drivers trying to face resettlement. So the long answer to your question is, we have seen some improvements. What we've done is we've approached the government about a phased approach, as far as permitting. We would see kind of in Q2, maybe the end of even Q1, we're going to approach them with some modifications to our to our existing operational permit and EIA, we're assuming that those would be kind of minor changes, which will allow us in the second half of the year, if it's positive, to do some work on the ground. And once that is approved, we would then do some major changes, which would include adjusting, looking at the tunnel and turning it into a diversion ditch, which we think would take us into 2023 before that would be approved. So the short story long is, we believe in end of Q1 we'll approach the government with a modify - a request for a modified permit, and then kind of six to eight months later, submit a second half. Our second version of a modification will just take us into 2023.

Great, thank you very much.

Thank you. Your next question will be from Ovais Habib at Scotiabank. Please go ahead.

Thanks operator and B2 team. Couple of my questions have already been answered but just don't want to harp on too much on the Cardinal side, but can you just tell us exactly kind of - essentially how much the revised guidance on Fekola is due to Cardinal. And also, in terms of the guidance provided on Cardinal that the deposits has potentially about 60,000 ounces of gold per year, again, can you just give us a little bit more clarity on the constraints on that 60,000 ounces a year, especially the fact that that the mill is running at 9 million tons per annum?

So if I understand your question, you're asking for what is the ounce profile from Cardinal over the next couple years?

That and Bill just trying to understand is there any sort of constraint on that 60,000 ounces of gold per year that you've laid out in terms of, I guess, soft guidance?

Yeah. So the constraint really revolves around looking at what the Fekola permit or what the Fekola pit grade is, versus what Cardinal is, versus the mining sequence and so all that is being taken into account. Remember, Cardinal is a little bit further haul and so we're obviously taking the higher grade first and then, of course, that you got to include stockpiles. And that what I'll tell you is that in 2022, right now, we're estimating about 650,000 ton coming from the Cardinal deposit and that actually adds up to about 50,000 ounces for 2022. And then as you get deeper into some of the higher grade zones, you'll pick that up in some of the later years.

Got it. And just in terms of, obviously you've been drilling into the inferred ounces as well, have you been doing - also maybe this is a question for Tom, but have you been doing any sort of step out drilling as well? Is there any extent to this on in terms of strike potential?

Yeah, so I'll say first, as far as - basically we've divided it up or the operational group is bringing the inferred to indicate it but the geologists are right next to us because it is open for sure and maybe either Tom or Brian can discuss that. But it is wide open, and we see this thing continue to grow so much so that we've actually included in 2022 budget, some more work on the social side to make sure that the communities are not kind of land restricted as we make this pit bigger.

Tom, you want to comment on the exploration climate?

Yeah, Ovais, just to answer your question, Cardinal is still open, it's open both at depth and on strike. And then we have an adjacent deposit called FMZ, which is on the sort of west, northwest side of Cardinal which almost abuts against us, or exploration is not only extending Cardinal, but it's extending FMZ and it remains open and we'll continue with that exploration again next year. That's within the budget for next year.

Okay, sounds good. Sorry, go ahead.

No, I just said, thanks, Tom.

Sorry about that, okay. So just Clive, just over to you now and just you mentioned at the beginning of the call that you've started or B2 started looking at some M&A opportunities as well. Any color you can provide on whether you're looking at kind of development projects, or this is operating mines, JV opportunities, any additional color you can provide?

Yeah, I think I said we continue to look, as we always have. As I mentioned, we like what we see in our pipeline and some of these great exploration projects that we have and Gramalote and the potential of Anaconda. But I would say that with our shares underperforming the sector and hopefully it's starting to catch up recently and we hope that continues along. Obviously, we wouldn't want to go and dilute our shareholders in a significant way, finding an a creative deal with our discipline around acquisitions, for the last 30 odd years about not paying promises that might be there and not overpaying for projects. It's going to be hard to go out and win a bidding war with other companies that didn't do what we did in the last 10 years and build mines when it was unpopular and don't have as good of pipeline as we have. So I think having settled that though, there's some sort of special opportunity where we can bring our strength of building mines, financing them or approving mines as we did not forget in most bodies some years ago. We're looking at those types of things, keeping an eye on a number of things. But I must say that I think one of the really positive aspects in that regard is the opportunity to do M&A using a combination potentially of cash in our shares to minimize dilution. We have a tremendous amount of cash and we also have access, as Mike said, to 600 million from the banks, including another 200 million, so 800 million is available for us for potentially part of an acquisition. So that changes it a little bit for me in the sense of, I can't imagine finding something accreted today that we would win a bid on. Also, I can't imagine doing something today using just our shares, unless it was a very special situation where something was grossly undervalued. So we're looking and we will continue to look in interesting places. Sometimes we're upstream to tread for opportunities so - but if we do a deal, I'm pretty confident that you guys and our shareholder and our Board of Directors would agree it is accretive, because otherwise we wouldn't be doing it.

That sounds good, Clive and thanks, everyone. That's it for me.

Thanks, Ovais.

Thank you. Next question will be from Anita Soni at CIBC World Market.

Hi. So my first question is with respect to the Bantako permit, so I think you mentioned in the MD&A that the - bringing it into production will be subject to the mine plan and also getting all necessary permits. Could you just elaborate on what remaining permits would be for that?

Yeah, so Bantako is in a separate license area, right. So it's not like - Cardinal was easy, where we just basically had to update the IAEA, and then show them how it fit into the mine plan and then it was approved for production, which that is now fully - we're now fully permitted on that side. Bantako is once you submit a feasibility study, then you have to go through the full situation of getting an EIA approved, then, of course, then there's the shareholders agreement, what percentage the government would want to take on it, we assume it'd be very similar to Fekola. And then you've got the convention, which basically lists out your fiscal stability and everything else. So there's a whole long process, which will be required for sure. And that's why the reality is we actually have already just for Bantako, we have a study ready to go that maybe tomorrow, if you want me to submit it. But the issue really relates to how then are all these legal steps which have to occur, how long does it take that? We put in, that's why you often hear Clive talk about the second half of 2022. We randomly put in six months, because we think that's how long it will take, but maybe it'll go faster than that.

Okay. All right. Yeah, I was wondering about how it would come in 2022 and we're still permits, but since you have a study ready to go, that's good. And then just getting an idea of the tailings, I think you said that, because of the Cardinal and the higher throughput levels that you're going through, currently now great that the mill is performing, but the tailings facility, can you just give an idea of like what kind of a lift would be required and how often you would have these additional lift conserved in the capital are associated around that?

Okay, well, I don't know that I have the capital numbers right at hand but certainly, from a lift perspective, remember, we were always kind of telegraphing that we had this kind of 6 million going to 7.5 million tons per annum. And so based on that, that's what our tailings expansion schedule was. Now, given the fact that we're operating at 9 million tons per annum, I mean, that has a knock on effect on a lot of things across the site but the one you mentioned was tailings facility. So the reality is we started already putting the next lift on it. And it's going to be a double lift, basically getting us up to the final elevation of what that facility could do. That's going to take us I think - I think that's going to take us into 2025, or 2026, it is somewhere around there, so basically, we're going to have to start doing the design work and the engineering on a new structure, which we've already identified a location for, and getting that permitted in 2022. So we can construct in 20 - late 2022, 2023, which puts us into production in 2025.

Okay, and then my final question - sorry, did you want to - we you continuing?

No, I just want to say I didn't have - I don't have the cost for that, obviously, in front of me, but it's - the operating costs or the construction costs typically, I think I remember seeing something is around $10 million, it somewhere in that range for the next lift.

Alright, and for the double lift [indiscernible]. Okay. And then lastly, on Gramalote, so your decision to kind of defer Gramalote seems pretty wise in retrospect, given the inflationary environment that everyone's hitting. As you're obviously seeing costs escalating in your operations, you're doing things to mitigate that but as you think about Gramalote and further progressing that forward, could you give us some parameters around how you think about cost escalation in light of capital build? We've seen a lot of your competitors really facing some headwinds, and they're all bidding for the same one part to get something rolling. So can you give us some, I guess, color on your thought process on whether or not you could defer Gramalote further or would you go full steam ahead on that?

Well, from a corporate point of view, I mean, obviously, we're building in some inflationary factors in terms of this things we're looking at Gramalote now. How long those factors are going to be in places is obviously a great debate and how long the inflation trend will continue. But I would say that, if we have a strong economic case, and we had a 15% IRR before, but decided that project could get better and we've seen signs of that, that that is happening by significant changes, that can that are reducing the capital, potentially, quite significantly. So inflation may chew into that a little bit but we'll be looking at that closely. But I must say that I think that, as a company, historically, if you've got something that's got good economics, we're going to want to go and the Government of Colombia, like all governments these days, if there's an economic project, they're going to want to build, and we are very supportive government there, we're in the right place in Colombia, in Ethiopia, and the local people really want this to happen. So there's also an issue there where if it's economic, we're going to want to move forward. If we're satisfied we build this inflation and the government of Colombia, the local people really want us to move forward with this and HGa [ph] a signal that they're on the same page as us, obviously awaiting the results of the final feasibility study.

And maybe just to add just a couple things that. I mean, clearly, we just updated the costs for our study, which was done in 2021. We'll update those again, as we go into additional detail on the mill and stuff with those costs are obviously being very tightly refined. But then the other thing is remember that the Columbia, the exchange rate, the Colombian peso weakened a little bit, so what we're going to see there is that there is things like that you buy on shore actually be cheaper to us and so that'll be some offsetting for sure.

All right. Thank you. That's it for my question.

Thanks.

Thank you. Your next question will be from Don DeMarco at National Bank Financial.

Thank you, operator, and congratulations on a strong free cash flow quarter guys. Many of my questions have been answered, but maybe I'll ask one on ESG. I think I heard Mike say that the Fekola cash costs have been reduced by about 3% from the solar plant. And I'm hearing across the board that electricity and fuel are drivers in inflation. Is the cost to generate solar power at Fekola subject to less inflationary pressures than the cost of generate genset generate power. And secondly, company-wide, what are some of your next ESG initiatives?

Okay, well, certainly I let - actually the answer is yes, of course. I mean, it's much less subjected to inflationary pressures doing solar. But I'll let John maybe talk, John Rajala is kind of our king of power and I'll let him talk about what solar costs are and you know what that all means for our operations?

Yeah, okay. Thanks, Bill. Yeah, so as far as the cost of generating solar power, it's just a fractional cost and whereas generated power with HFO was much higher. And we are expecting good cost going - we had a very good quarter in Q3 for costs - power generation costs which was $0.152 per kilowatt hour versus the budget of $0.156. That resulted in an overall savings of about $0.60 per ton of ore cost. And then going forward, we're getting into the higher solar irradiance months now and we're expecting even better cost performance from the solar. So does that answer your question?

Yeah. And do you have any plans to maybe expand that solar facility at the Fekola or build other ones at other - at your other minds?

Well, possibly - go ahead. Go ahead, Bill.

No, John. You go first.

I was just going to say, yeah, we've been thinking about that but no immediate plans to expand. It may possibly happen in the future, there as well at other sites, if it is wanted.

Yeah, we actually had a very interesting discussion at our board meeting yesterday where we talked specifically about that. If you look at something like, let's say, Bantako right, or Menankoto, we get back and we want to wheel power out to that site and certainly you could do it there. But because now - remember this - we've got a 7.5 megawatt facility at Otjikoto and now this facility at Fekola. We consider ourselves to be kind of on the cutting edge and on the front - leading front of that, so now we're looking at - Dennis Stansbury is actually looking at things like is programmable, okay, does it make sense? Obviously, that's kind of land restricted but can we do it there? Can we do it in Masbate? There's some technologies out there and I know that both John and Dennis have been studying this that you could put it on the tailings facility or could you put it on the face of the dam. We're looking at all that stuff and we're pretty high on it, for sure. And then the second half of your question related to other ESG initiatives that you'll see and once again, I would argue that we're kind of on the cutting edge or the leading front of ESG and we've always been very successful at. I would say, in 2021, a couple of key things you're going to see is our climate change initiatives that we've got ongoing, we're looking at doing a full inventory of our missions and of course, our water conservation, we've work in some places that have desert environments and so we're really focused on how do we reduce water consumption, and once again, at the leading edge of ESG, and those topics.

And of course, as you remember, we put up just one of the very first solar plants in mining in the Otjikoto some years ago [indiscernible]. So it's a big commitment for us to look at increasing it and also to look at where else is built so that we can use it.

Okay, thanks for that color. And my final question and this is an extension of a question asked by a previous caller and it goes back to Clive. In your preamble, you mentioned you'd consider accretive M&A opportunities. Did you mean accretive in terms of production? I mean, that is would be to consider an operating asset, if justified, or is your focus on M&A still primarily on development projects?

No, I think we know it could be special. It can be special situations where let's say a mine is set a problem through some poor management or other issues that we think we can make it better. Now, a lot of people send us you do deals and promise that and then sometimes it doesn't materialize, although I like the fact that the industry seems to be getting better technically, overall. If you think back to Masbate in 2013, I think it was when we acquired CGA Mining, as a single mine company. They did a pretty good job but we required them, their operating costs were $890 an ounce. And I remember some of the guys brought it forward and I was saying, well, why are we talking about this, if it's 890 an ounce and they said, well, here's out, there's a lot of things we would change. So last year, I think we had a couple of quarters under $500 an ounce for operating costs. So not only are we very good at building mines with our reconstruction team, and we'll continue with that but there is that opportunity. Also, sometimes these days, it's harder and harder for a single asset company to convince investors and banks etc sometimes that they can build it, do they have the team to build it? Do they have the owner's team if they're going to do some kind of a contract build, which I think so it's a bit dangerous, but do they have a strong owner's team? And can they finance it on reasonable terms? So I think there's some of those situations. There is competition, as I mentioned earlier, so we might be in a situation we're in a location where others fear to do, which we've done successfully before or we may find that the right fit, as I said, is something we can make better. Clearly we'd like to find - if we found a good development opportunity that was we could argue to our shareholders successfully that it was accretive opportunity, we are keen to do that as well. As of now we were pretty optimistic that Gramalote could very well be the next construction build for us. Then again we also have the potentials we talked about one day is or possibly another mill and Fekola is too early to say now but there's the possibility for that.

Okay, thanks for that. Good luck in Q4.

[Operator Instructions] And your next question will be from Geordie Mark at Haywood Securities. Please go ahead.

Just a couple of questions, extensions on a few and some new ones. Maybe on Fekola, given the multiple source origins you could have in the near to mid-term Bantako and Cardinal, [indiscernible] and the upgrade, I guess, to 9 million tons per annum in a blended source. Are you comfortable with non-earning ton per annum capacity or is the functional capacity to go beyond 9 or 10 per annum over the midterm [indiscernible] from the drill bit.

I can just hear John screaming, when is it enough. So, the long answer is Geordie, if you remember we did way back in the day when we kind of expanded, when we went from 4 million tons per annum to 5 million tons per annum. And then we looked at optimizing, and we actually had a step function, and we looked at plus 1.5, which was basically increasing the existing circuit. And then the second study that was looked at was a 10 million ton per annum, it was very quickly ignored, because the step function to 7.5, which is now 9, it was so much more cheaper, 50 million bucks. So there is the capacity to grow bigger, it's a big - that's a big step function and would require a lot of additional work. Is there ability to put it there? I think John would say yes, but then you'd have to start weighing this whole concept of, wouldn't it be cheaper potentially to put something up at Menankoto, right? Would you have a whole complex where you'd have maybe two mills running up there, so you wouldn't be trucking all that ore and distance and so, I think if you found enough ore that you would ultimately want to build something separate, but those studies would have to be done.

Okay. So 9 million for now, okay. Maybe over to Masbate, some nice positive recovery percentages there, given the history of positive percentage recovery versus that model, are you looking to revise the model or are you continuing to sort of more conservative stance on that or how should we look at that going forward?

Yeah, so for the 2022 budget, we actually did up the recovery system a little bit based on the ore type and how it fit in or where was coming from. Remember, it's all kind of anecdotally, right, it's all from results that we've already received, as opposed to doing additional drilling or additional testing of the metallurgy. So at this point, we're still - I think we're still - a little conservative, but we're moving towards just based on experience a higher recovery. And I don't know that there's any science behind it. It's just, this is what we see and this is what we are saying.

I'll just, I'll just add to that Bill that we've been doing some ore campaigns through the mill there at Masbate, with the major ore types to get a good estimate on recovery on a plant scale. So - and that's been built into the model as well for 2022.

Okay. Thank you. And in terms of maybe last one, for Otjikoto and Wolfshag underground, what are the steps to ultimately get to first of all, production underground now, it's not too far away from converse production, so what are you looking at there?

What's the question?

[indiscernible], yeah.

Yeah, I mean, Randy is literally at Otjikoto now, so maybe I'll let him answer but I will tell you is that we just continue the development of the [indiscernible] in the plan is to start producing ore in Q1, or at least getting some ore out of there in Q1. Randy, you want to talk about what are the final steps we have left to do?

Yeah, that's pretty - the development contractor is working on the main decline right now. As we speak, we've made a couple little tweaks there to the development plan and when we get into ore, we'll be starting to take out some development ore in the first quarter and then we've selected a production contractor that's going to be gearing up and coming in towards middle to end of Q1 and getting started there.

All right. [indiscernible] development ore and then coming into the great proportion of [indiscernible].

Yep, correct.

Thank you.

Any further questions, Geordie.

That's it. Thank you.

Thank you. [Operator Instructions] At this time, I would like to turn the call back over to Mr. Johnson.

Okay. Thanks, operator. Thanks, everyone. Good questions. And if there any other questions that come up, don't forget to reach out to us. And we look forward to reporting - planning and reporting another great quarter at the end of year. So thank you for your time.

Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. And at this time, we do ask that you please disconnect your lines.