New Found Gold (TSX:NFGC) - Q3 Hammerdown Production Results

Keith Boyle (0:00)

Hi, I'm Keith Boyle. I'm the CEO of New Found Gold, Canada's newest gold producer.

We have the Hammerdown Gold Mine in production now. We're building the Queensway Gold Project, all on the island of Newfoundland, in Newfoundland, Labrador. And we've got a property package that's fantastic exploration potential that really, you know, we call generational.

Mark (0:29)

Good to have you on board, as per usual. Look, Keith, three 2026 preliminary production results have come out. I guess the question people will be asking is, what does it prove? What does it prove in terms of your, not just in terms of the numbers, but your ability to build Newfound Gold into a large producer?

Keith Boyle (0:47)

Well, I mean, what it proves for me, what it demonstrates for the market, is that we're delivering on what we promised. We put out a PEA back in March that identified what Hammerdown could produce, and this is just the confirmation, if you will, of what that is. It's a 20,000 to 25,000 ounce a year producer at $2,500 all in sustaining cost, and so this first quarter of commercial production, we're just under $5,000, so just at the bottom of that range as we ramp up production. So, you know, I'm quite confident that we'll get back, we'll be in that range, but it does demonstrate that one, we're producing, and two, at the grades that we said we would produce.

So, yeah, this is all good news.

Mark (1:45)

Well, let's talk about that. If 1,863 ounces produced, you're talking about 20,000 to 25,000 as annual run rate on the current class.

What was the September number? Was it increasing or is this a sort of steady state?

Keith Boyle (2:03)

It fluctuates up and down. It's September number. I actually don't remember.

Mark (2:07)

Okay. But what are the things that you're trying to control? Because obviously, I think we talked about in the press release about a 2.76 gram per ton feed grade. I mean, is the kind of mine tons and reserve ounces reconciling with the model?

I mean, how much fluctuation is there?

Keith Boyle (2:25)

Yeah. So again, it'll fluctuate up and down on a given month. However, you know, what's really, really pleasing to see is how the mineral resource estimate model is reconciling well or production is reconciling well with the mineral resource estimate model. Like, we're within 5% of that estimate, which is fantastic when you consider what we've done. On top of that, we've been doing great control drilling that we started late April, and that on a 5 by 5 meter center pattern. And so we're now just getting to the point where we're able to use that information in order to better inform our mining practices. So again, all part of the ramp up, which will improve our mining practices and our grade to the mill.

Mark (3:21)

Well, can we talk about that, actually? Because obviously, there'll be dilution and oil losses at this ramp up stage, right? And I think you were talking about an 85% average recovery in there. What are the things that you're looking at to improve throughput and recovery and ultimately increase margin, I suppose?

Keith Boyle (3:43)

So there's really three parts. One is once you've used, if you will, your great control model, you've identified the veins, you really want to mine as tight to those veins as you can in order to reduce dilution, external dilution.

And the great control model one will help us do that. But also the mining practices that the team have been learning over this first part of the year to be able to better mine, cleaner mine, mine cleaner the veins. The second part is as we're putting it through the mill is to better recover. And that too, the mill, you know, started out at, I'll say the low 60s, high 50s, low 60s recoveries as the ore was first going through the mill. And it's now generating, or sorry, recovering, you know, in the mid 80s range, which is where we, which was what was identified in the PEA and which the market should expect. So you know, as we saw that improved through the years is because the team was learning that. And the third part, which is what we're building right now, we're adding our own crusher. We have a contract crusher still going, but we'll add our own crusher in sorter or sorter. And that will help us.

It's a kind of dilution control, if you will. It removes the lower grade material so that we can then better or send better grade material to the mill.

Mark (5:24)

OK, so the question is always right. In terms of what your goals are for what it can deliver for you into Q1, obviously higher fee grade, lower haulage cost, presumably, and ultimately more ounces.