6-K
B2GOLD CORP (BTG)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of February, 2024
Commission File Number: 001-35936
B2Gold Corp.
(Translation of registrant’s name into English)
Park Place
Suite 3400 - 666 Burrard Street
Vancouver, British Columbia V6C 2X8
Canada
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
[ ] Form 20-F [X] Form 40-F
DOCUMENTS INCLUDED AS PART OF THIS FORM 6-K
See the Exhibit Index hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| B2Gold Corp. | ||
|---|---|---|
| Date: February 21, 2024 | By: | /s/ Randall Chatwin |
| Name: | Randall Chatwin | |
| Title: | Senior Vice President, Legal and Corporate Communications |
EXHIBIT INDEX
EXHIBITS 99.1 AND 99.2 INCLUDED WITH THIS REPORT ARE HEREBY INCORPORATED BY REFERENCE INTO THE REGISTRANT'S REGISTRATION STATEMENTS ON FORM S-8 (FILE NOS. 333-239197, 333-232158, 333-206811, 333-200228, 333-218710, 333-226063, 333-192555 AND 333-273659) AND ON THE REGISTRATION STATEMENT ON FORM F-3D (NO. 333-274310) (COLLECTIVELY, THE "REGISTRATION STATEMENTS"), AS AMENDED OR SUPPLEMENTED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED BY US UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF 1934, IN EACH CASE AS AMENDED.
Document
B2GOLD CORP.
Consolidated Financial Statements
December 31, 2023 and 2022
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of B2Gold Corp.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of B2Gold Corp. and its subsidiaries (together, the Company) as of December 31, 2023 and 2022, and the related consolidated statements of operations, comprehensive income (loss), changes in equity and cash flows for the years then ended, including the related notes (collectively referred to as the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and its financial performance and its cash flows for the years then ended in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Annual Report on Internal Control over Financial Reporting on page 29 of the 2023 Management's Discussion & Analysis. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
| PricewaterhouseCoopers LLP |
|---|
| PricewaterhouseCoopers Place, 250 Howe Street, Suite 1400, Vancouver, British Columbia, Canada V6C 3S7 |
| T: +1 604 806 7000, F: +1 604 806 7806 |
| “PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership. |
Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Valuation of certain assets acquired and liabilities assumed in the acquisition of Sabina Gold & Silver Corp.
As described in Notes 6, 18 and 19 to the consolidated financial statements, on April 14, 2023, the Company obtained control of Sabina Gold & Silver Corp. (Sabina) for a total purchase price of $937 million. Management accounted for the acquisition as a purchase of assets. The purchase price was allocated based on the relative fair value of the assets acquired and liabilities assumed. Included in the assets acquired and liabilities assumed is the $740 million Goose Project mineral interest and a $174 million gold stream obligation. Management determined the fair value of the Goose Project mineral interest using a combination of a discounted cash flow model and a comparable market transactions approach. Management applied significant judgment in determining the fair value of the Goose Project mineral interest, which included the use of significant assumptions including reserves and resources, future
production levels, operating and capital costs, a long-term gold price per ounce, the discount rate, and in-situ multiples. The fair value of the gold stream obligation was based on the value of the extinguishable portion plus the fair value of the gold stream obligation retained. The fair value of the gold stream obligation retained was calculated by management based on an income approach and a discounted cash flow model. Management applied significant judgment in determining the fair value of the gold stream obligation, which included significant assumptions including forward gold price curves, credit adjusted risk-free rates, and the timing of future gold deliveries which is based on the future production levels of the Goose Project. The Company’s estimated quantities of reserves and resources for the Goose Project are based on information prepared by qualified persons (management’s specialists).
The principal considerations for our determination that performing procedures relating to the valuation of certain assets acquired and liabilities assumed in the acquisition of Sabina is a critical audit matter are (i) the significant judgment required by management, including the use of management specialists, in developing the fair value estimate of the Goose Project mineral interest and gold stream obligation; (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions for the Goose Project mineral interest related to reserves and resources, future production levels, operating and capital costs, a long-term gold price per ounce, the discount rate and in-situ multiples; iii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions for the gold stream obligation related to forward gold price curves, credit adjusted risk-free rates and the timing of future gold deliveries; and (iv) the audit effort involved the use of professionals with specialized skills and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s determination of the fair value of the Goose Project mineral interest and gold stream obligation from the acquisition of Sabina, including controls over the significant assumptions used in those management estimates. These procedures also included, among others, testing management’s process for determining the fair value of the Goose Project mineral interest and the gold stream obligation; evaluating the appropriateness of the valuation methods used; testing the completeness and accuracy of underlying data used in the respective models; and evaluating the reasonableness of the significant assumptions used by management. Evaluating the significant assumptions with respect to the long-term gold price per ounce and forward gold price curves involved evaluating whether these significant assumptions were reasonable considering: (i) the consistency with external market and industry data; and (ii) whether these significant assumptions were consistent with evidence obtained in other areas of the audit. The work of management’s specialists was used in performing the procedures to assess the reasonableness of the significant assumptions related to reserves and resources, future production levels, and operating and capital costs. As a basis for using this work, management’s specialists’ qualifications were understood and the Company’s relationship with management’s specialists was assessed. Evaluating the reasonableness of future operating and capital costs involved comparing them to historical results of comparable operating gold mines. The procedures performed also included evaluation of the methods and significant assumptions used by management’s specialists, tests of the data used by management’s specialists, and an evaluation of management’s specialists’ findings. Professionals with specialized skill and knowledge were used to assist in the
evaluation of the reasonableness of the discount rate, in-situ multiples, forward gold price curves and credit adjusted risk-free rates.
Impairment of the Fekola Complex cash-generating unit (CGU)
As described in Notes 4 and 10 to the consolidated financial statements, during the year, management identified indicators of impairment for the Fekola Complex CGU, which consists of the Fekola Mine and Fekola Regional Properties. As a result, management has performed an impairment assessment on the Fekola Complex CGU. The carrying value of the CGU was compared to the CGU’s recoverable amount which was determined to be fair value less costs of disposal. Management concluded that the Fekola Complex CGU was impaired, resulting in an impairment of $206 million. Management estimated the recoverable amount using a discounted cash flow model. Management applied significant judgment in determining the recoverable amount of the Fekola Complex CGU, including the use of significant assumptions such as mineable mineralization including reserves and resources, future production levels, operating and capital costs, a long-term gold price and discount rates applicable to each of the Fekola Mine and Fekola Regional Properties. Management estimates mineable mineralization including reserves and resources based on information compiled by qualified persons (management’s specialists).
The principal considerations for our determination that performing procedures relating to the impairment test of the Fekola Complex CGU is a critical audit matter are (i) the significant judgment by management, including the use of management’s specialists, when estimating the recoverable amount of the Fekola Complex CGU; and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions, related to mineable mineralization including reserves and resources, future production levels, operating and capital costs, a long-term gold price and the discount rates for each of the Fekola Mine and Fekola Regional Properties. In addition, the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s impairment test, including controls over the determination of the recoverable amount of the Fekola Complex CGU. These procedures also included, among others, testing management’s process for determining the recoverable amount of the Fekola Complex CGU which included evaluating the appropriateness of the discounted cash flow model; testing the completeness and accuracy of underlying data used in the model; and evaluating the reasonableness of significant assumptions used by management. Evaluating management’s significant assumptions with respect to future production levels, operating and capital costs and long-term gold price involved evaluating whether these significant assumptions were reasonable considering: (i) the current and past performance of the Fekola Mine; (ii) the consistency with external market and industry data; and (iii) whether these significant assumptions were consistent with evidence obtained in other areas of the audit, as applicable. The work of management’s specialists was used in performing the procedures to evaluate the reasonableness of mineable mineralization including reserves and resources. As a basis for using this work, management's specialists’ qualifications were understood and the Company’s relationship with management's specialists was assessed. The procedures performed also included evaluating the methods and significant assumptions used by management's specialists, testing of the data used by management's
specialists, and evaluating management's specialists’ findings. Professionals with specialized skill and knowledge were used to assist in the evaluation of the reasonableness of the discount rates.
/s/PricewaterhouseCoopers LLP
Chartered Professional Accountants
Vancouver, Canada
February 21, 2024
We have served as the Company’s auditor since 2007.
| B2GOLD CORP. | ||||
|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| FOR THE YEARS ENDED DECEMBER 31 | ||||
| (Expressed in thousands of United States dollars, except shares and per share amounts) | ||||
| 2023 | 2022 | |||
| --- | --- | --- | --- | --- |
| Gold revenue | $ | 1,934,272 | $ | 1,732,590 |
| Cost of sales | ||||
| Production costs (Note 23) | (616,197) | (626,526) | ||
| Depreciation and depletion | (402,371) | (383,852) | ||
| Royalties and production taxes | (135,703) | (117,968) | ||
| Total cost of sales | (1,154,271) | (1,128,346) | ||
| Gross profit | 780,001 | 604,244 | ||
| General and administrative | (62,364) | (54,479) | ||
| Share-based payments (Note 15) | (20,921) | (24,843) | ||
| (Impairment) reversal of impairment of long-lived assets (Note 10) | (322,148) | 909 | ||
| Write-down of mining interests (Note 10) | (19,905) | (12,366) | ||
| Foreign exchange losses | (16,020) | (10,054) | ||
| Share of net income of associates (Note 11) | 19,871 | 10,183 | ||
| Restructuring charges (Note 10) | (12,151) | — | ||
| Community relations | (5,205) | (2,738) | ||
| Loss on sale of mining interest (Note 10) | — | (2,804) | ||
| Other expense | (13,761) | (5,655) | ||
| Operating income | 327,397 | 502,397 | ||
| Interest and financing expense | (13,925) | (10,842) | ||
| Interest income | 18,519 | 11,964 | ||
| Change in fair value of gold stream (Note 6 and Note 18) | (12,300) | — | ||
| Gains on derivative instruments (Note 17) | 4,699 | 18,969 | ||
| Other (expense) income | (4,057) | 8,129 | ||
| Income from operations before taxes | 320,333 | 530,617 | ||
| Current income tax, withholding and other taxes (Note 20) | (290,081) | (247,811) | ||
| Deferred income tax recovery (Note 20) | 11,336 | 3,917 | ||
| Net income | $ | 41,588 | $ | 286,723 |
| Attributable to: | ||||
| Shareholders of the Company | $ | 10,097 | $ | 252,873 |
| Non-controlling interests (Note 16) | 31,491 | 33,850 | ||
| Net income | $ | 41,588 | $ | 286,723 |
| Earnings per share (attributable to shareholders of the Company) (Note 15) | ||||
| Basic | $ | 0.01 | $ | 0.24 |
| Diluted | $ | 0.01 | $ | 0.24 |
| Weighted average number of common shares outstanding (in thousands) (Note 15) | ||||
| Basic | 1,232,092 | 1,064,259 | ||
| Diluted | 1,237,404 | 1,071,004 |
See accompanying notes to consolidated financial statements.
| B2GOLD CORP. | ||||
|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
| FOR THE YEARS ENDED DECEMBER 31 | ||||
| (Expressed in thousands of United States dollars) | ||||
| 2023 | 2022 | |||
| --- | --- | --- | --- | --- |
| Net income | $ | 41,588 | $ | 286,723 |
| Other comprehensive income (loss) | ||||
| Items that will not be subsequently reclassified to net income: | ||||
| Unrealized gain (loss) on investments (Note 9) | 20,613 | (9,570) | ||
| Other comprehensive income (loss) | 20,613 | (9,570) | ||
| Total comprehensive income | $ | 62,201 | $ | 277,153 |
| Other comprehensive income (loss) attributable to: | ||||
| Shareholders of the Company | $ | 20,613 | $ | (9,570) |
| Non-controlling interests | — | — | ||
| $ | 20,613 | $ | (9,570) | |
| Total comprehensive income attributable to: | ||||
| Shareholders of the Company | $ | 30,710 | $ | 243,303 |
| Non-controlling interests | 31,491 | 33,850 | ||
| $ | 62,201 | $ | 277,153 |
See accompanying notes to consolidated financial statements.
| B2GOLD CORP. | ||||
|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
| FOR THE YEARS ENDED DECEMBER 31 | ||||
| (Expressed in thousands of United States dollars) | ||||
| 2023 | 2022 | |||
| --- | --- | --- | --- | --- |
| Operating activities | ||||
| Net income | $ | 41,588 | $ | 286,723 |
| Mine restoration provisions settled (Note 14) | (2,297) | (793) | ||
| Non-cash charges, net (Note 21) | 794,961 | 425,944 | ||
| Changes in non-cash working capital (Note 21) | (6,538) | (48,604) | ||
| Changes in long-term supplies inventory (Note 8) | (18,537) | — | ||
| Changes in long-term value added tax receivables | (94,724) | (67,472) | ||
| Cash provided by operating activities | 714,453 | 595,798 | ||
| Financing activities | ||||
| Extinguishment of gold stream and construction financing obligations (Note 6) | (111,819) | — | ||
| Revolving credit facility draw downs (Note 13) | 150,000 | — | ||
| Revolving credit facility transaction costs | (3,296) | (2,401) | ||
| Repayment of equipment loan facilities (Note 13) | (13,301) | (19,802) | ||
| Interest and commitment fees paid | (4,582) | (4,456) | ||
| Cash proceeds from stock option exercises (Note 15) | 12,854 | 14,276 | ||
| Dividends paid (Note 15) | (186,724) | (170,635) | ||
| Principal payments on lease arrangements (Note 13) | (6,189) | (6,616) | ||
| Distributions to non-controlling interest (Note 16) | (34,316) | (30,331) | ||
| Other | 4,863 | 8,680 | ||
| Cash used by financing activities | (192,510) | (211,285) | ||
| Investing activities | ||||
| Expenditures on mining interests: | ||||
| Fekola Mine | (298,942) | (117,622) | ||
| Masbate Mine | (30,142) | (39,528) | ||
| Otjikoto Mine | (61,063) | (79,096) | ||
| Goose Project | (282,338) | — | ||
| Fekola Regional Properties, pre-development | (55,975) | (26,309) | ||
| Gramalote Project | (6,380) | (15,887) | ||
| Other exploration (Note 21) | (76,005) | (63,629) | ||
| Cash acquired on acquisition of Sabina Gold & Silver Corp. (Note 6) | 38,083 | — | ||
| Transaction costs paid on acquisition of Sabina Gold & Silver Corp. (Note 6) | (6,672) | — | ||
| Purchase of long-term investment (Note 9) | (33,282) | — | ||
| Cash paid for acquisition of Gramalote Property interest (Note 10) | (20,393) | — | ||
| Funding of reclamation accounts | (6,541) | (6,746) | ||
| Cash paid for purchase of non-controlling interest (Note 10) | (6,704) | (3,336) | ||
| Deferred consideration received (Note 10) | 3,850 | 45,000 | ||
| Loan to associate (Note 12) | (2,458) | (5,000) | ||
| Cash paid for acquisition of Bakolobi Property (Note 10) | — | (48,258) | ||
| Cash paid for acquisition of Oklo Resources Limited (Note 10) | — | (21,130) | ||
| Cash acquired on acquisition of Oklo Resources Limited (Note 10) | — | 1,415 | ||
| Cash paid on exercise of mineral property option (Note 10) | — | (7,737) | ||
| Other | (377) | (919) | ||
| Cash used by investing activities | (845,339) | (388,782) | ||
| Decrease in cash and cash equivalents | (323,396) | (4,269) | ||
| Effect of exchange rate changes on cash and cash equivalents | (21,655) | (16,784) | ||
| Cash and cash equivalents, beginning of year | 651,946 | 672,999 | ||
| Cash and cash equivalents, end of year | $ | 306,895 | $ | 651,946 |
| Supplementary cash flow information (Note 21) |
See accompanying notes to consolidated financial statements.
| B2GOLD CORP. | ||||
|---|---|---|---|---|
| CONSOLIDATED BALANCE SHEETS | ||||
| (Expressed in thousands of United States dollars) | ||||
| As at | As at | |||
| --- | --- | --- | --- | --- |
| December 31, | December 31, | |||
| 2023 | 2022 | |||
| Assets | ||||
| Current | ||||
| Cash and cash equivalents | $ | 306,895 | $ | 651,946 |
| Accounts receivable, prepaids and other (Note 7) | 27,491 | 28,811 | ||
| Deferred consideration receivable (Note 10) | — | 3,850 | ||
| Value-added and other tax receivables | 29,848 | 18,533 | ||
| Inventories (Note 8) | 346,495 | 332,031 | ||
| 710,729 | 1,035,171 | |||
| Long-term investments (Note 9) | 86,007 | 31,865 | ||
| Value-added tax receivables | 199,671 | 121,323 | ||
| Mining interests (Note 10) | 3,563,490 | 2,274,730 | ||
| Investment in associates (Note 11) | 134,092 | 120,049 | ||
| Long-term stockpile (Note 8) | 56,497 | 48,882 | ||
| Long-term supplies inventory (Note 8) | 43,571 | — | ||
| Other assets (Note 12) | 63,635 | 49,213 | ||
| Deferred income taxes (Note 20) | 16,927 | — | ||
| $ | 4,874,619 | $ | 3,681,233 | |
| Liabilities | ||||
| Current | ||||
| Accounts payable and accrued liabilities | $ | 167,117 | $ | 114,791 |
| Current income and other taxes payable | 120,679 | 95,623 | ||
| Current portion of long-term debt (Note 13) | 16,256 | 15,519 | ||
| Current portion of mine restoration provisions (Note 14) | 3,050 | 5,545 | ||
| Other current liabilities | 6,369 | 2,138 | ||
| 313,471 | 233,616 | |||
| Long-term debt (Note 13) | 175,869 | 41,709 | ||
| Gold stream obligation (Note 18) | 139,600 | — | ||
| Mine restoration provisions (Note 14) | 104,607 | 95,568 | ||
| Deferred income taxes (Note 20) | 188,106 | 182,515 | ||
| Employee benefits obligation | 19,171 | 8,121 | ||
| Other long-term liabilities | 23,820 | 7,915 | ||
| 964,644 | 569,444 | |||
| Equity | ||||
| Shareholders’ equity | ||||
| Share capital (Note 15) | 3,454,811 | 2,487,624 | ||
| Contributed surplus | 84,970 | 78,232 | ||
| Accumulated other comprehensive loss | (125,256) | (145,869) | ||
| Retained earnings | 395,854 | 588,139 | ||
| 3,810,379 | 3,008,126 | |||
| Non-controlling interests (Note 16) | 99,596 | 103,663 | ||
| 3,909,975 | 3,111,789 | |||
| $ | 4,874,619 | $ | 3,681,233 | |
| Commitments (Note 25) | ||||
| Subsequent event (Note 26) | ||||
| Approved by the Board | "Clive T. Johnson" | Director | "Lisa M. Pankratz" | Director |
| --- | --- | --- | --- | --- |
See accompanying notes to consolidated financial statements.
| B2GOLD CORP. | ||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||||||||||||||
| FOR THE YEARS ENDED DECEMBER 31 | ||||||||||||||||||||||||||||
| (Expressed in thousands of United States dollars) | ||||||||||||||||||||||||||||
| 2023 | ||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||
| Shares<br>(‘000’s) | Share<br>capital | Contributed<br><br>surplus | Accumulated<br><br>other<br><br>comprehensive<br><br>loss | Retained earnings | Non-<br><br>controlling<br><br>interests | Total<br>equity | ||||||||||||||||||||||
| Balance at December 31, 2022 | 1,074,695 | $ | 2,487,624 | $ | 78,232 | $ | (145,869) | $ | 588,139 | $ | 103,663 | $ | 3,111,789 | |||||||||||||||
| Net income | — | — | — | — | 10,097 | 31,491 | 41,588 | |||||||||||||||||||||
| Shares and replacement options issued on acquisition of Sabina Gold & Silver Corp. (Note 6) | 216,452 | 925,375 | 5,075 | — | — | — | 930,450 | |||||||||||||||||||||
| Dividends (Note 15) | 4,005 | 11,833 | 1,258 | — | (200,116) | — | (187,025) | |||||||||||||||||||||
| Unrealized gain on investments | — | — | — | 20,613 | — | — | 20,613 | |||||||||||||||||||||
| Shares issued on exercise of stock options (Note 15) | 5,063 | 12,854 | — | — | — | — | 12,854 | |||||||||||||||||||||
| Shares issued on vesting of RSUs (Note 15) | 1,440 | 5,988 | (5,988) | — | — | — | — | |||||||||||||||||||||
| Shares issued on vesting of PSUs (Note 15) | 741 | 5,658 | (8,603) | — | — | — | (2,945) | |||||||||||||||||||||
| Transactions with non-controlling interests (Note 10 and Note 16) | — | — | — | — | (2,266) | (35,558) | (37,824) | |||||||||||||||||||||
| Share-based payments (Note 15) | — | — | 20,475 | — | — | — | 20,475 | |||||||||||||||||||||
| Transfer to share capital on exercise of stock options | — | 5,479 | (5,479) | — | — | — | — | |||||||||||||||||||||
| Balance at December 31, 2023 | 1,302,396 | $ | 3,454,811 | $ | 84,970 | $ | (125,256) | $ | 395,854 | $ | 99,596 | $ | 3,909,975 | 2022 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||
| Shares<br>(‘000’s) | Share<br>capital | Contributed<br><br>surplus | Accumulated<br><br>other<br><br>comprehensive<br><br>loss | Retained earnings | Non-<br><br>controlling<br><br>interests | Total<br>equity | ||||||||||||||||||||||
| Balance at December 31, 2021 | 1,056,334 | $ | 2,422,184 | $ | 67,028 | $ | (136,299) | $ | 507,381 | $ | 100,713 | $ | 2,961,007 | |||||||||||||||
| Net income | — | — | — | — | 252,873 | 33,850 | 286,723 | |||||||||||||||||||||
| Dividends (Note 15) | — | — | 1,163 | — | (172,086) | — | (170,923) | |||||||||||||||||||||
| Unrealized loss on investments | — | — | — | (9,570) | — | — | (9,570) | |||||||||||||||||||||
| Shares issued on exercise of stock options (Note 15) | 4,955 | 14,276 | — | — | — | — | 14,276 | |||||||||||||||||||||
| Shares issued on vesting of RSUs (Note 15) | 2,663 | 10,015 | (10,015) | — | — | — | — | |||||||||||||||||||||
| Shares issued on acquisition of Oklo Resources Limited (Note 10) | 10,743 | 35,658 | — | — | — | — | 35,658 | |||||||||||||||||||||
| Transactions with non-controlling interests (Note 16) | — | — | — | — | (29) | (30,900) | (30,929) | |||||||||||||||||||||
| Share-based payments (Note 15) | — | — | 25,547 | — | — | — | 25,547 | |||||||||||||||||||||
| Transfer to share capital on exercise of stock options | — | 5,491 | (5,491) | — | — | — | — | |||||||||||||||||||||
| Balance at December 31, 2022 | 1,074,695 | $ | 2,487,624 | $ | 78,232 | $ | (145,869) | $ | 588,139 | $ | 103,663 | $ | 3,111,789 |
See accompanying notes to consolidated financial statements.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
1Nature of operations
B2Gold Corp. (“B2Gold” or the “Company”) is a Vancouver-based gold producer with three operating mines: the Fekola Mine in Mali, the Masbate Mine in the Philippines and the Otjikoto Mine in Namibia, and a fourth project, the Goose Project, under construction in Canada. The Company had a 50% joint operation interest in the Gramalote gold project in Colombia (the "Gramalote Project"). On October 5, 2023, the Company acquired the remaining 50% of the Gramalote Project (Note 10). As at December 31, 2023, the Company held an approximately 24% interest in Calibre Mining Corp. ("Calibre") and an approximately 19% interest in BeMetals Corp. ("BeMetals"). Subsequent to December 31, 2023, on January 24, 2024, the Company's interest in Calibre was diluted to approximately 15% (Note 11). In addition, the Company has a portfolio of evaluation and exploration assets in a number of countries including Mali and Finland.
On April 14, 2023, the Company obtained control of Sabina Gold & Silver Corp. ("Sabina"), resulting in the acquisition of the 100% owned Back River Gold District, including the Goose Project, located in Nunavut, Canada (Note 6).
B2Gold is a public company listed on the Toronto Stock Exchange (the "TSX") under the symbol “BTO”, the NYSE American LLC exchange under the symbol “BTG” and the Namibian Stock Exchange under the symbol “B2G”. B2Gold’s head office is located at Suite 3400, Park Place, 666 Burrard Street, Vancouver, British Columbia, V6C 2X8.
2Basis of preparation
These consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (“IFRS”). These consolidated financial statements were authorized for issue by the Board of Directors on February 21, 2024.
3Recent accounting pronouncements
Pronouncements implemented
Amendments to IAS 12, Income taxes
In May 2023, the International Accounting Standards Board issued amendments to IAS 12, Income taxes, to clarify the application to income taxes arising from tax law enacted or substantively enacted related to the Pillar Two model rules published by the Organization for Economic Co-operation and Development (OECD). The amendments require a mandatory temporary exception which prohibits the accounting for deferred taxes arising from tax law that implements the Pillar Two model rules. These amendments were effective immediately upon their release. The amendments also require disclosures that explain an entity's exposure to Pillar Two income taxes. These disclosure requirements are effective for annual reporting periods beginning on or after January 1, 2023. The Company has applied the exception to recognizing and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS 12.
In August 2023, Finance Canada released, for public consultation, the draft legislation to implement the OECD's Pillar Two global minimum tax regime. Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions in which the Company operates. The legislation will be effective for the Company's financial year beginning January 1, 2024.
The Company has performed an assessment of its potential exposure to Pillar Two income taxes. This assessment is based on the most recent information available regarding the financial performance of the constituent entities of the consolidated group. Based on the assessment performed, the Company does not expect any material exposure to Pillar Two top-up taxes.
4Summary of material accounting policies
The material accounting policies used in the preparation of these financial statements are as follows:
Principles of consolidation
The financial statements of the Company consolidate the accounts of B2Gold and its subsidiaries. All intercompany transactions, balances, and unrealized gains and losses from intercompany transactions are eliminated on consolidation.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The Company’s most significant wholly-owned and partially owned subsidiaries are presented below:
| % interest | ||
|---|---|---|
| - | Fekola SA (“Fekola Mine”) | 80 |
| - | B2Gold Namibia (Pty) Ltd. (“Otjikoto Mine”) | 90 |
| - | Philippines Gold Processing & Refining Corporation (“Masbate Mine”) | 100 |
| - | Filminera Resources Corporation ("Masbate Mine") | 40 |
| - | B2Gold Back River Corp ("Goose Project") | 100 |
| - | Gramalote Limited ("Gramalote Project") | 100 |
Subsidiaries are entities controlled by the Company. Control exists when the Company has power over an investee, when the Company is exposed, or has rights, to variable returns from the investee and when the Company has the ability to affect those returns through its power over the investee. Subsidiaries are fully consolidated from the date on which control is obtained by B2Gold and are de-consolidated from the date that control ceases.
The Company holds its interest in the Masbate Gold Project (which operates the Masbate Mine) through two indirectly-owned subsidiaries. B2Gold has a 100% interest in Philippines Gold Processing & Refining Corporation (“PGPRC”) and a 40% interest in Filminera Resources Corporation (“FRC”). The remaining 60% interest in FRC is held by a Philippines-registered company that is owned by a Philippine shareholder. The Company consolidates the Masbate Gold Project as a result of its ownership interests and the contractual relationship between the entities. FRC owns the majority of the Masbate Gold Project tenements. PGPRC owns the process plant and is responsible for the sale of all gold. PGPRC and FRC have a contractual relationship, which includes PGPRC purchasing all of the ore production from FRC at a price equal to the cost for the ore plus a predetermined margin. For accounting purposes, this contractual relationship gives the Company control to consolidate FRC.
The Company's interest in Calibre and BeMetals are accounted for as investment in associates (Note 11). The Company does not control these entities, but does exert significant influence over their operations. The Company accounts for its interest in these associates using the equity method.
The Company established a trust arrangement under its Incentive Plan (Note 15) for the benefit of its directors, officers, employees and service providers. The Company consolidates this trust as it has the power to control its financial and operating policies and obtain the benefits from its activities.
Investments in joint arrangements and associates
A joint arrangement is a contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.
The Company considers whether a joint arrangement is a joint operation or joint venture. The parties to a joint operation have the rights to the underlying assets and are exposed to the underlying liabilities of the joint arrangement. The Company accounts for investment in joint operations by recognizing its share of the operations underlying assets, liabilities, revenues and expenses. The parties to a joint venture have an interest in the underlying net assets of the joint arrangement. Investments in joint ventures are accounted for using the equity method. The equity method involves recording the initial investment at cost. Additional funding into an investee is recorded as an increase in the carrying value of the investment. The carrying amount is adjusted by the Company’s share of post-acquisition net income or loss, dilution gains or losses (resulting from changes in ownership interest), depreciation or amortization.
An associate is an entity over which the Company has significant influence, but not control. Investments in associates are also accounted for using the equity method.
Business combinations
A business combination requires that the assets acquired and liabilities assumed constitute a business. A business is an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing goods or services to customers, generating investment income (such as dividends or interest) or generating other income from ordinary activities. A business consists of inputs and processes applied to those inputs that have the ability to create outputs.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Although businesses usually have outputs, outputs are not required for an integrated set to qualify as a business as the Company considers other factors to determine whether the set of activities or assets is a business.
The Company has an option to apply a ‘concentration test’ to assess whether an acquired set of activities and assets are not a business. If substantially all of the fair value of the gross assets acquired are concentrated in a single, identifiable asset or group of similar identifiable assets, the concentration test is met, and the transaction is accounted for as an asset acquisition. In such cases, the acquirer identifies and recognizes the individual identifiable assets acquired and liabilities assumed. The cost of the net assets is allocated to the individual identifiable assets and liabilities on the basis of their relative fair values at the date of purchase. Such a transaction or event will not give rise to goodwill. Acquisition-related costs in an asset acquisition are recognized as part of the cost of the assets acquired.
Business combinations are accounted for using the acquisition method whereby acquired assets and liabilities are recorded at fair value as of the date of acquisition with the excess of the purchase consideration over such fair value being recorded as goodwill. Non-controlling interest in an acquisition may be measured at either fair value or at the non-controlling interest’s proportionate share of the fair value of the acquiree’s net identifiable assets.
The excess of (i) total consideration transferred by the Company, measured at fair value, including contingent consideration, and (ii) the non-controlling interests in the acquiree, over the acquisition-date fair value of the net of the assets acquired and liabilities assumed, is recorded as goodwill. If the fair value attributable to the Company’s share of the identifiable net assets exceeds the cost of acquisition, the difference is recognized as a gain in the Consolidated Statement of Operations.
Should the consideration be contingent on future events, the cost of the acquisition recorded includes management’s best estimate of the fair value of the contingent amounts expected to be payable. Provisional fair values allocated at the reporting date are finalized within one year of the acquisition date with retroactive restatement to the acquisition date as required.
Transaction costs, other than those associated with the issue of debt or equity securities, which the Company incurs in connection with a business combination, are expensed as incurred.
Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each of the group's entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are presented in United States dollars, which is the Company’s presentation currency. The Company’s mining operations operate within an economic environment where the functional currency is the United States dollar. References to "$" or "US$" are to United States dollars, while references to "Cdn. $" are to Canadian dollars and "Aus. $" are to Australian dollars.
Transactions and balances
Transactions denominated in foreign currencies are translated into the United States dollar as follows:
•Monetary assets and liabilities are translated at the rates of exchange at the Consolidated Balance Sheet date;
•Non-monetary assets and liabilities are translated at historical exchange rates prevailing at each transaction date;
•Revenue and expenses are translated at the exchange rate at the date of the transaction, except depreciation, depletion and amortization, which are translated at historical exchange rates, and share-based compensation expense, which is translated at the rates of exchange applicable at the date of grant of the share-based compensation; and
•Exchange gains and losses on translation are included in earnings. When the gain or loss on certain non-monetary items, such as long-term investments classified as fair value through other comprehensive income (“OCI”) is recognized in OCI, the translation differences are also recognized in OCI.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Group companies
For any subsidiaries or joint ventures whose functional currency differs from the United States dollar, balances and transactions are translated into the United States dollar as follows:
•Assets and liabilities are translated at the rates of exchange at the Consolidated Balance Sheet date;
•Revenue and expenses are translated at average exchange rates throughout the reporting period or at rates that approximate the actual exchange rates; items such as depreciation are translated at the monthly average exchange rate; and
•Exchange gains and losses on translation are included in OCI.
The exchange gains and losses are recognized in earnings upon the substantial disposition, liquidation or closure of the entity that gave rise to such amounts.
Financial instruments
The Company recognizes financial assets and liabilities on the Consolidated Balance Sheet when the Company becomes party to the contractual provisions of the instrument.
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held with banks, and other short-term highly liquid investments with original maturities of three months or less. Cash and cash equivalents are classified as financial assets and subsequently measured at amortized cost.
Accounts receivable, accounts payable and accrued liabilities
Accounts receivable, accounts payable and accrued liabilities are non-interest bearing. Accounts receivable are classified as financial assets and accounts payable and accrued liabilities are classified as financial liabilities. They are initially measured at fair value and subsequently recorded at amortized cost, which approximates fair value due to the short term to maturity. Accounts receivable are net of expected credit losses.
Long-term investments
Equity investments in entities that are not subsidiaries, joint ventures or investments in associates are classified as fair value through profit and loss ("FVTPL") unless they are irrevocably designated, on an individual basis, as fair value through other comprehensive income ("FVOCI"). These investments are measured at fair value on acquisition and at each reporting date. Any unrealized holding gains and losses related to long-term investments designated as FVOCI are excluded from net earnings and are included in OCI. Upon disposal, any accumulated gains and losses remain in equity.
Lease liabilities
Lease liabilities are interest bearing and are initially measured at the present value and subsequently recorded at amortized cost.
Debt
The Company initially recognizes all financial liabilities at fair value and classifies them as subsequently measured at either FVTPL or amortized cost, as appropriate. For debt subsequently measured at amortized cost, the effective interest rate method is used. Debt classified as FVTPL is measured at fair value on each financial period-end date with gains and losses flowing through the Consolidated Statement of Operations. For debt that is optionally classified as FVTPL, the part of the fair value change related to the Company’s own credit risk is recorded in OCI rather than the Consolidated Statement of Operations.
Derivative instruments
Derivative instruments, including embedded derivatives, are recorded at FVTPL and accordingly recorded at fair value on the Consolidated Balance Sheet with changes in the fair value being recognized as gains or losses in the Consolidated Statement of Operations. Fair values for derivative instruments are determined using valuation techniques, using assumptions based on market conditions existing at the balance sheet date.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Impairment of financial assets held at amortized cost
At each reporting date, the Company measures the loss allowance for financial assets held at amortized cost at an amount equal to the lifetime expected credit losses if the credit risk on the financial assets has increased significantly since initial recognition. If at the reporting date, the credit risk on the financial assets has not increased significantly since initial recognition, the Company measures the loss allowances for the financial assets at an amount equal to twelve month expected credit losses.
Derecognition of financial assets
Financial assets are derecognized when the investments mature or are sold, and substantially all the risks and rewards of ownership have been transferred. Gains and losses on derecognition of financial assets classified as FVTPL or amortized cost are recognized within other non-operating income. Accumulated gains or losses on financial assets classified as FVOCI remain within accumulated other comprehensive income.
Inventories
Gold and silver bullion, in-process and stockpile inventories are recorded at the lower of average cost and net realizable value. The cost of finished goods and work-in-progress comprises raw materials, direct labour, and other direct costs, as well as stripping in the production stage and related production overheads (based on normal operating capacity) including applicable depreciation on property, plant and equipment. Net realizable value is the estimated selling price less applicable selling expenses and cost to complete.
When inventories have been written down to net realizable value, a new assessment of net realizable value is made in each subsequent period. If the circumstances that caused the write down no longer exist, the amount of the write down on inventory not yet sold is reversed.
Materials and supplies inventories are valued at the lower of average cost and net realizable value. Cost includes acquisition, freight and other directly attributable costs.
Mining interests
Mining interests include property, plant and equipment, mineral properties, construction-in-progress (including mine development costs), deferred stripping, exploration and evaluation expenditures, capitalized borrowing costs, and impairment.
Mineral property costs
Mineral property (including mine development costs) are stated at cost less accumulated depreciation and impairment losses. When production commences, these costs are amortized using the UOP method, based on recoverable ounces from the estimated proven and probable reserves plus a portion of measured and indicated resources that are reasonably expected to be converted to proven and probable reserves.
Capitalization of mine development costs to construction-in-progress ceases when the mine is capable of operating in the manner intended by management. The Company applies judgement in its assessment of when a mine is capable of operating in the manner intended by management which takes account of the design of the mine and the nature of the initial commissioning phase of the mine.
In accordance with the amendments to IAS 16, Property, plant and equipment, for new mines commissioned on or after January 1, 2022, revenues and the associated cost of production for any items produced during the commissioning phase are recognized in the Consolidated Statement of Operations.
Non-recoverable costs for projects determined not to be commercially feasible are expensed in the period in which the determination is made or when the carrying value of the project is determined to be impaired.
Deferred stripping
Deferred stripping costs are included as a component of mineral property costs. Stripping incurred during the production phase of a mine are considered production costs and are included in the cost of inventory produced during the period in which stripping costs are incurred, unless the stripping activity can be shown to be a betterment of the mineral property. Betterment occurs when stripping activity increases future output of the mine by providing access to additional reserves.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Stripping costs incurred to provide access to the ore body for extraction are capitalized as mineral property costs and are amortized on a UOP basis over the reserves and resources to which they relate.
Construction-in-progress
Qualifying assets in the course of construction are capitalized as construction-in-process until the asset is substantially complete and ready for its intended use, at which time, it is transferred to the appropriate category of mineral property or buildings, plant and equipment and depreciation commences.
Buildings, plant and equipment
Buildings, plant and equipment are recorded at cost. Repairs and maintenance expenditures are charged to operating costs; major improvements and replacements which extend the useful life of an asset are capitalized to the cost of the asset. Buildings, plant and equipment are amortized over the life of the mine using the units-of-production (“UOP”) method based on the recoverable ounces from the estimated proven and probable reserves and a portion of the measured and indicated resources that are reasonably expected to be converted to proven and probable reserves. Mobile equipment, tailings dams and other equipment are depreciated on a straight-line basis over three to six years as appropriate, net of residual value. The Company allocates the amount initially recognized in respect of an item of buildings, plant and equipment to its significant components and depreciates separately each component part. Residual values, method of amortization and useful lives of the assets are reviewed annually and adjusted if appropriate.
Exploration and Evaluation Expenditures
The Company defers the cost of acquiring, maintaining its interest in, exploring and evaluating a mineral property as exploration and evaluation until a decision to construct, abandon or sell the property is made. Once the technical feasibility and commercial viability of the extraction of mineral reserves or resources from a particular mineral property has been determined, exploration and evaluation expenditures are reclassified to “mineral property costs”. If no mineable ore body is discovered, such costs are expensed in the period in which it is determined the property has no future economic value. Exploration costs that do not relate to any specific property are expensed as incurred.
The establishment of technical feasibility and commercial viability of a mineral property is assessed based on a combination of factors, such as but not limited to:
•The extent to which mineral reserves or mineral resources have been identified through a feasibility study or similar level document;
•The results of optimization studies and further technical evaluation carried out to mitigate project risks identified in the feasibility study;
•The status of environmental permits; and
•The status of mining leases or permits.
In addition, commercial viability is deemed to be achieved when the Company determines that the project will provide a satisfactory return relative to its perceived risks. Ore reserves and resources may be declared for an undeveloped mining project before its commercial viability has been fully determined. Evaluation costs may continue to be capitalized during the period between declaration of reserves and approval to mine as further work is undertaken in order to refine the development case to maximize the project’s returns.
Borrowing costs
Borrowing costs attributable to the construction of qualifying assets, which take a substantial period of time to make ready for their intended use, are added to the cost of the assets until such time as the assets are substantially complete and ready for their intended use. The amount of borrowing costs capitalized cannot exceed the actual amount of borrowing costs incurred in a period. All other borrowing costs are expensed in the period in which they are incurred.
Impairment and reversals of impairment
The carrying amounts of long-lived assets are tested for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If there are indicators of impairment, the recoverable amount of the asset is estimated in order to determine the extent of the impairment. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount and is recorded as an expense in the Consolidated Statement of Operations.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The recoverable amount is the higher of an asset’s “fair value less costs of disposal” ("FVLCD") and “value-in-use”. Where the asset does not generate cash flows that are independent from other assets, the recoverable amount of the cash-generating unit ("CGU") to which the asset belongs is determined. FVLCD is determined as the amount that would be obtained from the sale of the asset less costs of disposal in an arm’s length transaction between knowledgeable and willing parties. For mining assets this would generally be determined based on the present value of the estimated future cash flows arising from the continued development, use or eventual disposal of the asset. In assessing these cash flows and discounting them to the present value, assumptions used are those that an independent market participant would consider appropriate. In assessing “value-in-use”, the estimated future cash flows expected to arise from the continuing use of the assets in their present form and from their disposal are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.
Impairment losses are evaluated for potential reversals when events or circumstances warrant such consideration. Where an impairment loss is subsequently reversed, the amount of such reversal is limited such that the revised carrying amount of the asset or CGU does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset or CGU in the prior years. A reversal of an impairment loss is recognized into earnings immediately.
Leases
At the inception of a contract, to determine if it contains a lease, the Company assesses whether it conveys the right to control and obtain substantially all of the economic benefits of an identified asset, for a period of time, in exchange for consideration. Where a contract contains a lease, the Company recognizes a right-of-use asset and a lease liability at the commencement date of the lease.
The right-of-use asset is measured at cost less any accumulated depreciation and impairment losses and may be adjusted for any remeasurement of the lease liability. Cost is the amount of the initial lease liability plus any initial direct costs incurred and any lease payments made at or before the commencement date less any incentives received.
The right-of-use assets are included in the cost of property, plant and equipment for the associated mining interest on the Consolidated Balance Sheet. They are depreciated, in accordance with the Company's existing accounting policy, over the shorter of the lease term or the life of the asset.
The lease liability is initially measured at the present value of future lease payments discounted at the interest rate implicit in the contract. If the implicit rate cannot be determined, the incremental borrowing rate over a similar term and with similar security for the funds necessary to obtain an asset of similar value in a similar economic environment is used. The lease payments include fixed payments less any incentives receivable, variable lease payments that depend on an index or rate and amounts expected to be paid under residual value guarantees. Where the lease contains an extension or purchase option, the costs associated with the option are included if it is reasonably expected to be exercised by the Company.
Thereafter, the amount of the lease liability is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of the lease liability is remeasured to reflect any modifications to the contract terms. Lease liabilities are presented as a component of debt on the Consolidated Balance Sheet.
The Company has elected not to recognize right-of-use assets and lease liabilities for contracts that have a lease term of 12 months or less or are for the use of low value assets. These contracts are recognized as an expense in the Consolidated Statement of Operations in the period the cost is incurred. In addition, for certain asset classes, the Company has elected to treat both lease and non-lease components as a single lease component for the purposes of applying IFRS 16, Leases.
Mine restoration provisions
Future obligations to retire an asset including site closure, dismantling, remediation and on-going treatment and monitoring are initially recognized and recorded as a liability based on estimated future cash flows discounted at a risk free rate. The measurement determination is based on estimated future cash flows, the current risk-free discount rate, and an estimated inflation factor. The value of restoration provisions is adjusted at each reporting period for changes to factors including the expected amount of cash flows required to discharge the liability, the timing of such cash flows and the risk-free interest rate. The liability is added to the carrying amount of the associated asset, and this additional carrying amount is depreciated over the life of the asset. The liability is accreted to full value over time through periodic charges to earnings. This unwinding of the discount is expensed in the Consolidated Statement of Operations. As reclamation work is performed or liabilities are otherwise settled, the recorded amount of the liability is reduced.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Share-based payments
The cost of stock options and other equity-settled share-based payment arrangements, including restricted share units and performance share units, is recorded based on the estimated fair-value at the grant date and charged to earnings over the vesting period.
The Company grants stock options to certain employees and directors. Each tranche is considered a separate award with its own vesting period and grant date fair value. The fair value of each tranche is measured at the date of grant using the Black-Scholes option pricing model. Compensation expense is recognized over the tranche’s vesting period by a charge to earnings, with a corresponding increase to contributed surplus based on the number of awards expected to vest. The number of awards expected to vest is reviewed at least annually, with any impact being recognized immediately.
The Company grants performance share units to certain officers and employees. Each tranche is considered a separate award with its own vesting period and grant date fair value. The fair value of each tranche is measured at the date of grant using a risk neutral Monte Carlo simulation based on a correlated Geometric Brownian Motion. Compensation expense is recognized over the tranche’s vesting period by a charge to earnings, with a corresponding increase to contributed surplus based on the number of awards expected to vest. The number of awards expected to vest is reviewed at least annually, with any impact being recognized immediately.
Cash settled share-based payment arrangements, including deferred share units and restricted phantom units are measured at fair value using the market value of the underlying shares on the date of issuance. The liability is then remeasured at market value on each reporting date until settlement with any gains or losses flowing through share-based payments expense.
Current and deferred income taxes
Income tax comprises current and deferred tax. Income tax is recognized in the Consolidated Statement of Operations except to the extent that it relates to items recognized directly in equity, in which case the income tax is also recognized directly in equity. Taxes on income in interim periods are recorded using the tax rate that would be applicable to expected annual profit.
Current tax is the expected tax payable on taxable income for the year, using tax rates enacted or substantively enacted, at the end of the reporting period.
Deferred tax is recognized in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined on a non-discounted basis using tax rates and laws that have been enacted or substantively enacted at the balance sheet date and are expected to apply when the deferred tax asset or liability is reversed. Deferred tax assets are recognized to the extent that it is probable that the assets can be recovered.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except, in the case of subsidiaries, where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. As an exception, deferred tax assets and liabilities are not recognized if the temporary differences arise from the initial recognition of goodwill, or an asset or liability in a transaction (other than in a business combination) that affects neither accounting profit nor taxable profit.
Deferred income tax assets and liabilities are presented as non-current.
Revenue
Gold revenue is recognized when it is probable that the economic benefits will flow to the Company, delivery has occurred, the sales price is reasonably determinable and collectability is reasonably assured. These criteria are generally met at the time the product is delivered to the customer and, depending on the delivery conditions, title and the risks and rewards of ownership have passed to the customer and acceptance of the product, when contractually required, has been obtained. Gold revenue is measured based on the price specified in the sales contract at the time of sale.
Silver revenue is accounted for as a by-product and is recorded as a credit to operating costs.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Earnings per share
Basic earnings per share is calculated by dividing the net income for the year attributable to shareholders of the Company by the weighted average number of common shares outstanding during the year.
Diluted earnings per share reflects the potential dilution from common share equivalents on the weighted average number of common shares outstanding during the year if the resulting shares would be dilutive. For stock options, the potential dilutive impact is calculated using the treasury share method whereby all “in-the-money” options are assumed to have been exercised at the beginning of the year and the proceeds from the exercise are assumed to have been used to purchase common shares at the average market price during the period.
5Significant accounting judgements and estimates
The preparation of these financial statements in conformity with IFRS requires judgements and estimates that affect the amounts reported. Those judgements and estimates concerning the future may differ from actual results. The following are the areas of accounting policy judgement and accounting estimates applied by management that most significantly affect the Company’s financial statements, including those areas of estimation uncertainty that could result in a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Areas of judgement
Uncertain tax positions
The Company’s operations involve the application of complex tax regulations in multiple international jurisdictions. Determining the tax treatment of a transaction requires the Company to apply judgement in its interpretation of the applicable tax law. These positions are not final until accepted by the relevant tax authority. The tax treatment may change based on the result of assessments or audits by the tax authorities often years after the initial filing.
The Company recognizes and records potential liabilities for uncertain tax positions based on its assessment of the amount, or range of amounts, of tax that will be due. The Company adjusts these accruals as new information becomes available. Due to the complexity and uncertainty associated with certain tax treatments, the ultimate resolution could result in a payment that is materially different from the Company’s current estimate of the tax liabilities.
Assessment of impairment and reversal of impairment indicators for long-lived assets
The Company applies significant judgement in assessing whether there are indicators of impairment or impairment reversal present that give rise to the requirement to conduct an impairment test. Internal and external factors such as significant changes in the use of the asset, legal and permitting factors, future gold prices, operating and capital cost forecasts, quantities of mineral reserves and resources, and movements in market interest rates are used by management in determining whether there are any indicators.
During the year, the Company identified indicators of impairment on the Fekola Complex CGU, consisting of the Fekola Mine and Fekola Regional Properties, as well as the Gramalote Project. As a result, these assets were tested for impairment (Note 10).
Capitalization of exploration and evaluation expenditures
The application of the Company’s accounting policy for capitalization of exploration and evaluation expenditures requires judgement in determining whether the future economic benefit is likely, either through future exploitation or sale, where properties have not reached a stage which permits a reasonable assessment of the existence of reserves. The deferral policy requires management to make certain judgements about future events or circumstances, in particular whether an economically viable mine can be established. Judgement is applied in the determination of whether any impairment indicators exist at each reporting date giving consideration to factors including mining title expiration dates, budgeted expenditures, discontinuation of activities in any area, and evaluation of any data which would indicate that the carrying amount of exploration and evaluation assets is not recoverable. If new information becomes available suggesting that the recovery of the carrying amount of exploration and evaluation assets is unlikely, the amount capitalized is written off in the Consolidated Statement of Operations in the period when the new information becomes available.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Determination of control or significant influence over investees
The assessment of whether the Company has a significant influence or control over an investee requires the application of judgement when assessing factors that could give rise to a significant influence or control. Factors evaluated when making a judgement of control or significant influence over an investee include, but are not limited to, ownership percentage, representation on the board of directors, participation in the policy-making process, material transactions and contractual arrangements between the Company and the investee, interchange of managerial personnel, provision of essential technical information and potential voting rights. In evaluating these factors, the Company determines the level of influence over the investee the Company has. Changes in the Company's assessment of the factors used in determining if control or significant influence exists over an investee would impact the accounting treatment of the investment in the investee.
Business combinations and asset acquisitions
The assessment of whether an acquisition meets the definition of a business or whether it is a purchase of assets is a key area of judgment. If deemed to be a business combination, the acquisition method requires acquired assets and liabilities assumed to be recorded at fair value as of the date of acquisition with the excess of the purchase consideration over such fair value being recorded as goodwill. Where an acquisition involves a purchase of assets the purchase price is allocated to the assets acquired and liabilities assumed based on their relative fair value and no goodwill arises on the transaction. The acquisition of Sabina was determined to be a purchase of assets (Note 6).
Sources of estimation uncertainty
Fair value of financial instruments
The fair value of financial instruments that are not traded in an active market are determined using valuation techniques. In determining the fair value of the gold stream obligation (Note 6), the Company makes significant assumptions that are based on the underlying models and the market conditions existing at both initial recognition and the end of each reporting period.
Mineral reserve and resource estimates
Mineral reserves are estimates of the amount of ore that can be economically and legally extracted from the Company’s mining properties. The Company estimates its mineral reserves and mineral resources based on information compiled by appropriately qualified persons relating to the geological data on the size, depth and shape of the ore body, and requires complex geological assessments to interpret the data. The estimation of recoverable mineral reserves is based upon factors such as estimates of foreign exchange rates, commodity prices, future capital requirements, metallurgical recoveries, permitting and production costs along with geological assumptions made in estimating the size, and grade of the ore body. Changes in the mineral reserve or mineral resource estimates may impact the carrying value of mining interests, mine restoration provisions, the gold stream obligation, recognition of deferred tax assets, depreciation and amortization charges and royalties receivable.
Impairment of long-lived assets
Long-lived assets are tested for impairment, or reversal of a previous impairment, if there is an indicator of impairment or a subsequent reversal. Calculating the estimated recoverable amount of CGUs for long-lived asset requires management to make estimates and assumptions that include such factors as mineable mineralization including reserves and resources, future production levels, operating and capital costs, application of royalty, income tax and mining tax rates, future metal prices and discount rates. The Company also assesses whether stability provisions under its 2012 Mali Mining Convention continue to apply to its exploration and exploitation permits. Changes in any of these assumptions or estimates used in determining the recoverable amount could impact the analysis. Such changes could be material.
Value-added tax receivables
The Company incurs indirect taxes, including value-added tax, on purchases of goods and services at its operating mines and development projects. Indirect tax balances are recorded at their estimated recoverable amounts within current or long-term assets, net of provisions, and reflect the Company’s best estimate of their recoverability under existing tax rules in the respective jurisdictions in which they arise. Management’s assessment of recoverability considers the probable outcomes of claimed deductions and/or disputes. The provisions and balance sheet classifications made to date may be subject to change and such change may be material.
Value-added tax receivables includes amounts for the Fekola Mine of $137 million (2022 - $77 million), for the Masbate Mine of $45 million (2022 – $37 million), and for the Gramalote Project of $18 million (2022 - $7 million).
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Current and deferred income taxes
The Company is periodically required to estimate the tax basis of assets and liabilities. Where applicable tax laws and regulations are either unclear or subject to varying interpretations, it is possible that changes in these estimates could occur that materially affect the amounts of deferred income tax assets and liabilities recorded in the financial statements. Changes in deferred tax assets and liabilities generally have a direct impact on earnings in the period that the changes occur.
Each period, the Company evaluates the likelihood of whether some portion or all of each deferred tax asset will not be realized. This evaluation is based on historic and future expected levels of taxable income and the associated repatriation of retained earnings, the pattern and timing of reversals of taxable temporary timing differences that give rise to deferred tax liabilities, and tax planning initiatives. Levels of future taxable income are affected by, among other things, metal prices, production costs, quantities of proven and probable gold reserves, interest rates and foreign currency exchange rates. The availability of retained earnings for distribution depends on future levels of taxable income as well as future reclamation expenditures, capital expenditures, dividends and other uses of available cash flow.
6Acquisition of Sabina
On April 19, 2023, the Company completed the acquisition of all of the issued and outstanding common shares of Sabina (the “Transaction”), resulting in the acquisition of the 100% owned Back River Gold District, including the Goose Project, located in Nunavut, Canada. The acquisition has been accounted for as a purchase of assets as the Company concluded that it did not acquire processes that could develop the acquired inputs into an operating mine. For accounting purposes, it was determined that B2Gold obtained control of Sabina on April 14, 2023, which is the date when the Transaction was irrevocably approved by the Supreme Court of British Columbia, giving the Company the ability to direct the use of the net assets acquired.
The purchase price of the acquisition was approximately $937 million, consisting of the fair value of B2Gold shares issued of $925 million, based on the issuance of 216,451,555 B2Gold shares at Cdn. $5.72 per share and a foreign exchange rate of Cdn. $1.3379 to $1, the fair value of B2Gold replacement stock options of $5 million (3,342,413 equivalent stock options for B2Gold common shares), plus B2Gold transaction costs of $7 million. The replacement stock options have been valued using the Black-Scholes option pricing model based on a risk-free annual interest rates ranging from 3.6% to 3.8%, an expected volatility of between 33% and 50%, an expected average life of up to 3.2 years and a dividend yield of 3.7%.
The purchase price was calculated as follows:
| $ | |
|---|---|
| Common shares issued (216,451,555 common shares) | 925,375 |
| Fair value of B2Gold replacement stock options | 5,075 |
| Transaction costs | 6,672 |
| Total purchase price | 937,122 |
The purchase price was allocated based on the relative fair value of the assets acquired and liabilities assumed as follows:
| B2GOLD CORP. | |||
|---|---|---|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | |||
| December 31, 2023 and 2022 | |||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) | $ | ||
| --- | --- | ||
| Cash and cash equivalents | 38,083 | ||
| Accounts receivable, prepaids and other | 816 | ||
| Value added and other tax receivables | 2,637 | ||
| Mining interest - Construction-in-progress - Goose Project | 1,050,326 | ||
| Mining interest - Buildings, plant & equipment | 33,921 | ||
| Mining interest - Exploration & Evaluation Asset - Hackett River Royalty | 64,540 | ||
| Mining interest - Exploration & Evaluation Assets - Other | 28,533 | ||
| Other assets | 15,738 | ||
| Accounts payable and accrued liabilities | (41,344) | ||
| Current portion of long-term debt | (3,770) | ||
| Construction financing obligations | (65,419) | ||
| Gold stream obligation | (173,700) | ||
| Long-term debt | (6,716) | ||
| Mine restoration provision | (3,436) | ||
| Other long-term liabilities | (3,087) | ||
| 937,122 |
The purchase price was allocated to the assets acquired and liabilities assumed in accordance with their relative fair value. Included within Mining interest - Construction-in-progress is the Goose Project mineral interest. The value of the Goose Project mineral interest of $740 million was determined using a combination of a discounted cash flow model and a comparable market transactions approach which required the use of significant assumptions that included reserves and resources, future production levels, operating and capital costs, a long-term gold price per ounce, the discount rate and in-situ multiples. The remaining construction-in-progress balance relates to site infrastructure costs, the value of which was determined based on Sabina's historical costs incurred. The value of the buildings, plant and equipment at the Goose Project was based on a trending analysis of recent purchases and the value of the other exploration and evaluation properties was determined to be consistent with Sabina's historical costs incurred.
As a result of the transaction, the Company also acquired a silver production royalty (the “Hackett River Royalty") equal to 22.5% of the first 190 million ounces of payable silver from the then current resource at Hackett River and other properties (the "Properties") and 12.5% of all payable silver from the Properties thereafter at no future cost. The fair value of the Hackett River Royalty was determined using a comparable market transactions approach.
The Company assumed certain construction financing and gold stream obligations from Sabina. The fair value of the construction financing obligations at acquisition was based on their extinguishment value. The Company also assumed a gold stream obligation (Note 18). The fair value of the gold stream obligation on acquisition was based on the value of the extinguishable portion plus the fair value of the gold stream obligation retained. See Note 19 for details of the valuation of the portion of the gold stream arrangement retained.
Following completion of the Transaction, the Company extinguished certain gold stream and construction financing obligations with payments totalling $112 million, as follows:
•a $46 million payment to extinguish one-third of the gold stream obligation;
•a $63 million payment to extinguish the gold metal off take agreement;
•a $2 million payment to extinguish the senior secured debt facility; and
•a $1 million payment to extinguish the $75 million gold prepay facility
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
7Accounts receivable, prepaids and other
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Supplier advances | 10,533 | 12,805 |
| Prepaid expenses | 8,639 | 4,062 |
| Current portion of derivative instruments (Note 17) | 481 | 5,009 |
| Other receivables | 7,838 | 6,935 |
| 27,491 | 28,811 |
8Inventories
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Gold and silver bullion | 53,065 | 49,467 |
| In-process inventory | 18,220 | 14,653 |
| Ore stock-pile inventory | 80,302 | 96,879 |
| Materials and supplies | 194,908 | 171,032 |
| 346,495 | 332,031 |
Ore stock-pile inventory includes amounts for the Fekola Mine of $59 million (2022 - $75 million), for the Otjikoto Mine of $7 million (2022 – $10 million), and for the Masbate Mine of $14 million (2022 - $12 million).
Long-term stock-pile inventory includes amounts for the Otjikoto Mine of $44 million (2022 – $40 million), for the Fekola Mine of $6 million (2022 - $6 million), and for the Masbate Mine of $6 million (2022 - $3 million).
Long-term supplies inventory are supplies for construction and operations at the Back River Project that are expected to be consumed beyond the next twelve months.
9Long-term investments
| 2023 | 2022 | |||||
|---|---|---|---|---|---|---|
| Cost | AOCI | Fair value | Cost | AOCI | Fair value | |
| $ | $ | $ | $ | $ | $ | |
| Snowline Gold Corp. | 32,759 | 19,909 | 52,668 | — | — | — |
| West African Resources Ltd. | 20,530 | (6,261) | 14,269 | 20,530 | (2,766) | 17,764 |
| Osino Resources Corp. (Note 10) | 6,955 | 5,340 | 12,295 | 6,955 | 347 | 7,302 |
| St. Augustine Gold & Copper Ltd. | 20,193 | (15,562) | 4,631 | 20,193 | (16,670) | 3,523 |
| Matador Mining Ltd. | 2,885 | (1,253) | 1,632 | 2,362 | 68 | 2,430 |
| RTG Mining Inc. | 13,400 | (13,092) | 308 | 13,400 | (12,798) | 602 |
| Other | 899 | (695) | 204 | 652 | (408) | 244 |
| 97,621 | (11,614) | 86,007 | 64,092 | (32,227) | 31,865 |
During the year ended December 31, 2023, the Company purchased 14 million shares (representing a 9.9% ownership interest) of Snowline Gold Corp. for a total of $33 million and 20 million additional shares of Matador Mining Ltd. for $1 million.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
10Mining interests
| Mineral Properties | Buildings, plant & equipment | Construction-in-progress | Exploration & evaluation assets | Total | |
|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | |
| Cost | |||||
| Balance at December 31, 2021 | 2,087,477 | 1,505,550 | 35,295 | 357,207 | 3,985,529 |
| Additions | 100,118 | 191,417 | 14,133 | 59,950 | 365,618 |
| Acquisitions | — | — | — | 108,235 | 108,235 |
| Disposals | — | (17,622) | — | — | (17,622) |
| Write-downs | — | — | — | (12,369) | (12,369) |
| Transfers | 33,988 | — | (32,832) | (1,156) | — |
| Change in mine restoration provision estimates | (18,171) | — | — | — | (18,171) |
| Balance at December 31, 2022 | 2,203,412 | 1,679,345 | 16,596 | 511,867 | 4,411,220 |
| Additions | 193,443 | 197,704 | 388,272 | 61,832 | 841,251 |
| Acquisitions | — | 41,166 | 1,050,326 | 114,898 | 1,206,390 |
| Disposals | — | (25,479) | — | — | (25,479) |
| Write-downs | — | — | — | (19,905) | (19,905) |
| Transfers | 21,087 | 61,414 | (61,414) | (21,087) | — |
| Change in mine restoration provision estimates | (495) | — | 363 | (150) | (282) |
| Balance at December 31, 2023 | 2,417,447 | 1,954,150 | 1,394,143 | 647,455 | 6,413,195 |
| Accumulated depreciation, depletion, amortization and impairment | |||||
| Balance at December 31, 2021 | (915,387) | (705,827) | — | (132,484) | (1,753,698) |
| Depreciation and depletion | (235,452) | (162,740) | — | — | (398,192) |
| Disposals | — | 15,400 | — | — | 15,400 |
| Balance at December 31, 2022 | (1,150,839) | (853,167) | — | (132,484) | (2,136,490) |
| Depreciation and depletion | (241,194) | (171,155) | — | — | (412,349) |
| Impairment | (96,800) | (65,753) | — | (154,710) | (317,263) |
| Disposals | — | 16,397 | — | — | 16,397 |
| Balance at December 31, 2023 | (1,488,833) | (1,073,678) | — | (287,194) | (2,849,705) |
| Net book value at December 31, 2022 | 1,052,573 | 826,178 | 16,596 | 379,383 | 2,274,730 |
| Net book value at December 31, 2023 | 928,614 | 880,472 | 1,394,143 | 360,261 | 3,563,490 |
Impairment of the Fekola Complex CGU
During the year ended December 31, 2023, the State of Mali introduced a new mining code (the “2023 Mining Code”). In conjunction with the implementation of the 2023 Mining Code and the associated impact to the costs of the Fekola Complex, consisting of the Fekola Mine and the Fekola Regional Properties, the Company completed an update of its Fekola and Fekola Regional Properties life-of-mine estimates. This update included revisions to the mine plan and expected saprolite mill feed from the Fekola Regional Properties, along with updates to related operating and capital cost estimates. The update included the Company’s best current estimate of the final fiscal terms of the 2023 Mining Code, which remains subject to ongoing negotiations with the State of Mali. The final fiscal terms of the 2023 Mining Code remain subject to change and could result in a variation from the estimates used to determine the recoverable amount of the Fekola Complex. Clarification of the final application of the 2023 Mining Code remains subject to ongoing negotiations with the State of Mali, followed by the anticipated issuance of a final implementation decree. Collectively, these changes are considered to be indicators of impairment for the Fekola Complex assets.
As a result, the Company has performed an impairment assessment on the Fekola Complex CGU. The carrying value of the CGU was compared to the CGU’s recoverable amount which was determined to be its fair value less costs of disposal ("FVLCD"). To estimate the recoverable amount of the CGU for impairment, the Company utilized a discounted cash flow model incorporating significant assumptions that included such factors as mineable mineralization including reserves and resources, future production levels, operating and capital costs, a long-term gold price of $1,800 per ounce, and a discount rate of 6.25% for the Fekola Mine and 7% for the Fekola Regional Properties. Management’s estimate of the FVLCD of its
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
CGU is classified as level 3 in the fair value hierarchy. The Company’s estimate of future cash flows is subject to risks and uncertainties and therefore could change in the future if the underlying assumptions change.
The Company’s analysis concluded that the Fekola Complex CGU was impaired resulting in an impairment of $206 million. A net impairment charge of $192 million after taking into account a deferred income tax recovery of $14 million was recorded in the Consolidated Statement of Operations for the year ended December 31, 2023.
The recoverable amount of the Fekola Complex CGU is most sensitive to changes in the gold price and discount rate. In isolation, a $50 per ounce decrease in the gold price would result in a reduction in the recoverable amount of the Fekola Complex CGU of approximately $174 million. In isolation, a 25 basis point increase in the discount rate would result in a reduction in the recoverable amount of the Fekola Complex CGU of approximately $20 million.
Gramalote Property
On October 5, 2023, the Company completed the acquisition of the remaining 50% of the net assets of the Gramalote Project from its joint venture partner AngloGold Ashanti Limited ("AngloGold"). The acquisition has been accounted for as a purchase of assets as the Company concluded that it did not acquire processes that could develop the acquired inputs into an operating mine.
The purchase price consists of the following cash payments to AngloGold contingent on certain milestones:
•$20 million paid upon closing of the transaction
•$10 million contingent consideration to be paid upon B2Gold announcing a construction decision at the Gramalote Project;
•$10 million to be paid upon commercial production at the Gramalote Project, contingent on commercial production beginning within five years of closing;
•$10 million contingent consideration to be paid on the first anniversary of commercial production at the Gramalote Project;
•$10 million contingent consideration to be paid on the second anniversary of commercial production at the Gramalote Project.
The total purchase price of $35 million, including an estimate of the fair value of the future contingent payments, has been determined using the expected value approach in accordance with IFRS 13, Fair value measurements. The purchase price is composed as follows:
| $ | |
|---|---|
| Cash consideration upon closing | 20,000 |
| Fair value of contingent consideration | 14,298 |
| Transaction costs | 393 |
| Total purchase price | 34,691 |
The purchase price was allocated based on the relative fair value of the assets acquired and liabilities assumed as follows:
| $ | |
|---|---|
| Cash and cash equivalents | 1,606 |
| Accounts receivable, prepaids and other | 2,197 |
| Value added tax receivables (non-current) | 8,567 |
| Mining interest - Gramalote | 25,568 |
| Accounts payable and accrued liabilities | (1,317) |
| Lease liabilities | (111) |
| Current income and other taxes payable | (144) |
| Mine restoration provision | (1,675) |
| 34,691 |
Future contingent payments are recognized as a liability at amortized cost. The expected value approach develops a set of probability-based outcomes for the payment of contingent consideration discounted based on market participant assumptions to determine the fair value. The assumptions used in the valuation included the timing and probability of contingent payments and the discount rate. The fair value of the contingent consideration was estimated to be $14 million. The total purchase price was allocated based on the relative fair value of the assets acquired and liabilities assumed,
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
including the mining interest, working capital, value-added tax receivables and mine restoration provisions. The value of the 50% Gramalote Project mining interest was determined to be $26 million.
The acquisition of AngloGold's 50% share of the Gramalote Project was considered to be an impairment indicator for the Company's existing 50% interest in the Gramalote Project under IFRS 6, Exploration and evaluation of mineral resources, for the year ended December 31, 2023. The recoverable amount of $26 million allocated to the Company's existing 50% share of the Gramalote Project resulted in an impairment of $112 million.
Otjikoto
During the year ended December 31, 2023, the Company communicated to employees about the phased closure plan for the Otjikoto Mine that began in 2023. The announcement of the planned closure of the mine resulted in an obligation for severance pay under Namibian law. The undiscounted severance obligation before inflation adjustments is estimated at $16 million. The present value of these payments was $12 million using a Namibian based discount rate of 11%, a Namibian based inflation rate of 7% and a Namibian dollar ("N$") exchange rate of N$18.30 to $1. The present value of these payments has been recorded on the Consolidated Balance Sheet as at December 31, 2023 and as a restructuring charge in the Consolidated Statement of Operations for the year.
Menankoto
During the year ended December 31, 2023, the Company paid $7 million in cash to buy the remaining 5% non-controlling interest ownership of Menankoto SARL, giving it 100% ownership of the property. The loss on the purchase of $7 million was recorded in retained earnings on the Consolidated Balance Sheet at December 31, 2023.
Acquisition of Oklo
On September 20, 2022, the Company completed a scheme of arrangement (the “Scheme”) by which it acquired all of the issued and outstanding ordinary shares of Oklo Resources Limited ("Oklo") based on an exchange ratio of 0.0206 of a common share of B2Gold for each Oklo share and A$0.0525 in cash for each Oklo ordinary share outstanding. The primary asset acquired was the Dandoko Property located in Mali.
The Scheme has been accounted for as a purchase of net assets. For accounting purposes, the acquisition date was determined to be September 7, 2022, the date at which the Company obtained control of Oklo.
The cost of the acquisition was approximately $57 million, and included the fair value of the shares issued of $36 million (based on the issuance of 10,742,814 shares at Cdn. $4.37 per share and a foreign exchange rate of Cdn. $1.3166 to $1), cash consideration of $18 million, a loan facility made available to Oklo of $1 million and transaction costs of approximately $1 million.
The purchase price was calculated as follows:
| $ | |
|---|---|
| Common shares issued (10,742,814 common shares) | 35,658 |
| Cash consideration | 18,426 |
| Loan facility | 1,346 |
| Transaction costs | 1,358 |
| Total purchase price | 56,788 |
| B2GOLD CORP. | |
| --- | |
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | |
| December 31, 2023 and 2022 | |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The purchase price was allocated to the assets and liabilities as follows:
| $ | |
|---|---|
| Cash and cash equivalents | 1,415 |
| Accounts receivable, prepaids and other | 83 |
| Mining interest - Dandoko Property | 56,287 |
| Mining interest - Other | 3,690 |
| Accounts payable and accrued liabilities | (2,332) |
| Current income and other taxes payable | (2,355) |
| 56,788 |
Subsequent to the acquisition, the Company settled the $2 million of taxes payable, relating to capital gains taxes on the acquisition, in cash.
Bakolobi Permit
On April 21, 2022 the Company completed the acquisition of the Bakolobi permit in Mali from a local Malian company for $24 million in cash. The Company also paid $24 million in cash pursuant to a continuing obligation to the previous ownership group of the Bakolobi permit (which includes an international mining company) under the terms of a previous purchase and sale agreement related to the purchase of the Bakolobi permit.
Ondundu Property
In the second quarter of 2022, the initial agreement for the sale of the Ondundu Property in Namibia to Osino Resources Corp. ("Osino") was revised such that the Company would receive 12 million common shares of Osino initially estimated to be valued at $10 million at June 30, 2022 (based on a price Cdn. $1.08 per Osino common share and an exchange rate of Cdn. $1.29 to $1) instead of $4 million in cash and $5 million in Osino common shares as outlined in the original agreement signed in 2021. As a result of the change in consideration, $1 million of the previously recorded impairment loss on the Ondundu Property was reversed in the Consolidated Statement of Operations for the year ended December 31, 2022.
On July 20, 2022, the Company completed the sale of the Ondundu Property for total consideration of $11 million valued as follows:
•12 million Osino shares valued at $7 million based on a share price of Cdn. $0.77 per share and a foreign exchange rate of Cdn. $1.2877 to $1;
•$4 million in deferred consideration to be received in cash six months after closing;
•$2.5 million to be received upon the earlier of (i) completion of a feasibility study including the Ondundu Property or (ii) first gold production from the property, to which no value has been assigned.
Due to the decline in value of the Osino share price between the date of the agreement modification and the closing date, the transaction was completed at a further loss of $3 million. This amount was recognized in the Consolidated Statement of Operations for the year ended December 31, 2022.
During the year ended December 31, 2022, the Company paid $8 million to exercise its option to acquire the remaining 51% interest in the Ondundu property prior to the closing of the sale.
During the year ended December 31, 2023, the Company received the $4 million deferred consideration.
Bantako North Property
On October 11, 2022, the Company purchased the remaining 10% interest in Dampan Resources SARL, which owns the Bantako North Property for consideration of $4 million plus certain future contingent consideration payments.
Other
During the year-ended December 31, 2023, the Company wrote-off $20 million (2022 - $12 million) relating to non-core properties that it no longer plans to proceed with.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
On November 30, 2021, the Company completed the sale of its 81% interest in the Kiaka gold project located in Burkina Faso to West African Resources Limited. The consideration included $45 million of deferred consideration. On September 2, 2022, the Company received the $45 million deferred consideration in cash.
As at December 31, 2023 the Company had leased assets of $28 million under IFRS 16. The leased assets primarily consisted of the corporate offices of $19 million (cost of $24 million net of $5 million in accumulated depreciation) and other leased assets of $9 million (cost of $20 million net of accumulated depreciation of $11 million) classified as buildings, plant and equipment.
11Investment in associates
| Calibre | BeMetals | Total | |
|---|---|---|---|
| $ | $ | $ | |
| Balance at December 31, 2021 | 93,728 | 10,508 | 104,236 |
| Share of net income (loss) | 12,416 | (2,233) | 10,183 |
| Gain on dilution | 5,630 | — | 5,630 |
| Balance at December 31, 2022 | 111,774 | 8,275 | 120,049 |
| Share of net income (loss) | 20,122 | (251) | 19,871 |
| Impairment | — | (4,885) | (4,885) |
| Loss on dilution | (943) | — | (943) |
| Balance at December 31, 2023 | 130,953 | 3,139 | 134,092 |
Calibre
On January 12, 2022, the Company's associate, Calibre, acquired Fiore Gold Ltd. for a combination of shares and cash. As a result of the shares issued in the transaction, the Company's investment was diluted from approximately 33% of the outstanding shares of Calibre to approximately 25%. A gain on this dilution of $6 million was recognized in Other (expense) income in the Consolidated Statement of Operations during the year ended December 31, 2022. The Company determined that it still has significant influence over the decision-making process of Calibre as a result of holding approximately 25% of the outstanding shares and having an executive of the Company sit on Calibre's Board of Directors. As at December 31, 2023, the Company held approximately 24% of the outstanding shares of Calibre.
The trading price of Calibre on December 31, 2023 was Cdn $1.36 per share which corresponds to a quoted market value of $114 million (at a closing exchange rate of Cdn $1.32 per US$) for the Company's investment in Calibre.
The equity accounting for Calibre is based on its published results to September 30, 2023 and an estimate of results for the period of October 1, 2023 to December 31, 2023. The following is a summary of the Condensed Interim Consolidated Statement of Financial Position of Calibre at September 30, 2023 on a 100% basis: Current assets - $229 million, non-current assets - $543 million, total assets - $773 million, current liabilities - $82 million, non-current liabilities - $160 million and net assets - $530 million. The following is a summary of the Condensed Interim Consolidated Statement of Operations of Calibre for the nine months ending September 30, 2023 on a 100% basis: Revenues - $410 million, production costs - $209 million, royalties and production taxes - $15 million, depreciation and depletion - $56 million, general and administrative expense - $9 million, stock-based compensation - $3 million, current income tax expense - $32 million, deferred income tax expense - $7 million and net income - $73 million. The Company's equity share of Calibre's estimated net income for the year ended December 31, 2023 was $20 million (2022 - $12 million).
Subsequent to December 31, 2023, on January 24, 2024, Calibre announced that it had completed the acquisition of Marathon Gold Corporation. As a result of the Calibre shares issued as part of the acquisition, the Company's interest in Calibre was diluted to approximately 15%.
BeMetals
The trading price of BeMetals on December 31, 2023 was Cdn $0.09 per share which corresponds to a quoted market value of $2 million (at a closing exchange rate of Cdn $1.32 per US$) for the Company's investment. During the year ended December 31, 2023, the Company determined that its associate BeMetals had become impaired due to the significant and prolonged decline in the fair value of the BeMetals shares held. The Company recorded an impairment loss of $5 million to reflect the fair value of the investment in BeMetals.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The equity accounting for BeMetals is based on its most recent published results to September 30, 2023 and publicly available information to December 31, 2023. BeMetals files its financial results in Canadian dollars. The Condensed Interim Consolidated Statement of Financial Position has been converted to United States dollars at a rate of Cdn. $1.32 and the Condensed Statement of Loss and Comprehensive Loss has been converted at a rate of Cdn. $1.35. The following is a summary of the Condensed Interim Consolidated Statement of Financial Position of BeMetals at September 30, 2023 on a 100% basis: Current assets - $2 million, non-current assets - $21 million, total assets - $23 million, and net assets - $16 million. The following is a summary of the Condensed Interim Consolidated Statement of Loss and Comprehensive Loss of BeMetals for the nine months ending September 30, 2023 on a 100% basis: net loss and comprehensive loss - $1 million.
12Other assets
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Reclamation deposits | 50,934 | 32,203 |
| Loan to associate | 5,763 | 5,095 |
| Restricted cash | 5,259 | 1,347 |
| Debt service reserve account (Note 13) | 577 | 2,801 |
| Deferred financing costs (Note 13) | — | 6,711 |
| Other | 1,102 | 1,056 |
| 63,635 | 49,213 |
Reclamation deposits include amounts for the Fekola Mine of $21 million (2022 - $18 million), for the Otjikoto Mine of $14 million (2022 – $10 million), for the Goose Project of $12 million (2022 - $nil) and for the Masbate Mine of $4 million (2022 - $4 million).
During the year ended December 31, 2022, the Company issued a promissory note to its associate BeMetals Corp. for the principal amount of $5 million. The note has a term of 3 years and bears interest at 4.7% annually. The Company recorded an expected credit loss of $2 million on its loan to associate during the year ended December 31, 2023. During the year ended December 31, 2023, $2 million was advanced to the associate. Subsequent to December 31, 2023, on January 8, 2024, a further $2 million was advanced to the associate.
13Long-term debt
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Revolving credit facility: | ||
| Principal amount | 150,000 | — |
| Unamortized financing costs | (7,365) | — |
| 142,635 | — | |
| Equipment loans: | ||
| Fekola equipment loan facilities (net of unamortized transaction costs) | 13,875 | 23,102 |
| Goose equipment loan facility (net of unamortized transaction costs) | 6,776 | — |
| Masbate equipment loan facility (net of unamortized transaction costs) | — | 872 |
| 20,651 | 23,974 | |
| Lease liabilities | 28,839 | 33,254 |
| Total debt | 192,125 | 57,228 |
| Current portion | (16,256) | (15,519) |
| Long-term debt | 175,869 | 41,709 |
| B2GOLD CORP. | ||
| --- | ||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| December 31, 2023 and 2022 | ||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The following is a continuity schedule of the Company's debt balances:
| Revolving credit facility | Equipment loans | Lease Liabilities | Total | |
|---|---|---|---|---|
| $ | $ | $ | $ | |
| Balance at December 31, 2021 | — | 46,273 | 28,861 | 75,134 |
| Lease liabilities incurred | — | — | 11,882 | 11,882 |
| Debt repayments | — | (19,802) | (6,616) | (26,418) |
| Foreign exchange gains | — | (2,716) | (2,218) | (4,934) |
| Non-cash interest and financing expense | — | 219 | 1,345 | 1,564 |
| Balance at December 31, 2022 | — | 23,974 | 33,254 | 57,228 |
| Revolving credit facility draw downs | 150,000 | — | — | 150,000 |
| Lease liabilities incurred | — | — | 5,457 | 5,457 |
| Lease liabilities terminated | — | — | (6,341) | (6,341) |
| Debt acquired as part of Sabina acquisition (Note 6) | — | 9,431 | 1,055 | 10,486 |
| Debt repayments | — | (13,301) | (6,224) | (19,525) |
| Foreign exchange losses | — | 410 | 330 | 740 |
| Reclass of deferred financing costs from other assets<br><br>(Note 12) | (8,311) | — | — | (8,311) |
| Non-cash interest and financing expense | 946 | 137 | 1,308 | 2,391 |
| Balance at December 31, 2023 | 142,635 | 20,651 | 28,839 | 192,125 |
| Current portion | — | (11,316) | (4,940) | (16,256) |
| 142,635 | 9,335 | 23,899 | 175,869 |
Revolving credit facility
On December 16, 2021, the Company entered into a revised revolving credit facility ("RCF") agreement with its existing syndicate of banks. The maximum available for drawdown under the facility was $600 million with an accordion feature, available on the receipt of additional binding commitments, for a further $200 million. In July 2023, the available and undrawn capacity of the RCF was increased to $700 million under the accordion feature with the addition of the National Bank of Canada. The facility may be further increased to $800 million under the accordion feature any time prior to the maturity date of December 16, 2025.
The RCF bears interest on a sliding scale based on the Secured Overnight Financing Rate (“SOFR”) plus term credit spread adjustment in addition to a sliding scale premium between 2.00% to 2.50%. Commitment fees for the undrawn portion of the facility are also on a sliding scale basis between 0.450% and 0.563%. The term of the RCF is four years, maturing on December 16, 2025. Unamortized transaction costs on the RCF of $7 million are being amortized over the remainder of the facility term.
The Company has provided security on the RCF in the form of a general security interest over the Company’s assets and pledges creating a charge over the shares of certain of the Company’s direct and indirect subsidiaries. In connection with the RCF, the Company must also maintain certain ratios for leverage and interest coverage. As at December 31, 2023, the Company was in compliance with these debt covenants.
During the year-ended December 31, 2023, the Company drew down $150 million on the RCF leaving $550 million remaining available for future draw downs.
Subsequent to December 31, 2023, in February 2024, the Company repaid the drawn down balance on the RCF leaving $700 million available for future draw downs.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Fekola equipment loan facilities
During 2016, the Company entered into a Euro 71 million term equipment facility (the "first equipment facility") with Caterpillar Financial SARL, as Mandated Lead Arranger, and Caterpillar Financial Services Corporation, as original lender. The aggregate principal amount of up to Euro 71 million was available to the Company’s subsidiary, Fekola SA (the “Borrower”) to finance or refinance the mining fleet and other mining equipment at the Company's Fekola Mine in Mali and was fully utilized.
The Company is required to maintain a deposit in a debt service reserve account (“DSRA”) equal at all times to the total of the principal, interest and other payments that become payable over the next six months under the first equipment facility. At December 31, 2023, the balance in the DSRA account was Euro 1 million ($1 million equivalent).
Each equipment loan under the first equipment facility is repayable in 20 equal quarterly installments. The final repayment date shall be five years from the first disbursement under each equipment loan. The interest rate on each loan is a rate per annum equal to EURIBOR plus a margin of 5.10%. The Company and the Company’s subsidiary, Mali Mining Investments Limited, have guaranteed the first equipment facility and security is given over the equipment of the Borrower which has been financed by the first equipment facility, related warranty and insurance, and over the DSRA.
On September 29, 2020, the Company entered into a second term equipment facility (the "second equipment facility") with Caterpillar Financial Services Corporation for aggregate principal amount of up to the Euro equivalent of $40 million. The second equipment facility is available to the Company’s majority-owned subsidiary, Fekola SA (the “Borrower”) to finance or refinance up to 75% of the cost of the mining fleet and other mining equipment at the Company's Fekola Mine in Mali. The second equipment facility is available from the date of the agreement and ends on the earlier of the day when the new equipment facility is fully drawn and 12 months from date of the agreement. On October 26, 2020, the Borrower drew down the entire amount under the new equipment facility for proceeds of Euro 36 million.
Each equipment loan under both facilities is repayable in 20 equal quarterly installments. The final repayment date shall be five years from the first disbursement under each equipment loan. The interest rate on each loan is a rate per annum equal to EURIBOR plus a margin of 4.25%. The Company and its wholly-owned subsidiary, Mali Mining Investments Limited, have guaranteed the second equipment facility and security is given over the equipment of the Borrower which has been financed by the second equipment facility, related warranty and insurance. There is no requirement to maintain a DSRA for the second equipment facility.
Masbate equipment loan facility
On June 1, 2017, the Company entered into an $18 million term equipment facility with Caterpillar Financial Services Philippines Inc. The aggregate principal amount was available to the Company’s Philippines subsidiaries to finance or refinance the mining fleet and other mining equipment at the Company's Masbate Mine and was fully utilized.
Each equipment loan is repayable in 20 equal quarterly installments. The final repayment date shall be five years from the first disbursement under each equipment loan. The interest rate on each loan is a rate per annum equal to LIBOR plus a margin of 3.85%. The Company has guaranteed the equipment facilities and security is given over the equipment of the Borrower which has been financed by the equipment facility. During the year ended December 31, 2023, the Company fully repaid the outstanding balance under the equipment facility.
Goose Project equipment loan facilities
As part of the acquisition of Sabina (Note 6), the Company acquired a series of equipment loans with two suppliers for open pit and underground mining equipment. The loans for the open pit mining equipment are denominated in US dollars, bear interest at a floating rate of 3-month SOFR plus 4.25% and have four year terms. The loans for the underground mining equipment are denominated in Canadian dollars, bear interest at fixed rates between 3.0% and 5.7% and have four year terms.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Lease liabilities
For the year ended December 31, 2023, payments totalling $3 million (2022 - $7 million) relating to short-term leases (those with a term of 12 months or less) and $58 million (2022 - $13 million) relating to variable lease payments (including both lease and non-lease components) have been expensed in the Consolidated Statement of Operations.
The expected timing of undiscounted lease payments at December 31, 2023 for leases accounted for under IFRS 16 is as follows:
| $ | |
|---|---|
| Less than one year | 5,190 |
| One to five years | 15,101 |
| More than five years | 14,597 |
| 34,888 |
For the year ended December 31, 2023, the Company recognized depreciation expense of $6 million (2022 - $5 million) on right-of-use assets recognized under IFRS 16, Leases in the Consolidated Statement of Operations and made payments on these leases of $6 million (2022 - $7 million).
Debt repayment schedule
The following table summarizes the Company’s scheduled debt repayments on its outstanding debt as at December 31, 2023:
| 2024 | 2025 | 2026 | 2027 | 2028 | Total | |
|---|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | $ | |
| Revolving credit facility | ||||||
| Principal | — | 150,000 | — | — | — | 150,000 |
| Interest (estimated) | 11,462 | 10,985 | — | — | — | 22,447 |
| Fekola equipment loan facilities: | ||||||
| Principal | 8,093 | 5,973 | — | — | — | 14,066 |
| Interest (estimated) | 569 | 154 | — | — | — | 723 |
| Goose equipment loan facility: | ||||||
| Principal | 3,225 | 2,878 | 673 | — | — | 6,776 |
| Interest (estimated) | 253 | 140 | 35 | — | — | 428 |
| Lease liabilities | ||||||
| Principal | 5,190 | 4,331 | 3,507 | 2,404 | 2,439 | 17,871 |
| 28,792 | 174,461 | 4,215 | 2,404 | 2,439 | 212,311 |
14Mine restoration provisions
The Company’s mine restoration provisions consist primarily of costs associated with mine reclamation and closure activities. These activities, which are site specific, generally include costs for earthworks, including detoxification and recontouring, revegetation, water treatment and demolition. In calculating the present value of the Company’s mine restoration provisions as at December 31, 2023, management used a risk-free rate applicable to each location’s functional currency ranging from 3.86% to 3.92% and a long-term inflation rate of 2.2%. The undiscounted cash flows, before inflation adjustments to settle the mine restoration provisions was estimated at approximately $130 million at December 31, 2023 (2022 - $122 million). Due to the nature of mine closure plans, cash expenditures are expected to occur over a significant period of time with the majority of the expenditures expected to occur in the years from 2032 to 2043.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The following table shows the movement in the provision for mine restoration provisions:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Balance, beginning of year | 101,113 | 117,281 |
| Reclamation spending | (2,297) | (793) |
| Accretion expense | 4,011 | 2,571 |
| Change in obligation | (281) | (17,946) |
| Liabilities acquired | 5,111 | — |
| Balance, end of year | 107,657 | 101,113 |
| Less: current portion | (3,050) | (5,545) |
| 104,607 | 95,568 |
15Share capital
The Company’s authorized share capital consists of an unlimited number of common shares and an unlimited number of preferred shares. As at December 31, 2023, the Company had 1,302,396,192 common shares outstanding, including 1,705,000 common shares held in trust under the Company’s Incentive Plan (described below). No preferred shares were outstanding.
During the year ended December 31, 2023, the Company paid a quarterly dividend of $0.04 per share totalling $200 million for the year. Of this amount, $12 million was paid through the issuance of 4 million shares under the Company's Dividend Re-investment Plan ("DRIP"). The DRIP was approved by the Board in the third quarter of 2023. During the year-ended December 31, 2022, the Company paid a quarterly dividend of $0.04 per share totalling $172 million for the year. The dividends have been recognized in retained earnings in the Consolidated Statement of Changes in Equity during the respective period.
Subsequent to December 31, 2023, on February 21, 2024, B2Gold’s Board of Directors declared a cash dividend for the first quarter of 2024 of $0.04 per common share, payable on March 20, 2024 to shareholders of record as of March 7, 2024.
During 2023, the Company received $13 million (2022 - $14 million) pursuant to the exercise of 5 million (2022 – 5 million) stock options.
Stock options
During the year ended December 31, 2023, 3,042,000 stock options were granted to employees with exercise prices ranging from Cdn. $4.11 to Cdn. $5.40 per share. These stock options have a term of up to five years and vest over a period of up to three years. The estimated fair value when granted of these options totalling $3 million is being recognized over the vesting period. The fair value was calculated using the Black-Scholes option pricing model based on a risk-free annual interest rate of up to 4.4%, an expected life of up to 3 years, an expected volatility of up to 50% and a dividend yield rate of up to 5.3%.
During 2022, approximately 4,534,000 stock options were granted to employees and directors with exercise prices ranging from Cdn. $3.95 to Cdn. $5.79 per share. These stock options have a term of up to ten years and vest over a period of up to five years. The estimated fair value when granted of these options totalling $6 million is being recognized over the vesting period. The fair value was calculated using the Black-Scholes option pricing model based on a risk-free annual interest rate of up to 4.0%, an expected life of up to 10 years, an expected volatility of up to 54% and a dividend yield rate of up to 5.5%.
Option pricing models require the input of subjective assumptions regarding the expected volatility. The Company calculates expected volatility based on the historical volatility of its stock price. Changes in this assumption can materially affect the fair value estimate.
For the year ended December 31, 2023, share-based payments expense, relating to the vesting of stock options, was $5 million (2022 - $10 million), net of $1 million (2022 - $1 million) capitalized to mining interests.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
A summary of changes to stock options outstanding is as follows:
| Number of<br>outstanding<br>options | Weighted-<br>average<br>exercise price | |
|---|---|---|
| (‘000’s) | (in Cdn.$) | |
| Outstanding at December 31, 2021 | 32,489 | 4.75 |
| Granted | 4,534 | 5.29 |
| Exercised | (4,955) | 3.67 |
| Forfeited or expired | (1,141) | 5.35 |
| Outstanding at December 31, 2022 | 30,927 | 4.98 |
| Granted | 3,042 | 4.80 |
| B2Gold replacement options on acquisition of Sabina (Note 6) | 3,342 | 3.87 |
| Exercised | (5,098) | 3.42 |
| Forfeited or expired | (1,246) | 5.28 |
| Outstanding at December 31, 2023 | 30,967 | 5.09 |
During 2023, 5 million (2022 – 5 million) stock options were exercised. The weighted average share price at the time of exercise was Cdn. $4.86 (2022 – Cdn. $5.42).
Stock options outstanding and exercisable as at December 31, 2023 are as follows:
| Range of exercise prices<br>(in Cdn. $) | Number of outstanding options<br>(‘000’s) | Weighted- average years to expiry | Weighted-average exercise price<br>(in Cdn. $) | Number of exercisable options<br>(‘000’s) | Weighted-average exercise price<br>(in Cdn. $) |
|---|---|---|---|---|---|
| 2.95 – 2.99 | 35 | 3.39 | 2.95 | 13 | 2.95 |
| 3.00 – 3.99 | 1,988 | 2.96 | 3.26 | 1,918 | 3.25 |
| 4.00 – 4.99 | 7,245 | 4.22 | 4.44 | 3,639 | 4.42 |
| 5.00 – 5.99 | 19,538 | 2.99 | 5.38 | 15,415 | 5.39 |
| 6.00 – 6.99 | 2,041 | 2.30 | 6.25 | 1,863 | 6.25 |
| 7.00 – 8.53 | 120 | 1.56 | 8.01 | 120 | 8.01 |
| 30,967 | 3.22 | 5.09 | 22,968 | 5.14 |
Restricted share unit plan
The Company has a Restricted Share Unit Plan (the “RSU Plan”) whereby restricted share units (“RSUs”) may be granted to directors, executive officers and employees of the Company. The RSU Plan reflects the Company’s commitment to a long term incentive compensation structure that aligns the interests of its directors, executive officers and employees with the interests of its shareholders. Once vested, each RSU is redeemable for one common share entitling the holder to receive the common share for no additional consideration.
During the year ended December 31, 2023, the Company granted approximately 2 million (2022 – 2 million) RSUs to executive officers and employees of the Company. One-third of the RSUs vest one year from the grant date, another one-third will vest two years from the grant date with the remainder vesting three years from the grant date. The total estimated fair value of the RSU granted was approximately $7 million (2022 - $8 million) based on the market value of the Company’s shares at the grant date. The fair value of each RSU is recorded as a share-based payments expense over the vesting period.
For the year ended December 31, 2023, share-based payments expense relating to the vesting of RSUs was $7 million (2022 - $8 million).
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Summary of changes to RSUs outstanding:
| Number of<br>outstanding<br>RSUs | |
|---|---|
| (‘000’s) | |
| Outstanding at December 31, 2021 | 3,679 |
| Granted | 1,751 |
| Vested and converted to common shares | (2,663) |
| Forfeited | (119) |
| Reinvested dividend equivalents | 136 |
| Outstanding at December 31, 2022 | 2,784 |
| Granted | 1,939 |
| Vested and converted to common shares | (1,440) |
| Forfeited | (119) |
| Reinvested dividend equivalents | 158 |
| Outstanding at December 31, 2023 | 3,322 |
Deferred share unit plan
The Company has a Deferred Share Unit plan (the "DSU plan") for the benefit of the directors of the Company. Pursuant to the plan, eligible directors can elect to receive all or part of their total cash compensation in the form of deferred share units ("DSUs"). The number of DSUs granted to an eligible director is determined by dividing the portion of the compensation to be paid in DSUs by the volume weighted average trading price of the common shares on the stock exchange on which the majority of the volume of trading of the shares occurred over the relevant period for the five trading days immediately preceding the date of grant. In addition, the Board may, at its discretion, grant additional DSUs to plan participants. Each eligible director is required to hold DSUs received until the eligible director ceases to be a director of the Company, following which the DSUs will be settled in cash. As the DSUs are cash settled, they are recorded as a liability at fair market value on the Consolidated Balance Sheet with changes in the fair value being recognized as a share-based payment expense or recovery in the Consolidated Statement of Operations.
For the year ended December 31, 2023, the Company issued 0.4 million DSUs (2022 - 0.2 million) with a fair market value of $1 million (2022 - $1 million) to directors of the Company. During the year ended December 31, 2023, 0.7 million DSUs valued at $3 million were released. As at December 31, 2023, there were 2 million DSUs outstanding (2022 - 2 million). For the year ended December 31, 2023, share-based payments expense relating to DSUs was $1 million (2022 - recovery of $0 million).
Performance share unit plan
The Company has a Performance Share Unit plan (the "PSU plan") for the benefit of officers, employees and eligible consultants. Under the plan, eligible participants will receive shares based on the achievement of certain defined performance measures over a defined period of time. The number of shares receivable shall be 0% to 200% of the performance share units ("PSUs") awarded, with the factor applied being dependent on the extent to which the defined performance measures have been achieved.
On November 7, 2023, the Company adopted an amended and restated Executive Officer Incentive Compensation Clawback Policy (the “Clawback Policy”) to comply with new rules of the New York Stock Exchange American set forth in Listed Company Manual Section 811 -- Erroneously Awarded Compensation and Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as codified by Section 10D and Rule 10D-1 of the U.S. Securities Exchange Act of 1934, as amended. In addition, the Company amended its Performance Share Unit Plan on November 7, 2023 (the “Amended PSU Plan”) to add an option to settle future PSU grants, when vested, in cash (instead of shares) at the Company’s sole discretion. The addition of the cash settlement option does not impact the accounting treatment of the PSUs.
During the year ended December 31, 2023, the Company granted 2 million PSUs to employees comprised of two equal 50% tranches. Vesting of tranche one of the PSUs granted will depend on the timing of completion of construction and commissioning of the Goose Project and the number of shares that may vest will be between 0% to 200% of the number of tranche one PSUs. The estimated fair value when granted of this portion of $3 million was calculated based on the fair value of the Company's stock on the date of the grant and the expected completion timing of the Goose Project. Vesting of tranche
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
two of the PSUs granted will depend on total shareholder return of the Company compared to a group of peer companies over the period January 1, 2023 to December 31, 2025. The number of shares that may vest will be between 0% and 200% of the number of tranche two PSUs. The estimated fair value when granted of the tranche two PSUs of $4 million was calculated using a risk-neutral Monte Carlo simulation based on a correlated Geometric Brownian Motion. The fair value of both tranches is being recognized over the vesting period. The model used historical share price volatility ranging from 28% to 71% for the group, a Canadian risk-free annual interest rate of 3.87%, and a United States risk-free annual interest rate of 4.16%.
For the year ended December 31, 2022, the Company granted approximately 1 million PSUs to employees. The number of shares to be issued will be 0% to 200% of the number of PSUs depending on total shareholder return compared to a group of peer companies over the period January 1, 2022 to December 31, 2024. The estimated fair value when granted of $8 million is being recognized over the vesting period. The fair value was calculated using a risk-neutral Monte Carlo simulation based on a correlated Geometric Brownian Motion. The model used historical share price volatility ranging from 32% to 81% for the group, a Canadian risk-free annual interest rate of 2.88%, and a United States risk-free annual interest rate of 2.76%.
During the year ended December 31, 2023, the Company issued 1 million shares on the vesting of PSUs. As at December 31, 2023, 5 million PSUs were outstanding under the plan (2022 - 5 million). For the year ended December 31, 2023, share-based payments expense relating to PSUs was $8 million (2022 - $7 million).
Restricted phantom unit plan
The Company has a Restricted Phantom Unit plan (the "RPU plan") for the benefit of the directors of the Company. Once vested, each restricted phantom unit is redeemable for the cash value of one common share. As the restricted phantom units ("RPUs") are cash settled, they are recorded as a liability at fair market value on the Consolidated Balance Sheet with changes in the fair value being recognized as a share-based payment expense or recovery in the Consolidated Statement of Operations.
For the year ended December 31, 2023, the Company issued 0.1 million (2022 - 0.1 million) RPUs with a fair market value of $0.2 million (2022 - $0.2 million) to directors of the Company. As at December 31, 2022, there were 0.1 million RPUs outstanding (2022 - 0.1 million). For the year ended December 31, 2022, share-based payments expense relating to RPUs was $0.3 million (2022 - $0.3 million).
Incentive plan
On June 29, 2007, the Company established the B2Gold Incentive Plan (the “Incentive Plan”) for the benefit of directors, officers, employees and service providers of the Company and issued to the trustees of the Incentive Plan options to acquire 4,955,000 common shares. On October 12, 2007, following the exercise of these options, an aggregate of 4,955,000 common shares were issued to and paid for by the trustees of the Incentive Plan. These shares were held in trust by the trustees pursuant to the terms of the Incentive Plan. The Company is required under IFRS to consolidate the trust. The Company recognizes a share-based compensation expense with respect to these incentive shares, when these shares are granted to the ultimate beneficiaries by the trust. As at December 31, 2023, there are 1,705,000 common shares remaining in the trust.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Earnings per share
The following is the calculation basic and diluted earnings per share:
| 2023 | 2022 | |
|---|---|---|
| Net income and diluted net income (attributable to shareholders of the Company) | 10,097 | 252,873 |
| Basic weighted average number of common shares outstanding (in thousands) | 1,232,092 | 1,064,259 |
| Effect of dilutive securities: | ||
| Stock options | 1,099 | 1,928 |
| Restricted share units | 755 | 732 |
| Performance share units | 3,458 | 4,085 |
| Diluted weighted average number of common shares outstanding (in thousands) | 1,237,404 | 1,071,004 |
| Earnings per share (attributable to shareholders of the Company) | ||
| Basic | ||
| Diluted |
All values are in US Dollars.
16Non-controlling interest
The following is a continuity schedule of the Company's non-controlling interests:
| Fekola | Masbate | Otjikoto | Other | Total | |
|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | |
| Balance at December 31, 2021 | 59,089 | 16,653 | 24,927 | 44 | 100,713 |
| Share of net income (loss) | 25,467 | 5,567 | 3,471 | (655) | 33,850 |
| Interest on loan to non-controlling interest | (3,499) | — | — | — | (3,499) |
| Distributions to non-controlling interest | (26,870) | — | (4,051) | — | (30,921) |
| Participating funding from non-controlling interest | — | — | — | 2,980 | 2,980 |
| Other | — | — | 732 | (192) | 540 |
| Balance at December 31, 2022 | 54,187 | 22,220 | 25,079 | 2,177 | 103,663 |
| Share of net income (loss) | 17,146 | 5,824 | 8,799 | (278) | 31,491 |
| Interest on loan to non-controlling interest | (4,174) | — | — | — | (4,174) |
| Distributions to non-controlling interest | (24,248) | (300) | (10,068) | — | (34,616) |
| Participating funding from non-controlling interest | — | — | — | 2,332 | 2,332 |
| Other | — | — | 428 | 472 | 900 |
| Balance at December 31, 2023 | 42,911 | 27,744 | 24,238 | 4,703 | 99,596 |
| B2GOLD CORP. | |||||
| --- | |||||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | |||||
| December 31, 2023 and 2022 | |||||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The following is the summarized financial information of subsidiaries with material non-controlling interests:
| Fekola | Otjikoto | |||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |
| $ | $ | $ | $ | |
| Summarized Balance Sheets | ||||
| Current assets | 265,468 | 395,017 | 89,575 | 79,187 |
| Non-current assets | 979,116 | 967,148 | 297,950 | 335,802 |
| Total assets | 1,244,584 | 1,362,165 | 387,525 | 414,989 |
| Current liabilities | 174,643 | 230,574 | 43,623 | 13,258 |
| Non-current liabilities | 70,119 | 55,135 | 114,633 | 153,251 |
| Total liabilities | 244,762 | 285,709 | 158,256 | 166,509 |
| Summarized Statements of Operations | ||||
| Revenue | 1,143,780 | 1,067,482 | 417,589 | 280,394 |
| Net income | 147,584 | 243,823 | 87,599 | 36,792 |
17Derivative financial instruments
Fuel derivatives
During the year ended December 31, 2023, the Company entered into additional series of forward contracts for the purchase of 20 million litres of gas oil and 16 million litres of fuel oil with scheduled settlement between August 2023 and July 2024. These derivative instruments were not designated as hedges by the Company and were recorded at FVTPL.
For the year ended December 31, 2023, the Company recorded an unrealized fuel derivative loss of $4 million (2022 – loss of $10 million) and a realized fuel derivative gain of $9 million (2022 - gain of $29 million) in the Consolidated Statement of Operations.
The following is a summary, by maturity dates, of the Company’s fuel derivative contracts outstanding as at December 31, 2023:
| 2024 | ||
|---|---|---|
| Forward – fuel oil: | ||
| Litres (thousands) | 9,187 | |
| Average strike price | $ | 0.40 |
| Forward – gas oil: | ||
| Litres (thousands) | 2,501 | |
| Average strike price | $ | 0.54 |
The unrealized fair value of these contracts at December 31, 2023 was $1 million (see Note 7).
18Gold stream obligation
As part of the acquisition of Sabina (Note 6), the Company acquired a Gold Stream Arrangement with Wheaton Precious Metals ("WPM"). The $125 million upfront payment (the “Deposit”) was funded in 4 installments, of which all were received prior to the acquisition. In return, B2Gold is obligated to deliver 4.15% of the gold production from the Goose Project, reducing to 2.15% and 1.5% after the delivery of 130,000 and 200,000 ounces, respectively. WPM is obligated to pay B2Gold a purchase price for each ounce of refined gold metal equal to:
•During a deposit period, i.e. any period during which the Deposit is greater than nil, 18% of the p.m. LBMA Gold Price. The difference between the LBMA gold price and such purchase price being payable is deducted against the Deposit until it has been reduced to nil.
•During a non-deposit period, 22% of the p.m. LBMA Gold Price.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The acquisition of Sabina triggered a one-time change of control event that allowed B2Gold to exercise a one-time option to buy back one third of the Gold Stream (the “Buy-back Option”) for consideration of $46 million. On April 20, 2023, the Buy-back option was exercised at a purchase price of $46 million. As a result of the exercise of the Buy-back Option, the quantity of gold deliverable to WPM under the Gold Stream is reduced by 33%. After execution of the Buy-back Option, the Deposit amount is reduced by 33% to $83.75 million. Further, the delivery obligation is also reduced by the same proportion as follows:
•2.7805% of gold production up to delivery of 87,100 oz
•1.4405% of gold production up to an aggregate of 134,000 oz
•1.005% of gold production thereafter.
The gold stream obligation was determined to be a derivative liability under IFRS 9, Financial instruments, and has been classified as FVTPL. As a result, it has been recorded at its fair value on the Consolidated Balance Sheet with changes in the fair value being recorded in the Consolidated Statement of Operations. The fair value of the gold stream was determined to be level 3 in the fair value hierarchy (Note 19). The Company has guaranteed the remaining portion of the gold stream obligation.
The following is a summary of the changes in the gold stream obligation:
| $ | |
|---|---|
| Balance at December 31, 2022 | — |
| Fair value at acquisition (Note 6) | 173,700 |
| Exercise of buy-back option | (46,400) |
| Change in fair value | 12,300 |
| Balance at December 31, 2023 | 139,600 |
19Financial instruments
The Company’s financial assets and liabilities consist of cash and cash equivalents, accounts receivable, reclamation deposits, loan to associate, long-term investments, accounts payable and accrued liabilities, fuel derivative contracts, gold stream obligation, and long-term debt.
Fair values
The Company’s financial assets and liabilities are classified based on the lowest level of input significant to the fair value measurement based on the fair value hierarchy:
Level 1 – quoted prices in active markets for identical assets or liabilities;
Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
Level 3 – inputs for the asset or liability that are not based on observable market data.
As at December 31, 2023, the Company’s financial assets and liabilities measured at fair value are categorized as follows:
| As at December 31, 2023 | As at December 31, 2022 | |||||
|---|---|---|---|---|---|---|
| Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |
| $ | $ | $ | $ | $ | $ | |
| Long-term investments (Note 9) | 86,007 | — | — | 31,865 | — | — |
| Fuel derivative contracts (Note 17) | — | 481 | — | — | 5,009 | — |
| Gold stream obligation (Note 6 and Note 18) | (139,600) | — |
The Company’s long-term investments consist of shares of publicly traded mining companies. The fair values of these were determined using market quotes from an active market for each investment.
The fair value of the Company's fuel derivative contracts was determined using prevailing market rates for instruments with similar characteristics.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The fair value of the gold stream was calculated based on an income approach and a discounted cash flow model. The calculated fair value includes significant assumptions that are based on observable market data, including forward gold price curves and credit adjusted risk-free rates. The fair value also includes significant assumptions that are not based on observable market data, including the timing of future gold deliveries which are based on the future production levels of the Goose Project. The valuation has been prepared by an independent valuations specialist with direct oversight from the Company. Gold production is assumed to begin in the first quarter of 2025. Forward gold price estimates ranged from $2,183 to $3,264 per ounce. A $100 per ounce change in the gold forward price would have approximately a $6 million impact on the fair value of the gold stream obligation at December 31, 2023. A 50 basis point change in the credit adjusted risk-free rate would also have approximately a $4 million impact on the fair value of the gold stream obligation at December 31, 2023.
The fair value of the Company's long-term debt also approximates its carrying value as it has a floating interest rate and the Company's credit spread has remained approximately consistent. The fair value of the Company's other financial instruments approximate their carrying value due to their short-term nature.
Capital risk management
The Company’s objectives when managing its capital is to ensure it will be able to continue as a going concern while maximizing the return to shareholders including the payment of dividends. The selling price of gold and minimizing production costs and capital expenditures are key factors in helping the Company reach its capital risk management objectives. The capital structure of the Company includes shareholders’ equity and debt.
Credit risk
As at December 31, 2023, the Company’s maximum exposure to credit risk was the book value of cash and cash equivalents, accounts receivable, loans receivable and the carrying value of its derivative portfolio. The Company limits its credit exposure on cash and cash equivalents by holding its deposits mainly with high credit quality financial institutions as determined by credit rating agencies.
The Company maintains its excess cash balances in short-term investments accounts. The Company does not maintain insurance for its cash balances.
Liquidity risk
The Company manages its liquidity risk through its budgeting and forecasting process. Budgets are prepared annually and forecasts are prepared and reviewed on a regular basis, to help determine the funding requirements to support the Company’s current operations and expansion and development plans and by managing its capital structure as described above.
As at December 31, 2023, the Company had cash and cash equivalents of $307 million. Cash provided by operating activities totalled $714 million for the year ended December 31, 2023. As at December 31, 2023, the Company had a $700 million revolving credit facility of which $550 million is undrawn.
As at December 31, 2023, the Company had drawn down the full amount under its equipment loan facilities at Fekola and Back River.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
As at December 31, 2023, the Company’s significant commitments are disclosed in the table below. In addition, significant commitments are disclosed in Note 13 for debt repayments and Note 25 for capital expenditure commitments.
| 2024 | 2025 | 2026 | 2027 | 2028 | Total | |
|---|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | $ | |
| Accounts payable and accrued liabilities | 167,117 | — | — | — | — | 167,117 |
| Revolving credit facility: | ||||||
| Principal (Note 13) | — | 150,000 | — | — | — | 150,000 |
| Interest & commitment fees (estimated) | 13,487 | 12,925 | — | — | — | 26,412 |
| Fekola equipment loan facilities: | ||||||
| Principal | 8,093 | 5,973 | — | — | — | 14,066 |
| Interest (estimated) | 569 | 154 | — | — | — | 723 |
| Goose equipment loan facility: | ||||||
| Principal | 3,225 | 2,878 | 673 | — | — | 6,776 |
| Interest (estimated) | 253 | 140 | 35 | — | — | 428 |
| Lease liabilities | ||||||
| Principal | 5,190 | 4,331 | 3,507 | 2,404 | 2,439 | 17,871 |
| 197,934 | 176,401 | 4,215 | 2,404 | 2,439 | 383,393 | |
| Capital expenditure commitments | 126,381 | — | — | — | — | 126,381 |
| Other liabilities | 1,000 | 4,455 | 1,148 | — | 5,436 | 12,039 |
| 325,315 | 180,856 | 5,363 | 2,404 | 7,875 | 521,813 |
Market risk
Market risk includes currency and price risk.
The Company’s operations in foreign countries are subject to currency fluctuations and such fluctuations may materially affect the Company’s financial position and results. The Company reports its financial results in United States dollars and incurs expenses in European euros, CFA francs, Namibian dollars, South African rand, Philippine pesos, Canadian dollars and Colombian pesos. As these exchange rates fluctuate against the United States dollar, the Company will experience foreign exchange gains and losses.
The Company also holds cash and cash equivalents that are denominated in non-United States dollar currencies which are subject to currency risk. As at December 31, 2023, $209 million of the Company’s $307 million in cash and cash equivalents was held in United States dollars. A 10% movement in foreign exchange rates versus the United States dollar would result in approximately a $9 million change in the Company’s cash position.
The Company maintains a portfolio of fuel derivatives that are measured at FVTPL. A 10% change in the forward price of fuel would result in a insignificant change in the value of the fuel derivative portfolio.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
20 Income and other taxes
Income tax expense differs from the amount that would result from applying the Canadian federal and provincial income tax rates to earnings from operations before taxes. These differences result from the following items:
| 2023 | 2022 | |
|---|---|---|
| Income from operations before taxes | 320,333 | 530,617 |
| Canadian federal and provincial income tax rates | 27.00 | 27.00 |
| Income tax expense at statutory rates | 86,490 | 143,267 |
| Increase (decrease) attributable to: | ||
| Effects of different foreign statutory tax rates | 18,054 | 26,256 |
| Change due to foreign exchange | (11,430) | 24,950 |
| Withholding and other taxes | 26,956 | 26,041 |
| Non-deductible expenditures | 32,029 | 31,948 |
| Benefit not recorded on impairment losses | 93,772 | — |
| Benefit of optional tax incentives | (13,281) | (13,965) |
| Future withholding tax | 29,548 | (12,000) |
| Change in non-taxable portions of gains | (2,345) | (2,135) |
| Losses and tax bases for which no tax benefit has been recorded | 18,707 | 7,178 |
| Change in accruals for tax audits | (951) | 11,209 |
| Amounts under provided for in prior years | 1,196 | 1,145 |
| Income tax expense | 278,745 | 243,894 |
| Current income tax, withholding and other taxes | 290,081 | 247,811 |
| Deferred income tax recovery | (11,336) | (3,917) |
| Income tax expense | 278,745 | 243,894 |
All values are in US Dollars.
Included in current income tax expense for the year-ended December 31, 2023, is $36 million (2022 - $36 million), related to the State of Mali's 10% priority dividend on its free carried interest in the Fekola Mine. This priority dividend is accounted for as an income tax in accordance with IAS 12, Income Taxes.
Fekola Tax Audits
The Company's subsidiary, Fekola SA, received a Notice for Reassessment dated September 6, 2022, from the Malian Directorate General of Taxes (“DGT”) asserting proposed adjustments and other tax liabilities amounting to $27 million excluding penalties, $46 million including penalties, (based on the December 31, 2023 exchange rate of CFA 594 to $1) arising from tax audits conducted for fiscal years 2016-2018. Fekola SA filed a contentious claim, dated November 3, 2022, outlining its objections to the reassessment in accordance with the Mali Income Tax Act. At December 31, 2023, the Company has recorded a total provision of $10 million (net provision of $5 million after taking into account a $5 million prepayment made in December 2022) reflecting its best estimate of the final settlement of the reassessment amount.
Total provision for tax disputes recognized are as follows:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Opening balance | 12,950 | 2,971 |
| Additions | 49 | 11,209 |
| Reductions | (2,200) | (1,230) |
| Closing balance | 10,799 | 12,950 |
During the year ended December 31, 2023, the Company recorded a deferred tax expense of $30 million (2022 - recovery of $12 million) related to future withholding tax expected to be incurred on retained earnings the Company is planning to repatriate from its foreign subsidiaries in the foreseeable future. The Company's foreign subsidiaries continue to accumulate
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
earnings in excess of their expected needs for reinvestment. The deferred tax expense will eventually be a current tax expense as dividends from foreign subsidiaries and the associated withholding taxes are paid.
Deferred tax liabilities of approximately $116 million (2022 – $125 million) have not been recognized on the repatriation of earnings from foreign subsidiaries where the Company controls the timing of the reversal of the temporary differences but it is probable that such differences will not reverse in the foreseeable future.
Total income tax expense attributable to geographical jurisdiction is as follows:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Mali | 186,258 | 195,917 |
| Philippines | 32,658 | 13,453 |
| Namibia | 67,852 | 28,496 |
| Other | (8,023) | 6,028 |
| 278,745 | 243,894 |
The composition of the Company’s net deferred income tax (liabilities) assets and deferred tax expense (recovery) is as follows:
| Deferred tax<br>(liabilities)/assets | Deferred income tax expense/(recovery) | |||
|---|---|---|---|---|
| As at December 31, 2023 | As at December 31, 2022 | 2023 | 2022 | |
| $ | $ | $ | $ | |
| Operating loss carry-forwards | 9,312 | 22,119 | 12,807 | 8,616 |
| Current assets and liabilities | (1,442) | (7,030) | (5,588) | 1,528 |
| Mining interests | (152,406) | (207,133) | (54,727) | (4,448) |
| Mine restoration provisions | 14,504 | 24,622 | 10,118 | 4,430 |
| Future withholding tax | (38,548) | (9,000) | 29,548 | (12,000) |
| Unrealized gains | (10,127) | (7,510) | 2,617 | (587) |
| Other | 7,528 | 1,417 | (6,111) | (1,456) |
| (171,179) | (182,515) | (11,336) | (3,917) |
Represented on the balance sheet as:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Deferred tax asset | (16,927) | — |
| Deferred tax liability | 188,106 | 182,515 |
| Balance, end of year | 171,179 | 182,515 |
| B2GOLD CORP. | ||
| --- | ||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| December 31, 2023 and 2022 | ||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The Company has the following unrecognized deferred tax assets:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Capital and non-capital tax losses | 230,933 | 116,273 |
| Mining interests and other | 35,190 | 1,916 |
| Mine restoration provisions | 8,984 | 586 |
| Long-term debt | 2,775 | 3,615 |
| Current assets | 1,043 | — |
| 278,925 | 122,390 |
The Company has not recognized potential deferred tax assets of $279 million (2022 - $122 million) as it is not probable that future taxable profits will be available against which the Company can utilize the potential deferred tax assets.
The change for the year in the Company’s net deferred tax liability was as follows:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Balance, beginning of year | 182,515 | 186,432 |
| Deferred income tax recovery | (11,336) | (3,917) |
| Balance, end of year | 171,179 | 182,515 |
At December 31, 2023, the Company had non-capital tax losses which are not recognized as deferred tax assets. The Company recognizes the tax benefit of the non-capital tax losses only to the extent of anticipated future taxable income that can be reduced by non-capital tax losses. The gross amount of the non-capital tax losses for which a tax benefit has not been recorded are $637 million (2022 - $290 million) in Canada which expire between 2027 and 2043, and $124 million (2022 - $1 million) in Colombia of which $1 million expires between 2030 and 2034 and $123 million does not expire.
At December 31, 2023 the Company had capital losses in Canada of $317 million which have no expiry date and can be applied against future capital gains. No deferred income tax asset has been recorded with respect to these losses.
During the year ended December 31, 2023 the Company paid $239 million (2022 - $239 million) of current income tax, withholding and other taxes in cash.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
21Supplementary cash flow information
Supplementary disclosure of cash flow information is provided in the table below:
Non-cash (credits) charges:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Depreciation and depletion | 402,371 | 383,852 |
| Impairment (reversal of impairment) of long-lived assets (Note 10) | 322,148 | (909) |
| Deferred income tax recovery (Note 20) | (11,336) | (3,917) |
| Share of net income of associates (Note 11) | (19,871) | (10,183) |
| Write-down of mineral property interests (Note 10) | 19,905 | 12,366 |
| Share-based payments (Note 15) | 18,174 | 24,676 |
| Non-cash interest and financing expense | 13,925 | 10,842 |
| Change in fair value of gold stream obligation (Note 18) | 12,300 | — |
| Restructuring charges (Note 10) | 12,151 | — |
| Unrealized losses on derivative instruments (Note 17) | 4,500 | 10,442 |
| Loss on sale of mining interest (Note 10) | — | 2,804 |
| Other | 20,694 | (4,029) |
| 794,961 | 425,944 |
Changes in non-cash working capital:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Accounts receivable and prepaids | 147 | (3,915) |
| Value-added and other tax receivables | (10,634) | 3,402 |
| Inventories | (24,331) | (50,273) |
| Accounts payable and accrued liabilities | (21,378) | 1,188 |
| Current income and other taxes payable | 49,658 | 994 |
| (6,538) | (48,604) |
Other exploration:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Fekola Mine, exploration | (3,728) | (15,214) |
| Masbate Mine, exploration | (3,808) | (4,759) |
| Otjikoto Mine, exploration | (3,863) | (3,476) |
| Menankoto Property, exploration | (12,262) | (8,166) |
| Bantako North Property, exploration | (9,523) | (8,608) |
| Bakolobi Property, exploration | (8,665) | (2,031) |
| Dandoko Property, exploration | (6,097) | (896) |
| Finland Properties, exploration | (7,181) | (9,962) |
| George Property, exploration | (5,131) | — |
| Goose Project, exploration | (10,595) | — |
| Uzbekistan Properties, exploration | (1,089) | (4,072) |
| Other | (4,063) | (6,445) |
| (76,005) | (63,629) | |
| B2GOLD CORP. | ||
| --- | ||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| December 31, 2023 and 2022 | ||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
Non-cash investing and financing activities:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Common shares issued on acquisition of Sabina Gold & Silver Corp. (Note 6) | 925,375 | — |
| Fair value of B2Gold replacement options issued on acquisition of Sabina Gold & Silver Corp. (Note 6) | 5,075 | — |
| Contingent consideration on purchase of Gramalote Property (Note 10) | 14,297 | — |
| Change in current liabilities relating to mining interest expenditures | 29,257 | 1,956 |
| Interest on loan to non-controlling interest | 4,910 | 4,116 |
| Foreign exchange (losses) gains on Fekola equipment loan facility | (411) | 2,716 |
| Share-based payments, capitalized to mining interests | 694 | 1,036 |
| Shares issued on acquisition of Oklo Resources Limited (Note 10) | — | 35,658 |
| Share consideration received on sale of Ondundu Property (Note 10) | — | 6,955 |
| Deferred consideration on sale of Ondundu Property (Note 10) | — | 3,850 |
22Compensation of key management
Key management includes the Company’s directors, members of the Executive Committee and members of Senior Management. Compensation to key management consisted of:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Salaries and short-term employee benefits | 8,480 | 9,929 |
| Share-based payments | 14,692 | 14,276 |
| 23,172 | 24,205 |
23Production costs by nature
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Raw materials and consumables | 488,965 | 484,466 |
| Salaries and employee benefits | 128,090 | 114,014 |
| Contractors | 90,488 | 48,235 |
| Equipment rental | 2,786 | 3,350 |
| Other | 52,286 | 45,346 |
| Change in inventories | (6,272) | (26,135) |
| Capitalized to mining interests | (140,146) | (42,750) |
| 616,197 | 626,526 |
Salaries and employee benefits expense included in general and administrative costs were $28 million for the year ended December 31, 2023 (2022 - $28 million).
24Segmented information
The Company’s reportable operating segments for 2023 include its mining operations and development projects, namely the Fekola, Masbate and Otjikoto mines and the Goose Project. It also includes the Fekola Regional properties which are in the exploration & evaluation stage. The Fekola Regional segment includes the Bantako North, Menankoto, Dandoko and Bakolobi properties. Results from operating segments from 2022 have been restated to remove the results of the Fekola Regional segment from the Other Mineral Properties segment. The Other Mineral Properties segment consists of the Company’s interests in mineral properties which are at various stages of exploration and evaluation, including the Company's interest in the Gramalote Project, as well as the Company's equity accounting for its investment in it's associate Calibre. The “Corporate and Other” segment includes corporate operations.
| B2GOLD CORP. |
|---|
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| December 31, 2023 and 2022 |
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
The Company’s segments are summarized in the following tables:
| 2023 | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fekola<br>Mine | Fekola Regional | Masbate <br>Mine | Otjikoto<br>Mine | Goose Project | Other<br>Mineral<br>Properties | Corporate<br><br>& Other | Total | |||||||||||
| $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||
| External gold revenue | 1,143,781 | — | 372,902 | 417,589 | — | — | — | 1,934,272 | ||||||||||
| Production costs | 333,215 | — | 160,952 | 122,030 | — | — | — | 616,197 | ||||||||||
| Depreciation & depletion | 214,533 | 1,267 | 79,423 | 107,148 | — | — | 2,000 | 404,371 | ||||||||||
| Impairment of long-lived assets | 159,317 | 46,349 | — | — | — | 116,482 | — | 322,148 | ||||||||||
| Write-down of mining interests | — | — | — | — | — | 19,905 | — | 19,905 | ||||||||||
| Current income tax, withholding and other taxes | 192,462 | — | 22,813 | 75,713 | — | (1,000) | 93 | 290,081 | ||||||||||
| Net income (loss) | 122,008 | (45,173) | 64,897 | 85,293 | (2,687) | (107,426) | (75,324) | 41,588 | ||||||||||
| Capital expenditures | 302,670 | 92,522 | 33,950 | 64,926 | 292,934 | 23,843 | 242 | 811,087 | ||||||||||
| Total assets | 1,342,500 | 250,729 | 739,506 | 414,383 | 1,479,754 | 384,530 | 263,217 | 4,874,619 | 2022 | |||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||
| Fekola<br>Mine | Fekola Regional | Masbate <br>Mine | Otjikoto<br>Mine | Goose Project | Other<br>Mineral<br>Properties | Corporate & Other | Total | |||||||||||
| $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||
| External gold revenue | 1,067,482 | — | 384,714 | 280,394 | — | — | — | 1,732,590 | ||||||||||
| Production costs | 326,529 | — | 177,705 | 122,292 | — | — | — | 626,526 | ||||||||||
| Depreciation & depletion | 215,664 | — | 88,834 | 79,354 | — | 6 | 2,613 | 386,471 | ||||||||||
| Reversal of impairment of long-lived assets | — | — | — | — | — | (909) | — | (909) | ||||||||||
| Write-down of mining interests | — | — | 313 | — | — | 12,053 | — | 12,366 | ||||||||||
| Current income tax, withholding and other taxes | 196,499 | — | 24,676 | 26,512 | — | 124 | — | 247,811 | ||||||||||
| Net income (loss) | 231,587 | (10,125) | 71,252 | 33,844 | — | (9,182) | (30,653) | 286,723 | ||||||||||
| Capital expenditures | 132,836 | 46,011 | 44,287 | 82,572 | — | 44,102 | 174 | 349,982 | ||||||||||
| Total assets | 1,456,040 | 208,714 | 755,297 | 439,051 | — | 341,005 | 481,126 | 3,681,233 |
The Company’s mining interests are located in the following geographical locations:
| 2023 | 2022 | |
|---|---|---|
| $ | $ | |
| Mining interests | ||
| Canada | 1,509,289 | 26,820 |
| Mali | 1,131,343 | 1,159,931 |
| Philippines | 533,781 | 577,039 |
| Namibia | 264,747 | 306,718 |
| Colombia | 66,184 | 145,855 |
| Finland | 32,954 | 22,523 |
| Burkina Faso | 21,087 | 21,087 |
| Other | 4,105 | 14,757 |
| 3,563,490 | 2,274,730 | |
| B2GOLD CORP. | ||
| --- | ||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| December 31, 2023 and 2022 | ||
| (All tabular amounts are in thousands of United States dollars unless otherwise stated) |
25Commitments
As at December 31, 2023, the Company had the following commitments (in addition to those disclosed elsewhere in these financial statements):
•For payments of $40 million for underground development, $11 million for mobile equipment, $9 million related to the solar plant expansion, $2 million related to plant and powerhouse maintenance, $1 million related to mobile equipment rebuilds, $1 million for the tailings storage facility expansion and $5 million for other capital projects at the Fekola Mine, all of which is expected to be incurred in 2024.
•For payments of $51 million for construction activities at the Goose Project, all of which is expected to be incurred in 2024.
•For payments of $2 million for mobile equipment for Fekola Regional pre-development, all of which is expected to be incurred in 2024.
•For payments of $5 million for mobile equipment at the Masbate Mine, all of which is expected to be incurred in 2024.
26Subsequent event
Subsequent to December 31, 2023, on January 23, 2024, the Company entered into a series of prepaid gold sales with a number of its existing lenders. Under the terms of the prepaid gold sales, the Company will receive an upfront payment of $500 million, based on gold forward curve prices averaging approximately $2,191 per ounce, in exchange for equal monthly deliveries of gold from July 2025 to June 2026 totaling 264,775 ounces. Gold deliveries can be from production from any of the Company’s operating mines and the Gold Prepay can be settled prior to maturity through accelerated delivery of the remaining deliverable gold ounces.
38
Document
B2GOLD CORP.
MANAGEMENT’S DISCUSSION AND ANALYSIS
For the year ended December 31, 2023
This Management’s Discussion and Analysis (“MD&A”) has been prepared as at February 21, 2024 and contains certain "forward-looking information" and “forward-looking statements” under Canadian and United States securities laws, respectively ("forward-looking statements"). All statements included herein, other than statements of historical fact, including without limitation statements regarding potential mineralization, exploration results and future plans, production and objectives of B2Gold Corp. (the “Company” or “B2Gold”), are forward-looking statements that involve various risks, uncertainties and assumptions. See the “Cautionary Statement on Forward-Looking Information” section. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements as a result of a number of factors, including those set out in “Risks and Uncertainties.”
The following discussion of the operating results and financial position of the Company should be read in conjunction with the audited consolidated financial statements and the notes thereto of the Company for the year ended December 31, 2023. These consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (“IFRS”). All amounts are expressed in United States dollars, unless otherwise stated. All production results and the Company's guidance presented in this MD&A reflect total production at the mines the Company operates on a 100% basis. Production from the La Libertad, El Limon and Pan mines owned by Calibre Mining Corp. ("Calibre") is presented on an approximate 24% basis (fourth quarter of 2022 and previous periods - 25%), representing the Company’s indirect ownership interest in Calibre's operations through its equity investment in Calibre (subject to reduction if B2Gold’s interest in Calibre dilutes). On January 24, 2024, the Company's indirect interest in Calibre was subsequently reduced to 15%.
Additional information related to B2Gold, including our Annual Information Form, is available on the Company's website www.b2gold.com and on SEDAR at www.sedarplus.ca.
INDEX
| Overview | 2 |
|---|---|
| Asset Acquisition - Sabina Gold & Silver Corp. | 6 |
| Review of Financial Results | 7 |
| Review of Mining Operations and Development Projects | 11 |
| Liquidity and Capital Resources | 20 |
| Critical Accounting Estimates | 26 |
| Risks and Uncertainties | 28 |
| Disclosure Controls and Internal Controls Over Financial Reporting | 29 |
| Non-IFRS Measures | 29 |
| Summary of Quarterly Results | 40 |
| Summary and Outlook | 40 |
| Outstanding Share Data | 41 |
| Cautionary Statement on Forward-Looking Information | 41 |
OVERVIEW
B2Gold is a Vancouver-based gold producer with three operating mines: the Fekola Mine in Mali, the Masbate Mine in the Philippines and the Otjikoto Mine in Namibia, and a fourth project, the Goose Project, under construction in Canada. The Company completed the acquisition of 100% of Sabina Gold & Silver Corp. ("Sabina") including the Goose Project and Back River Gold District on April 19, 2023 (See "Asset Acquisition - Sabina"). The Company also has an approximately 15% interest in Calibre (reduced from 24% on January 24, 2024) and an approximately 19% interest in BeMetals Corp. In addition, the Company has a portfolio of exploration and development projects in a number of countries including Mali, Finland and Colombia.
Summary
Consolidated gold revenue for the year ended December 31, 2023 was $1.93 billion on sales of 994,060 ounces at an average realized gold price of $1,946 per ounce, compared to $1.73 billion on sales of 969,155 ounces at an average realized gold price of $1,788 per ounce in 2022. The increase in gold revenue of 12% ($0.20 billion) was due to a 3% increase in gold ounces sold and a 9% increase in the average realized gold price. For the fourth quarter of 2023, consolidated gold revenue was $512 million on sales of 256,921 ounces at an average realized gold price of $1,993 per ounce, compared to $592 million on sales of 339,355 ounces at an average realized gold price of $1,746 per ounce in the fourth quarter of 2022. The fourth quarter decrease in gold revenue of 14% ($80 million) was due to a 24% decrease in gold ounces sold (mainly due to the lower gold production), partially offset by a 14% increase in the average realized gold price.
B2Gold had another year of strong operational performance in 2023, with the achievement of B2Gold’s eighth consecutive year of meeting or exceeding annual production guidance. Total gold production for 2023 was 1,061,060 ounces (including 68,717 ounces of attributable production from Calibre) (2022 - 1,027,874 ounces), achieving the upper half of the 2023 guidance range of between 1,000,000 and 1,080,000 ounces. Consolidated gold production from the Company’s three operating mines was 992,343 ounces (2022 - 973,003 ounces), in the upper half of the guidance range of between 940,000 - 1,010,000 ounces, with solid performances from each of the Company’s three mines (refer to "Review of Mining Operations and Development Projects" section below). The Fekola Mine achieved another strong year in 2023, producing 590,243 ounces of gold, near the mid-point of the guidance range of between 580,000 and 610,000 ounces. The Masbate Mine continued its strong performance in 2023, producing 193,502 ounces of gold, exceeding the upper end of its guidance range of 170,000 to 190,000 ounces while the Otjikoto Mine produced 208,598 ounces of gold, near the upper end of its guidance range of 190,000 to 210,000 ounces. In the fourth quarter of 2023, B2Gold’s consolidated gold production was 270,611 ounces, 9% (21,312 ounces) higher than budget but, as expected, 23% (82,158 ounces) lower than the fourth quarter of 2022. The Company's three mines all exceeded budget in the fourth quarter of 2023. The Company’s total gold production for the fourth quarter of 2023 was 288,665 ounces (including 18,054 ounces of attributable production from Calibre).
For the year ended December 31, 2023, consolidated cash operating costs1 were $631 per gold ounce produced ($620 per gold ounce sold), 7% lower than budget and in-line with 2022. Including estimated attributable results for Calibre, cash operating costs for the year ended December 31, 2023 were $654 per gold ounce produced ($644 per gold ounce sold) below the low end of the Company's guidance range of $670 to $730 per ounce and in-line with 2022. Cash operating costs per ounce produced for the year ended December 31, 2023 were below the low end of the guidance range as a result of lower than budgeted fuel costs and a weaker Namibian dollar. In the fourth quarter of 2023, consolidated cash operating costs were $611 per gold ounce produced ($640 per gold ounce sold), in line with budget and 39% higher than 2022. Including estimated attributable results for Calibre, cash operating costs for the fourth quarter of 2023 were $633 per gold ounce produced ($661 per gold ounce sold), in line with budget and 35% higher than the fourth quarter of 2022. Consolidated cash operating costs for the fourth quarter of 2023 were higher than the fourth quarter of 2022 as a result of record gold production in the fourth quarter of 2022.
Consolidated all-in sustaining costs2 for the year ended December 31, 2023 were $1,199 per gold ounce sold compared to $1,022 per gold ounce sold for 2022. Including estimated attributable results for Calibre, all-in sustaining costs for the year ended December 31, 2023 were $1,201 per gold ounce sold ($1,033 per gold ounce sold for 2022), at the low end of the Company's guidance range of $1,195 to $1,255 per ounce sold. Consolidated all-in sustaining costs for the fourth quarter of 2023 were $1,264 per gold ounce sold, in line with the budget of $1,231 per gold ounce sold but higher than $876 per gold ounce sold for the fourth quarter of 2022. Including estimated attributable results for Calibre, all-in sustaining costs for the fourth quarter of 2023 were $1,257 per gold ounce sold compared to a budget of $1,231 per gold ounce sold and $892 per gold ounce sold for the fourth quarter of 2022.
In 2024, B2Gold expects total gold production to be between 860,000 and 940,000 ounces (including 40,000 to 50,000 ounces of attributable production from Calibre). The Company’s consolidated gold production is expected to be relatively consistent throughout 2024, with third quarter production expected to be slightly lower, and fourth quarter production expected to be slightly higher. The expected decrease in gold production relative to 2023 is predominantly due to lower production at the Fekola Complex as a result of the delay in receiving an exploitation license for Fekola Regional from the Government of Mali, delaying the 80,000 to 100,000 ounces that were scheduled in the life of mine plan to be trucked to the Fekola mill and processed in 2024. The contribution of this gold production from Fekola Regional is now expected to start at the beginning of 2025. The Company’s total consolidated cash operating costs for the year (including estimated attributable results for Calibre) are forecast to be
1 “Cash operating costs” a non-IFRS measure; for a description of how we calculate this measure and a reconciliation from this measure to the most directly comparable measure specified, defined or determined under IFRS and presented in our financial statements, refer to “Non-IFRS Measures”
2 “All-in sustaining costs” is a non-IFRS measure; for a description of how we calculate this measure and a reconciliation from this measure to the most directly comparable measure specified, defined or determined under IFRS and presented in our financial statements, refer to “Non-IFRS Measures”
between $835 and $895 per ounce and total consolidated all-in sustaining costs (including estimated attributable results for Calibre) are forecast to be between $1,360 and $1,420 per ounce. The anticipated increase in the Company's consolidated cash operating costs per ounce for 2024 reflects the processing of lower-grade ore at Fekola in 2024. The total consolidated all-in sustaining costs per ounce for 2024 reflect the final full year of spending on both the new Fekola Tailings Storage Facility ("TSF") and the Fekola solar plant expansion, in addition to the ongoing substantial capitalized stripping campaign planned at Fekola for 2024.
For the year ended December 31, 2023, the Company generated net income of $42 million compared to $287 million in 2022 including net income attributable to the shareholders of the Company of $10 million ($0.01 per share) compared to $253 million ($0.24 per share) in 2022. Adjusted net income attributable to the shareholders of the Company3 for the year ended December 31, 2023 was $347 million ($0.28 per share) compared to $264 million ($0.25 per share) in 2022. Net loss for the fourth quarter of 2023 was $117 million compared to a net income of $176 million for the fourth quarter of 2022. For the fourth quarter of 2023, the Company generated a net loss attributable to the shareholders of the Company of $113 million (loss of $0.09 per share) compared to net income attributable to the shareholders of the Company of $158 million ($0.15 per share) in the fourth quarter of 2022. Adjusted net income attributable to shareholders of the Company for the fourth quarter of 2023 was $91 million ($0.07 per share) compared to $121 million ($0.11 per share) in the fourth quarter of 2022.
Cash flow provided by operating activities was $714 million for the year ended December 31, 2023 compared to $596 million during 2022, an increase of $118 million. The increase reflects higher revenues of $202 million and lower non-cash working capital outflows for the year ended December 31, 2023, partially offset by higher long-term value added tax receivable outflows of $27 million, higher long-term inventory outflows of $19 million and lower realized gains on fuel derivatives of $20 million. During the year ended December 31, 2023 the Company paid $239 million (2022 - $239 million) of current income tax, withholding and other taxes in cash, including $54 million related to 2022 outstanding tax liability obligations. Based on current assumptions, including an average gold price of $1,800 per ounce for 2024, the Company is forecasting to make total cash income tax payments for current income tax, withholding and other taxes in 2024 of approximately $187 million.
In January 2024, to further enhance the financial flexibility of the Company and provide additional cash liquidity at attractive terms as the Company continues to fund sustaining, development and growth projects across the operating portfolio, and increase financial capacity for potential growth projects in Namibia and Colombia, B2Gold has entered into a series of prepaid gold sales (the "Gold Prepay") with a number of its existing lenders. The Company received an upfront payment of $500 million, based on gold forward curve prices averaging approximately $2,191 per ounce, in exchange for equal monthly deliveries of gold from July 2025 to June 2026 totaling 264,775 ounces, representing approximately 10% of expected annual gold production in each of 2025 and 2026 (subject to finalization of production guidance for 2025 and 2026). Gold deliveries can be from production from any of the Company’s operating mines and the Gold Prepay can be settled prior to maturity through accelerated delivery of the remaining deliverable gold ounces. The Gold Prepay was executed by Bank of Montreal, Canadian Imperial Bank of Commerce, ING Capital Markets LLC, and National Bank of Canada.
B2Gold continues to maintain a strong financial position and liquidity. At December 31, 2023, the Company had cash and cash equivalents of $307 million compared to cash and cash equivalents of $652 million at December 31, 2022. Working capital (defined as current assets less current liabilities) at December 31, 2023 was $397 million compared to $802 million at December 31, 2022. During the year ended December 31, 2023, the Company drew down $150 million on the Company's $700 million revolving credit facility ("RCF") with $550 million remaining available for future draw downs. Subsequent to December 31, 2023, the Company utilized a portion of the proceeds from the $500 million Gold Prepay completed in January 2024 to repay the $150 million balance drawn on the RCF, leaving the full amount of $700 million available for future draw downs.
On February 22, 2023, June 5, 2023, September 5, 2023 and November 22, 2023, B2Gold’s Board of Directors ("Board") declared a cash dividend for each of the first, second, third and fourth quarter of 2023, respectively, of $0.04 per common share (or $0.16 per share on an annualized basis), paid on March 17, 2023, June 27, 2023, September 29, 2023 and December 18, 2023, respectively. The declaration and payment of future quarterly dividends remains at the discretion of the Board and will depend on the Company's financial results, cash requirements, future prospects and other factors deemed relevant by the Board.
In 2023, the Company implemented a Dividend Reinvestment Plan (the "DRIP”). The DRIP provides B2Gold shareholders residing in Canada and the United States with the opportunity to have the cash dividends declared on all or some of their common shares automatically reinvested into additional common shares of the Company (the “Reinvestment Shares”) on an ongoing basis. Participation in the DRIP is optional and will not affect shareholders’ cash dividends unless they elect to participate in the DRIP. Dividends are only payable as and when declared by the Company’s Board of Directors. The benefits of enrolling in the DRIP include the convenience of automatic reinvestment of dividends into Reinvestment Shares; flexibility to enroll some or all common shares in the DRIP; and ability to acquire Reinvestment Shares without paying any brokerage fees. Participants in the DRIP will acquire Reinvestment Shares issued from the Company’s treasury (a “Treasury Purchase”) at a price equal to the volume weighted average price of the Company’s common shares on the Toronto Stock Exchange for the five consecutive trading days immediately preceding a dividend payment date, subject to a possible discount, in the Company’s sole discretion, of up to 5%. For the dividend declared on September 5, 2023 and November 24, 2023, a discount of 3% was offered.
3 “Adjusted net income attributable to shareholders of the Company” is a non-IFRS measure; for a description of how we calculate this measure and a reconciliation from this measure to the most directly comparable measure specified, defined or determined under IFRS and presented in our financial statements, refer to “Non-IFRS Measures”
On April 19, 2023, the Company completed the acquisition of Sabina, resulting in the Company acquiring Sabina’s 100% owned Back River Gold District located in Nunavut, Canada by issuing approximately 216 million B2Gold common shares. The Back River Gold District consists of five mineral claims blocks along an 80 kilometre ("km") belt. The most advanced project in the district, Goose, is fully permitted, currently in construction, and has been de-risked with significant infrastructure in place at the time of acquisition. The Goose Project has an estimated two year construction period, which is expected to be completed in the first quarter of 2025. B2Gold’s management team has strong northern construction expertise and experience to deliver the fully permitted Goose Project and the financial resources to develop the significant gold resource endowment at the Back River Gold District into a large, long life mining complex. B2Gold recognizes that respect and collaboration with the Kitikmeot Inuit Association ("KIA") is central to the license to operate in the Back River Gold District and will continue to prioritize developing the project in a manner that recognizes Indigenous input and concerns and brings long-term socio-economic benefits to the area.
Subsequent to completion of the acquisition of Sabina, in the second quarter of 2023, B2Gold completed its inaugural winter ice road ("WIR") season and received all critical materials that were necessary to maintain the schedule for construction completion of the mill in the first quarter of 2025. Phase 1 camp construction and earthworks necessary to extend the airstrip are complete, and concrete and steel work in the mil area are progressing ahead of schedule. As well, the Company extinguished certain of Sabina's construction financing obligations with payments totalling $112 million as follows: senior secured debt facility for a $2 million payment, gold prepay facility for a $1 million payment, the entire gold metal offtake agreement for a $63 million payment, and one-third of the gold stream obligation for a $46 million payment.
On June 23, 2023, the Company announced an initial capital expenditure estimate of C$800 million (excluding working capital), which was in line with B2Gold expectations since the Sabina acquisition announcement and reflects scope changes to further optimize the Goose Project. B2Gold had updated the construction budget to further de-risk the project and construct a reliable and low operating cost mine. Sabina had incurred approximately C$340 million up to April 2023 leaving approximately C$460 million (approximately $350 million) expected to be spent by B2Gold from the date of acquisition and up to completion of construction in the first quarter of 2025. After completing a detailed review of the Goose Project design, materials, and construction schedule as part of the 2024 budgeting process, the Company has revised the total construction capital estimate from C$800 million to C$1,050 million. Most of the increase in the construction capital estimate relates to underestimated labour and site operating costs in the feasibility study, along with additional general inflationary impacts on construction materials, consumables, and transportation costs. In addition, a detailed review of the project design has identified deficiencies in project components including power generation and distribution, laboratory, piping, and controls and instrumentation, which are being corrected to deliver a reliable operation. In 2024, B2Gold expects to incur approximately C$280 million in construction capital costs. More than half of the construction capital costs to be incurred in 2024 are related to labour in order to bring the project close to commissioning by the end of the year, and all major components have been purchased or are under contract, reducing the risk of capital cost variance. In the fourth quarter of 2023 and post-acquisition to December 31, 2023, the Company incurred $126 million (C$171 million) and $282 million (C$381 million), respectively for construction activities at the Goose Project. Construction of the 2024 WIR is being finalized and is expected to be fully operational by February 23, 2024. All required materials will be transported from the Marine Laydown Area ("MLA") to the Goose Project site by the end of April 2024, keeping it on schedule for completion of construction by the first quarter of 2025.
In addition, the net cost of open pit and underground development, deferred stripping, and sustaining capital expenditures to be incurred prior to first gold production is estimated at approximately C$200 million (including approximately C$125 million of direct mining costs related to open pit and underground development). The cost of these initiatives is primarily related to optimization changes in the underground mine plan as a result of switching the underground mining method to long-hole stoping and prioritizing ore from the Umwelt crown pillar area ahead of the zones below. The Company anticipates that the increase in underground development costs will be offset during operations through lower sustainable operating costs than could be achieved with the cut-and-fill underground mining method. Additionally, B2Gold has elected to advance open pit mining of the Echo Pit, which is underway and will produce construction fill, stockpile ore and provide tailings storage capacity. Open pit mining of the Umwelt Pit is expected to commence in the first quarter of 2024 and will produce much of the commissioning ore as well as future tailings storage. In 2024, B2Gold expects to incur approximately C$170 million in open pit and underground development, deferred stripping, and sustaining capital expenditures.
In 2024, the Company will undertake a buildup of working capital over the Goose Project construction period up to the first quarter of 2025 in order to materially de-risk the execution of the production ramp-up phase and initial years of operation by including 2025 and certain 2026 consumables and sustaining capital equipment on the 2024 sealift. Areas of focus for working capital include: accelerated purchase and additional storage of diesel fuel to manage the requirements for operations in 2025 and part of 2026; critical inventory of consumables and spares for mining and processing to avoid the requirement for air transport; and development of open pit and underground ore stockpiles to provide a consistent and uninterrupted feed to the process plant. It is estimated that approximately C$205 million of fuel, reagents, and other working capital items will be purchased in 2024 to build up site inventory levels, which will substantially de-risk the project from operational and supply chain disruptions. Post-acquisition to December 31, 2023, $57 million of consumables inventory costs were incurred, including long-term consumables of $44 million.
In the second quarter of 2023, a significant exploration program was approved at the Back River Gold District for 2023. B2Gold approved a $20 million exploration budget for the balance of 2023 to complete approximately 27,000 metres of drilling focused in proximity to existing deposits at the Goose Project, as well as following up on regional targets identified at the George, Boulder, Boot and Del projects. For the year ended December 31, 2023, the Company ultimately incurred $16 million on Back River Gold District exploration.
On June 21, 2023, the Company announced an updated Mineral Resource estimate for the Anaconda Area, located approximately 20 km from the Fekola Mine in Mali. The updated resource included a significantly increased Mineral Resource estimate for the Anaconda Area (the "June 2023 Mineral Resource estimate"), comprised of the Menankoto permit, the Bantako North permit and the Bakolobi permit. The updated Mineral Resource estimate includes a significant increase in the laterite, saprolite and saprock (collectively “oxide”) Mineral Resources, and an initial sulphide Indicated Mineral Resource estimate. The June 2023 Mineral Resource estimate includes an Indicated Mineral Resource estimate of 57,000,000 tonnes at 1.11 grams per tonne ("g/t") gold for 2,030,000 ounces of gold, and an Inferred Mineral Resource estimate of 46,600,000 tonnes at 1.33 g/t gold for 2,000,000 ounces of gold, constrained within a conceptual pit run at $1,800 per ounce gold.
Receipt of a mining permit for the Fekola Regional licenses remains outstanding pending finalization of an implementation decree for the new 2023 Mining Code by the State of Mali. No production is forecast from Fekola Regional in the Company's 2024 guidance, with production now expected to commence at the beginning of 2025. If an exploitation license for Fekola Regional is received in the first half of 2024, there is potential for 2024 Fekola Complex production to be supplemented with up to 18,000 ounces of higher-grade ore from Fekola Regional.
During the year ended December 31, 2023, the State of Mali introduced a new mining code (the “2023 Mining Code”). In conjunction with the implementation of the 2023 Mining Code and the associated impact to the value of the Fekola Complex, the Company completed an update of its Fekola and Fekola Regional life-of-mine estimates. This update included revisions to the mine plan and expected saprolite mill feed from Fekola Regional, along with updates to related operating and capital cost estimates. The update included the Company’s best current estimate of the final fiscal terms of the 2023 Mining Code, which remains subject to ongoing negotiations with the State of Mali. The final fiscal terms of the 2023 Mining Code remain subject to change and could result in a variation from the estimates used to determine the recoverable amount of the Fekola Complex. Clarification of the final application of the 2023 Mining Code remains subject to ongoing negotiations with the State of Mali, followed by the anticipated issuance of a final implementation decree. Collectively, these changes are considered to be impairment indicators for the Fekola Complex assets and resulted in an impairment charge of $206 million recorded in the Consolidated Statement of Operations for the year ended December 31, 2023. A net impairment charge of $192 million after taking into account a deferred income tax recovery of $14 million was recorded in the Consolidated Statement of Operations for the year ended December 31, 2023.
On September 14, 2023, the Company entered into a purchase agreement with AngloGold Ashanti Limited ("AngloGold") to acquire AngloGold’s 50% stake in the Gramalote project (the “Gramalote Transaction”), located in the Department of Antioquia, Colombia (the “Gramalote Project”). Upon completion of the Gramalote Transaction, which occurred on October 5, 2023, B2Gold
now owns 100% of the Gramalote Project.
On January 31, 2024, the Company announced positive exploration drilling results from the Antelope deposit at the Otjikoto Mine. The Antelope deposit, comprised of the Springbok Zone, the Oryx Zone, and a possible third structure, Impala, subject to further confirmatory drilling, is located approximately three km south of the Otjikoto open pit. The Antelope deposit has the potential to be developed as an underground mining operation, which could complement the expected processing of low grade stockpiles at the Otjikoto mill from 2026 to 2031.
ASSET ACQUISITION - SABINA
On April 19, 2023, the Company completed the acquisition of all of the issued and outstanding common shares of Sabina (the “Transaction”), resulting in the acquisition of the 100% owned Back River Gold District, including the Goose Project, located in Nunavut, Canada. The acquisition has been accounted for as a purchase of assets as the Company concluded that it did not acquire processes that could develop the acquired inputs into an operating mine. For accounting purposes, it was determined that B2Gold obtained control of Sabina on April 14, 2023, which is the date when the Transaction was irrevocably approved by the Supreme Court of British Columbia, giving the Company the ability to direct the use of the net assets acquired.
The purchase price of the acquisition was approximately $937 million, consisting of the fair value of B2Gold shares issued of $925 million, based on the issuance of 216,451,555 B2Gold shares at C$5.72 per share and a foreign exchange rate of C$1.3379 to $1, the fair value of B2Gold replacement stock options of $5 million (3,342,413 equivalent stock options for B2Gold common shares), plus B2Gold transaction costs of $7 million. The replacement stock options have been valued using the Black-Scholes option pricing model based on a risk-free annual interest rates ranging from 3.6% to 3.8%, an expected volatility of between 33% and 50%, an expected average life of up to 3.2 years and a dividend yield of 3.7%.
The purchase price was calculated as follows (dollars in thousands):
| $ | |
|---|---|
| Common shares issued (216,451,555 common shares) | 925,375 |
| Fair value of B2Gold replacement stock options | 5,075 |
| Transaction costs | 6,672 |
| Total purchase price | 937,122 |
The purchase price was allocated based on the relative fair value of the assets and liabilities as follows (dollars in thousands):
| $ | |
|---|---|
| Cash and cash equivalents | 38,083 |
| Accounts receivable, prepaids and other | 816 |
| Value added and other tax receivables | 2,637 |
| Mining interest - Construction-in-progress - Goose Project | 1,050,326 |
| Mining interest - Buildings, plant & equipment | 33,921 |
| Mining interest - Exploration & Evaluation Assets - Hackett River Royalty | 64,540 |
| Mining interest - Exploration & Evaluation Assets - Other | 28,533 |
| Other assets | 15,738 |
| Accounts payable and accrued liabilities | (41,344) |
| Current portion of long-term debt | (3,770) |
| Construction financing obligations | (173,700) |
| Gold stream obligation | (65,419) |
| Long-term debt | (6,716) |
| Mine restoration provision | (3,436) |
| Other long-term liabilities | (3,087) |
| 937,122 |
The purchase price was allocated to the assets acquired and liabilities assumed in accordance with their relative fair value. Included within Mining interest - Construction-in-progress is the Goose Project mineral interest. The value of the Goose Project mineral interest of $740 million was determined using a combination of a discounted cash flow model and a comparable market transactions approach which required the use of significant assumptions that included reserves and resources, future production levels, operating and capital costs, a long-term gold price per ounce, the discount rate and in-situ multiples. The remaining construction-in-progress balance relates to site infrastructure costs, the value of which was determined based on Sabina's historical costs incurred. The value of the buildings, plant and equipment at the Goose Project was based on a trending analysis of recent purchases and the value of the other exploration and evaluation properties was determined to be consistent with Sabina's historical costs incurred.
As a result of the Transaction, the Company also acquired a silver production royalty (the “Hackett River Royalty") equal to 22.5% of the first 190 million ounces of payable silver from the then current resource at Hackett River and other properties (the "Properties") and 12.5% of all payable silver from the Properties thereafter at no future cost. The fair value of the interest in the Hackett River Royalty was determined using a comparable market transactions approach.
The Company assumed certain construction financing and gold stream obligations from Sabina. The fair value of the construction financing obligations at acquisition was based on their extinguishment value. The Company also assumed a gold stream obligation. The fair value of the gold stream obligation on acquisition was based on the value of the extinguishable portion plus the fair value of the gold stream obligation retained.
Following completion of the Transaction, the Company extinguished certain gold stream and construction financing obligations with payments totalling $112 million, broken down as follows:
•a $46 million payment to extinguish one-third of the gold stream arrangement;
•a $63 million payment to extinguish the gold metal offtake agreement;
•a $2 million payment to extinguish the senior secured debt facility; and
•a $1 million payment to extinguish the $75 million gold prepay facility.
REVIEW OF FINANCIAL RESULTS
Selected Quarterly and Full Year Financial and Operating Results
| Three months ended | Year ended | ||||
|---|---|---|---|---|---|
| December 31 | December 31 | ||||
| 2023 | 2022 | 2023 | 2022 | 2021 | |
| Gold revenue ($ in thousands) | 511,974 | 592,468 | 1,934,272 | 1,732,590 | 1,762,264 |
| Net (loss) income ($ in thousands) | (117,396) | 176,468 | 41,588 | 286,723 | 460,825 |
| (Loss) earnings per share – basic (1) ($/share) | (0.09) | 0.15 | 0.01 | 0.24 | 0.40 |
| (Loss) earnings per share – diluted (1) ($/share) | (0.09) | 0.15 | 0.01 | 0.24 | 0.40 |
| Cash provided by operating activities ($ in thousands) | 205,443 | 270,491 | 714,453 | 595,798 | 724,113 |
| Total assets ($ in thousands) | 4,874,619 | 3,681,233 | 4,874,619 | 3,681,233 | 3,561,293 |
| Non-current liabilities ($ in thousands) | 651,173 | 335,828 | 651,173 | 335,828 | 369,097 |
| Average realized gold price ($/ounce) | 1,993 | 1,746 | 1,946 | 1,788 | 1,796 |
| Adjusted net income(1)(2) ($ in thousands) | 90,697 | 121,442 | 347,203 | 263,782 | 385,370 |
| Adjusted earnings per share (1)(2) - basic ($) | 0.07 | 0.11 | 0.28 | 0.25 | 0.37 |
| Consolidated operations results: | |||||
| Gold sold (ounces) | 256,921 | 339,355 | 994,060 | 969,155 | 981,401 |
| Gold produced (ounces) | 270,611 | 352,769 | 992,343 | 973,003 | 987,595 |
| Production costs ($ in thousands) | 164,406 | 159,559 | 616,197 | 626,526 | 493,389 |
| Cash operating costs(2) ($/gold ounce sold) | 640 | 470 | 620 | 646 | 503 |
| Cash operating costs(2) ($/gold ounce produced) | 611 | 440 | 631 | 637 | 511 |
| Total cash costs(2) ($/gold ounce sold) | 769 | 593 | 756 | 768 | 626 |
| All-in sustaining costs(2) ($/gold ounce sold) | 1,264 | 876 | 1,199 | 1,022 | 874 |
| Operations results including equity investment in Calibre: | |||||
| Gold sold (ounces) | 274,980 | 354,496 | 1,062,785 | 1,024,272 | 1,041,381 |
| Gold produced (ounces) | 288,665 | 367,870 | 1,061,060 | 1,027,874 | 1,047,414 |
| Production costs ($ in thousands) | 181,801 | 176,195 | 683,963 | 684,894 | 549,610 |
| Cash operating costs(2) ($/gold ounce sold) | 661 | 497 | 644 | 669 | 528 |
| Cash operating costs(2) ($/gold ounce produced) | 633 | 468 | 654 | 660 | 535 |
| Total cash costs(2) ($/gold ounce sold) | 786 | 618 | 776 | 788 | 648 |
| All-in sustaining costs(2) ($/ounce gold sold) | 1,257 | 892 | 1,201 | 1,033 | 888 |
(1) Attributable to the shareholders of the Company.
(2) Non-IFRS measure. For a description of how these measures are calculated and a reconciliation of these measures to the most directly comparable measures specified, defined or determined under IFRS and presented in the Company’s financial statements, refer to “Non-IFRS Measures”.
Annual results
Revenue
Consolidated gold revenue for the year ended December 31, 2023 was $1.93 billion on sales of 994,060 ounces at an average realized gold price of $1,946 per ounce, compared to $1.73 billion on sales of 969,155 ounces at an average realized gold price of $1,788 per ounce in 2022. The increase in gold revenue of 12% ($0.20 billion) was due to a 3% increase in gold ounces sold and a 9% increase in the average realized gold price.
For the year ended December 31, 2023, the Fekola Mine accounted for $1.14 billion (2022 - $1.07 billion) of gold revenue from the sale of 588,460 ounces (2022 - 599,600 ounces), the Masbate Mine accounted for $373 million (2022 - $385 million) of gold revenue from the sale of 190,800 ounces (2022 - 214,015 ounces) and the Otjikoto Mine accounted for $418 million (2022 - $280 million) of gold revenue from the sale of 214,800 ounces (2022 - 155,540 ounces).
Production and operating costs
B2Gold had another year of strong operational performance in 2023, with the achievement of B2Gold’s eighth consecutive year of meeting or exceeding annual production guidance. Total gold production for 2023 was 1,061,060 ounces (including 68,717 ounces of attributable production from Calibre) (2022 - 1,027,874 ounces), achieving the upper half of the 2023 guidance range of between 1,000,000 and 1,080,000 ounces. Consolidated gold production from the Company’s three operating mines was 992,343 ounces (2022 - 973,003 ounces), in the upper half of the guidance range of between 940,000 - 1,010,000 ounces, with solid performances from each of the Company’s three mines (refer to "Review of Mining Operations and Development Projects" section below). The Fekola Mine achieved another strong year in 2023, producing 590,243 ounces of gold, near the mid-point of the guidance range of between 580,000 and 610,000 ounces. The Masbate Mine continued its strong performance in 2023, producing 193,502 ounces of gold, exceeding the upper end of its guidance range of 170,000 to 190,000 ounces while the Otjikoto Mine produced 208,598 ounces of gold, near the upper end of its guidance range of 190,000 to 210,000 ounces.
For the year ended December 31, 2023, consolidated cash operating costs (refer to "Non-IFRS Measures") were $631 per gold ounce produced ($620 per gold ounce sold), 7% lower than budget and in-line with 2022. Including estimated attributable results for Calibre, cash operating costs for the year ended December 31, 2022 were $654 per gold ounce produced ($644 per gold ounce sold) below the low end of the Company's guidance range of $670 to $730 per ounce and in-line with 2022. Cash operating costs per ounce produced for the year ended December 31, 2023 were below the low end of the guidance range as a result of lower than budgeted fuel costs and a weaker Namibian dollar.
Consolidated all-in sustaining costs (refer to “Non-IFRS Measures”) for the year ended December 31, 2023 were $1,199 per gold ounce sold compared to $1,022 per gold ounce sold for 2022. Including estimated attributable results for Calibre, all-in sustaining costs for the year ended December 31, 2023 were $1,201 per gold ounce sold ($1,033 per gold ounce sold for 2022), at the low end of the Company's guidance range of $1,195 to $1,255 per ounce sold.
Depreciation and depletion
Depreciation and depletion expense, included in total cost of sales, was $402 million for the year ended December 31, 2023 compared to $384 million in 2022. The 5% increase in depreciation expense was mainly due to a 3% increase in gold ounces sold and a 2% increase in the depreciation charge per ounce gold sold.
Royalties and production taxes
Royalties and production taxes included in total cost of sales were $136 million for the year ended December 31, 2023 compared to $118 million for the year ended December 31, 2022. The 15% increase in royalties and production taxes was mainly due to a 3% increase in gold ounces sold and a 9% increase in the average realized gold price.
Other
G&A costs relate mainly to the Company’s head office in Vancouver, the Bamako office in Mali, the Makati office in the Philippines and the Windhoek office in Namibia. For the year ended December 31, 2023, G&A costs increased by $8 million to $62 million, primarily due to higher general office costs, higher legal and consulting charges and higher bank charges.
Share-based payment expense for the year ended December 31, 2023 was $21 million compared to $25 million for 2022. The lower share-based payment expense resulted from the timing of share-based payment grants and related vesting.
For the year ended December 31, 2023, the Company recorded impairment charges totalling $322 million consisting of a $112 million impairment charge on the Gramalote Project as a result of the Company's acquisition from AngloGold of the remaining 50% stake in the Gramalote Project, a $4 million impairment charge on its investment in BeMetals Corp., and a $206 million impairment charge on the Fekola Complex. The net impairment charge for the Fekola Complex was $192 million (pre-tax $206 million less $14 million deferred tax recovery).
For the year ended December 31, 2023, the Company recorded a $20 million write-down of mineral property interests relating to greenfield exploration targets compared to $12 million in 2022.
The Company reported $16 million in foreign exchange losses for the year ended December 31, 2023 compared to foreign exchange losses of $10 million in 2022 reflecting the weakening of the Namibian currency and the distribution of intercompany dividends from Mali.
For the year ended December 31, 2023, the Company's estimate of its share of its associates net income was approximately $20 million compared to $10 million in 2022. For the year ended December 31, 2023, this included an estimate of the Company's share of net income for Calibre of $20 million. The Company will update any differences in the first quarter of 2024.
For the year ended December 31, 2023, the Company recorded a $12 million provision for recognition of Otjikoto severance costs.
Other operating expenses for the year ended December 31, 2023 were $14 million, which included a $6 million for loss on recovery of input taxes and $2 million for exploration evaluation costs.
The Company reported $14 million in interest and financing expense for the year ended December 31, 2023 compared to $11 million in 2022. The increase was due to a $150 million drawdown of the RCF in the fourth quarter of 2023.
For the year ended December 31, 2023, the Company recorded interest income of $19 million compared to $12 million in 2022 due to higher interest rates earned on its cash balances in 2023.
The Company reported a loss on change in fair value of the gold stream obligation of $12 million for the year ended December 31, 2023 resulting from changes in long-term gold prices and interest rates.
For the year ended December 31, 2023, the Company recorded derivative gains of $5 million compared to derivative gains of $19 million in 2022. The gains were driven by fuel forward contracts derivative instruments and consisted of net unrealized losses of $5 million (2022 - net unrealized losses of $10 million) and realized gains of $10 million (2022 - realized gains of $29 million).
Other non-operating expense for the year ended December 31, 2023 was $4 million compared to an other non-operating income for the year ended December 31, 2022 of $8 million. The non-operating income for the year ended December 31, 2022 mainly consisted of a dilution gain on investment in Calibre of $6 million following dilution of the Company's investment in Calibre from 33% to 25% as a result of Calibre's acquisition of Fiore Gold Ltd., which closed in January 2022.
Current income tax, withholding and other taxes
For the year ended December 31, 2023, the Company recorded a net current income, withholding and other taxes expense of $290 million compared to $248 million in 2022, consisting of current income tax of $227 million (2022 - $186 million), the 10% priority dividend to the State of Mali of $36 million (2022 - $36 million) and withholding tax (on intercompany dividends/management fees) of $27 million (2022 - $26 million). The priority dividend is accounted for as an income tax in accordance with IAS 12, Income Taxes. Compared to 2022, current income and other tax expense for the year ended December 31, 2023 was $42 million higher mainly as a result of higher income in Otjikoto in 2023. For the year ended December 31, 2023, the Company recorded a deferred income tax recovery of $11 million compared to a deferred income tax recovery of $4 million in 2022. The changes in the deferred tax recovery were due to: $39 million lower deferred tax expense from foreign exchange effects due to strengthening of foreign currencies in Mali and Colombia as compared to a weakening in 2022, $42 million higher deferred tax expense due to higher expected dividends in excess of net income of foreign subsidiaries in the future and $10 million greater deferred tax recovery from temporary differences between accounting and taxable income mainly due to the deferred income tax recovery generated from the Fekola Complex impairment charge. The effective tax rate was much higher for 2023 than 2022 mainly due to the impairment of the Fekola Complex and Gramalote which resulted in small deferred tax recoveries relative to the amount of impairments due to deferred tax assets not recognized and certain permanent tax differences on the original acquisition of the assets when no deferred income tax liability was recorded.
For the year ended December 31, 2023, the Company generated net income of $42 million compared to $287 million in 2022, and net income attributable to the shareholders of the Company of $10 million ($0.01 per share) compared to $253 million ($0.24 per share) in 2022. Adjusted net income attributable to the shareholders of the Company (refer to “Non-IFRS Measures”) for the year ended December 31, 2023 was $347 million ($0.28 per share) compared to $264 million ($0.25 per share) in 2022. Adjusted net income for the year ended December 31, 2023 excluded impairment of long-lived assets of $304 million, the write-down of mining interests of $20 million, unrealized losses on derivative instruments of $5 million, change in fair value of gold stream of $12 million and deferred income tax recovery of $9 million.
Cash flow provided by operating activities was $714 million for the year ended December 31, 2023 compared to $596 million during 2022, an increase of $118 million. The increase reflects higher revenues of $202 million and lower non-cash working capital outflows for the year ended December 31, 2023, partially offset by higher long-term value added tax receivable outflows of $27 million, higher long-term inventory outflows of $19 million and lower realized gains on fuel derivatives of $20 million. During the year ended December 31, 2023 the Company paid $239 million (2022 - $239 million) of current income tax, withholding and other taxes in cash, including $54 million related to 2022 outstanding tax liability obligations. Based on current assumptions, including an average gold price of $1,800 per ounce for 2024, the Company is forecasting to make total cash income tax payments for current income tax, withholding and other taxes in 2024 of approximately $187 million.
B2Gold continues to maintain a strong financial position and liquidity. At December 31, 2023, the Company had cash and cash equivalents of $307 million compared to cash and cash equivalents of $652 million at December 31, 2022. Working capital (defined as current assets less current liabilities) at December 31, 2023 was $397 million compared to $802 million at December 31, 2022. During the year ended December 31, 2023, the Company drew down $150 million on the RCF with $550 million remaining available for future draw downs. Subsequent to December 31, 2023, the Company utilized a portion of the proceeds from the $500 million Gold Prepay completed in January 2024 to repay the $150 million balance drawn on the RCF, leaving the full amount of $700 million available for future draw downs.
Fourth quarter 2023 and 2022
Revenue
For the fourth quarter of 2023, consolidated gold revenue was $512 million on sales of 256,921 ounces at an average realized gold price of $1,993 per ounce, compared to $592 million on sales of 339,355 ounces at an average realized gold price of $1,746 per ounce in the fourth quarter of 2022. The fourth quarter decrease in gold revenue of 14% ($80 million) was due to a 24% decrease in gold ounces sold (mainly due to the lower gold production), partially offset by a 14% increase in the average realized gold price.
In the fourth quarter of 2023, the Fekola Mine accounted for $256 million (fourth quarter of 2022 - $415 million) of gold revenue from the sale of 128,321 ounces (fourth quarter of 2022 - 237,800 ounces), the Masbate Mine accounted for $107 million (fourth quarter of 2022 - $94 million) of gold revenue from the sale of 53,500 ounces (fourth quarter of 2022 - 53,865 ounces), the Otjikoto Mine accounted for $149 million (fourth quarter of 2022 - $83 million) of gold revenue from the sale of 75,100 ounces (fourth quarter of 2022 - 47,690 ounces).
Production and operating costs
In the fourth quarter of 2023, B2Gold’s consolidated gold production was 270,611 ounces, 9% (21,312 ounces) higher than budget but, as expected, 23% (82,158 ounces) lower than the fourth quarter of 2022. The Company's three mines all exceeded budget in the fourth quarter of 2023. The Company’s total gold production for the fourth quarter of 2023 was 288,665 ounces (including 18,054 ounces of attributable production from Calibre).
In the fourth quarter of 2023, consolidated cash operating costs (refer to "Non-IFRS Measures") were $611 per gold ounce produced ($640 per gold ounce sold), in line with budget and 39% higher than 2022. Including estimated attributable results for Calibre, cash operating costs for the fourth quarter of 2023 were $633 per gold ounce produced ($661 per gold ounce sold), in line with budget and 35% higher than the fourth quarter of 2022. Consolidated cash operating costs for the fourth quarter of 2023 were higher than the fourth quarter of 2022 as a result of record gold production in the fourth quarter of 2022.
Consolidated all-in sustaining costs (refer to "Non-IFRS Measures") for the fourth quarter of 2023 were $1,264 per gold ounce sold, in line with the budget of $1,231 per gold ounce sold but higher than $876 per gold ounce sold for the fourth quarter of 2022. Including estimated attributable results for Calibre, all-in sustaining costs for the fourth quarter of 2023 were $1,257 per gold ounce sold compared to a budget of $1,231 per gold ounce sold and $892 per gold ounce sold for the fourth quarter of 2022.
Depreciation and depletion
Depreciation and depletion expense included in total cost of sales was $109 million in the fourth quarter of 2023 compared to $131 million in the fourth quarter of 2022. The 17% decrease in depreciation expense was primarily due to a 24% decrease in the gold ounces sold partially offset by a 10% increase in the depreciation charge per ounce of gold sold. The increase in the depreciation charge per gold ounce sold was a result of higher depreciation related to the Otjikoto underground development.
Royalties and production taxes
Royalties and production taxes included in total cost of sales were $33 million for the fourth quarter of 2023 compared to $42 million in the fourth quarter of 2022. The 21% decrease in royalties and production taxes resulted mainly from a 24% decrease in gold ounces sold, a change in the sales mix in the fourth quarter of 2023 to include proportionately fewer ounces sold from the Fekola Mine compared to the fourth quarter of 2022, resulting in an overall lower effective royalty rate for the quarter, partially offset by a 14% increase in the average realized gold price in the fourth quarter of 2023.
Other
G&A for the fourth quarter of 2023 of $21 million was in line with 2022.
Share-based payment expense for the fourth quarter of 2023 was $5 million, in line with the fourth quarter of 2022.
For the fourth quarter of 2023, the Company recorded impairment charges totalling $206 million on the Fekola Complex. The net impairment charge for the Fekola Complex was $192 million (pre-tax $206 million less $14 million deferred income tax recovery).
In the fourth quarter of 2023, the Company recorded a $3 million write-down of mineral property interests relating to greenfield exploration targets.
For the fourth quarter of 2023, the Company's estimate of its share of Calibre's and BeMetals' net income was approximately $2 million compared to $1 million in the fourth quarter of 2022. The Company will update any differences in the first quarter of 2024.
The Company reported $5 million in interest and financing expense for the fourth quarter of 2023 compared to $3 million in the fourth quarter of 2022. The increase is due to the drawdown of the RCF in the fourth quarter of 2023.
For the fourth quarter 2023, the Company recorded interest income of $3 million compared to $4 million in the fourth quarter of 2022 due to lower cash balances in the fourth quarter of 2023.
The Company reported a loss on change in fair value of the gold stream obligation of $19 million for the fourth quarter of 2023 resulting from changes in long-term gold prices and interest rates.
For the fourth quarter of 2023, the Company recorded a net current income, withholding and other taxes expense of $74 million compared to $107 million in the fourth quarter of 2022, consisting of current income tax of $64 million (fourth quarter of 2022 - $87 million), the 10% priority dividend to the State of Mali of $8 million (fourth quarter of 2022 - $18 million) and withholding tax (on dividends from subsidiaries/intercompany interest/management fees) of $2 million (fourth quarter of 2022 - $2 million). The priority dividend is accounted for as an income tax in accordance with IAS 12, Income Taxes. Compared to the fourth quarter of 2022, current income tax expense for the fourth quarter of 2023 was lower mainly as a result of lower profit from Fekola than in the fourth quarter of 2022, which was only partially offset by higher taxable income at Otjikoto and Masbate. For the fourth quarter of 2023, the Company recorded a deferred income tax recovery of $13 million compared to a deferred income tax recovery of $48 million in the fourth quarter of 2022. The fourth quarter of 2023 deferred income tax recovery includes $28 million higher future withholding taxes, $12 million lower recovery for foreign exchange effects and $4 million greater recovery for temporary differences between accounting and taxable income which was primarily due to the Fekola impairment in the fourth quarter of 2023.
The Company generated a net loss for the fourth quarter of 2023 of $117 million compared to net income of $176 million for the fourth quarter of 2022 and the Company generated net loss attributable to the shareholders of the Company of $113 million (loss of $0.09 per share) for the fourth quarter of 2023 compared to net income attributable to the shareholders of the Company of $158 million ($0.15 per share) in the fourth quarter of 2022. Adjusted net income attributable to shareholders of the Company (refer to “Non-IFRS Measures”) for the fourth quarter of 2023 was $91 million ($0.07 per share) compared to $121 million ($0.11 per share) in the fourth quarter of 2022. Adjusted net income in the fourth quarter of 2023 excluded the impairment of long-lived assets of $188 million, write-down of mining interests of $3 million, unrealized losses on derivative instruments of $4 million, change in fair value of gold stream obligation of $19 million and deferred income tax recovery of $11 million.
REVIEW OF MINING OPERATIONS AND DEVELOPMENT PROJECTS
Fekola Mine - Mali
| Three months ended | Year ended | |||
|---|---|---|---|---|
| December 31 | December 31 | |||
| 2023 | 2022 | 2023 | 2022 | |
| Gold revenue ($ in thousands) | 255,509 | 415,121 | 1,143,781 | 1,067,482 |
| Gold sold (ounces) | 128,321 | 237,800 | 588,460 | 599,600 |
| Average realized gold price ($/ounce) | 1,991 | 1,746 | 1,944 | 1,780 |
| Tonnes of ore milled | 2,419,637 | 2,469,924 | 9,408,400 | 9,376,096 |
| Grade (grams/tonne) | 1.99 | 3.31 | 2.13 | 2.14 |
| Recovery (%) | 93.4 | 92.8 | 92.3 | 92.9 |
| Gold production (ounces) | 143,010 | 244,014 | 590,243 | 598,661 |
| Production costs ($ in thousands) | 82,921 | 85,053 | 333,215 | 326,529 |
| Cash operating costs(1) ($/gold ounce sold) | 646 | 358 | 566 | 545 |
| Cash operating costs(1) ($/gold ounce produced) | 605 | 348 | 572 | 537 |
| Total cash costs(1) ($/gold ounce sold) | 809 | 495 | 729 | 684 |
| All-in sustaining costs(1) ($/gold ounce sold) | 1,444 | 708 | 1,194 | 867 |
| Capital expenditures ($ in thousands) | 87,830 | 48,843 | 298,942 | 117,622 |
| Exploration ($ in thousands) | 2,022 | 1,366 | 3,728 | 15,214 |
(1)Non-IFRS measure. For a description of how these measures are calculated and a reconciliation of these measures to the most directly comparable measures specified, defined or determined under IFRS and presented in the Company’s financial statements, refer to “Non-IFRS Measures”.
The Fekola Mine in Mali (owned 80% by the Company and 20% by the State of Mali) was a strong performer in 2023, producing 590,243 ounces of gold, near the midpoint of the annual guidance range for the Fekola Complex4 of 580,000 to 610,000 ounces and 1% (8,418 ounces) lower compared to 2022. For the year ended December 31, 2023, mill feed grade was 2.13 g/t compared to budget
4 Fekola Complex is comprised of Fekola Mine (Medinandi permit hosting the Fekola and Cardinal zones) and Fekola Regional (Anaconda Area (Bantako, Menankoto and Bakolobi permits) and Dandoko permit).
of 2.20 g/t and 2.14 g/t in 2022; mill throughput was 9.41 million tonnes (an annual record) compared to budget of 9.00 million tonnes and 9.38 million tonnes in 2022; and gold recovery averaged 92.3% compared to budget of 93.4% and 92.9% in 2022. In the fourth quarter of 2023, the Fekola Mine in Mali produced 143,010 ounces of gold, 14% (18,010 ounces) higher than budgeted and 41% (101,004 ounces) lower compared to the fourth quarter of 2022, largely due to the exceptionally high grade ore processed from Fekola Phase 6 pit during the fourth quarter of 2022. During the fourth quarter of 2023, the Fekola processing facilities continued to outperform budget as a result of continued favorable ore fragmentation and continued optimization of the grinding circuit. For the fourth quarter of 2023, mill feed grade was 1.99 g/t compared to budget of 1.79 g/t and 3.31 g/t in the fourth quarter of 2022; mill throughput was 2.42 million tonnes compared to budget of 2.33 million tonnes and 2.47 million tonnes in the fourth quarter of 2022; and gold recovery averaged 93.4% compared to budget of 93.6% and 92.8% in the fourth quarter of 2022. Mined ore tonnage and grade continue to reconcile well with the Fekola resource model.
For the year ended December 31, 2023, the Fekola Mine's cash operating costs (refer to “Non-IFRS Measures”) of $572 per ounce produced ($566 per gold ounce sold) were at the lower end of the Fekola Complex's guidance range of between $565 to $625 per ounce and $35 (7%) per ounce produced higher than in 2022. Fekola’s cash operating costs for the fourth quarter of 2023 were $605 per gold ounce produced ($646 per gold ounce sold), 10% lower than the budget of $672 per gold ounce produced and higher than the $348 per gold ounce produced for the fourth quarter of 2022. For the fourth quarter of 2023, cash operating costs per ounce produced were higher compared to the fourth quarter of 2022 mainly due to the record quarterly gold production experienced in the fourth quarter of 2022.
All-in sustaining costs (refer to “Non-IFRS Measures”) for the Fekola Mine for the year ended December 31, 2023 were $1,194 per gold ounce sold, higher than the original guidance range of between $1,085 and $1,145 per ounce but near the low end of the revised guidance of $1,175 to $1,235 per ounce. For the year ended December 31, 2022, all-in sustaining costs were $867 per gold ounce sold. All-in sustaining costs for the year ended December 31, 2023 were within the Fekola Mine's revised guidance range and higher than the year ended December 31, 2022 as a result of additional sustaining capital expenditures during 2023 compared to 2022. All-in sustaining costs for the fourth quarter of 2023 were $1,444 per gold ounce sold compared to a budget of $1,427 per gold ounce sold and $708 per gold ounce sold in the fourth quarter of 2022. As with the full year 2023, all-in sustaining costs per ounce for the fourth quarter of 2023 reflect significantly higher capital expenditures compared to the fourth quarter of 2022.
Capital expenditures for the year ended December 31, 2023 totalled $299 million, primarily consisting of $80 million for deferred stripping, $84 million for mobile equipment purchases and rebuilds, $39 million for tailings storage facility expansion and equipment, $39 million for the development of the Fekola underground mine, $18 million for the expansion of the solar power plant, $12 million site general capital, $12 million for other mining sustaining capital, $10 million for process and power plant, and $5 million for Bantako road construction. Capital expenditures in the fourth quarter of 2023 totalled $88 million, primarily consisting of $24 million for deferred stripping, $18 million for mobile equipment purchases and rebuilds, $16 million for tailings storage facility expansion and equipment, $14 million for the development of the Fekola underground mine, $7 million for the expansion of the solar power plant, $5 million site general capital and $3 million for other mining sustaining capital.
The Fekola Complex in Mali is expected to produce between 470,000 and 500,000 ounces of gold in 2024 at cash operating costs of between $835 and $895 per ounce and all-in sustaining costs of between $1,420 and $1,480 per ounce. The Fekola Complex’s total 2024 gold production is anticipated to decrease relative to 2023, predominantly due to lower production at the Fekola Complex as a result of the delay in receiving an exploitation license for Fekola Regional. Receipt of mining permit for the Fekola Regional licenses remains outstanding pending finalization of an implementation decree for the new 2023 Mining Code by the State of Mali. No production is forecast from Fekola Regional in the Company's 2024 guidance with production now expected to commence at the beginning of 2025. If an exploitation license for Fekola Regional is received in the first half of 2024, there is potential for 2024 Fekola Complex production to be supplemented with up to 18,000 ounces of higher-grade ore from Fekola Regional. B2Gold recently held meetings with the representatives of the Government of Mali regarding the 2023 Mining Code. The Government of Mali assisted the Company in clarifying the application of the 2023 Mining Code to existing and future projects in Mali, and also expressed their desire for B2Gold to rapidly progress the development of Fekola Regional and committed to assisting the Company in such development.
The haul road from Bantako North to Fekola is complete and construction of the mining infrastructure (warehouse, workshop, fuel depot, and offices) is on schedule and will be completed in the first quarter of 2024. Mining operations will commence upon receipt of an exploitation license, with gold production approximately three months after commencement.
Fekola is expected to process 9.4 million tonnes of ore during 2024 at an average grade of 1.77 g/t gold with a process gold recovery of 90.9%. Gold production is expected to be evenly weighted between the first half of 2024 and the second half of 2024. In the second half of 2024, gold production is weighted approximately 40% to the third quarter and approximately 60% to the fourth quarter.
The expected increase in Fekola’s all-in sustaining costs for 2024 relative to 2023 reflects the expected decrease in production at Fekola in 2024 due to the delay in receiving an exploitation license for Fekola Regional (no production for Fekola Regional assumed in 2024), and higher sustaining capital expenditures. Capital expenditures in 2024 at the Fekola Complex are expected to total approximately $309 million, of which approximately $202 million is classified as sustaining capital expenditures and $107 million is classified as non-sustaining expenditures. Sustaining capital expenditures are anticipated to include $80 million for deferred stripping, $45 million for ongoing construction of the new TSF (expected to be completed in the second quarter of 2025), $39 million for new and replacement Fekola mining equipment, including capitalized rebuilds, and $19 million for the
expansion of the Fekola solar plant (expected to be completed in the third quarter of 2024). Non-sustaining capital expenditures are anticipated to include $64 million for underground mine development and $43 million for mine development and infrastructure at Fekola Regional.
Masbate Mine – Philippines
| Three months ended | Year ended | |||
|---|---|---|---|---|
| December 31 | December 31 | |||
| 2023 | 2022 | 2023 | 2022 | |
| Gold revenue ($ in thousands) | 107,063 | 94,010 | 372,902 | 384,714 |
| Gold sold (ounces) | 53,500 | 53,865 | 190,800 | 214,015 |
| Average realized gold price ($/ounce) | 2,001 | 1,745 | 1,954 | 1,798 |
| Tonnes of ore milled | 2,077,503 | 2,043,931 | 8,302,075 | 7,929,094 |
| Grade (grams/tonne) | 0.90 | 1.08 | 0.97 | 1.11 |
| Recovery (%) | 77.0 | 68.3 | 74.5 | 74.9 |
| Gold production (ounces) | 46,490 | 48,687 | 193,502 | 212,728 |
| Production costs ($ in thousands) | 43,733 | 47,228 | 160,952 | 177,705 |
| Cash operating costs(1) ($/gold ounce sold) | 817 | 877 | 844 | 830 |
| Cash operating costs(1) ($/gold ounce produced) | 910 | 872 | 859 | 817 |
| Total cash costs(1) ($/gold ounce sold) | 933 | 984 | 966 | 937 |
| All-in sustaining costs(1) ($/gold ounce sold) | 1,118 | 1,187 | 1,143 | 1,104 |
| Capital expenditures ($ in thousands) | 9,195 | 9,620 | 30,142 | 39,528 |
| Exploration ($ in thousands) | 1,067 | 1,648 | 3,808 | 4,759 |
(1)Non-IFRS measure. For a description of how these measures are calculated and a reconciliation of these measures to the most directly comparable measures specified, defined or determined under IFRS and presented in the Company’s financial statements, refer to “Non-IFRS Measures”.
The Masbate Mine in the Philippines continued its strong operational performance in 2023, producing 193,502 ounces of gold, exceeding the upper end of its guidance range of 170,000 to 190,000 ounces. Masbate's 2023 annual gold production was 9% (19,226 ounces) lower compared to 2022, mainly resulting from the planned processing of lower grade ore in 2023, partially offset by higher mill throughput. Gold recoveries for 2023 were in-line with those of 2022 (74.5% for 2023 versus 74.9% for 2022). Average 2023 gold recoveries were equal to the budget despite processing a higher percentage of sulphide and transitional ore as compared to budget. Masbate's mill throughput was above budget in 2023 due to the effects of continued improvements to optimization of mill operations and blending of mill feed. Mined ore tonnage and grade continue to reconcile well with the Masbate resource model. For the year ended December 31, 2023, mill feed grade was 0.97 g/t compared to budget of 0.96 g/t and 1.11 g/t in 2022; mill throughput was a record 8.30 million tonnes compared to budget of 7.84 million tonnes and 7.93 million tonnes in 2022; and gold recovery averaged 74.5% compared to budget of 74.5% and 74.9% in 2022. In the fourth quarter of 2023, Masbate produced 46,490 ounces of gold, in line with budget. Lower ore gold grade during the fourth quarter of 2023 was offset by higher than budgeted mill throughput. Fourth quarter of 2023 mill feed grade was 0.90 g/t compared to budget of 0.95 g/t and 1.08 g/t in the fourth quarter of 2022; mill throughput was 2.08 million tonnes compared to budget of 1.95 million tonnes and 2.04 million tonnes in the fourth quarter of 2022; and gold recovery averaged 77.0% compared to budget of 76.1% and 68.3% in the fourth quarter of 2022. Fourth quarter of 2023 gold production was lower by 5% (2,197 ounces) compared to the fourth quarter of 2022 due to lower processed ore grade, partially offset by higher gold recoveries and higher mill throughput. Processed ore grade was lower in the fourth quarter of 2023 (compared to the fourth quarter of 2022) due to the planned mining of additional lower grade ore during the fourth quarter of 2023. Gold recoveries for processed ore were higher in the fourth quarter of 2023 (compared to the fourth quarter of 2022) due to the processing of ore from areas of the Main Vein pit with more favorable gold recovery characteristics as compared to 2022.
The Masbate Mine’s cash operating costs (refer to “Non-IFRS Measures”) of $859 per ounce produced for the year ended December 31, 2023 ($844 per gold ounce sold) were at the low end of the revised guidance range of between $855 to $915 per ounce and well below the original guidance range of between $985 to $1,045 per ounce. Cash operating costs per gold ounce produced for the year ended December 31, 2023 were below budget primarily due to lower than budgeted mining and processing costs resulting from lower than budgeted diesel and heavy fuel oil cost and higher than budgeted gold production. Cash operating costs per ounce produced for the year ended December 31, 2023 were 5% higher than the year ended December 31, 2022 mainly as a result of lower gold production in 2023. The Masbate Mine's cash operating costs for the fourth quarter of 2023 were $910 per gold ounce produced ($817 per gold ounce sold) which was $71 per ounce produced lower than budget and $38 per ounce produced higher than the fourth quarter of 2022. The lower cash operating costs per gold ounce produced in the fourth quarter of 2023 compared to budget were largely the result of lower than budgeted fuel prices and higher than budgeted gold production. Cash operating costs per gold ounce produced for the fourth quarter of 2023 were higher than the fourth quarter of 2022, mainly the result of processing lower grade ore in the fourth quarter of 2023 compared to the fourth quarter of 2022.
All-in sustaining costs (refer to “Non-IFRS Measures”) for the Masbate Mine were $1,143 per gold ounce sold for the year ended December 31, 2023, well below the lower end of its guidance range of between $1,370 and $1,430 per ounce sold (and below its revised guidance range of between $1,155 and $1,215 per ounce sold) and higher than the $1,104 per gold ounce sold for the year ended December 31, 2022. All-in sustaining costs for the year ended December 31, 2023 were lower than the guidance range as a result of higher than budgeted gold ounces sold, lower than budgeted cash operating costs described above and lower than budgeted sustaining capital expenditures. All-in sustaining costs for the fourth quarter of 2023 were $1,118 per gold ounce sold compared to a budget of $1,339 per gold ounce sold and $1,187 per gold ounce sold in the fourth quarter of 2022. All-in sustaining costs for the fourth quarter of 2023 were well below budget as a result of higher than budgeted gold ounces sold and lower than budgeted cash operating costs described above.
Capital expenditures totalled $30 million in 2023, primarily consisting of mobile equipment rebuilds and purchases of $17 million, $3 million for the completion of a new powerhouse generator and other powerhouse engine rebuilds, $2 million in deferred stripping, $2 million for TSF projects and $2 million for capitalized mill maintenance. Capital expenditures for the fourth quarter of 2023 totalled $9 million, primarily consisting of $5 million for mobile equipment rebuilds and purchases, $1 million for capitalized mill maintenance, $1 million for powerhouse rebuilds and $1 million for the tailings storage facility.
The Masbate Mine in the Philippines is expected to produce between 170,000 and 190,000 ounces of gold in 2024 at cash operating costs of between $945 and $1,005 per ounce and all-in sustaining costs of between $1,300 and $1,360 per ounce. Gold production is scheduled to be relatively consistent throughout 2024. For 2024, Masbate is expected to process 7.9 million tonnes of ore at an average grade of 0.93 g/t with a process gold recovery of 76.0%. Mill feed will be a blend of mined fresh ore and low-grade ore stockpiles.
Capital expenditures for 2024 at Masbate are expected to total $49 million, of which approximately $33 million is classified as sustaining capital expenditures and $16 million is classified as non-sustaining capital expenditures. Sustaining capital expenditures are anticipated to include $16 million for mining and mobile equipment replacement and rebuilds, $6 million for deferred stripping, $6 million for process plant and $3 million for tailing storage facility expansion. Non-sustaining capital expenditures are anticipated to include $16 million for land acquisition and mine development.
Otjikoto Mine - Namibia
| Three months ended | Year ended | |||
|---|---|---|---|---|
| December 31 | December 31 | |||
| 2023 | 2022 | 2023 | 2022 | |
| Gold revenue ($ in thousands) | 149,402 | 83,337 | 417,589 | 280,394 |
| Gold sold (ounces) | 75,100 | 47,690 | 214,800 | 155,540 |
| Average realized gold price ($/ounce) | 1,989 | 1,747 | 1,944 | 1,803 |
| Tonnes of ore milled | 888,561 | 839,599 | 3,443,308 | 3,412,960 |
| Grade (grams/tonne) | 2.88 | 2.25 | 1.91 | 1.50 |
| Recovery (%) | 98.5 | 98.8 | 98.6 | 98.5 |
| Gold production (ounces) | 81,111 | 60,068 | 208,598 | 161,614 |
| Production costs ($ in thousands) | 37,752 | 27,278 | 122,030 | 122,292 |
| Cash operating costs(1) ($/gold ounce sold) | 503 | 572 | 568 | 786 |
| Cash operating costs(1) ($/gold ounce produced) | 451 | 465 | 585 | 769 |
| Total cash costs(1) ($/gold ounce sold) | 582 | 642 | 646 | 858 |
| All-in sustaining costs(1) ($/gold ounce sold) | 816 | 965 | 984 | 1,161 |
| Capital expenditures ($ in thousands) | 14,797 | 19,521 | 61,063 | 79,096 |
| Exploration ($ in thousands) | 1,410 | 1,201 | 3,863 | 3,476 |
(1)Non-IFRS measure. For a description of how these measures are calculated and a reconciliation of these measures to the most directly comparable measures specified, defined or determined under IFRS and presented in the Company’s financial statements, refer to “Non-IFRS Measures”.
The Otjikoto Mine in Namibia, in which the Company holds a 90% interest, had a strong finish to 2023 and produced an annual record of 208,598 ounces of gold, at the upper end of the guidance range of 190,000 to 210,000 ounces for 2023 and 29% (46,984 ounces) higher compared to 2022, mainly due to improved processed grade as a result of higher grade ore mined from the Wolfshag underground mine. For the year ended December 31, 2023, mill feed grade was 1.91 g/t compared to budget of 1.87 g/t and 1.50 g/t in 2022; mill throughput was 3.44 million tonnes compared to budget of 3.40 million tonnes and 3.41 million tonnes in 2022; and gold recovery averaged 98.6% compared to budget of 98.0% and 98.5% in 2022. In the fourth quarter of 2023, the Otjikoto Mine produced a quarterly record of 81,111 ounces of gold which was 3% (2,239 ounces) above budget and 35% (21,043 ounces) higher than the fourth quarter of 2022 mainly due to improved processed grade as a result of higher grade ore mined from the Wolfshag underground mine. For the fourth quarter of 2023, mill feed grade was 2.88 g/t compared to budget of 2.92 g/t and 2.25 g/t in the fourth quarter of 2022; mill throughput was 0.89 million tonnes compared to budget of 0.86 million tonnes and 0.84 million tonnes in the fourth quarter of 2022; and gold recovery averaged 98.5% compared to budget of 98.0% and 98.8% in the fourth quarter of 2022.
As of the beginning of 2023, the Probable Mineral Reserve estimate for the Wolfshag deposit included 203,000 ounces of gold in 1.1 million tonnes of ore at an average grade of 5.55 g/t gold. Open pit mining operations at the Otjikoto Mine are scheduled to ramp down in 2024 and conclude in 2025, while processing operations will continue until 2031, when economically viable stockpiles are forecast to be exhausted. Underground operations are currently projected to continue until 2026 with potential to extend underground operations if the ongoing current underground exploration program is successful in identifying additional underground deposits.
On January 31, 2024, the Company announced positive exploration drilling results from the Antelope deposit at the Otjikoto Mine. The Antelope deposit, comprised of the Springbok Zone, the Oryx Zone, and a possible third structure, Impala, subject to further confirmatory drilling, is located approximately 3 km south of the Otjikoto open pit. The Antelope deposit has the potential to be developed as an underground mining operation, which could complement the expected processing of low grade stockpiles at the Otjikoto mill from 2026 to 2031.
The Otjikoto Mine's cash operating costs (refer to “Non-IFRS Measures”) for the year ended December 31, 2023 were $585 per gold ounce produced ($568 per gold ounce sold), within its revised guidance range of between $545 to $605 per ounce produced (and below its original guidance range of $590 to $650 per ounce produced). Cash operating costs per ounce produced for the year ended December 31, 2023 were below the original guidance range as a result of higher than budgeted gold ounces produced and lower operating costs due to a weaker than budgeted Namibian dollar. For the fourth quarter of 2023, the Otjikoto Mine's cash operating costs were $451 per gold ounce produced ($503 per ounce gold sold), compared to a budget of $343 per ounce produced. Higher than budget cash operating costs per ounce produced for the fourth quarter of 2023 were driven by net decreases in stockpiled ore from open pits and underground. Cash operating costs per ounce produced for the fourth quarter of 2023 and the year ended December 31, 2023 were 3% and 24% lower, respectively, than the fourth quarter of 2022 and the year ended December 31, 2022, respectively, mainly as a result of higher ounces produced in 2023 and a weaker Namibian dollar.
All-in sustaining costs (refer to “Non-IFRS Measures”) for the Otjikoto Mine for the year ended December 31, 2023 were $984 per gold ounce sold, within its revised guidance range of $950 to $1,010 per ounce sold (and well below its original guidance range of between $1,080 and $1,140 per ounce sold) and lower compared to $1,161 per gold ounce sold in 2022. All-in sustaining costs for the year ended December 31, 2023 were below the low end of its original guidance range as a result of higher than budgeted gold ounces sold, lower than budgeted cash operating costs described above and lower than budgeted sustaining capital expenditures primarily related to deferred stripping and underground development. All-in sustaining costs for the fourth quarter of 2023 were $816 per gold ounce sold compared to the budget of $727 per gold ounce sold and lower than $965 per gold ounce sold in the fourth quarter of 2022. All-in sustaining costs for the fourth quarter of 2023 were higher than budget as a result of higher than budgeted cash operating costs described above, lower than budgeted gold ounces sold partially offset by lower than budgeted capital expenditures.
Capital expenditures totalled $61 million in 2023, primarily consisting of $47 million for deferred stripping for the Otjikoto pit, $10 million for Wolfshag underground development and $2 million in mobile equipment rebuilds. Capital expenditures for the fourth quarter of 2023 totalled $15 million, primarily consisting of $10 million for deferred stripping for the Otjikoto pit and $3 million for Wolfshag underground development.
The Otjikoto Mine in Namibia is expected to produce between 180,000 and 200,000 ounces of gold in 2024 at cash operating costs of between $685 and $745 per ounce and all-in sustaining costs of between $960 and $1,020 per ounce. Gold production at Otjikoto is expected to be relatively consistent throughout 2024. Otjikoto is expected to process a total of 3.4 million tonnes of ore at an average grade of 1.77 g/t gold with a process gold recovery of 98.0%. Processed ore will be sourced from the Otjikoto pit and the Wolfshag underground mine, supplemented by existing medium and high-grade ore stockpiles.
Capital expenditures in 2024 at Otjikoto are expected to total $33 million, of which approximately $32 million is classified as sustaining capital expenditures and $1 million is classified as non-sustaining capital expenditures. Sustaining capital expenditures are anticipated to include $32 million for deferred stripping and deferred underground development.
Investment in Calibre
At December 31, 2023, B2Gold held approximately 24% of the total issued and outstanding Calibre common shares and equity accounts for this ownership interest. The market value of the Company's 24% common shareholding of Calibre at December 31, 2023 was $114 million. For the year ended December 31, 2023, the Company's estimate of its share of Calibre's net income based on publicly available information was approximately $20 million. For the fourth quarter of 2023, the Company's estimate of its share of Calibre's net income based on publicly available information was approximately $2 million. Calibre reported its fourth quarter and full year 2023 financial results on February 20, 2024. The Company will update any differences in the first quarter of 2024.
On January 24, 2024, Calibre completed its acquisition of Marathon Gold Corporation and issued 249,813,422 Calibre common shares, reducing B2Gold's ownership interest in Calibre to approximately 15%. As a result of the acquisition, Calibre acquired a 100% interest in the advanced-stage Valentine Gold Project in Newfoundland & Labrador.
Attributable share of Calibre production and costs
Based on Calibre's production press release dated January 9, 2024, consolidated production of Calibre for the year ended December 31, 2023 was 283,494 ounces of which the Company's attributable share was 68,717 ounces. Consolidated production of Calibre for the fourth quarter of 2023 was 75,482 ounces of which the Company's attributable share was 18,054 ounces.
The Company has assumed that the consolidated cash operating costs per ounce produced and all-in sustaining costs for Calibre for the year ended December 31, 2023 will be at the mid-point of the guidance ranges of approximately $960 to $1,060 per ounce and $1,175 to $1,275 per ounce, respectively. Consolidated cash operating costs per ounce produced and all-in sustaining costs for Calibre for the fourth quarter of 2023 reflect adjustments to record Calibre's actual first nine months of 2023 results.
In 2024, Calibre operations are forecast to produce between 275,000 and 300,000 ounces of gold. The Company’s expected share (15%) of attributable ounces produced, projected from Calibre, is between 40,000 and 50,000 ounces. Calibre’s cash operating costs are forecast to be between $1,000 and $1,100 per ounce and all-in sustaining costs are forecast to be between $1,275 and $1,375 per ounce.
Goose Project - Canada
On April 19, 2023, the Company completed the acquisition of Sabina, resulting in the Company acquiring Sabina’s 100% owned Back River Gold District located in Nunavut, Canada by issuing approximately 216 million common shares of B2Gold as consideration. The Back River Gold District consists of five mineral claims blocks along an 80 km belt. The most advanced project in the district, Goose, is fully permitted, construction has commenced, and has been de-risked with significant infrastructure currently in place. The Goose Project has an estimated two year construction period, which is expected to be completed in the first quarter of 2025. B2Gold’s management team has strong northern construction expertise and the experience to deliver the fully permitted Goose Project and the financial resources to develop the significant gold resource endowment at the Back River Gold District into a large, long life mining complex.
B2Gold recognizes that respect and collaboration with the KIA is central to the license to operate in the Back River Gold District and will continue to prioritize developing the project in a manner that recognizes Inuit priorities, addresses concerns and brings long-term socio-economic benefits to the Kitikmeot Region. B2Gold looks forward to continuing to build on its strong collaboration with the KIA and Kitikmeot communities. Additionally, B2Gold congratulates Nunavut Tunngavik Inc. and the Governments of Nunavut and Canada for reaching a landmark Nunavut Land and Resources Devolution Agreement. The signing of this agreement is an incredible milestone for Nunavummiut and all Canadians. With this agreement, Nunavummiut now have a greater role in the management of lands and resources across their vast territory. This will strengthen decision making and enhance socio-economic opportunities. B2Gold looks forward to advancing its relationships with Nunavummiut to continue to contribute to Nunavut’s growing resource economy.
Goose Project Construction Update Highlights
Construction at the Goose Project continues to progress on track, with the project remaining on schedule to pour gold in the first quarter of 2025. Concrete and steel works in the mill area to date are progressing ahead of schedule. Exterior cladding of the mill building and truck shop is complete, and cladding of the power house will start in the first quarter of 2024, allowing for work to continue through the colder months and remain on schedule. Additionally, the ball mill will be set in place in the first quarter of 2024, approximately four months ahead of schedule, and the focus will shift to piping, electrical and mechanical systems as materials begin to arrive via the WIR road from the MLA.
The 2023 WIR successfully brought required materials to complete building envelopes in 2023. Concrete, steel, and consumables required for construction were successfully transported to the Goose Project site on the WIR and are being installed at the construction site. Construction equipment including cranes, generators, welders, lifts, and tooling are in operation and being used for camp and workshop construction. Completion of the 2023 WIR successfully de-risked the development of future WIRs. Construction of the 2024 WIR is being finalized and is expected to be fully operational by February 23, 2024. All required materials will be transported from the MLA to the Goose Project site by the end of April 2024, keeping it on schedule for completion of construction by the first quarter of 2025.
Site construction is ongoing, led by the B2Gold in-house construction team, which has successfully managed five construction projects for B2Gold and its predecessor company Bema Gold. The B2Gold in-house construction team have successfully built the following projects on-time and on-budget over the past three decades: the Julietta and Kupol mines in Russia, the La Libertad mine in Nicaragua, the Otjikoto mine in Namibia, and the Fekola mine in Mali. The B2Gold in-house construction team is complemented by key personnel previously working on the project with Sabina.
Since closing of the acquisition of Sabina in April 2023, B2Gold has worked to integrate its in-house construction team with the Sabina team, as well as rescope the external contractors working on the Goose Project. Through these integration efforts and based on prior experience at B2Gold’s current operations, the Company's decision to move to an owner-operated construction model versus a fixed priced EPC contract for the construction of the process plant is expected to reduce costs and result in a mill
with higher availability and lower sustaining capital requirements. Using B2Gold's owner-operated team also allows for flexibility in construction and the ability to prioritize construction activities as needed.
In addition, the B2Gold in-house purchasing team has identified significant savings by purchasing certain mobile equipment versus the ‘lease to own’ purchase model utilized by Sabina, and through lower negotiated pricing for certain reagents and consumables required for project construction and commissioning.
On June 23, 2023, the Company announced an initial capital expenditure estimate of C$800 million (excluding working capital), which was in line with B2Gold expectations since the Sabina acquisition announcement and reflects scope changes to further optimize the Goose Project. B2Gold had updated the construction budget to de-risk the project and construct a reliable and low operating cost mine. Sabina had incurred approximately C$340 million up to April 2023 leaving approximately C$460 million (approximately $350 million) expected to be spent by B2Gold from the date of acquisition and up to completion of construction in the first quarter of 2025. After completing a detailed review of the Goose Project design, materials, and construction schedule as part of the 2024 budgeting process, the Company has revised the total construction capital estimate from C$800 million to C$1,050 million. Most of the increase in the construction capital estimate relates to underestimated labour and site operating costs in the feasibility study, along with additional general inflationary impacts on construction materials, consumables, and transportation costs. In addition, a detailed review of the project design has identified deficiencies in project components including power generation and distribution, laboratory, piping, and controls and instrumentation, which are being corrected to deliver a reliable operation. In 2024, B2Gold expects to incur approximately C$280 million in construction capital costs. Future construction capital cost variance is expected to be minimal as over half of the construction capital costs to be incurred in 2024 are related to labour in order to bring the project close to commissioning by the end of the year, and all major components have been purchased or are under contract. In the fourth quarter of 2023 and post-acquisition to December 31, 2023, the Company incurred $126 million (C$171 million) and $282 million (C$381 million), respectively for construction activities at the Goose Project.
In addition, the net cost of open pit and underground development, deferred stripping, and sustaining capital expenditures to be incurred prior to first gold production is estimated at approximately C$200 million (including approximately C$125 million of direct mining costs related to open pit and underground development). The cost of these initiatives is primarily related to optimization changes in the underground mine plan as a result of switching the underground mining method to long-hole stoping and prioritizing ore from the Umwelt crown pillar area ahead of the zones below. It is anticipated that the increase in underground development costs will be offset during operations through lower sustainable operating costs than could be achieved with the cut-and-fill underground mining method. Additionally, B2Gold has elected to advance open pit mining of the Echo Pit, which is underway and will produce construction fill, stockpile ore and provide tailings storage capacity. Open pit mining of the Umwelt Pit is expected to commence in the first quarter of 2024 and will produce much of the commissioning ore as well as future tailings storage. In 2024, B2Gold expects to incur approximately C$170 million in open pit and underground development, deferred stripping, and sustaining capital expenditures.
In 2024, the Company will undertake a buildup of working capital over the Goose Project construction period up to the first quarter of 2025 in order to materially de-risk the execution of the production ramp-up phase and initial years of operation by including 2025 and certain 2026 consumables and sustaining capital equipment on the 2024 sealift. Areas of focus for working capital include: accelerated purchase and additional storage of diesel fuel to manage the requirements for operations in 2025 and part of 2026; critical inventory of consumables and spares for mining and processing to avoid the requirement for air transport; and development of open pit and underground ore stockpiles to provide a consistent and uninterrupted feed to the process plant. It is estimated that approximately C$205 million of fuel, reagents, and other working capital items will be purchased in 2024 to build up site inventory levels, which will substantially de-risk the project from operational and supply chain disruptions. Post-acquisition to December 31, 2023, $57 million of consumables inventory costs were incurred, including long-term consumables of $44 million.
Goose Project Infrastructure
Marine Laydown Area
Following the acquisition of Sabina, the MLA located on Bathurst Inlet, Nunavut was reorganized to maximize space for the 2023 sealift. Additionally, the fuel tank containment area at the MLA was enlarged to facilitate increased storage. The MLA has an approximately 70 person camp, a 3,000 foot gravel airstrip and heliport, and over 65,000 metres2 of outdoor storage area. The purchasing of materials and supplies needed to support the 2024 construction campaign has been completed and all materials provided to the ports for the 2023 sealift, which was completed successfully in mid-October 2023 with a total shipping volume of 90,000 metres cubed of dry cargo and 24,000,000 liters of arctic grade diesel fuel. This materially includes all planned sealift materials required for successful construction, commissioning, and mining of the Goose Project. Current activities at the MLA include maintenance and preparation of the WIR construction and haulage fleet and staging all materials for shipment on the WIR to the Goose site. Additional materials identified will need to be flown to site on an as-needed basis.
Accommodation Complex
Phase 1 of the accommodation complex opened in July 2023, including sleeping quarters, office area, medical center, gymnasium, kitchens, and water treatment. Phase 1 of the accommodation complex includes 310 beds at the permanent site location, which together with the 160 beds located at the existing exploration camp, provide the necessary accommodations to support accelerated construction, mining and exploration activities to ensure an on-time project completion. Phase 2 of the accommodation complex will further expand the permanent camp. Phase 2 materials are at the MLA and are ready for transport to the Goose Project site and will be integrated into the complex prior to the 2024 summer construction season.
Concrete and Steel Work
Over 2,000,000 kilograms of structural steel and approximately 500,000 kilograms of plate steel has arrived at site. Erection of the structural steel for the mill area, power house, and truck shop is well underway, and exterior cladding of the mill and reagent areas and truck shop are complete. Enclosure of these buildings has allowed for work to continue through the colder months and remain on schedule. The first concrete pour was completed in July 2023, with approximately 40% of the 2023 concrete foundations and pads complete within the mill area, powerhouse and truck shop as of September 30, 2023. Concrete and steel installations in the fourth quarter of 2023 focused on detailed mill plinths and structural supports in preparation for mill installation. Mill sole plates have been installed and grouted and the mill will be set in the first quarter of 2024, approximately four months ahead of schedule. Crews for installation of piping, electrical, and mechanical systems have been mobilized and will work within the enclosed workshops and buildings as the site ramps up to the peak 2024 construction season.
Airstrip
Earthworks necessary to extend the airstrip were completed in September 2023. The extension of the airstrip to 5,000 feet allows large capacity, fully loaded passenger planes to land at the Goose Project during the 2024 construction campaign. B2Gold expects that this will make employee and contractor rotations and supplying the project site from Edmonton significantly easier and will further de-risk the project.
Goose Project Mine Development
B2Gold made the decision to accelerate underground mining development to increase average gold production in the first five years to approximately 300,000 ounces per year. Open pit mining of the Echo Pit is underway and will produce construction fill, stockpile ore and provide tailings storage capacity. Open pit mining of the Umwelt Pit will commence later in the first quarter of 2024 and will produce much of the commissioning ore as well as future tailings storage. Underground development of the Umwelt deposit is also underway, currently at a depth of 142 vertical metres below surface. Breakthrough of the initial ventilation raise has been completed and development towards the ore zones is in progress with more than 2,100 metres of lateral development completed to date and primary headings within 300 metres of the Umwelt ore zone.
Goose Project Update Life of Mine Plan
The B2Gold technical team continues to analyze ways to optimize the Goose Project life of mine plan. Areas of optimization currently being studied include:
•Mining of the Umwelt crown pillar
◦The crown pillar between the Umwelt open pit and underground mining areas contains over 150,000 ounces of gold and was only partially included in prior production schedules.
◦Geotechnical and mine design and engineering is underway with the goal of mining and backfilling the crown pillar prior to completion of the Umwelt open pit.
•Underground mining method
◦The B2Gold engineering team has determined that most of the Umwelt underground mine can be mined effectively with long-hole stoping, which is expected to reduce costs and increase ore production rates versus development based mining methods.
•Renewable power generation
◦The Sabina team previously identified the potential for wind power generation, and studies are in progress by B2Gold to identify the best solution and to quantify the potential operational and cost impact to the Goose Project.
Subsequent to the completion of the acquisition of Sabina, B2Gold extinguished certain of Sabina’s construction financing obligations. The original Gold Metal Offtake Agreement ("Gold Offtake") between Sabina and Orion Mine Finance (“Orion”) allowed for the repurchase of 50% of the Gold Offtake in the event of a change of control for $31 million. Under the terms of the agreement with Orion, B2Gold paid a total purchase price of $63 million to retire the entire Gold Offtake. In addition, B2Gold has paid $3 million to retire the senior secured debt facility and gold prepay facility entered into between Orion and Sabina. After completion of the repurchase transactions, Orion no longer holds any security over the Goose Project or the Back River Gold District. The original Stream Agreement between Sabina and Wheaton Precious Metals (“Wheaton”) allowed for the repurchase of 33% of the gold stream on the Goose Project. Under the terms of the agreement with Wheaton, B2Gold paid a total purchase price of $46 million to retire 33% of the existing gold stream.
Fekola Complex - Fekola Mine and Fekola Regional Development
The Fekola Complex is comprised of the Fekola Mine (Medinandi permit hosting the Fekola and Cardinal pits and Fekola underground) and Fekola Regional (Anaconda Area (Bantako, Menankoto and Bakolobi permits) and the Dandoko permit).
Based on B2Gold's preliminary planning, the Anaconda Area could provide selective higher grade saprolite material (average annual grade of up to 2.2 g/t gold) to be trucked approximately 20 km and fed into the Fekola mill at a rate of up to 1.5 million tonnes per annum. Trucking of selective higher grade saprolite material from the Anaconda Area to the Fekola mill will increase the ore processed and has the potential to generate approximately 80,000 to 100,000 ounces of gold production per year from Fekola Regional sources. Receipt of a mining permit for the Fekola Regional licenses remains outstanding pending finalization of an implementation decree for the new 2023 Mining Code by the State of Mali. No production is forecast from Fekola Regional in the Company's 2024 guidance, with production now expected to commence at the beginning of 2025. If an exploitation license for Fekola Regional is received in the first half of 2024, there is potential for 2024 Fekola Complex production to be supplemented with up to 18,000 ounces of higher-grade ore from Fekola Regional. In addition, if the Company is successful in discovering additional sulphide ore across the Fekola Complex, the trucking of oxide ore from Fekola Regional to the Fekola mill may be able to be extended. B2Gold recently held meetings with the representatives of the Government of Mali regarding the 2023 Mining Code. The Government of Mali assisted the Company in clarifying the application of the 2023 Mining Code to existing and future projects in Mali, and also expressed their desire for B2Gold to rapidly progress the development of Fekola Regional and committed to assisting the Company in such development.
For the fourth quarter of 2023 and the year ended December 31, 2023, the Company invested $10 million and $56 million, respectively, in the development of Fekola Regional (Anaconda Area) saprolite mining including road construction, mine infrastructure, and mining equipment. For 2023, the Company had budgeted a total of $63 million for Fekola Regional development. The haul road from Bantako North to Fekola is complete and construction of the mining infrastructure (warehouse, workshop, fuel depot, and offices) is on schedule and will be completed in the first quarter of 2024.
Gramalote Project - Colombia
On September 14, 2023, the Company entered into a purchase agreement with AngloGold to acquire AngloGold’s 50% stake in the Gramalote Project. Upon completion of the Gramalote Transaction, which occurred on October 5, 2023, B2Gold now owns 100% of the Gramalote Project.
Under the terms of the Gramalote Transaction, the purchase price will be paid in cash and consist of the following payments to AngloGold based on, and contingent upon, certain milestones:
•$20 million was paid upon closing of the Gramalote Transaction;
•$10 million upon B2Gold announcing a construction decision at the Gramalote Project;
•$10 million upon commercial production at the Gramalote Project, contingent on commercial production beginning within five years of closing of the Gramalote Transaction. If commercial production does not commence within five years of closing of the Gramalote Transaction, this payment will not be made;
•$10 million on the first anniversary of commercial production at the Gramalote Project; and
•$10 million on the second anniversary of commercial production at the Gramalote Project.
The acquisition of the remaining 50% of the Gramalote Project immediately adds to B2Gold’s consolidated Mineral Resource base and significantly increases the Company’s exposure to the upside from the potential development of the Gramalote Project, while still providing ongoing exposure to AngloGold through the contingent payments, which make up the majority of the purchase price. The Gramalote Transaction is in line with B2Gold’s strategy of executing on accretive opportunities, increasing Mineral Reserves and Resources and continuing to advance development projects.
The acquisition of AngloGold's 50% share of the Gramalote Project was considered to be an impairment indicator for the Company's existing 50% of the Gramalote Project under IFRS 6, Exploration and evaluation of mineral resources, for the year ended December 31, 2023, resulting in an impairment charge of $112 million.
The Gramalote Transaction now consolidates the Gramalote Project under one owner, providing additional optionality to analyze lower capital intensity, higher-return development opportunities for the Gramalote Project. Historically, the Gramalote Project has been advanced under a joint venture between B2Gold and AngloGold, which has led to analyzing the project on a larger scale basis to provide meaningful production growth to both companies. Under a single owner, different development opportunities will be assessed with the goal of delineating a project that maximizes the return for B2Gold as sole owner of the Gramalote Project.
B2Gold's in-house projects team has commenced work on various smaller scale project development plans for the Gramalote Project, with the goal of identifying a higher-return project than the previously contemplated joint venture development plan. Based on the results of the 2022 Gramalote feasibility study, the contemplated larger scale project did not meet the combined investment return thresholds for development by both B2Gold and AngloGold. B2Gold conducted a detailed review of the Gramalote Project, including the facility size and location, power supply, mining and processing options, tailings design, resettlement, potential construction sequencing and camp design to identify potential cost savings to develop a smaller scale project. The results of the review allowed the Company to determine the optimal parameters and assumptions for a formal study, which commenced in the fourth quarter of 2023, with the goal of completing an initial preliminary economic assessment by the end of the second quarter of 2024.
Capital expenditures in 2024 at Gramalote are expected to be relatively stable throughout the year, totaling $13 million related to project study costs and ongoing care and maintenance.
LIQUIDITY AND CAPITAL RESOURCES
B2Gold continues to maintain a strong financial position and liquidity. At December 31, 2023, the Company had cash and cash equivalents of $307 million compared to cash and cash equivalents of $652 million at December 31, 2022. Working capital (defined as current assets less current liabilities) at December 31, 2023 was $397 million compared to $802 million at December 31, 2022. During the year ended December 31, 2023, the Company drew down $150 million on the RCF with $550 million remaining available for future draw downs.
In January 2024, to further enhance the financial flexibility of the Company and provide additional cash liquidity at attractive terms as the Company continues to fund sustaining, development and growth projects across the operating portfolio, and increase financial capacity for potential growth projects in Namibia and Colombia, B2Gold has entered into a Gold Prepay with a number of its existing lenders. The Company received an upfront payment of $500 million, based on gold forward curve prices averaging approximately $2,191 per ounce, in exchange for equal monthly deliveries of gold from July 2025 to June 2026 totaling 264,775 ounces, representing approximately 10% of expected annual gold production in each of 2025 and 2026 (subject to finalization of production guidance for 2025 and 2026). Gold deliveries can be from production from any of the Company’s operating mines and the Gold Prepay can be settled prior to maturity through accelerated delivery of the remaining deliverable gold ounces. The Gold Prepay was executed by Bank of Montreal, Canadian Imperial Bank of Commerce, ING Capital Markets LLC, and National Bank of Canada. Subsequent to December 31, 2023, the Company utilized a portion of the proceeds from the $500 million Gold Prepay completed in January 2024 to repay the $150 million balance drawn on the RCF, leaving the full amount of $700 million available for future draw downs.
The Company's RCF is with a syndicate of international banks for an aggregate amount of $700 million. The RCF also allows for an accordion feature whereby upon receipt of additional binding commitments, the facility may be increased to $800 million any time prior to the maturity date of December 16, 2025. In July 2023, the RCF was increased from $600 million to $700 million under the accordion feature with the addition of the National Bank of Canada. The RCF bears interest on a sliding scale of between the Secured Overnight Financing Rate (“SOFR”) plus a term credit spread adjustment in addition to the existing sliding scale premium of between 2.00% to 2.50%. Commitment fees for the undrawn portion of the facility are also on a sliding scale basis of between 0.45% and 0.563%. As of December 31, 2023, the borrowing rate under the RCF was 7.68%. The Company has provided security on the RCF in the form of a general security interest over the Company’s assets and pledges creating a charge over the shares of certain of the Company’s direct and indirect subsidiaries. In connection with the RCF, the Company must also maintain certain ratios for leverage and interest coverage. As at December 31, 2023, the Company was in compliance with these debt covenants.
As part of the acquisition of Sabina, the Company acquired a $125 million gold stream arrangement with Wheaton. The $125 million upfront payment (the “Deposit”) was funded in 4 installments, of which all were received prior to the acquisition. In return, B2Gold was obligated to deliver 4.15% of the gold production from the Goose Project, reducing to 2.15% and 1.5% after the delivery of 130,000 and 200,000 ounces, respectively. Wheaton was obligated to pay B2Gold a purchase price for each ounce of refined gold metal equal to:
•During a deposit period, i.e. any period during which the Deposit is greater than nil, 18% of the p.m. LBMA Gold Price. The difference between the LBMA gold price and such purchase price being payable is deducted against the Deposit until it has been reduced to nil.
•During a non-deposit period, 22% of the p.m. LBMA Gold Price.
Upon the completion of a change of control event, B2Gold exercised its one-time option to buy back 33% of the gold stream (the “Buy-back Option”). On April 20 2023, the Buy-back Option was exercised at a purchase price of $46 million. As a result of the exercise of the Buy-back Option, the quantity of gold deliverable to Wheaton under the gold stream is reduced by 33%. After execution of the Buy-back Option, the Deposit amount was reduced by 33% to $84 million. Further, the delivery obligation is also reduced by the same proportion as follows:
•2.7805% of gold production up to delivery of 87,100 oz;
•1.4405% of gold production up to an aggregate of 134,000 oz; and
•1.005% of gold production thereafter.
The Company has guaranteed the remaining portion of the gold stream obligation.
For the year ended December 31, 2023, capital expenditures totalled $811 million. The most significant expenditures were Fekola Mine expenditures of $299 million, Masbate Mine expenditures of $30 million, Otjikoto Mine expenditures of $61 million, the Goose Project expenditures of $282 million, Fekola Regional pre-development expenditures of $56 million and Gramalote Project expenditures of $6 million (refer to “Review of Mining Operations and Development Projects" section for additional details of capital expenditures). Exploration costs for the year ended December 31, 2023 totalled $76 million. In addition, for the year ended December 31, 2023, the Company made strategic investments in Snowline Gold Corp. totalling $33 million for 14 million shares (a 9.9% equity interest), acquired $38 million in cash as part of the acquisition of Sabina, paid $7 million in cash for transaction fees for the acquisition of Sabina, paid $20 million to acquire the additional 50% interest in the Gramalote Project, received $4 million deferred consideration in connection with the sale of the Ondundu Project in 2022 and incurred $7 million in acquisition costs for the purchase of the non-controlling interest in the Menankoto exploration permit.
As at December 31, 2023, and in addition to those commitments disclosed elsewhere in this MD&A, the Company had the following commitments:
•For payments of $40 million for underground development, $11 million for mobile equipment, $9 million related to the solar plant expansion, $2 million related to plant and powerhouse maintenance, $1 million related to mobile equipment rebuilds, $1 million for the tailings storage facility expansion and $5 million for other capital projects at the Fekola Mine, all of which is expected to be incurred in 2024.
•For payments of $51 million for construction activities at the Goose Project, all of which is expected to be incurred in 2024.
•For payments of $2 million for mobile equipment for Fekola Regional pre-development, all of which is expected to be incurred in 2024.
•For payments of $5 million for mobile equipment at the Masbate Mine, all of which is expected to be incurred in 2024.
For 2024, the Company has budgeted total capital expenditures of $309 million at the Fekola Complex, $49 million at the Masbate Mine, $33 million at the Otjikoto Mine, $333 million at the Goose Project and $13 million at the Gramalote Project. The Company’s total 2024 exploration budget is approximately $63 million.
As at December 31, 2023, the Company’s significant commitments are disclosed in the table below:
| 2024 | 2025 | 2026 | 2027 | 2028 | Post 2028 | Total | |
|---|---|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | $ | $ | |
| (000's) | (000's) | (000's) | (000's) | (000's) | (000's) | (000's) | |
| Accounts payable and accrued liabilities | 167,117 | — | — | — | — | — | 167,117 |
| RCF: | |||||||
| Principal | — | 150,000 | — | — | — | — | 150,000 |
| Interest & commitment fees (estimated) | 13,487 | 12,925 | — | — | — | — | 26,412 |
| Fekola equipment loan facilities: | |||||||
| Principal | 8,093 | 5,973 | — | — | — | — | 14,066 |
| Interest (estimated) | 569 | 154 | — | — | — | — | 723 |
| Goose Project equipment loan facility: | |||||||
| Principal | 3,225 | 2,878 | 673 | — | — | — | 6,776 |
| Interest (estimated) | 253 | 140 | 35 | — | — | — | 428 |
| Lease liabilities | |||||||
| Principal | 5,190 | 4,331 | 3,507 | 2,404 | 2,439 | 10,968 | 28,839 |
| Capital expenditure commitments | 126,381 | — | — | — | — | — | 126,381 |
| Mine restoration provisions | 3,123 | — | 2,634 | 1,963 | — | 121,879 | 129,599 |
| Employee benefits obligation | 3,789 | 2,969 | 1,488 | 428 | 10,295 | 8,004 | 26,973 |
| Other liabilities | 1,000 | 4,455 | 1,148 | — | 5,436 | 7,866 | 19,905 |
| 332,227 | 183,825 | 9,485 | 4,795 | 18,170 | 148,717 | 697,219 |
The Company accrues mine restoration provisions over the life of its mining operations and amounts shown are estimated expenditures in the indicated years at their undiscounted values.
The Company believes that its future cash flows from operations along with the undrawn and available balances on its current facilities will allow it to meet its current obligations as they come due.
Derivative financial instruments
Fuel contracts – fuel oil, gas oil, diesel
The Company uses forward contracts for fuel oil, gas oil and diesel to manage the risk of volatility in the Company's future operating costs. The Company reviews the open positions and the potential for additional forward contracts on an ongoing basis. During the year ended December 31, 2023, the Company entered into additional series of forward contracts for the purchase of 15,931,000 litres of fuel oil and 20,412,000 litres of gas oil with scheduled settlement between August 2023 and July 2024. These derivative instruments were not designated as hedges by the Company and are being recorded at their fair value at the end of each reporting period with changes in fair value recorded in the Consolidated Statement of Operations.
The following is a summary, by maturity dates, of the Company’s fuel derivative contracts outstanding as at December 31, 2023:
| 2024 | ||
|---|---|---|
| Forward – fuel oil: | ||
| Litres (thousands) | 9,187 | |
| Average strike price | $ | 0.40 |
| Forward – gas oil: | ||
| Litres (thousands) | 2,501 | |
| Average strike price | $ | 0.54 |
The unrealized fair value of these contracts at December 31, 2023 was $1 million.
Operating activities
Cash flow provided by operating activities was $714 million for the year ended December 31, 2023 compared to $596 million during 2022, an increase of $118 million. The increase reflects higher revenues of $202 million and lower non-cash working capital outflows for the year ended December 31, 2023, partially offset by higher long-term value added tax receivable outflows of $27 million, higher long-term inventory outflows of $19 million, lower realized gains on fuel derivatives of $20 million. During the year ended December 31, 2023 the Company paid $239 million (2022 - $239 million) of current income tax, withholding and other taxes in cash, including $54 million related to 2022 outstanding tax liability obligations. Based on current assumptions, including an average gold price of $1,800 per ounce for 2024, the Company is forecasting to make total cash income tax payments for current income tax, withholding and other taxes in 2024 of approximately $187 million.
Financing activities
The Company’s cash used by financing activities for the year ended December 31, 2023 was a net outflow of $193 million. For the year ended December 31, 2023, drew down $150 million on the RCF, the Company extinguished certain construction obligations acquired as part of the Sabina acquisition in the amount of $112 million, the Company made equipment loan facility repayments of $13 million, made principal payments on lease arrangements of $6 million, received proceeds from the exercise of stock options of $13 million, made interest and commitment fees payments of $5 million and made distributions to non-controlling interests of $34 million. In addition, total dividends of $187 million were paid to shareholders for the year ended December 31, 2023 at $0.04 per share on a quarterly basis ($0.16 per share on an annualized basis).
On February 22, 2023, June 5, 2023, September 5, 2023 and November 22, 2023, B2Gold’s Board declared a cash dividend for the first, second, third and fourth quarter of 2023, respectively, of $0.04 per common share (or $0.16 per share on an annualized basis), paid on March 17, 2023, June 27, 2023, September 29, 2023 and December 18, 2023, respectively. The declaration and payment of future quarterly dividends remains at the discretion of the Board and will depend on the Company's financial results, cash requirements, future prospects and other factors deemed relevant by the Board.
In 2023, the Company implemented a DRIP. The DRIP provides B2Gold shareholders residing in Canada and the United States with the opportunity to have the cash dividends declared on all or some of their common shares automatically reinvested into additional common shares of the Company (the “Reinvestment Shares”) on an ongoing basis. Participation in the DRIP is optional and will not affect shareholders’ cash dividends unless they elect to participate in the DRIP. Dividends are only payable as and when declared by the Company’s Board of Directors. The benefits of enrolling in the DRIP include the convenience of automatic reinvestment of dividends into Reinvestment Shares; flexibility to enroll some or all common shares in the DRIP; and ability to acquire Reinvestment Shares without paying any brokerage fees. Participants in the DRIP will acquire Reinvestment Shares issued from the Company’s treasury (a “Treasury Purchase”) at a price equal to the volume weighted average price of the Company’s common shares on the Toronto Stock Exchange for the five consecutive trading days immediately preceding a dividend payment date, subject to a possible discount, in the Company’s sole discretion, of up to 5%. For the dividend declared on September 5, 2023 and November 24, 2023, a discount of 3% was offered.
B2Gold expects to declare future quarterly dividends in 2024 at the same rate of $0.04 per common share ($0.16 per share on an annualized basis). This dividend is designated as an "eligible dividend" for the purposes of the Income Tax Act (Canada). Dividends paid by B2Gold to shareholders outside Canada (non-resident investors) will be subject to Canadian non-resident withholding taxes.
The declaration and payment of future dividends and the amount of any such dividends will be subject to the determination of the Board, in its sole and absolute discretion, taking into account, among other things, economic conditions, business performance, financial condition, growth plans, expected capital requirements, compliance with the Company's constating documents, all applicable laws, including the rules and policies of any applicable stock exchange, as well as any contractual restrictions on such dividends, including any agreements entered into with lenders to the Company, and any other factors that the Board deems appropriate at the relevant time. There can be no assurance that any dividends will be paid at the intended rate or at all in the future.
Investing activities
For the year ended December 31, 2023, capital expenditures totalled $811 million. The most significant expenditures were Fekola Mine expenditures of $299 million, Masbate Mine expenditures of $30 million, Otjikoto Mine expenditures of $61 million, Goose Project expenditures of $282 million, Fekola Regional pre-development expenditures of $56 million and Gramalote Project expenditures of $6 million (refer to “Review of Mining Operations and Development Projects" section for additional details of capital expenditures). Exploration costs for the year ended December 31, 2023 totalled $76 million. In addition, for the year ended December 31, 2023, the Company made strategic investments in Snowline totalling $33 million for 14 million shares (a 9.9% equity interest), acquired $38 million in cash as part of the acquisition of Sabina, paid $7 million in cash for transaction fees for the acquisition of Sabina, paid $20 million to acquire the additional 50% interest in the Gramalote Project, received $4 million deferred consideration in connection with the sale of the Ondundu Project in 2022 and incurred $7 million in acquisition costs for the purchase of the non-controlling interest in the Menankoto exploration permit.
Exploration
Resource property expenditures on exploration are disclosed in the table below:
| For the three months ended December 31, 2023 | For the three months ended December 31, 2022 | For the year ended December 31, 2023 | For the year ended December 31, 2022 | |
|---|---|---|---|---|
| $ | $ | $ | $ | |
| (000’s) | (000’s) | (000’s) | (000’s) | |
| Fekola Mine, exploration | 2,022 | 1,366 | 3,728 | 15,214 |
| Masbate Mine, exploration | 1,067 | 1,648 | 3,808 | 4,759 |
| Otjikoto Mine, exploration | 1,410 | 1,201 | 3,863 | 3,476 |
| Menankoto Property, exploration | 862 | 3,437 | 12,262 | 8,166 |
| Bantako North Property, exploration | 832 | 1,874 | 9,523 | 8,608 |
| Bakolobi Property, exploration | 1,007 | 1,491 | 8,665 | 2,031 |
| Dandoko Property, exploration | 350 | 829 | 6,097 | 896 |
| Goose Project, exploration | 6,395 | — | 10,595 | — |
| George Property, exploration | 468 | — | 5,131 | — |
| Finland Properties, exploration | 2,019 | 3,398 | 7,181 | 9,962 |
| Uzbekistan Properties, exploration | — | 1,379 | 1,089 | 4,072 |
| Other | 1,260 | 1,501 | 4,063 | 6,445 |
| 17,692 | 18,124 | 76,005 | 63,629 |
B2Gold executed another year of aggressive exploration in 2023 incurring $78 million (including $2 million of target generation costs included in other operating expenses in the Consolidated Statement of Operations) compared to a revised budget of approximately $84 million (original budget of $64 million). Exploration in 2023 was focused predominantly in Mali, other operating mine sites in Namibia and the Philippines, both infill and generative exploration at the recently acquired Back River Gold District, as well as continued focus on grassroots targets around the world.
B2Gold is planning another year of extensive exploration in 2024 with a budget of approximately $63 million. A significant focus will be exploration at the Back River Gold District, with the goal of enhancing and growing the significant resource base at the Goose Project and surrounding regional targets. In Namibia, the exploration program at the Otjikoto Mine will be the largest program since 2012. In Mali, the exploration program will be a more strategic search for near-mine, near-surface sources of additional sulphide-related gold mineralization. In the Philippines, the exploration program at Masbate will focus on converting inferred mineral resource areas and expanding the existing open pits. Early stage exploration programs will continue in Finland, the Philippines and Cote d’Ivoire in 2024. Finally, the search for new joint ventures and strategic investment opportunities will continue, building on existing equity investments in Snowline Gold Corp. and Matador Mining Ltd.
Goose Project Exploration
In the second quarter of 2023, a significant exploration program was approved at the Back River Gold District for 2023. B2Gold approved a $20 million exploration budget for the balance of 2023 to complete approximately 27,000 metres of drilling focused in proximity to existing deposits at the Goose Project, as well as following up on regional targets identified at the George, Boulder, Boot and Del projects. For the year ended December 31, 2023, the Company ultimately incurred $16 million on Back River Gold District exploration.
Drilling at the Goose Project began in early August 2023 with two drill rigs, testing the Llama deposit down-plunge for mineral resource confirmation and mineral resource expansion, and testing regional targets that were developed based on structural modelling and geophysical re-processing. The objective for drilling at the George Project was to test several targets over a strike length of 10 km.
As at December 31, 2023, 22,840 metres of drilling was completed over 65 drill holes, with 5 drill rigs. The objectives for the drilling program at the Goose Project included:
a.Select drill holes for a reagent optimization metallurgic sample (3 drill holes have now been completed for this);
b.Test the Umwelt and Llama deposits down-plunge for resource confirmation and resource expansion; and
c.Test regional targets at the Goose Project that were developed based on structural modeling and geophysical re-processing.
At the George Project, located 50 km northwest of the Goose Project, a 2023 spring and summer drill program tested multiple targets along a 10 km strike length to evaluate mineralization controls and upside potential with 6,010 m drilled over 26 drill holes. The George Project represents three sub-parallel zones of tightly folded banded iron formation that stretch over 20 km in strike length. Drill results from the 2023 campaign reflect similar widths and grades as those reported by previous operators, with several holes from the 2023 program extending mineralization along strike and between known zones of mineral resources.
2024 Guidance for Canada
A total of $28 million is budgeted for exploration at the Back River Gold District in 2024. A total of 25,000 metres of drilling will target extensions of the Llama and Umwelt deposits, the largest and highest grade resources at the Goose Project. In addition to drilling, deep-imaging geophysical methods are planned in order to improve the Company’s ability to target new underground resources in areas such as Nuvuyak, Goose Neck and Kogoyak. Regional exploration including geophysics, mapping, and potentially, limited drilling will be undertaken on the George, Boot, Boulder and Del projects.
Mali Exploration
In 2023, a total of approximately $35 million was budgeted for exploration in Mali with an ongoing focus on the Anaconda Area (Bantako, Menankoto and Bakolobi permits). In addition, the extensions of known prospective structures in the Anaconda Area and on the Fekola Mine were also being targeted in the area between them on the relatively under explored Bakolobi permit. The Dandoko permit located to the east of Fekola was also a focus for exploration. A total of 151,132 metres of diamond, reverse circulation, aircore and auger drilling has been completed in the during the year ended December 31, 2023. For the year ended December 31, 2023, the Company ultimately incurred $40 million.
In the Anaconda Area, drilling was directed at increasing the existing saprolite Indicated Mineral Resource and expanding the Inferred Mineral Resource. An updated Mineral Resource Estimate for the Anaconda Area was released in June 2023. The Company announced an updated Mineral Resource estimate for the Anaconda Area, located approximately 20 km from the Fekola Mine in Mali. The June 2023 Mineral Resource estimate included a significantly increased Mineral Resource estimate for the Anaconda Area, comprised of the Menankoto, Bantako North and Bakolobi permits. The updated Mineral Resource estimate includes a significant increase in the laterite, saprolite and saprock (collectively “oxide”) Mineral Resources, and an initial sulphide Indicated Mineral Resource estimate. The June 2023 Mineral Resource estimate includes Indicated Mineral Resource estimate of 57,000,000 tonnes at 1.11 g/t gold for 2,030,000 ounces of gold, and Inferred Mineral Resource estimate of 46,600,000 tonnes at 1.33 g/t gold for 2,000,000 ounces of gold, constrained within a conceptual pit run at $1,800 per ounce gold.
Since the completion of a significant update to the Anaconda Area Mineral Resource estimate in June 2023, drilling in the Mamba Zone has shifted to exploration for additional shallow sulphide targets, that may be amenable to open pit development.
The mineralized structures identified at the Fekola Mine track northward onto the Anaconda Area. These include the Cobra Zone that has been a significant contributor to the total oxide Mineral Resource estimate in the Anaconda Area and continues to generate significant intervals of both oxide- and sulphide-hosted mineralization. The southernmost portion of Cobra comprises a separate geological structure, which is currently being explored as the Taipan Zone. Recent drilling on the Cobra and Taipan Zones have returned encouraging intervals of oxide and sulphide mineralization, with Taipan also returning particularly strong sulphide intercepts. In 2023, 106,866 metres have been drilled on the Mamba, Cobra and Taipan Zones.
Another north trending structure parallel to and approximately 25 km east of the Fekola structure was drilled on the Dandoko permit. The mineral resources are distributed across the Seko, Koko, Disse and Diabarou deposits.
In addition, $2 million was included in the Mali exploration budget to pursue multiple grassroots targets on other permits held in West Mali.
2024 Guidance for Mali
A total of $10 million is budgeted for exploration in Mali in 2024 with an ongoing focus on discovery of additional high-grade, sulphide mineralization across the Fekola Complex to supplement feed to the Fekola mill. A total of 20,000 metres of diamond and reverse circulation drilling is planned for Mali in 2024.
The Philippines Exploration
The Masbate exploration budget for 2023 was $6 million, of which the Masbate exploration budget was $4 million, including approximately 8,000 metres of drilling. The 2023 exploration program focused on converting inferred mineral resource areas below existing design pits, to support expanding the existing open pits. Several grassroot greenfield targets were also tested. For the year ended December 31, 2023, the Company incurred $4 million for Masbate Mine exploration, which was in-line with the budget (included approximately 7,773 metres of diamond and reverse circulation drilling in 33 holes).
Approximately $1 million was applied to targeting new regional projects in highly prospective areas in the Philippines, leveraging off B2Gold's presence and operational experience in the country. A wholly-owned subsidiary of B2Gold has been incorporated in the Philippines and a team marshalled to pursue these opportunities
2024 Guidance for the Philippines
The total budget for the Philippines in 2024 is approximately $6 million, of which the Masbate exploration budget is $4 million, including approximately 7,000 metres of drilling. The 2024 exploration program will continue to focus on converting inferred mineral resource areas below existing design pits, to support expanding the existing open pits. Several grassroots greenfield targets will be further tested as well.
An additional $2 million will be allocated to targeting new regional projects in highly prospective areas in the Philippines, leveraging off B2Gold’s presence and operational experience in the country. A total of 4,000 metres is allocated to testing new projects.
Namibia Exploration
The total exploration budget for Namibia in 2023 was approximately $3 million. For the year ended December 31, 2023, the Company incurred $4 million which included 2,058 metres of diamond drilling and 1,695 metres of RAB drilling at the Otjikoto mine area. Diamond drilling targeted the extension of the Otjikoto structure several kilometres south of the Otjikoto open pit. This zone has been designated the Antelope Zone, where grades and widths of mineralization potentially amenable to underground mining have been identified over 800 metres of strike. Drilling is also underway on several other regional targets in proximity to the Otjikoto mine infrastructure.
2024 Guidance for Namibia
A total of $9 million is budgeted for exploration at Otjikoto in 2024, the largest program since the definition of the Wolfshag discovery in 2012. The focus of the exploration program will be drilling the recently discovered Antelope zone, located approximately 3 km south of Phase 5 of the Otjikoto open pit, with a total of 39,000 metres of drilling planned.
Greenfield Exploration
B2Gold had allocated approximately $24 million (including $3 million for the grassroots projects in Mali and the Philippines) in 2023 for its grassroots exploration programs, including Finland, Cote d’Ivoire, Uzbekistan and several new regions. This included a budget allocation for target generation and pursuing new opportunities in prospective gold regions of Africa, South America, the Philippines, Central Asia and Canada. The actual spend on greenfield exploration for the year ended December 31, 2023 was approximately $15 million.
In Finland, the Company spent $7 million on the Central Lapland Joint Venture with Aurion Resources Ltd. Drilling to continue on the Helmi trend, which is the westward extension of Rupert Resources' Ikkari discovery. This trend coincides with B2Gold's base-
of-till drilling and appears to be hosted by the same structure as Ikkari, based on the interpretation of airborne geophysical data. In addition, other regional targets already identified with base of till sampling, coincident with structures identified in airborne geophysical data, was drill tested. A total of 11,600 metres of diamond drilling was planned for Finland. A total of 13,319 metres of diamond drilling for 64 holes has been completed in Finland for 2023.
In Cote d'Ivoire, the Company spent $2 million for ongoing exploration. The 2023 program included follow up work on positive soil geochemical anomalies defined in 2022 on the wholly owned Guiberoua and Soubre properties in southwest Cote d’Ivoire. A total 6,000 metres of diamond and reverse circulation drilling and 14,000 metres of aircore and auger drilling was planned.
In addition to the defined programs noted above, the Company spent approximately $5 million on the generation of other new greenfield targets.
2024 Guidance for Greenfields Exploration
B2Gold has allocated approximately $13 million (including $2 million for the grassroots projects in the Philippines) in 2024 for its grassroots exploration programs, including Finland and Cote d’Ivoire.
In Finland, the Company has allocated $4 million to fund its 70% contribution to the Central Lapland Joint Venture with Aurion Resources Ltd. A total of 9,700 metres of diamond drilling will test targets defined during an extensive prospectivity analysis completed in 2023.
A budget of approximately $3 million has been allocated by the Company for ongoing exploration in Cote d’Ivoire. A total of 17,000 metres of diamond, reverse circulation and reconnaissance auger drilling is planned in 2024.
In addition to the defined programs noted above, the Company has allocated approximately $4 million for the generation and evaluation of new greenfields targets.
CRITICAL ACCOUNTING ESTIMATES
Full disclosure of the Company’s accounting policies and significant accounting judgments and estimation uncertainties in accordance with IFRS can be found in Notes 4 and 5 of its audited consolidated financial statements for the year ended December 31, 2023. Management considers the following estimates to be the most critical in understanding the judgements involved in preparing the Company’s consolidated financial statements and the uncertainties that could impact its results of operations, financial condition and cash flows:
Mineral reserve and resource estimates
Mineral reserves are estimates of the amount of ore that can be economically and legally extracted from the Company’s mining properties. The Company estimates its mineral reserves and mineral resources based on information compiled by appropriately qualified persons relating to the geological data on the size, depth and shape of the ore body, and requires complex geological assessments to interpret the data. The estimation of recoverable mineral reserves is based upon factors such as estimates of foreign exchange rates, commodity prices, future capital requirements, metallurgical recoveries, permitting and production costs along with geological assumptions made in estimating the size, and grade of the ore body. Changes in the mineral reserve or mineral resource estimates may impact the carrying value of mining interests, gold stream obligation, mine restoration provisions, recognition of deferred tax assets, depreciation and amortization charges and royalties receivable.
Assessment of impairment and reversal of impairment indicators for long-lived assets
The Company applies significant judgement in assessing whether there are indicators of impairment or impairment reversal present that give rise to the requirement to conduct an impairment test. Internal and external factors such as significant changes in the use of the asset, legal and permitting factors, future gold prices, operating and capital cost forecasts, quantities of mineral reserves and resources, and movements in market interest rates are used by management in determining whether there are any indicators.
During the year, the Company identified indicators of impairment on the Fekola Complex CGU, consisting of the Fekola Mine and Fekola Regional Properties, as well as the Gramalote Project. As a result, these assets were tested for impairment.
Impairment of long-lived assets
Long-lived assets are tested for impairment, or reversal of a previous impairment, if there is an indicator of impairment or a subsequent reversal. Calculating the estimated recoverable amount of cash-generating units for long-lived asset requires management to make estimates and assumptions that include such factors as mineable mineralization including reserves and resources, future production levels, operating and capital costs, application of royalty, income tax and mining tax rates, future metal prices and discount rates. The Company also assesses whether stability provisions under its 2012 Mali Mining Convention continue to apply to its exploration and exploitation permits. Changes in any of these assumptions or estimates used in determining the recoverable amount could impact the analysis. Such changes could be material.
Fekola Complex cash-generating unit
During the year ended December 31, 2023, the State of Mali introduced a new mining code (the “2023 Mining Code”). In conjunction with the implementation of the 2023 Mining Code and the associated impact to the costs of the Fekola Complex, consisting of the Fekola Mine and the Fekola Regional Properties, the Company completed an update of its Fekola and Fekola Regional Properties life-of-mine estimates. This update included revisions to the mine plan and expected saprolite mill feed from the Fekola Regional Properties, along with updates to related operating and capital cost estimates. The update included the Company’s best current estimate of the final fiscal terms of the 2023 Mining Code, which remains subject to ongoing negotiations with the State of Mali. The final fiscal terms of the 2023 Mining Code remain subject to change and could result in a variation from the estimates used to determine the recoverable amount of the Fekola Complex. Clarification of the final application of the 2023 Mining Code remains subject to ongoing negotiations with the State of Mali, followed by the anticipated issuance of a final implementation decree. Collectively, these changes are considered to be indicators of impairment for the Fekola Complex assets.
As a result, the Company has performed an impairment assessment on the Fekola Complex cash-generating unit (“CGU”). The carrying value of the CGU was compared to the CGU’s recoverable amount which was determined to be its fair value less costs of disposal ("FVLCD"). To estimate the recoverable amount of the CGU for impairment, the Company utilized a discounted cash flow model incorporating significant assumptions that included such factors as mineable mineralization including reserves and resources, future production levels, operating and capital costs, a long-term gold price of $1,800 per ounce, and a discount rate of 6.25% for the Fekola Mine and 7% for the Fekola Regional Properties. The Company’s estimate of future cash flows is subject to risks and uncertainties and therefore could change in the future if the underlying assumptions change.
The Company’s analysis concluded that the Fekola Complex CGU was impaired. An impairment charge of $206 million was recorded in the Consolidated Statement of Operations for the year ended December 31, 2023. A net impairment charge of $192 million after taking into account a deferred income tax recovery of $14 million was recorded in the Consolidated Statement of Operations for the year ended December 31, 2023.
The recoverable amount of the Fekola Complex CGU is most sensitive to changes in the gold price and discount rate. In isolation, a $50 per ounce decrease in the gold price would result in a reduction in the recoverable amount of approximately $174 million. In isolation, a 25 basis point increase in the discount rate would result in a reduction in the recoverable amount of the Fekola Complex CGU of approximately $20 million.
Gramalote Project cash-generating unit
On October 5, 2023, the Company completed the acquisition of the remaining 50% of the net assets of the Gramalote Project from its joint venture partner AngloGold. The acquisition of the AngloGold's 50% share of the Gramalote Project was considered to be an impairment indicator for the Company's existing 50% interest in the Gramalote Project under IFRS 6, Exploration and evaluation of mineral resources, for the year ended December 31, 2023. The recoverable value of $26 million allocated to the Company's existing 50% share of the Gramalote Project resulted in a net impairment charge of $112 million recorded in the Consolidated Statement of Operations.
The purchase price consists of the following cash payments to AngloGold contingent on certain milestones:
•$20 million paid upon closing of the transaction;
•$10 million to be paid upon B2Gold announcing a construction decision at the Gramalote Project;
•$10 million to be paid upon commercial production at the Gramalote Project, contingent on commercial production beginning within five years of closing;
•$10 million to be paid on the first anniversary of commercial production at the Gramalote Project; and
•$10 million to be paid on the second anniversary of commercial production at the Gramalote Project.
The total purchase price of $35 million, including an estimate for the future contingent payments, has been determined using the expected value approach in accordance with IFRS 13, Fair value measurements. Future contingent payments are recognized as a liability at amortized cost. The expected value approach develops a set of probability-based outcomes for the payment of contingent consideration discounted based on market participant assumptions to determine the fair value. The assumptions used in the valuation included the timing and probability of contingent payments and the discount rate. The fair value of the contingent consideration was estimated to be $14 million. The total purchase price was allocated to the net identifiable assets and liabilities acquired, including the mineral interests, working capital, VAT receivables and reclamation liabilities. The value of the 50% Gramalote Project mineral interests was determined to be $26 million.
Value-added tax receivables
The Company incurs indirect taxes, including value-added tax, on purchases of goods and services at its operating mines and development projects. Indirect tax balances are recorded at their estimated recoverable amounts within current or long-term assets, net of provisions, and reflect the Company’s best estimate of their recoverability under existing tax rules in the respective jurisdictions in which they arise. Management’s assessment of recoverability considers the probable outcomes of claimed
deductions and/or disputes. The provisions and balance sheet classifications made to date may be subject to change and such change may be material.
Value-added tax receivables includes amounts for the Fekola Mine of $137 million (2022 - $77 million), for the Masbate Mine of $45 million (2022 – $37 million), and for the Gramalote Project of $18 million (2022 - $7 million).
Uncertain tax positions
The Company’s operations involve the application of complex tax regulations in multiple international jurisdictions. Determining the tax treatment of a transaction requires the Company to apply judgement in its interpretation of the applicable tax law. These positions are not final until accepted by the relevant tax authority. The tax treatment may change based on the result of assessments or audits by the tax authorities often years after the initial filing.
The Company recognizes and records potential liabilities for uncertain tax positions based on its assessment of the amount, or range of amounts, of tax that will be due. The Company adjusts these accruals as new information becomes available. Due to the complexity and uncertainty associated with certain tax treatments, the ultimate resolution could result in a payment that is materially different from the Company’s current estimate of the tax liabilities.
Fekola Tax Audits
The Company's subsidiary, Fekola SA, received a Notice for Reassessment dated September 6, 2022, from the Malian Directorate General of Taxes (“DGT”) asserting proposed adjustments and other tax liabilities amounting to $27 million excluding penalties, $46 million including penalties, (based on the December 31, 2023 exchange rate of CFA 594 to $1) arising from tax audits conducted for fiscal years 2016-2018. Fekola SA filed a contentious claim, dated November 3, 2022, outlining its objections to the reassessment in accordance with the Mali Income Tax Act. At December 31, 2023, the Company has recorded a total provision of $10 million (net provision of $5 million after taking into account a $5 million prepayment made in December 2022) reflecting its best estimate of the final settlement of the reassessment amount.
Current and deferred income taxes
The Company is periodically required to estimate the tax basis of assets and liabilities. Where applicable tax laws and regulations are either unclear or subject to varying interpretations, it is possible that changes in these estimates could occur that materially affect the amounts of deferred income tax assets and liabilities recorded in the financial statements. Changes in deferred tax assets and liabilities generally have a direct impact on earnings in the period that the changes occur.
Each period, the Company evaluates the likelihood of whether some portion or all of each deferred tax asset will not be realized. This evaluation is based on historic and future expected levels of taxable income and the associated repatriation of retained earnings, the pattern and timing of reversals of taxable temporary timing differences that give rise to deferred tax liabilities, and tax planning initiatives. Levels of future taxable income are affected by, among other things, metal prices, production costs, quantities of proven and probable gold reserves, interest rates and foreign currency exchange rates. The availability of retained earnings for distribution depends on future levels of taxable income as well as future reclamation expenditures, capital expenditures, dividends and other uses of available cash flow.
RISKS AND UNCERTAINTIES
The exploration and development of natural resources are highly speculative in nature and the Company’s business operations, investments and prospects are subject to significant risks. For details of these risks, please refer to the risk factors set forth in the Company’s current Annual Information Form, which can be found under the Company’s corporate profile on SEDAR+ at www.sedarplus.ca, the Company’s current Form 40-F Annual Report, which can be found on EDGAR at www.sec.gov, and the Company’s other filings and submissions with securities regulators on SEDAR and EDGAR, which could materially affect the Company’s business, operations, investments and prospects and could cause actual events to differ materially from those described in forward-looking statements relating to the Company. Additional risks and uncertainties not presently known to the Company or that the Company currently considers immaterial may also impair the business, operations, investments and prospects of the Company. If any of the risks actually occur, the business of the Company may be harmed and its financial condition and results of operations may suffer significantly.
DISCLOSURE CONTROLS AND INTERNAL CONTROL OVER FINANCIAL REPORTING
Disclosure controls and procedures
Disclosure controls and procedures are designed (a) under Canadian law, to provide reasonable assurance and (b) under U.S. law, to ensure that information required to be disclosed in reports filed or submitted by the Company under Canadian securities legislation and the U.S. Securities and Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms and include, without limitation, controls and procedures designed to ensure that information required to be disclosed in reports filed or submitted by the Company under Canadian securities legislation and the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
As at December 31, 2023, management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company's disclosure controls and procedures, as defined in the rules of the Canadian Securities Administrators and under the Exchange Act. Based upon the results of that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2023, the Company's disclosure controls and procedures were effective.
Management’s annual report on internal control over financial reporting
The Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer is responsible for establishing and maintaining adequate internal control over financial reporting. Any system of internal control over financial reporting, no matter how well designed, has inherent limitations and may not prevent or detect misstatements. Even when the Company's system of internal control over financial reporting is determined to be effective, it can only provide reasonable assurance with respect to financial statement preparation and presentation.
Management has used the criteria established in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to evaluate the effectiveness of the Company's internal control over financial reporting.
As at December 31, 2023, management, with the participation of the Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company's internal control over financial reporting and concluded that the Company's internal control over financial reporting was effective.
The effectiveness of the Company’s internal control over financial reporting has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, who have expressed their opinion in their report included with our annual consolidated financial statements.
Changes in internal control over financial reporting
There has been no change in our internal control over financial reporting during the year ended December 31, 2023 which has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
NON-IFRS MEASURES
Cash operating costs per gold ounce sold and total cash costs per gold ounce sold
‘‘Cash operating costs per gold ounce’’ and “total cash costs per gold ounce” are common financial performance measures in the gold mining industry but, as non-IFRS measures, they do not have a standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. Management believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate our performance and ability to generate cash flow. Accordingly, these measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The measures, along with sales, are considered to be a key indicator of the Company’s ability to generate earnings and cash flow from its mining operations.
Cash cost figures are calculated on a sales basis in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures of other companies. Other companies may calculate these measures differently. Cash operating costs and total cash costs per gold ounce sold are derived from amounts included in the statement of operations and include mine site operating costs such as mining, processing, smelting, refining, transportation costs, royalties and production taxes, less silver by-product credits. The tables below show a reconciliation of cash operating costs per gold ounce sold and total cash costs per gold ounce sold to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2023 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |||||||||
| $ | $ | $ | $ | $ | $ | |||||||||
| Production costs | 82,921 | 43,733 | 37,752 | 164,406 | 17,395 | 181,801 | ||||||||
| Royalties and production taxes | 20,891 | 6,185 | 5,966 | 33,042 | 1,418 | 34,460 | ||||||||
| Total cash costs | 103,812 | 49,918 | 43,718 | 197,448 | 18,813 | 216,261 | ||||||||
| Gold sold (ounces) | 128,321 | 53,500 | 75,100 | 256,921 | 18,059 | 274,980 | ||||||||
| Cash operating costs per ounce ($/gold ounce sold) | 646 | 817 | 503 | 640 | 963 | 661 | ||||||||
| Total cash costs per ounce ($/gold ounce sold) | 809 | 933 | 582 | 769 | 1,042 | 786 | For the three months ended December 31, 2022 | |||||||
| --- | --- | --- | --- | --- | --- | --- | ||||||||
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |||||||||
| $ | $ | $ | $ | $ | $ | |||||||||
| Production costs | 85,053 | 47,228 | 27,278 | 159,559 | 16,636 | 176,195 | ||||||||
| Royalties and production taxes | 32,660 | 5,757 | 3,316 | 41,733 | 1,137 | 42,870 | ||||||||
| Total cash costs | 117,713 | 52,985 | 30,594 | 201,292 | 17,773 | 219,065 | ||||||||
| Gold sold (ounces) | 237,800 | 53,865 | 47,690 | 339,355 | 15,141 | 354,496 | ||||||||
| Cash operating costs per ounce ($/gold ounce sold) | 358 | 877 | 572 | 470 | 1,099 | 497 | ||||||||
| Total cash costs per ounce ($/gold ounce sold) | 495 | 984 | 642 | 593 | 1,174 | 618 | ||||||||
| For the year ended December 31, 2023 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | ||||||||
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |||||||||
| $ | $ | $ | $ | $ | $ | |||||||||
| Production costs | 333,215 | 160,952 | 122,030 | 616,197 | 67,766 | 683,963 | ||||||||
| Royalties and production taxes | 95,576 | 23,439 | 16,688 | 135,703 | 5,053 | 140,756 | ||||||||
| Total cash costs | 428,791 | 184,391 | 138,718 | 751,900 | 72,819 | 824,719 | ||||||||
| Gold sold (ounces) | 588,460 | 190,800 | 214,800 | 994,060 | 68,725 | 1,062,785 | ||||||||
| Cash operating costs per ounce ($/gold ounce sold) | 566 | 844 | 568 | 620 | 986 | 644 | ||||||||
| Total cash costs per ounce ($/gold ounce sold) | 729 | 966 | 646 | 756 | 1,060 | 776 | ||||||||
| For the year ended December 31, 2022 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | ||||||||
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |||||||||
| $ | $ | $ | $ | $ | $ | |||||||||
| Production costs | 326,529 | 177,705 | 122,292 | 626,526 | 58,368 | 684,894 | ||||||||
| Royalties and production taxes | 83,893 | 22,887 | 11,188 | 117,968 | 4,163 | 122,131 | ||||||||
| Total cash costs | 410,422 | 200,592 | 133,480 | 744,494 | 62,531 | 807,025 | ||||||||
| Gold sold (ounces) | 599,600 | 214,015 | 155,540 | 969,155 | 55,117 | 1,024,272 | ||||||||
| Cash operating costs per ounce ($/gold ounce sold) | 545 | 830 | 786 | 646 | 1,059 | 669 | ||||||||
| Total cash costs per ounce ($/gold ounce sold) | 684 | 937 | 858 | 768 | 1,135 | 788 |
Cash operating costs per gold ounce produced
In addition to cash operating costs on a per gold ounce sold basis, the Company also presents cash operating costs on a per gold ounce produced basis. Cash operating costs per gold ounce produced is derived from amounts included in the statement of operations and include mine site operating costs such as mining, processing, smelting, refining, transportation costs, less silver by-product credits. The tables below show a reconciliation of cash operating costs per gold ounce produced to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Production costs | 82,921 | 43,733 | 37,752 | 164,406 | 17,395 | 181,801 |
| Inventory sales adjustment | 3,618 | (1,430) | (1,160) | 1,028 | — | 1,028 |
| Cash operating costs | 86,539 | 42,303 | 36,592 | 165,434 | 17,395 | 182,829 |
| Gold produced (ounces) | 143,010 | 46,490 | 81,111 | 270,611 | 18,054 | 288,665 |
| Cash operating costs per ounce ($/gold ounce produced) | 605 | 910 | 451 | 611 | 963 | 633 |
| For the three months ended December 31, 2022 | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Production costs | 85,053 | 47,228 | 27,278 | 159,559 | 16,636 | 176,195 |
| Inventory sales adjustment | (82) | (4,781) | 662 | (4,201) | — | (4,201) |
| Cash operating costs | 84,971 | 42,447 | 27,940 | 155,358 | 16,636 | 171,994 |
| Gold produced (ounces) | 244,014 | 48,687 | 60,068 | 352,769 | 15,101 | 367,870 |
| Cash operating costs per ounce ($/gold ounce produced) | 348 | 872 | 465 | 440 | 1,102 | 468 |
| For the year ended December 31, 2023 | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Production costs | 333,215 | 160,952 | 122,030 | 616,197 | 67,766 | 683,963 |
| Inventory sales adjustment | 4,161 | 5,362 | 72 | 9,595 | — | 9,595 |
| Cash operating costs | 337,376 | 166,314 | 122,102 | 625,792 | 67,766 | 693,558 |
| Gold produced (ounces) | 590,243 | 193,502 | 208,598 | 992,343 | 68,717 | 1,061,060 |
| Cash operating costs per ounce ($/gold ounce produced) | 572 | 859 | 585 | 631 | 986 | 654 |
| For the year ended December 31, 2022 | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Production costs | 326,529 | 177,705 | 122,292 | 626,526 | 58,368 | 684,894 |
| Inventory sales adjustment | (4,959) | (3,895) | 1,938 | (6,916) | — | (6,916) |
| Cash operating costs | 321,570 | 173,810 | 124,230 | 619,610 | 58,368 | 677,978 |
| Gold produced (ounces) | 598,661 | 212,728 | 161,614 | 973,003 | 54,871 | 1,027,874 |
| Cash operating costs per ounce ($/ gold ounce produced) | 537 | 817 | 769 | 637 | 1,064 | 660 |
All-in sustaining costs per gold ounce
In June 2013, the World Gold Council, a non-regulatory association of the world’s leading gold mining companies established to promote the use of gold to industry, consumers and investors, provided guidance for the calculation of the measure “all-in sustaining costs per gold ounce”, but as a non-IFRS measure, it does not have a standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. The original World Gold Council standard became effective January 1, 2014 with further updates announced on November 16, 2018 which were effective starting January 1, 2019.
Management believes that the all-in sustaining costs per gold ounce measure provides additional insight into the costs of producing gold by capturing all of the expenditures required for the discovery, development and sustaining of gold production and allows the Company to assess its ability to support capital expenditures to sustain future production from the generation of operating cash flows. Management believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is
intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures of other companies. The Company has applied the principles of the World Gold Council recommendations and has reported all-in sustaining costs on a sales basis. Other companies may calculate these measures differently.
B2Gold defines all-in sustaining costs per ounce as the sum of cash operating costs, royalties and production taxes, capital expenditures and exploration costs that are sustaining in nature, sustaining lease expenditures, corporate general and administrative costs, share-based payment expenses related to RSUs/DSUs/PSUs/RPUs, community relations expenditures, reclamation liability accretion and realized (gains) losses on fuel derivative contracts, all divided by the total gold ounces sold to arrive at a per ounce figure.
The tables below show a reconciliation of all-in sustaining costs per ounce to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Corporate | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | $ | |
| Production costs | 82,921 | 43,733 | 37,752 | — | 164,406 | 17,395 | 181,801 |
| Royalties and production taxes | 20,891 | 6,185 | 5,966 | — | 33,042 | 1,418 | 34,460 |
| Corporate administration | 4,760 | 1,159 | 1,190 | 14,032 | 21,141 | 813 | 21,954 |
| Share-based payments – RSUs/DSUs/PSUs/RPUs(1) | 34 | — | — | 3,706 | 3,740 | — | 3,740 |
| Community relations | 1,087 | 40 | 195 | — | 1,322 | — | 1,322 |
| Reclamation liability accretion | 433 | 322 | 324 | — | 1,079 | — | 1,079 |
| Realized gains on fuel derivative contracts | (1,393) | (1,038) | (277) | — | (2,708) | — | (2,708) |
| Sustaining lease expenditures | 818 | 306 | (49) | 490 | 1,565 | — | 1,565 |
| Sustaining capital expenditures(2) | 73,764 | 8,049 | 14,797 | — | 96,610 | 1,191 | 97,801 |
| Sustaining mine exploration(2) | 2,022 | 1,067 | 1,410 | — | 4,499 | 38 | 4,537 |
| Total all-in sustaining costs | 185,337 | 59,823 | 61,308 | 18,228 | 324,696 | 20,855 | 345,551 |
| Gold sold (ounces) | 128,321 | 53,500 | 75,100 | — | 256,921 | 18,059 | 274,980 |
| All-in sustaining cost per ounce ($/gold ounce sold) | 1,444 | 1,118 | 816 | — | 1,264 | 1,155 | 1,257 |
(1) Included as a component of Share-based payments on the Consolidated Statement of Operations.
(2) Refer to Sustaining capital expenditures and Sustaining mine exploration reconciliations below.
The table below shows a reconciliation of sustaining capital expenditures to operating mine capital expenditures as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine capital expenditures | 87,830 | 9,195 | 14,797 | 111,822 | 1,191 | 113,013 |
| Road construction | (52) | — | — | (52) | — | (52) |
| Fekola underground | (14,014) | — | — | (14,014) | — | (14,014) |
| Other | — | (948) | — | (948) | — | (948) |
| Land acquisitions | — | (198) | — | (198) | — | (198) |
| Sustaining capital expenditures | 73,764 | 8,049 | 14,797 | 96,610 | 1,191 | 97,801 |
The table below shows a reconciliation of sustaining mine exploration to operating mine exploration as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine exploration | 2,022 | 1,067 | 1,410 | 4,499 | 38 | 4,537 |
| Regional exploration | — | — | — | — | — | — |
| Sustaining mine exploration | 2,022 | 1,067 | 1,410 | 4,499 | 38 | 4,537 |
The tables below show a reconciliation of all-in sustaining costs per ounce to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2022 | |||||||
|---|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Corporate | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | $ | |
| Production costs | 85,053 | 47,228 | 27,278 | — | 159,559 | 16,636 | 176,195 |
| Royalties and production taxes | 32,660 | 5,757 | 3,316 | — | 41,733 | 1,137 | 42,870 |
| Corporate administration | 3,955 | 1,201 | 1,290 | 14,272 | 20,718 | 768 | 21,486 |
| Share-based payments – RSUs/DSUs/PSUs/RPUs(1) | — | — | — | 4,157 | 4,157 | — | 4,157 |
| Community relations | 564 | 81 | 148 | — | 793 | — | 793 |
| Reclamation liability accretion | 300 | 286 | 216 | — | 802 | — | 802 |
| Realized gains on fuel derivative contracts | (1,189) | (1,910) | (745) | — | (3,844) | — | (3,844) |
| Sustaining lease expenditures | 348 | 295 | 129 | 445 | 1,217 | — | 1,217 |
| Sustaining capital expenditures(2) | 45,790 | 9,378 | 13,480 | — | 68,648 | 204 | 68,852 |
| Sustaining mine exploration(2) | 985 | 1,648 | 922 | — | 3,555 | — | 3,555 |
| Total all-in sustaining costs | 168,466 | 63,964 | 46,034 | 18,874 | 297,338 | 18,745 | 316,083 |
| Gold sold (ounces) | 237,800 | 53,865 | 47,690 | — | 339,355 | 15,141 | 354,496 |
| All-in sustaining cost per ounce ($/gold ounce sold) | 708 | 1,187 | 965 | — | 876 | 1,238 | 892 |
(1) Included as a component of Share-based payments on the Consolidated Statement of Operations.
(2) Refer to Sustaining capital expenditures and Sustaining mine exploration reconciliations below.
The table below shows a reconciliation of sustaining capital expenditures to operating mine capital expenditures as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine capital expenditures | 48,843 | 9,620 | 19,521 | 77,984 | 204 | 78,188 |
| Cardinal mobile equipment | (947) | — | — | (947) | — | (947) |
| Tailings facility life-of-mine study | (887) | — | — | (887) | — | (887) |
| Fekola underground study | (740) | — | — | (740) | — | (740) |
| Other | (479) | — | (87) | (566) | — | (566) |
| Land acquisitions | — | (242) | — | (242) | — | (242) |
| Underground development | — | — | (5,466) | (5,466) | — | (5,466) |
| National power grid connection | — | — | (488) | (488) | — | (488) |
| Sustaining capital expenditures | 45,790 | 9,378 | 13,480 | 68,648 | 204 | 68,852 |
The table below shows a reconciliation of sustaining mine exploration to operating mine exploration as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the three months ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine exploration | 1,366 | 1,648 | 1,201 | 4,215 | — | 4,215 |
| Regional exploration | (381) | — | (279) | (660) | — | (660) |
| Sustaining mine exploration | 985 | 1,648 | 922 | 3,555 | — | 3,555 |
The tables below show a reconciliation of all-in sustaining costs per ounce to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the year ended December 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Corporate | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | $ | |
| Production costs | 333,215 | 160,952 | 122,030 | — | 616,197 | 67,766 | 683,963 |
| Royalties and production taxes | 95,576 | 23,439 | 16,688 | — | 135,703 | 5,053 | 140,756 |
| Corporate administration | 12,201 | 2,921 | 5,339 | 41,850 | 62,311 | 2,794 | 65,105 |
| Share-based payments – RSUs/DSUs/PSUs/RPUs(1) | 43 | — | — | 16,188 | 16,231 | — | 16,231 |
| Community relations | 3,773 | 163 | 1,269 | — | 5,205 | — | 5,205 |
| Reclamation liability accretion | 1,552 | 1,181 | 1,181 | — | 3,914 | — | 3,914 |
| Realized gains on fuel derivative contracts | (4,169) | (3,824) | (1,206) | — | (9,199) | — | (9,199) |
| Sustaining lease expenditures | 1,935 | 1,218 | 1,145 | 1,891 | 6,189 | — | 6,189 |
| Sustaining capital expenditures(2) | 255,026 | 28,194 | 61,063 | — | 344,283 | 8,518 | 352,801 |
| Sustaining mine exploration(2) | 3,728 | 3,808 | 3,863 | — | 11,399 | 57 | 11,456 |
| Total all-in sustaining costs | 702,880 | 218,052 | 211,372 | 59,929 | 1,192,233 | 84,188 | 1,276,421 |
| Gold sold (ounces) | 588,460 | 190,800 | 214,800 | — | 994,060 | 68,725 | 1,062,785 |
| All-in sustaining cost per ounce ($/gold ounce sold) | 1,194 | 1,143 | 984 | — | 1,199 | 1,225 | 1,201 |
(1) Included as a component of Share-based payments on the Consolidated Statement of Operations.
(2) Refer to Sustaining capital expenditures and Sustaining mine exploration reconciliations below.
The table below shows a reconciliation of sustaining capital expenditures to operating mine capital expenditures as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the year ended December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine capital expenditures | 298,942 | 30,142 | 61,063 | 390,147 | 8,518 | 398,665 |
| Road construction | (5,335) | — | — | (5,335) | — | (5,335) |
| Fekola underground | (38,581) | — | — | (38,581) | — | (38,581) |
| Land acquisitions | — | (198) | — | (198) | — | (198) |
| Other | — | (1,750) | — | (1,750) | — | (1,750) |
| Sustaining capital expenditures | 255,026 | 28,194 | 61,063 | 344,283 | 8,518 | 352,801 |
The table below shows a reconciliation of sustaining mine exploration to operating mine exploration as extracted from the annual consolidated financial statements (dollars in thousands):
| For the year ended December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine exploration | 3,728 | 3,808 | 3,863 | 11,399 | 57 | 11,456 |
| Regional exploration | — | — | — | — | — | — |
| Sustaining mine exploration | 3,728 | 3,808 | 3,863 | 11,399 | 57 | 11,456 |
The tables below show a reconciliation of all-in sustaining costs per ounce to production costs as extracted from the annual consolidated financial statements on a consolidated and a mine-by-mine basis (dollars in thousands):
| For the year ended December 31, 2022 | |||||||
|---|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Corporate | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | $ | |
| Production costs | 326,529 | 177,705 | 122,292 | — | 626,526 | 58,368 | 684,894 |
| Royalties and production taxes | 83,893 | 22,887 | 11,188 | — | 117,968 | 4,163 | 122,131 |
| Corporate administration | 10,093 | 3,019 | 5,380 | 35,987 | 54,479 | 3,101 | 57,580 |
| Share-based payments – RSUs/DSUs/PSUs/RPUs(1) | — | — | — | 15,314 | 15,314 | — | 15,314 |
| Community relations | 1,311 | 272 | 1,155 | — | 2,738 | — | 2,738 |
| Reclamation liability accretion | 942 | 940 | 688 | — | 2,570 | — | 2,570 |
| Realized gains on fuel derivative contracts | (11,097) | (12,766) | (5,549) | — | (29,412) | — | (29,412) |
| Sustaining lease expenditures | 871 | 1,230 | 2,307 | 2,208 | 6,616 | — | 6,616 |
| Sustaining capital expenditures(2) | 100,479 | 38,265 | 40,572 | — | 179,316 | 2,603 | 181,919 |
| Sustaining mine exploration(2) | 6,805 | 4,759 | 2,522 | — | 14,086 | — | 14,086 |
| Total all-in sustaining costs | 519,826 | 236,311 | 180,555 | 53,509 | 990,201 | 68,235 | 1,058,436 |
| Gold sold (ounces) | 599,600 | 214,015 | 155,540 | — | 969,155 | 55,117 | 1,024,272 |
| All-in sustaining cost per ounce ($/gold ounce sold) | 867 | 1,104 | 1,161 | — | 1,022 | 1,238 | 1,033 |
(1) Included as a component of Share-based payments on the Consolidated Statement of Operations.
(2) Refer to Sustaining capital expenditures and Sustaining mine exploration reconciliations below.
The table below shows a reconciliation of sustaining capital expenditures to operating mine capital expenditures as extracted from the annual consolidated financial statements (dollars in thousands):
| For the year ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine capital expenditures | 117,622 | 39,528 | 79,096 | 236,246 | 2,603 | 238,849 |
| Cardinal mobile equipment | (9,849) | — | — | (9,849) | — | (9,849) |
| Tailings facility life-of-mine study | (5,216) | — | — | (5,216) | — | (5,216) |
| Fekola underground study | (1,378) | — | — | (1,378) | — | (1,378) |
| Land acquisitions | — | (1,229) | — | (1,229) | — | (1,229) |
| Other | (700) | (34) | (449) | (1,183) | — | (1,183) |
| Underground development | — | — | (32,783) | (32,783) | — | (32,783) |
| National power grid connection | — | — | (5,292) | (5,292) | — | (5,292) |
| Sustaining capital expenditures | 100,479 | 38,265 | 40,572 | 179,316 | 2,603 | 181,919 |
The table below shows a reconciliation of sustaining mine exploration to operating mine exploration as extracted from the annual consolidated financial statements (dollars in thousands):
| For the year ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| Fekola<br> Mine | Masbate<br> Mine | Otjikoto<br> Mine | Total | Calibre equity investment | Grand<br> Total | |
| $ | $ | $ | $ | $ | $ | |
| Operating mine exploration | 15,214 | 4,759 | 3,476 | 23,449 | — | 23,449 |
| Regional exploration | (8,409) | — | (954) | (9,363) | — | (9,363) |
| Sustaining mine exploration | 6,805 | 4,759 | 2,522 | 14,086 | — | 14,086 |
Adjusted net income and adjusted earnings per share - basic
Adjusted net income and adjusted earnings per share – basic are non-IFRS measures that do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company defines adjusted net income as net income attributable to shareholders of the Company adjusted for non-recurring items and also significant recurring non-cash items. The Company defines adjusted earnings per share – basic as adjusted net income divided by the basic weighted number of common shares outstanding.
Management believes that the presentation of adjusted net income and adjusted earnings per share - basic is appropriate to provide additional information to investors regarding items that we do not expect to continue at the same level in the future or that management does not believe to be a reflection of the Company's ongoing operating performance. Management further believes that its presentation of these non-IFRS financial measures provide information that is useful to investors because they are important indicators of the strength of our operations and the performance of our core business. Accordingly, it is intended to provide additional information and should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate this measure differently.
A reconciliation of net (loss) income to adjusted net income as extracted from the annual consolidated financial statements is set out in the table below:
| Three months ended | Year ended | |||
|---|---|---|---|---|
| December 31, | December 31, | |||
| 2023 | 2022 | 2023 | 2022 | |
| $ | $ | $ | $ | |
| (000’s) | (000’s) | (000’s) | (000’s) | |
| Net (loss) income attributable to shareholders of the Company for the period: | (113,224) | 157,756 | 10,097 | 252,873 |
| Adjustments for non-recurring items and significant recurring non-cash items: | ||||
| Impairment (reversal) of long-lived assets | 187,964 | — | 304,446 | (909) |
| Write-down of mining interests | 2,921 | 4,905 | 19,905 | 11,778 |
| Loss on sale of mining interest | — | — | — | 2,804 |
| Unrealized loss on derivative instruments | 4,101 | 3,171 | 4,500 | 10,442 |
| Office lease termination costs | — | — | 1,946 | — |
| Loan receivable provision | — | — | 2,085 | — |
| Change in fair value of gold stream | 18,800 | — | 12,300 | — |
| Dilution loss (gain) on investment in Calibre | 943 | (172) | 943 | (5,630) |
| Non-cash interest income on deferred consideration receivable | — | — | — | (2,806) |
| Deferred income tax recovery | (10,808) | (44,218) | (9,019) | (4,770) |
| Adjusted net income attributable to shareholders of the Company for the period | 90,697 | 121,442 | 347,203 | 263,782 |
| Basic weighted average number of common shares outstanding (in thousands) | 1,300,791 | 1,074,448 | 1,232,092 | 1,064,259 |
| Adjusted net earnings attributable to shareholders of the Company per share–basic ($/share) | 0.07 | 0.11 | 0.28 | 0.25 |
SUMMARY OF QUARTERLY RESULTS
| Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |
|---|---|---|---|---|---|---|---|---|
| 2023 | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | 2022 | |
| Gold revenue ($ in thousands) | 511,974 | 477,888 | 470,854 | 473,556 | 592,468 | 392,554 | 381,985 | 365,583 |
| Net (loss) income for the period ($ in thousands) | (117,396) | (34,770) | 91,850 | 101,904 | 176,468 | (21,234) | 40,686 | 90,803 |
| (Loss) earnings per share (1) – basic ($) | (0.09) | (0.03) | 0.06 | 0.08 | 0.15 | (0.02) | 0.04 | 0.08 |
| (Loss) earnings per share (1) – diluted ($) | (0.09) | (0.03) | 0.06 | 0.08 | 0.15 | (0.02) | 0.04 | 0.08 |
| Cash flows provided by operating activities ($ in thousands) | 205,443 | 110,204 | 194,983 | 203,823 | 270,491 | 93,118 | 124,879 | 107,310 |
| Gold sold (ounces) | 256,921 | 248,889 | 239,100 | 249,150 | 339,355 | 229,400 | 205,300 | 195,100 |
| Average realized gold price ($/ounce) | 1,993 | 1,920 | 1,969 | 1,901 | 1,746 | 1,711 | 1,861 | 1,874 |
| Gold produced (ounces) | 270,611 | 225,052 | 245,961 | 250,719 | 352,769 | 214,903 | 208,858 | 196,473 |
| Gold produced, total including Calibre equity investment(ounces) | 288,665 | 242,838 | 262,701 | 266,856 | 367,870 | 227,016 | 223,623 | 209,365 |
| Production costs ($ in thousands) | 164,406 | 171,425 | 152,762 | 127,604 | 159,559 | 185,704 | 158,303 | 122,960 |
| Cash operating costs (2) ($/gold ounce sold) | 661 | 706 | 667 | 540 | 497 | 824 | 786 | 656 |
| Total cash costs (2) ($/gold ounce sold) | 786 | 840 | 800 | 678 | 618 | 939 | 900 | 784 |
| All-in sustaining costs (2) ($/gold ounce sold) | 1,257 | 1,272 | 1,214 | 1,060 | 892 | 1,169 | 1,111 | 1,036 |
| Adjusted net income (1)(2)<br><br>($ in thousands) | 90,697 | 64,840 | 85,804 | 105,862 | 121,442 | 31,996 | 45,248 | 65,096 |
| Adjusted earnings per share (1)(2) – basic ($) | 0.07 | 0.05 | 0.07 | 0.10 | 0.11 | 0.03 | 0.04 | 0.06 |
(1)Attributable to the shareholders of the Company.
(2)Non-IFRS Measure. For a description of how these measures are calculated and a reconciliation of these measures to the most directly comparable measures specified, defined or determined under IFRS and presented in the Company’s financial statements, refer to “Non-IFRS Measures”.
Quarterly gold revenue throughout the eight quarters is a function of quarterly production levels, the timing of bullion shipments and changes in average realized gold price while cash flows from operating activities are also impacted by cash operating costs of each quarter and changes in working capital, in addition to the factors noted for gold revenue. Net income throughout the eight quarters is a function of quarterly revenues, cash operating costs, related taxes and asset impairment charges. The net loss in the third quarter of 2023 reflects an impairment loss of $112 million impairment charge on the Gramalote Project as a result of the Company's acquisition from AngloGold of the remaining 50% stake in the Gramalote Project. The net loss in the fourth quarter of 2023 reflects an impairment of $192 million related to the Fekola Complex, net of deferred income tax.
SUMMARY AND OUTLOOK
Total gold production in 2024 is anticipated to be between 860,000 and 940,000 ounces, including 40,000 to 50,000 ounces of attributable production from Calibre. Production is expected to be relatively consistent throughout 2024, with third quarter production expected to be slightly lower and fourth quarter production is expected to be slightly higher. The expected decrease in gold production relative to 2023 is predominantly due to lower production at the Fekola Complex as a result of the delay in receiving an exploitation license for Fekola Regional from the Government of Mali, delaying the 80,000 to 100,000 ounces that were scheduled in the life of mine plan to be trucked to the Fekola mill and processed in 2024. The contribution of this gold production from Fekola Regional is now assumed to start at the beginning of 2025. The Company's total consolidated cash operating costs for the year (including estimated attributable results for Calibre) are forecast to be between $835 and $895 per gold ounce produced and total consolidated all-in sustaining costs (including estimate attributable results for Calibre) are forecast to be between $1,360 and $1,420 per gold ounce sold. The anticipated increase in the Company's consolidated cash operating costs per ounce for 2024 reflects the processing of lower-grade ore at Fekola in 2024. The total consolidated all-in sustaining costs per ounce for 2024 reflect the final full year of spending on both the new Fekola tailings storage facility and the Fekola solar plant expansion, in addition to the ongoing substantial capitalized stripping campaign planned at Fekola for 2024.
Construction of the Goose Project is progressing on track, with the project remaining on schedule for first gold pour in the first quarter of 2025. Construction continues ahead of schedule within the mill and processing buildings, along with preparatory work for peak construction activities in the second and third quarters of 2024. Mine development is well underway at the Echo Pit and Umwelt Underground mine to generate high-grade stockpiles prior to mill commissioning. Following the successful completion of the 2023 sealift, construction of the WIR is being finalized and expected to be fully operational by February 23, 2024, transporting all required materials from the MLA to the Goose Project site by the end of April 2024.
Results of the Fekola Complex optimization study outlining the trucking of ore from the Anaconda Area to be released in the first quarter of 2024. Results from the Fekola Complex optimization study indicate that the trucking of both oxide and sulphide ore from Fekola Regional to be toll milled by the Fekola mill is the optimal option to maximize the value of Fekola Regional, and to extend the processing life of the Fekola mill.
The Company has completed a detailed review of the Gramalote Project, including the facility size and location, power supply, mining and processing options, tailings design, resettlement, potential construction sequencing and camp design to identify potential cost savings to develop a smaller scale project. A formal study commenced in the fourth quarter of 2023, with the goal of completing a PEA by the end of the second quarter of 2024.
B2Gold expects to declare future quarterly dividends in 2024 at the same rate of $0.04 per common share (or an annualized rate of $0.16 per common share), which represents one of the highest dividend yields in the gold sector.
The Company's ongoing strategy is to continue to maximize profitable production from its mines, further advance its pipeline of remaining development and exploration projects, evaluate new exploration, development and production opportunities and continue to pay an industry leading dividend yield.
OUTSTANDING SHARE DATA
At February 21, 2024, 1,302,948,967 common shares were outstanding. In addition, there were approximately 27.9 million stock options outstanding with exercise prices ranging between C$3.24 to C$8.53 per share, approximately 3.3 million RSUs outstanding and approximately 4.2 million PSUs outstanding.
The number of common shares available for issuance under the Company's stock option plan but not subject to outstanding options was 31.2 million and 27.9 million as at January 1, 2023 and December 31, 2023, respectively.
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Production results and production guidance presented in this MD&A reflect the total production at the mines B2Gold operates on a 100% basis. Please see our most recent Annual Information Form for a discussion of our ownership interest in the mines B2Gold operates. In respect of Calibre’s operations, production is presented on an approximate 24% basis to December 31, 2023 (to reflect B2Gold's approximate interest in Calibre during the period).
This MD&A includes certain “forward-looking information” and “forward-looking statements” (collectively “forward-looking statements”) within the meaning of applicable Canadian and United States securities legislation, including: projections; outlook; guidance; forecasts; estimates; and other statements regarding future or estimated financial and operational performance, gold production and sales, revenues and cash flows, and capital costs (sustaining and non-sustaining) and operating costs, including projected cash operating costs and all-in sustaining costs, and budgets on a consolidated and mine by mine basis, which if they occur, would have on our business, our planned capital and exploration expenditures; future or estimated mine life, metal price assumptions, ore grades or sources, gold recovery rates, stripping ratios, throughput, ore processing; statements regarding anticipated exploration, drilling, development, construction, permitting and other activities or achievements of B2Gold; and including, without limitation: remaining well positioned for continued strong operational and financial performance for 2024; projected gold production, cash operating costs and all-in sustaining costs on a consolidated and mine by mine basis in 2024; total consolidated gold production of between 860,000 and 940,000 ounces (including 40,000 to 50,000 attributable ounces from Calibre) in 2024, with cash operating costs of between $835 and $895 per ounce and all-in sustaining costs of between $1,360 and $1,420 per ounce; B2Gold’s continued prioritization of developing the Goose Project in a manner that recognizes Indigenous input and concerns and brings long-term socio-economic benefits to the area; the Goose Project capital cost being approximately C$1,050 million and the net cost of open pit and underground development, deferred stripping, and sustaining capital expenditures to be incurred prior to first gold production being approximately C$200 million; the construction capital cost to complete the Goose Project being approximately C$335 million; the WIR at the Goose Project being operational by February 23, 2024; the Goose Project producing approximately 300,000 ounces of gold per year for the first five years and the Umwelt crown pillar containing over 150,000 ounces of gold; the Company's consolidated gold production to be relatively consistent throughout 2024; the potential for Fekola Regional to provide saprolite material to feed the Fekola mill within three months after receipt of an exploitation license; Fekola Regional production now expected to commence at the beginning of 2025; the timing and results of a study for the Fekola Complex optimization study; the potential receipt of an exploitation permit for Bantako North later in 2024;; the impact of the 2023 mining code in Mali; the potential for first gold production in the first quarter of 2025 from the Goose Project; the potential to extend Wolfshag underground mine past 2026; the potential for the Antelope Zone to contribute to the Otjikoto production profile; the timing and results of a preliminary economic assessment for the Gramalote Project; the potential payment of future dividends, including the timing and amount of any such dividends, and the expectation that quarterly dividends will be maintained at the same level; and B2Gold's attributable share of Calibre’s operations. All statements in this MD&A that address events or developments that we expect to occur in the future are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, although not always, identified by words such as "expect", "plan", "anticipate", "project", "target", "potential", "schedule", "forecast", "budget", "estimate", "intend" or "believe" and similar expressions or their negative connotations, or that events or conditions "will", "would", "may", "could", "should" or "might" occur. All such forward-looking statements are based on the opinions and estimates of management as of the date such statements are made.
Forward-looking statements necessarily involve assumptions, risks and uncertainties, certain of which are beyond B2Gold's control, including risks associated with or related to: the volatility of metal prices and B2Gold's common shares; changes in tax laws; the dangers inherent in exploration, development and mining activities; the uncertainty of reserve and resource estimates; not achieving production, cost or other estimates; actual production, development plans and costs differing materially from the estimates in B2Gold's feasibility and other studies; the ability to obtain and maintain any necessary permits, consents or authorizations required for mining activities; environmental regulations or hazards and compliance with complex regulations associated with mining activities; climate change and climate change regulations; the ability to replace mineral reserves and identify acquisition opportunities; the unknown liabilities of companies acquired by B2Gold; the ability to successfully integrate new acquisitions; fluctuations in exchange rates; the availability of financing; financing and debt activities, including potential restrictions imposed on B2Gold's operations as a result thereof and the ability to generate sufficient cash flows; operations in foreign and developing countries and the compliance with foreign laws, including those associated with operations in Mali, Namibia, the Philippines and Colombia and including risks related to changes in foreign laws and changing policies related to mining and local ownership requirements or resource nationalization generally; remote operations and the availability of adequate infrastructure; fluctuations in price and availability of energy and other inputs necessary for mining operations; shortages or cost increases in necessary equipment, supplies and labour; regulatory, political and country risks, including local instability or acts of terrorism and the effects thereof; the reliance upon contractors, third parties and joint venture partners; the lack of sole decision-making authority related to Filminera Resources Corporation, which owns the Masbate Gold Project; challenges to title or surface rights; the dependence on key personnel and the ability to attract and retain skilled personnel; the risk of an uninsurable or uninsured loss; adverse climate and weather conditions; litigation risk; competition with other mining companies; community support for B2Gold's operations, including risks related to strikes and the halting of such operations from time to time; conflicts with small scale miners; failures of information systems or information security threats; the ability to maintain adequate internal controls over financial reporting as required by law, including Section 404 of the Sarbanes-Oxley Act; compliance with anti-corruption laws, and sanctions or other similar measures; social media and B2Gold's reputation; risks affecting Calibre having an impact on the value of the Company's investment in Calibre, and potential dilution of B2Gold's equity interest in Calibre; as well as other factors identified and as described in more detail under the heading "Risk Factors" in B2Gold's most recent Annual Information Form, B2Gold's current Form 40-F Annual Report and B2Gold's other filings with Canadian securities regulators and the U.S. Securities and Exchange Commission (the "SEC"), which may be viewed at www.sedar.com and www.sec.gov, respectively (the "Websites"). The list is not exhaustive of the factors that may affect B2Gold's forward-looking statements.
B2Gold's forward-looking statements are based on the applicable assumptions and factors management considers reasonable as of the date hereof, based on the information available to management at such time. These assumptions and factors include, but are not limited to, assumptions and factors related to B2Gold's ability to carry on current and future operations, including: development and exploration activities; the timing, extent, duration and economic viability of such operations, including any mineral resources or reserves identified thereby; the accuracy and reliability of estimates, projections, forecasts, studies and assessments; B2Gold's ability to meet or achieve estimates, projections and forecasts; the availability and cost of inputs; the price and market for outputs, including gold; foreign exchange rates; taxation levels; the timely receipt of necessary approvals or permits; the ability to meet current and future obligations; the ability to obtain timely financing on reasonable terms when required; the current and future social, economic and political conditions; and other assumptions and factors generally associated with the mining industry.
B2Gold's forward-looking statements are based on the opinions and estimates of management and reflect their current expectations regarding future events and operating performance and speak only as of the date hereof. B2Gold does not assume any obligation to update forward-looking statements if circumstances or management's beliefs, expectations or opinions should change other than as required by applicable law. There can be no assurance that forward-looking statements will prove to be accurate, and actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements. Accordingly, no assurance can be given that any events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits or liabilities B2Gold will derive therefrom. For the reasons set forth above, undue reliance should not be placed on forward-looking statements.
CAUTIONARY STATEMENT REGARDING MINERAL RESERVE AND RESOURCE ESTIMATES
The disclosure in this MD&A was prepared in accordance with Canadian National Instrument 43-101 (“NI 43-101”), which differs significantly from the requirements of the SEC, and resource and reserve information contained or referenced in this MD&A may not be comparable to similar information disclosed by public companies subject to the technical disclosure requirements of the SEC. Historical results or feasibility models presented herein are not guarantees or expectations of future performance.
QUALIFIED PERSONS
William Lytle, Senior Vice President and Chief Operating Officer, a qualified person under National Instrument 43-101, has reviewed and approved the disclosure of all scientific and technical information related to operational matters contained in this MD&A. Andrew Brown, P. Geo., Vice President, Exploration, a qualified person under NI 43-101, has approved the scientific and technical information regarding exploration matters contained in this MD&A.
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Consent of Independent Registered Public Accounting Firm
We hereby consent to the incorporation by reference into the Registration Statements on Form S-8 (No. 333-273659, 333-239197, 333-232158, 333-226063, 333-218710, 333-206811, 333-200228 and 333-192555) of B2Gold Corp. (the “Company”) of our report dated February 21, 2024 relating to the 2023 consolidated financial statements and the effectiveness of the Company’s internal control over financial reporting, which appears in Exhibit 99.1 to the Company’s current report on Form 6-K filed on February 21, 2024.
/s/PricewaterhouseCoopers LLP
Chartered Professional Accountants
Vancouver, Canada
February 21, 2024
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Exhibit 99.4
Consent of Andrew Brown
I consent to the inclusion in the Management’s Discussion and Analysis of B2Gold Corp. (the “Company”) for the year ended December 31, 2023 (the “MD&A”), of references to my name, including as an expert or qualified person under Canadian National Instrument 43-101, with respect to the use and disclosure of any scientific and technical information regarding the Company’s exploration matters associated with the properties contained, summarized, or incorporated by reference therein (the “Technical Information”).
I also consent to the incorporation by reference in the Company’s Registration Statements on Form S-8 (Nos. 333-239197, 333-232158, 333-206811, 333-200228, 333-218710, 333-226063, 333-192555 and 333-273659) and on the Registration Statement on Form F-3D (No. 333-274310), filed with the United States Securities and Exchange Commission, and any amendments or supplements thereto, of the references to my name as a qualified person and of such Technical Information contained or incorporated by reference in the MD&A.
| Date: February 21, 2024 | /s/ Andrew Brown |
|---|---|
| Andrew Brown, Vice President, Exploration |
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Exhibit 99.5
Consent of William Lytle
I consent to the inclusion in the Management’s Discussion and Analysis of B2Gold Corp. (the “Company”) for the year ended December 31, 2023 (the “MD&A”), of references to my name, including as an expert or qualified person under Canadian National Instrument 43-101, with respect to the use and disclosure of any scientific and technical information regarding the Company’s operational matters associated with the properties contained, summarized, or incorporated by reference therein (the “Technical Information”).
I also consent to the incorporation by reference in the Company’s Registration Statements on Form S-8 (Nos. 333-239197, 333-232158, 333-206811, 333-200228, 333-218710, 333-226063, 333-192555 and 333-273659) and on the Registration Statement on Form F-3D (No. 333-274310), filed with the United States Securities and Exchange Commission, and any amendments or supplements thereto, of the references to my name as a qualified person and of such Technical Information contained or incorporated by reference in the MD&A.
| Date: February 21, 2024 | /s/ William Lytle |
|---|---|
| William Lytle, Senior Vice President and Chief Operating Officer |