Earnings Call Transcript - EGO Q2 2025

Operator, Operator

Thank you for standing by. This is the conference operator. Welcome to the Eldorado Gold Second Quarter 2025 Results Conference Call. The conference is being recorded. I would now like to turn the conference over to Lynette Gould, Vice President, Investor Relations, Communications and External Affairs. Please go ahead, Ms. Gould.

Lynette Gould, Vice President, Investor Relations, Communications and External Affairs

Thank you, operator, and good morning, everyone. I'd like to welcome you to our second quarter 2025 results conference call. Before we begin, I would like to remind you that we will be making forward-looking statements and referring to non-IFRS measures during the call. Please refer to the cautionary statements included in the presentation and the disclosure on non-IFRS measures and risk factors in our management's discussion and analysis. Joining me on the call today, we have George Burns, President and Chief Executive Officer; Paul Ferneyhough, Executive Vice President and Chief Financial Officer; Louw Smith, Executive Vice President, Development, Greece; and Simon Hille, Executive Vice President, Operations and Technical Services. Our release yesterday details our second quarter 2025 financial and operating results. This should be read in conjunction with our second quarter 2025 financial statements and management's discussion and analysis, both of which are available on our website. They have also both been filed on SEDAR+ and EDGAR. All dollar figures discussed today are U.S. dollars, unless otherwise stated. We will be speaking to the slides that accompany this webcast, which you can download from our website. After the prepared remarks, we will open the call for Q&A. At this time, we will invite analysts to queue for questions. I will now turn the call over to George.

George Raymond Burns, President and CEO

Thanks, Lynette, and good morning, everyone. Turning to the outline for today's call. I'll begin with an overview of our second quarter 2025 results and highlights. I'll then hand the call over to Paul to go through our financials, followed by Louw and Simon, who will provide a review of our operational performance. We'll conclude by opening the call to questions from our analysts. Turning to Slide 4 and our second quarter highlights. We delivered solid performance across our operations, achieving safe production of 133,769 gold ounces. The Lamaque Complex and K??lada? exceeded our expectations for the quarter. At Lamaque, we achieved higher throughput due to the earlier-than-anticipated processing of a portion of the second bulk sample of Ormaque. At K??lada?, our optimization efforts last year led to accelerated inventory drawdown. These additional ounces were initially anticipated later in the year. Efemçukuru delivered stable production for another quarter. As noted in the Q1 conference call, production at Olympias returned to expected levels and maintained that performance throughout the quarter. Looking ahead, we remain firmly on track to achieve our guidance of producing between 460,000 and 500,000 ounces of gold in 2025. Based on the first half performance, we expect to deliver around the midpoint of our guidance range. Total cash costs and all-in sustaining costs were $1,064 per ounce sold and $1,520 per ounce sold, respectively. Costs were higher compared to 2024, primarily as a result of higher royalties driven by record high gold prices in addition to higher labor costs. Paul will touch on our costs in more detail later in the call. Before moving on to other highlights for the quarter, the photo shown here on the bottom right part of the slide shows the first stages of our open pit mining at Skouries. Last week, while on site with other executives, we watched the mining of our first oxide ore using the smaller ADT trucks as shown here. We were very pleased to see the overall progress at Skouries, which has been impressive. I will speak to this in more detail later on the call. Turning to Slide 5. In the second quarter, our lost time injury frequency rate was 0.95, an increase from the LTIFR of 0.40 in the second quarter of 2024. We acknowledge there is always room for improvement, and we remain committed to continuous improvement in our safety performance, and we thank our employees for their dedication to maintaining safe operations. Throughout 2025, we are continuing to make health and safety improvements, focusing on high potential risk control, empowering our employees to cultivate a positive and health and safety culture. This is supported by the multi-year implementation of our new Courageous Safety Leadership program, which has been kicked off this year. On sustainability, during the quarter, we issued our annual sustainability report. Additionally, our global sites were recognized for their dedication and work receiving the following awards. In Québec, the team was awarded the Socio-Economic Commitment Felon Award at the Val-d'Or Chamber of Commerce Business Gala. And at the Québec Mining Association Conference, the team was recognized with the Environmental Distinction Award. In Greece, in recognition of the comprehensive health emergency management plan implemented at the Kassandra Mines, the team won the Gold Award at the 2025 Health and Safety Awards. Additionally, earlier this month, Eldorado Gold was recognized as one of Canada's best companies in 2025 based on our strong performance in sustainability transparency, employee satisfaction, and consistent revenue growth over the past 3 years. Lastly, we announced the expanded normal course issuer bid on May 1 of this year, reinforcing its role as a key pillar in our disciplined capital allocation strategy. This NCIB expired yesterday, July 31. As noted in our press release yesterday, our Board has reapproved the program and expanded its scope to include the New York Stock Exchange in addition to the Toronto Stock Exchange. Year-to-date, we have repurchased over 28 million shares at a cost of $58 million. With a strong balance sheet, ongoing cash generation, improving production profile, and progress on our key projects, we believe that the repurchasing of our shares at current market prices is a prudent way to deploy capital while continuing to invest in our long-term growth. I'll stop there and turn the call over to Paul for a review of our financial results.

Paul Ferneyhough, Executive Vice President and CFO

Thank you, George. Moving to Slide 6. Our results demonstrate strong operational performance consistent with our full-year guidance. Sustained elevated gold prices have underpinned robust cash flow generation from our operating assets. In Q2, Eldorado reported net earnings from continuing operations of $139 million or $0.68 per share. This performance was driven by higher average realized gold prices and strong gold sales, partially offset by increased production costs and income tax expenses. Excluding one-time nonrecurring items, adjusted net earnings for the quarter were $90 million or $0.44 per share. Adjustments include a $23 million foreign exchange gain from the translation of deferred tax balances and a $19 million unrealized gain on derivative instruments, primarily related to euro to U.S. dollar currency forward contracts. Free cash flow for the quarter totaled negative $62 million. However, excluding capital investments in the Skouries project, free cash flow was positive $62 million compared to $34 million in Q2 2024, reflecting the continued strength of our operating assets under current gold market conditions. From an operational perspective, cash flow before working capital changes reached $202 million in the quarter, up significantly from $132 million in the same period last year. This increase is attributable to a 52% rise in revenue from $297 million to $452 million, supported by a 40% uplift in average realized gold price, which reached $3,270 per ounce in Q2 this year compared to $2,336 per ounce in the same period last year. Production costs in the quarter amounted to $162 million, a $34 million increase over Q2 2024, mainly due to greater gold volumes sold and increased royalties, the latter contributing to approximately one-third of the production cost increase per ounce. Elevated gold prices contributed to higher revenue as well as increased costs, notably royalties and taxes. In Q2, total cash costs were $1,064 per ounce sold and all-in sustaining costs stood at $1,520 per ounce sold. These impacts are expected to result in consolidated total cash costs and ASIC for the full year at or above the high end of our guidance range. Growth capital investments at our operating mines during the quarter totaled $47 million, supporting various projects. At K??lada?, this included planned waste stripping, equipment procurement to extend mine life, and ongoing construction of the second phase of the North Heap Leach Pad. At the Lamaque Complex, investments were primarily directed towards the water management structure at the North Basin construction and bulk sampling work at Ormaque. At Skouries, progress remains on track. During the quarter, we invested approximately $117 million in the project, along with an additional $27 million in accelerated operational capital to facilitate our transition to self-perform open pit mining operations. Our current tax expense for Q2 was $45 million, an increase from $21 million in the prior year period, reflecting improved profitability in Canada and Türkiye. Deferred income tax recovery amounted to $11 million versus an expense of $1 million in Q2 2024. This recovery included a $23 million benefit related to the strengthening of the euro against the U.S. dollar, partially offset by a $9 million expense arising from the use of tax attributes in Canada. Turning to Slide 7. Our solid balance sheet continues to underpin the business, affording us significant financial flexibility. We concluded the first half of 2025 with total liquidity of just over $1.1 billion. This strong financial foundation enables ongoing investment in our portfolio of profitable cash-generating operations while advancing the construction of Skouries. It also positions us to capitalize on emerging opportunities and return value to shareholders through initiatives such as the NCIB. With that overview, I'll now pass the call to Louw, who will present the highlights of our Greek assets.

Louw Smith, Executive Vice President, Development, Greece

Thanks, Paul, and good morning. Starting on Slide 8 at our Skouries copper-gold project. At the end of Q2, overall project progress was 70% for Phase 2 of construction. We continue to expect first copper-gold concentrate production in the first quarter of 2026 and commercial production in mid-2026. We continued seeing a steady ramp-up of skilled labor during the second quarter with a heavy emphasis on concrete and site-wide structural mechanical labor trades. Personnel through the gate each day grew from approximately 1,300 to 1,730, including 186 Skouries operational personnel recruited to date. The photo on the bottom of this slide is a good visual representation of the operations team we have at site already. Although we've surpassed our labor and personnel target, it's essential to ensure we are matching the skilled workforce to relevant work fronts to support our plan to deliver. This ongoing focus will help us plan appropriately and continue building an even more capable and dynamic team. From a productivity standpoint, we are seeing construction productivity at or slightly better than our assumptions across the site. On this slide, you can see in the top left photo the process plant where work continues to progress with the SAG mill feed conveyor installed during the quarter. The top right photo shows the tank farm at the filtered tailings plant with foundations complete and all five tanks underway, two at the final height. Moving on to Slide 9. During the second quarter, the project capital investment at Skouries was $117 million. The spend in the quarter was in line with our expectations. With elevated personnel on site, we are de-risking the schedule, achieving strong productivity, and accelerating work across multiple work fronts to support the optimization of commissioning activities. The critical path remains on track, and we expect to meet our project capital guidance of $400 million to $450 million for the full year. In addition, we spent $27 million in accelerated operational capital during the quarter, bringing the spend to date to just over $40 million towards the $80 million to $100 million expected this year. Most of the open pit mining equipment is on site and commissioned. The majority of the open pit equipment operators' team has been onboarded with 26 operators on site, and training on the open pit mining equipment is well underway. In addition, as mentioned earlier, we commenced open pit ore mining in July. The photos in this slide and the next few slides will show the advancement of work underway. As you can see in the large photo on the left of the slide, infrastructure around the process plant continues to advance. Work in the process plant continues to expand to additional work fronts for mechanical installations, piping, cable trays, and electrical. As of this week, all the hydro testing in the processing plant, as well as the fire and process water tanks at the pump house, is now complete. In addition, mechanical installations are proceeding in the support infrastructure areas. Infrastructure surrounding the main process building is shown with the process plant substation, lime plant, flotation blowers building structurally complete. As you can see on the control building structure, the full floor concrete is complete, and we are now working on the final elevation. The installation of the equipment for the lime plant silos has been completed with cladding and roofing work having started in July. Moving to Slide 10. As you can see in the panoramic photo on the slide, the thickeners continue to advance to plan. Concrete works and mechanical installations for the first two thickeners have been completed. Work is advancing on the associated infrastructure with the pump house building, with the structural and mechanical rough set complete and pipe rack construction advancing as planned. Water testing of the clarifier and water storage tank was also completed to plan during the quarter. Turning to Slide 11. At the filtered tailings building, which remains on the critical path, we have included a link to an updated time-lapse video showcasing the structural steel installation, which is approximately 75% complete as of the end of July. During the quarter, mechanical work progressed with the installation of the six feeder conveyors, and the collector conveyor was completed in June. Additionally, as shown in the photo on the right, assembly of the first filter press has commenced. On Slide 12, work continues on the construction of the crusher building structure. The concrete work has advanced to the second of three elevations above the foundation. Additionally, the apron feeder and associated chutes have been installed, and the bottom shell of the primary crusher is preassembled, as shown here on the far left side of the slide with installation expected in August. During the quarter, conveyor foundations between the primary crusher and coarse ore stockpile advanced to plan, along with the stockpile dome foundations. On the far right photo, the foundation work underway is shown. Additionally, the reclaim tunnel concrete and escape tunnel concrete are complete, and preassembly of the first three reclaim feeders and associated shoot work has commenced for installation in Q3. Foundations for the process plant feed conveyors are also underway. Before moving to speak to Olympias, I want to take a moment to recognize the Skouries team for their tremendous efforts this quarter as they safely progress the construction at Skouries. Protecting the health and safety of our employees, the contractors, suppliers, and communities is our first priority and a cornerstone of our operating philosophy. Moving to Olympias on Slide 13. Second quarter gold production was 15,978 ounces, and total cash costs were $1,578 per ounce sold, a 35% improvement in gold production and a 34% decrease in cost over the first quarter. Following the flotation circuit upset conditions in Q1, the plant stabilized and throughput and recoveries were at planned levels in Q2. Costs during the quarter were impacted by increased labor costs and the impact of the strengthening euro, partially offset by lower transport costs and higher byproduct credits, as well as impacts of realized gains on the euro foreign currency collar hedges. We have commenced the mill expansion to 650,000 tonnes per annum. Beginning with earthworks, as a result of delays in permitting and engineering detail, we now anticipate the completion by mid-2026. We are excited for the potential that this expansion will unlock for the Olympias team over the long term. I'll stop there and hand it over to Simon to discuss the Turkish and Canadian operations.

Simon Oswald Hille, Executive Vice President, Operations and Technical Services

Thanks, Louw. Starting in Türkiye on Slide 14. It is my great pleasure to congratulate the hard-working team at K??lada?. In May, they achieved a milestone with safe production of the fourth million ounce poured through all the phases of the operation and site support; this is a true testament to your diligence, commitment, and teamwork. With an estimated 13 years of mine life remaining at K??lada?, the site continues to have a bright future as a cornerstone asset for Eldorado. Cumulatively, our operations in Türkiye have now produced over 5 million ounces. Now into the quarter, K??lada? delivered a solid second quarter with production totaling 46,058 ounces and total cash costs of $1,133 per ounce sold. Total cash costs were primarily impacted by higher labor costs, not offset by the devaluation of the local currency and higher royalty expense driven by the higher gold price and increase in gold sales during the quarter. The increase in production during the quarter was primarily due to continued leaching of gold ounces from stacked ore in the prior year, higher grades stacked in prior periods, and accelerated drawdown of inventory as a result of optimization efforts put in place in 2024. The investment focused on closing our high-pressure grinding roll circuit and additional screening and whole ore agglomeration is on track for an update alongside our third quarter results. Additionally, we have decided to accelerate the expansion of the secondary crusher circuit to facilitate operational de-bottlenecking and reduce the wear on the HPGR. The geometallurgical study for characterization of future mining phases has been decoupled from the investment of the HPGR circuit and is now expected to be complete in Q1 of 2026 as a response to slower-than-expected progress in drilling, core logging, and metallurgical testing. On Slide 15 at Efemçukuru, second quarter gold production was 21,093 ounces at a total cash cost of $1,335 per ounce sold. Gold production throughput and average gold grade were in line with the plan for the quarter. And now moving to the Lamaque Complex on Slide 16. Lamaque delivered production of 50,640 ounces at a total cash cost of $721 per ounce sold. Second quarter production was positively impacted from higher throughput, along with the early processing of a portion of the second Ormaque ore sample, which was blended with the Triangle ore feed. This is another exciting milestone as we progress the Ormaque deposit. And with that, I'll turn back to George for his closing remarks.

George Raymond Burns, President and CEO

Thanks, team. In summary, the second quarter was strong, both operationally and financially, reflecting the ongoing efforts across all sites. We saw a 15% increase in gold production, coupled with an 8% decrease in total cash costs compared to the first quarter. We are well positioned for the second half of 2025 to deliver on our production guidance. Our strong balance sheet and quality assets position us to deliver value to our stakeholders, especially with current metal prices. Our growth capital investments in Greece are advancing well, creating diversification in our product portfolio with copper beginning in 2026. We remain committed to achieving and delivering peer-leading shareholder returns, supported by low-cost incremental production across the portfolio. Thank you for your time. I will now turn it over to the operator for questions from our analysts.

Operator, Operator

The first question comes from Cosmos Chiu with CIBC.

Cosmos Chiu, Analyst

Maybe my first question is on your CapEx spend at Skouries in Q2. Good to see that you hit your CapEx targets for the quarter and representing an increase quarter-over-quarter. George, what we're seeing in Q2, is that a good number to use in terms of run rate? Or should we continue to expect that to increase as you get closer to production?

George Raymond Burns, President and CEO

Yes. In terms of activity on the ground, we expect to see a ramp-up in Q3 and then begin to see a ramp down in Q4 and then Q1 as we move into commissioning and startup of the facility, a further ramp down in activity and spending. So yes, it was great to see the increased construction workforce in Q2, beating our expectations, and again, we expect to see a bit of continuation in Q3 in those activities and spend rates and then decrease in Q4.

Cosmos Chiu, Analyst

Thank you, Louw, for the detailed update on the situation at the site. In your MD&A discussion yesterday, you mentioned a critical path. It seems that the filtered tailings plant is part of that path. Could you discuss if there are any other elements included in the critical path? If the filtered tailings plant is the sole focus, could you explain why it holds that significance? Is it primarily due to the lead time and the duration required for its construction? Please provide more details about the critical path.

Louw Smith, Executive Vice President, Development, Greece

We discussed from the start of the project that the construction of the filter plant is on the critical path. This is because it involved a redesign; initially, we had plans for a wet thick and slurry disposal method. Given the project's layout, we had to place this facility between the plant and the tailings disposal area, in a valley. This necessitated extensive geotechnical investigations and significant foundation work since we couldn't reach bedrock easily. We had to install over 600 reinforced concrete pilings from the fill to the bedrock, which was a time-consuming task. We have completed the concrete work for the filter plant building, as well as the tank farm and compressor building. Some work is still ongoing for the concrete foundation in the purification and air blower area. The main reason for this is the substantial work needed to establish the foundation, and we are nearly finished with that. We have made excellent progress on the filter plant building this quarter. The steel members for the roof are in place, and we have completed the bottom two floors. We are currently installing filters on the third floor, while the fourth floor primarily needs clearance for equipment as we prepare for operations. Overall, we are pleased with our progress, but the facility remains on the critical path, and we are on schedule for commissioning and start-up in the first quarter.

Cosmos Chiu, Analyst

Okay. Great. Let's discuss the balance sheet for a moment. As you pointed out, you have a very strong balance sheet at the end of Q2 with over $1 billion in cash. I'm trying to understand the reasoning behind the recent drawdown on your term loan of EUR 154.1 million. Did you really need to make that drawdown? It seems to me that your budget for the Skouries is $1.06 billion, and you have already spent over $700 million. You are generating cash from your other assets, so I'm looking to understand the justification for that drawdown when you have ample cash available now, and you would have had significant cash even before that drawdown.

Paul Ferneyhough, Executive Vice President and CFO

Cosmos, it's Paul. Look, I think as far as the drawdown is concerned, we're working through the remainder of the project financing facility that's available to us. The interest rates on that facility are very advantageous to us as a company. We managed to negotiate a great deal when we got into that. We've got still about another EUR 85 million under the vanilla facility available to us. And then there's another EUR 60 million under contingent cost overrun. Now right now, I think we will plan to draw down the entirety of the facility. That was what was intended to fund 80% of the investment in Skouries. The balance sheet that we've got today does offer us significant flexibility. And once we get to project completion, we will then have choices around the pace at which we repay that project finance debt. Our disclosure sets out the vanilla terms and conditions, but we do have choices to accelerate both repayments and access cash from Skouries once it comes into production. So really, this is just us making use of the vanilla facility and taking advantage of the very competitive interest rates that we have.

George Raymond Burns, President and CEO

I just add to that, we also believe our share price is undervalued as we deliver on Skouries. So the balance sheet and drawing down the debt enables us to execute on this NCIB and purchase back our shares where we think they're considerably undervalued.

Cosmos Chiu, Analyst

Great. Maybe just my last question is on K??lada?. I was reading up and you mentioned this as well, there is a potential investment closing of the HPGR circuit with additional screening and whole ore agglomeration that should come out fairly soon. It's the first time I've kind of heard of it. I'm just trying to wrap my head around what is being studied here. And I guess you talked about wear components in Q1. That was mentioned again here in Q2. And so I'm just wondering, is there anything that we should be concerned about in terms of what's happening here at the HPGR?

Simon Oswald Hille, Executive Vice President, Operations and Technical Services

Cosmos, it's Simon. Thank you for your question. Regarding the plan to close the HPGR, our analysis suggests that we can achieve a more consistent final product by making this change. To implement this, we will need to add a screen for the center product, along with the necessary agglomeration drums, as these two components go hand in hand. We are currently finalizing the engineering study this quarter to assess the investment required for this site, which will also optimize the existing capital across the entire plant. In terms of the secondary crusher de-bottlenecking, the current circuit lacks a protective screen in front of the HPGR. By installing a slightly larger secondary crusher, we can prevent oversized material from reaching the HPGR, which occasionally leads to drum damage. This is simply a prudent practice we are adopting. Additionally, this will address a key bottleneck in the historical K??lada? plant. With these two initiatives, we are positioning ourselves for a long and stable future at K??lada?.

George Raymond Burns, President and CEO

And maybe just a slight deeper dive on the damage to the HPGR that can occur. Essentially, if we get too large a piece into that HPGR, it can damage some of the bits. And so those have to then be taken off and replaced, which causes downtime and affects our throughput. So there's no significant issue in terms of damaging the overall HPGR. It's really the wear pieces that can get damaged and cause lower throughput. So this will help us in pushing throughput up and will help us de-bottleneck the plant. And as we said in our press release, that part of the investment is moving forward. We're ordering the crusher and moving forward with all our agglomeration, so additional drums and additional screening; those studies will be completed and discussed in our Q3 earnings call.

Cosmos Chiu, Analyst

So George, it sounds like throughput could increase and will increase, and could this also have a positive impact on recovery as well?

George Raymond Burns, President and CEO

Yes. We're studying whole throughput and recovery benefits out of this overall investment, and that's what we look to speak to in Q3. As Simon said, we had an issue with the drill and so the drilling on future potential pushbacks and so that work is a bit delayed. But all this investment could actually help bring future pushbacks and extend mine life at K??lada?. So it's better recovery, higher throughput, and potentially an increase in reserves if that drilling and metallurgical work all turns positive. So stay tuned.

Operator, Operator

The next question comes from Tanya Jakusconek with Scotiabank.

Tanya M. Jakusconek, Analyst

Simon, can I continue with you on K??lada? and ask about the issues with the metallurgical work? I believe you mentioned a delay in drilling. Is the reason for the delay that we can't get drillers? Can you clarify why we experienced this delay? Also, please discuss the reasons behind this pushback.

Simon Oswald Hille, Executive Vice President, Operations and Technical Services

Tanya, thanks for the question. Yes, unfortunately, when we started the program, the first drilling contractor that mobilized to site had substandard drill equipment. From a safety perspective, we had to terminate that relationship and find a second drilling contractor; that sort of led us to a three-month delay on the program. And so we've been working towards that. We do have some interference inside of the ideal spots in which we want to drill due to current production. But we're working through those and hope to sort of get the remainder of the program completed in 2025.

Tanya M. Jakusconek, Analyst

Okay. And so you do have now a driller in place, the contractor to do that drilling, and you're just managing your production versus the drilling is how I understood it?

Simon Oswald Hille, Executive Vice President, Operations and Technical Services

You are correct.

Tanya M. Jakusconek, Analyst

Okay. That's good. I’m going to leave K??lada?. Now, regarding Skouries, could someone assist me with a couple of things? First, congratulations on having that many people on site. As we approach the end of the year and prepare for the first production, could you remind me what skilled labor is needed? Also, how confident are you in retaining this labor? I was very pleased to hear about the productivity being slightly above or at expected levels. It has been really hot there, so I’m curious about how productivity has been affected through August due to the heat. That’s my first question about Skouries.

George Raymond Burns, President and CEO

Yes. When evaluating the trades, we are in a strong position with the concrete now, and that work will be winding down in Q3, with just some minor tasks left for Q4. I would consider that risk to be resolved. We successfully increased mechanical installations and structural steel in Q2, and that progress will carry on into the early part of Q3. We managed to secure additional accommodations and, with more personnel available, we executed on that. The increased workforce compared to our earlier plans this year is allowing us to finish work that isn't on the critical path. By completing this early, we can relieve the commissioning schedule. For instance, we have already commissioned the filters for the concentrate, and in August, we'll be commissioning the pebble pressure circuit, as that construction was finished this month. We will continue to push available trades to accelerate work and reduce risks for the overall project. However, this will not impact the critical path item, which is the dry stack filter plant. We are fully committed to productivity, which is a very positive sign. It indicates that we are on track to deliver on schedule and within budget. Any further questions on this?

Tanya M. Jakusconek, Analyst

Yes, I do. George, could we discuss the first gold pour? It seems everything is going according to plan. I’m not sure when in Q1 that will happen. Could you remind me of your definition of commercial production? Additionally, can you provide the timeline for this plant to reach steady state and highlight any critical items involved?

Paul Ferneyhough, Executive Vice President and CFO

Tanya, it's Paul. Just on the commercial production definition, it is open to interpretation. But based on what we see from peers in the industry, I think commercial really is going to be where we've exceeded something like 70% of throughput, and we're getting recoveries around the expected levels for the project. So that's what the ramp-up will need to look like.

Tanya M. Jakusconek, Analyst

But that's the definition of going commercial.

Paul Ferneyhough, Executive Vice President and CFO

Yes. It's open to some interpretation, but that's a good, I think, ready reckoner for you to understand what we're aiming to do by midyear next year.

Tanya M. Jakusconek, Analyst

Okay. And then someone can help me on then from there, how long is it going to take to ramp up to steady state and what are the critical items there?

George Raymond Burns, President and CEO

Yes. I would say Q3, we'd expect to be ramped up to nameplate. This is a pretty simple single flotation plant. Many of us in the company have operated these sorts of facilities. I would say the most tricky thing about this plant is the dry stack tailings facility. We've designed it with six filters. In the commissioning phase, we'll have oxide ore, which is going to be variable and tricky, but we'll be at lower throughput, and we'll have that extra filter capacity at that point. So we believe we're going to have a pretty smooth ramp-up in the second quarter. There'll be some challenging oxide ore types going through that plant. We've worked with Metso, our manufacturer, ensuring we have good variability in filter cloth to deal with the variability in ore types that we expect. And as we get through those learnings in Q2, and then it's fine-tuning. And as I say, we think by the end of Q3, we're at nameplate.

Tanya M. Jakusconek, Analyst

Okay. That's great. And if I could squeeze one more in. Just saw a couple of companies have been selling their equity stakes in their investments. Can you just remind me what you have outstanding? I think you have Probe left. I forget what else you have and whether that's core or noncore.

George Raymond Burns, President and CEO

Yes. So there's probably just three equity investments to speak of. First would be our Romanian assets. And as we disclosed, we continue to work on the divestiture of those assets. And at this point, I believe that will happen this year. And then on our toeholds, yes, we have a toehold in Probe and Amex and expect to continue to hold those.

Operator, Operator

Since there are no more questions, this concludes the question-and-answer session and today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.