Osisko Gold Royalties Ltd (OR) Q3 2021 Earnings Call Transcript

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Osisko Gold Royalties Ltd (OR 1.27%)
Q3 2021 Earnings Call
Nov 10, 2021, 10:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning, ladies and gentlemen, and welcome to the Osisko Gold Royalties Q3 2021 Results Conference Call. [Operator Instructions] Please note that this call is being recorded today, November 10, 2021, at 10:00 AM Eastern Time.

Today on the call, we have Mr. Sandeep Singh, President and Chief Executive Officer; and Mr. Frederic Ruel, Chief Financial Officer and Vice President, Finance. I would now like to turn your meeting over to your host for today's call, Mr. Sandeep Singh. [Foreign Speech]

Sandeep Singh -- President, Chief Executive Officer and Director

Great. Thank you, operator. Good morning, everyone. Thanks for joining us for an update on our Q3 financials. Really good quarter for us. I'm not getting tired of saying that. So looking forward to update you on our developments over the course of the last quarter and then looking forward.

As we do, I'll point out that there is a presentation on our website. If you don't already have it, we will be walking through that, Fred and I, pointing out slides as we go. So please make sure you pick up that presentation. And then, starting on Slide 2, I'll also remind you that we'll be making forward-looking statements as we give you this update. So please be mindful of that fact.

On Slide 3, just starting off with some highlights on the quarter, we earned, as you already know, given that we pre-released these numbers, just over 20,000 GEOs, gold equivalent ounces, for the quarter, which led to a record in terms of revenues and cash flows of CAD50 million and CAD44 million respectively for the royalty and streaming segment of our company. The cash margin stayed very similar, 93%, or 97% excluding Renard and no change in that high-margin business. And then on the net earnings side, CAD1.8 million, that's obviously as a result of the impairment on the Osisko Development side of Bonanza Ledge II. Reminder on that front that the purpose or one of the primary purposes of that BL II component, which is not the primary Cariboo assets, is for training, it's largely for the remediation of the PAG pile that sits on surface and it's an area that can be worked well to commission the mill, while the larger project cannot be touched in the permitting process. So bit of noise there, but not more than that.

Adjusted earnings from the royalty segment of CAD23.3 million or CAD0.14 a share. As you know, we increased our dividend a quarter ago to CAD0.055 and paid that dividend on October 15. We've also reissued that dividend for the next quarter in the same way. In terms of some acquisitions, maybe I'll just jump around a little bit. Apart from the dividend, that we've also been more active on our NCIB over the course of the third quarter buying back 1.7 million shares at an average price of CAD15. We've been saying this that the disconnect, if it gets too wide between our fundamental value and our share price, we would take advantage of it and we did some more aggressively in Q3 and we'll look to find if we're given more opportunities, we'll take them in the future.

In terms of new investments, we acquired, as you know, that 2.75% royalty on the TZ project in Brazil, which is now being pushed forward by G Mining very aggressively. We'll talk about that. That does have a buy down, right, which you could take it down to 0.75%, which is how we thought about it. And we also post the quarter concluded a transaction to buy a small portfolio of assets from Barrick with a flagship asset in that, that's moving forward to high grade asset that I will update you on just on the next page.

So a productive quarter for us and a lot of good things happening throughout the portfolio that we'll talk about through the rest of this presentation. On slide 4, I won't go through it because we already have on the TZ side. I think we talked about this last quarter. There was a subsequent event. But generally, good progress from G Mining. We're expecting a fees in the early part of 2021 -- sorry, 2022, forgive me. Construction financing to be kind of sorted out in H1 with a construction decision expected in the second half of next year. So fast tracking, and we look forward to that news flow as well as exploration upside coming from that group.

On the portfolio Barrick portfolio, the asset I was referring to, it was a 2% royalty on the West Kenya project that's being operated by Shanta Gold. It's a very high grade, very high IRR project with a very capable operator in the region who has the capacity to build a mine when this is the core part of their growth strategy. So we look forward to level that business that's going to be placed on this asset within Shanta. You'll notice there is some numbers there in terms of current expectations of a high-grade 105,000 ounce a year type mine for a long mine life. It also sits in a very respective large land package about 1,200 square kilometers, relatively untested with some of the best drill results coming out of it anywhere in the sector at this point, intervals [Phonetic] including 4 meters of over 700 grams, 6 meters of 200 grams a tonne. So that's another kind of small single for us, but one that we think could add a lot of value in the years to come.

On Slide 5, we touched on it earlier in terms of our returning capital to shareholders. We have a very strong dividend yield of 1.4%. We've returned capital to shareholders every day since existence of the Company, and that NCIB just upped it. Between the dividend and the NCIB, this year, we've returned more capital to shareholders than anybody in our peer group if you put the two together. And that will remain a focus for us. Our high margin business allows us to do that no matter what's happening in the commodity cycle. Obviously, great today, but irrespective of the gold price, with a 97% cash margin business, this can be a go-forward factor in our company.

On Slide 6, you just see the production over the quarter by asset. I'd say the producing asset base is performing extremely well. There are positive catalysts across the board and we'll touch on some of them in the subsequent slides. Also worth pointing out on a day where gold is having a bit of a run that we provide gold and silver as we provide the highest precious metal waiting in our peer group we believe are among the highest at a point where we think gold has an opportunity to really outperform after being range bound frankly, either down or range bound for the last 12 months.

Obviously, the CPI number out of the U.S. is not lost on anyone today. I think it's important to point out that it's not only the overall CPI number high, the core number is also high and I think the inflation story is broadening. And I think that rhetoric about it being transitory for much of 2021 is starting to feel more and more hollow. So we think there's a good backdrop for gold. Amongst that backdrop, we're going to be delivering more and more gold ounces at the right time we believe.

Move forward to -- forgive me, it says Slide 7 for me again, but the Canadian Malartic slide. Obviously, this is our flagship asset. It's a phenomenal flagship asset. On the operating side, it continues to do extremely well. Obviously, the catalyst that most people are watching for is the underground story to develop in terms of the underground actual development work that's progressing ahead of schedule. The infill drilling routinely is returning wide, very high grade results for East Gouldie, down to significant depths. The exploration or the extension work of East Gouldie is also coming in extremely nicely, promising widths and grades down to 2 kilometers of depth and out a kilometer and half from the closest resource ounce. So a lot of potential for upside there. Based on the disclosure from the operators, we expect a healthy resource increase in early 2022 and look forward to that news flow.

Apart from what I've already talked about, there's also other components of potential growth. There's a portion called Odyssey Internal, which if you look at the bottom left here, is kind of labeled as that porphyry -- those porphyry rocks sitting between Odyssey South and North. Those have had strong intersections as well early days, but that could contribute with more drilling. Overall right now, I believe there are 15 rigs active. It's been 95,000 meters drilled in the first three quarters, so we expect that momentum to continue. And as it does, really hasn't been any thing -- any step backward on that story. It's only gotten better as the operators focus on it. So, fantastic place to start.

On Slide 8, with respect to two other significant assets at Mantos, we've talked about this before. The debottlenecking project, if you will, the expansion project is nearly complete. They're giving us a 99% pre-commissioning progress. The overall completion of that is still expected in the first quarter of next year, at which point we start to see a ramp up in ounces there, expecting deliveries in the first full five years of post-expansion to average 1.3 million ounces of silver, so significant increase for us. Frankly, one of the better copper intermediate companies in the sector, and we expect those transparency increases on this asset and of the ounces frankly start coming out of the assets, people will start to appreciate this mine for what it is and our silver stream for what it means to us.

At the Eagle mine in -- for Victoria, that's really good news as well. Great result, frankly, in terms of the ramp up. It produced almost 56,000 ounces in the quarter, so a big step-up versus Q2. So it's nice to see the ramp up going as well as it is. Obviously, they're still focusing on exploration, but we expect their -- that efforts will ramp up as well -- so that effort to accelerate as the ramp-up starts to get to steady state and are keen to learn their plans to push the mine even further to 250,000 ounce a year type level in the near term. So excellent update on that front.

On the next slide, Slide 9, just a couple others, and we're touching on not all of our assets, but picking out some things that we think are salient. Very happy to see Minera Alamos start to pour gold or carbon to then pour gold off. So heap leach in Mexico where we have a 3% [Phonetic] NSR, we expect that company to scale up operations as they go at full capacity for full year for 1,000 GEOs for us. It's a brand new asset. It will mark our 18th producing asset and look forward to the success of that endeavor.

On the Seabee side, our 3% royalty there has been an important one for us for a long time. Nice to see the record level of throughput there in September trending toward -- and expectations that they'll trend toward the higher end of their guidance. And that even more importantly, the exploration results that they've been talking up in the near term look very promising. And we look forward to an update on that front in 2022. The Gap Hanging Wall is the next phase of production. And you'll notice there a couple of bullet points of intercepts that board extremely well. So positive results, not just on that ore body, but across all the ore bodies that make up CB complex and look forward to more information on that carrying into the next year.

On Slide 10, updates on the assets that are within Osisko Development Corp, so Cariboo and San Antonio. Cariboo, I think at the end of the quarter, they were up to a 152,000 meters of drilling. That gives them enough information to put the pin in it and now work toward a resource -- sorry, reserve update toward the end of the year, or very early next, but that type of timeframe, and still tracking for feasibility study in the first half of 2022. So those will be the major milestones there. In the interim, they've had good, successful, permitting perspective, including getting another ground bulk sample permit account mountain, which is not necessarily easy to do when you're in the process of a broader permanent cycle. So that shows the strength, I believe, of the relationship that they have with the regulators and so that's work that they can achieve in 2022, which will give them a head start in terms of information and just a head start on the asset overall. So a bit large catalyst on that story expected in 2022 along the same timelines that we've already talked about.

San Antonio, total of almost 23,000 meters have been drilled. We expect positive, potential increases on both the oxide and the sulfide level of that story. Results should be expected shortly, so it'll be good frankly for us and everyone to see more visibility on that asset. We're looking forward to that event. And we think as they continue to drill, the upside potential there, both in oxide and in sulfide is quite high. So we look forward to that story taking shape here in the very near term. In the meantime, they are putting the existing stockpile on -- back on leach with the new leach pad constructed and completed. And so we look forward to a small amount of production from that stockpile, which will be helpful to the overall story.

Couple of other development assets we're touching on today. First, Upper Beaver on Slide 11 here. The drilling there being done by Agnico is continuing to prove out. There's been some very long high-grade runs in the infill program that they're doing and potentially expanding it as well. So we expect that -- we frankly expect a pretty significant update overall in 2022 with respect to drilling and resources, the feasibility, the plan, and the timeline overall for development. Just recently, a project description was submitted in September which described a 10,000 to 15,000 ton per day operation with a 16-year mine life. So, pretty important asset. It's one, where if you go back to the commentary from Agnico, they've been talking about it for some time "us being a mine". The question has been timing and when do they phase it in. I think with the merger with Kirkland Lake, this is one of the areas that they've been talking up of potential synergies, so that has the potential to fast-track things not only for Upper Beaver, but also for other assets like AK and Amalgamated Kirkland, where we have 2% royalty as well. There are 700,000 ounces there that are sitting within 300 meters of the underground development of Macassa. So those prior -- we're probably -- obviously not a stand-alone asset, but can that come into play for us? We certainly hope so and we look forward to hearing more about how that all fits together over the course of next year.

And then Back Forty is an asset currently run by Aquila, which has gone through some permitting hiccups. I think it's maybe not the right word, but some permitting challenges. We're happy to see kind of a revamp permitting process underway, one with a much smaller footprint, smaller open pit, bigger underground, which should serve their permanent process well and frankly also happy to see Gold Resource Corp, a larger producing entity, come in and see the same thing that we do at Aquila does in terms of the potential there. So having a larger, better capitalized producer see that value in Back Forty and the value in the work that the Aquila team has been doing is a positive step and really big step forward in terms of this significant stream for us. So we look forward to that transaction being completed, the permitting work coming out with a positive result and then hopefully this becoming a core part of Gold Resources' growth strategy for their second asset.

On Slide 12, this is a slide that we got to show more routinely, so I won't go through it in detail, just our growth profile. A lot of organic growth on the come is the summary of it. Some of it hits in 2022 and 2023. There are other chunky assets that are moving forward more to the middle of decade, but they are generally assets that matter. These are important assets in the sector run by credible groups, excuse me. And never as fast as you'd like, but they're on the come. Even our long-term assets are benefiting from significant catalysts and progress. So when you look at this page, I think we've got a decade of growth in front of us that's in strong shape, and look forward to seeing that develop over the years.

So, I'll pause there and hand it off to Fred, who will give you a little bit more color on the actual financials, and then I'll be back to wrap it up and for the Q&A.

Frederic Ruel -- Chief Financial Officer and Vice President, Finance

Thank you, Sandeep. [Foreign Speech]. Good morning, everyone. Thank you for joining us today. Q3 was not too different from Q2. New records were reached with strong deliveries of gold and silver, which led again to record revenues and operating cash flows from our royalties and streams business. And if we go to Page 13 of the presentation, we recorded record revenues of CAD50 million compared to CAD41.2 million in Q3 of 2020, which was of course impacted by the COVID pandemic. We also had offtake revenues in 2020, which is not the case in Q3 of this year as our last producing offtake was converted into a stream last April.

Cash flows from operating activities were CAD41.1 million on a consolidated basis for the royalties and streams segment alone. Cash flows from operations reach a record CAD44.1 million compared to CAD37.3 million in Q3 of last year. If we go on Page 14, we present a summary of our earnings and adjusted earnings. Consolidated net earnings to Osisko shareholders was CAD1.8 million or CAD0.01 per share compared to CAD12.5 million in 2020 or CAD0.08 per share. The lower net earnings, as mentioned by Sandeep, was due to the impairment charges recorded by Osisko Development of CAD33.3 million.

On a consolidated basis, adjusted earnings were CAD17.9 million, CAD0.11 per share, which includes adjusted earnings of CAD23.3 million or CAD0.14 per share from the royalties and streams segment and an adjusted loss of CAD5.4 million from Osisko Development or CAD0.03 per share.

On Page 15, we have a summary of our quarterly results with additional details for the royalties and streams segment, which includes a gross profit of CAD33.8 million compared to CAD30.8 million last year. And as we have previously mentioned, operating cash flows of CAD44.1 million were generated in Q3 by our royalty and streaming business for a total year-to-date of CAD118 million.

On Page 16, we have a breakdown of our cash margin for Q3 and the first nine months of 2021. In Q3 of this year, the cash margin on our royalties reached CAD34.4 million. The cash margin on our streams amounted to CAD12.1 million for a total of CAD46.5 million. This brings the total cash margin for the first nine months of the year to CAD140 million.

And on Page 17, you'll find a summary of our financial position. Our consolidated cash balance was CAD152 million at the end of Q3, including CAD80 million for Osisko Gold Royalties and CAD72 million for Osisko Development. Osisko Gold Royalties held investments having a value of CAD169 million at the end of September in addition to our investment in Osisko Development valued at over CAD500 million. Our debt was stable at CAD405 million with over CAD535 million available under the credit facility, which as you know, was increased and extended last July. We have also acquired 1.7 million shares under our NCIB program for CAD26 million in Q3 for a total of CAD2.1 million in 2021 or CAD30.5 million.

In summary, we had record revenues and operating cash flows in Q3, as a result of strong deliveries and gold prices. And with the increase in gold prices and silver prices this morning following increased inflation in the U.S., we can only be optimistic for Q4 as well. I will now turn the call back to Sandeep for closing remarks and questions.

Sandeep Singh -- President, Chief Executive Officer and Director

Thanks, Fred. And we will open it up for Q&A here any second. Just been brought to my attention that perhaps there was a delay of about 10 minutes for some people entering the call, so our apologies for that. Hopefully, we can make it up in the Q&A if we need to, but rest assured. I said some great thing in those first 10 minutes, better than what you probably heard. But it is a simple quarter for us again and the operations are working extremely well. So apologies for that technical glitch. Hopefully, it won't happen again in future.

But operator, with that, I think we can open it up for Q&A.

Questions and Answers:

Operator

Thank you. [Operator Instructions] Your first question comes from Josh Wolfson from RBC Capital Markets. Please go ahead.

Sandeep Singh -- President, Chief Executive Officer and Director

Hi, Josh. Can you hear us?

Operator

Josh, your line is now open.

Josh Wolfson -- RBC Capital Markets -- Analyst

Sorry about that. That was an issue on my end. We see with the permitting and scheduling outlined in the release for Sapuchi at San Antonio. What should we expect in terms of timeframes for, I guess, initial kind of real mining and heap leach processing from that deposit and then overall, how does permitting look there and then scheduling for production?

Sandeep Singh -- President, Chief Executive Officer and Director

Yeah. Good morning, Josh. I think things look frankly quite well. We've always been a little bit worried that with COVID, we might see undue delays. Osisko Development might see undue delays there in Mexico. So far so good, so fingers crossed that that continues and there is no bureaucratic delays. Important to see that the stock pile got permitted and is nearly complete, so that work is ongoing, so there will be a little bit of production, but in terms of the main production that you're referring to from Sapuchi, the hope is that, that permit can come in. We're saying first-half, but the expectation is hopefully early part of next year, and then that's the gating item, once that comes into play, if it does come into play on that time horizon, that we can expect production in 2022.

Obviously, if it comes in earlier, hopefully we can get a little bit more in, but that's the kind of bounds that we're working with. So it'll be a little bit uncertain until the permit comes in and hopefully that once it does, it'll be a little bit more clarity on how much of a year we can catch in 2022. And if we don't catch the year we're expecting in 2022, frankly, it just flows into '23. But, overall, I think we're happy with the progress there and happy with the exploration drilling that we're seeing. It will be nice to get an update out there for everybody. And in the grand scheme of things as far as mining goes, I think it's all pretty near term.

Josh Wolfson -- RBC Capital Markets -- Analyst

Okay. So it sounds like that would imply -- if you get that Sapuchi permit in the first half of the year, you can get production, that would imply, let's say, within a six-month timeframe from permitting receipts, you'd be able to generate production? Is that fair to say?

Sandeep Singh -- President, Chief Executive Officer and Director

Yeah, look if it's the very last day of the first half, I think that's optimistic, but I think we're casting a pretty wide net when we say the first half of the year. So we'll see how that evolves and hopefully it could be sooner or later. And we'll have visibility on that. I think as we sit here on November 10, it's not that far away in terms of getting better visibility on the timing.

Josh Wolfson -- RBC Capital Markets -- Analyst

Okay. And then, for Mantos, so if commissioning is happening in the fourth quarter, should we expect maybe lower production in the near-term as maybe there's some operating interruptions before some improvements next year? And then, can you remind me what the typical delay is between production at the site and when Osisko receives the outputs in terms of revenues?

Sandeep Singh -- President, Chief Executive Officer and Director

I'll ask -- I don't have that second answer for you off the top of my fingertips. Fred, I will answer the first, maybe you want to give that some thought, but I think, overall, we don't in our conversations with the team over Mantos expect the final kind of tie in, if you will, to cause much of a back step in terms of production, so we've been told to date. And as you can imagine, it's a big project, it's not like it happens -- it's not like flipping on a switch. They've been doing it as we speak. As they're 99% complete on pre -commissioning, obviously, certain things are already kind of coming into the fold. So time will tell and it will happen pretty quickly, but so far, we do not expect there to be a step backwards. Same token, is it going to -- it's not a light switch to the positive either, so it will take a little bit of time to ramp up. So we're not expecting to get the full benefit of the year in terms of maybe being at 1.3 million ounces, but hopefully better than we are and then somewhere significantly toward that mark. So that's how we think about Mantos and try to putting you on the spot. If we don't have an answer, we can get back to you with one, Josh, but do you have a sense in terms of the timing delays on Mantos ounces?

Frederic Ruel -- Chief Financial Officer and Vice President, Finance

Yeah. Usually I would say it's one to two months. It's not more than two months.

Josh Wolfson -- RBC Capital Markets -- Analyst

Okay. That's great. And then maybe one final question just on the capital allocation side. The Company has been pretty active on its buyback, and most of the acquisitions in terms of royalties and streams have been smaller dollar amounts. Yeah, and there is a reasonable size debt position, but there's obviously a lot of financial flexibility. How do you see the Company balancing these different elements and perhaps what's the Company's appetite to transact the streams versus buying back stock at current prices?

Sandeep Singh -- President, Chief Executive Officer and Director

Look, I think -- you said -- you used the right word, I think, balance. We feel like we have the financial flexibility to do all of that. Obviously, if we see the right deals, we can reach for them. We have a lot of room on our credit facility. We upped it intentionally. We increased the facility, reduced the cost of it. That provides us kind if a backstop for the convert that comes due at the end of next year. But I said in early 2022 that we would be disciplined at a point in the cycle where there were a lot more options for the sector in terms of how to finance itself, and we worked, and we have been, and we will continue to be. So, we don't have to chase growth the same way as others, perhaps we have a lot of it internally. We're still active looking at things and we still been able to add good quality assets along the way without overpaying for them, assets that don't need spot prices to be viable.

So where we sit today though, I would say with commodities -- most commodities -- sorry, certain commodities having been flat to down with the equity market's a lot more discerning, if you will. I think there's a greater need for royalty and streaming capital, so if we can find the right asset that fit our objectives, we are happy to transact in bigger and bigger sums, but that's how we're managing it. Balance when the stock just gets ridiculous and cheap, we'll step in. I think we can do a little bit of all of it, frankly, and we'll keep reassessing that balance as it changes, and you can imagine, it's a pretty fluid situation. If you see something really big that you want to do, obviously that changes things. But for now we're pretty comfortable that we have the ability to do everything we need to with our balance sheet.

Josh Wolfson -- RBC Capital Markets -- Analyst

Great. Those are my questions. Thank you.

Sandeep Singh -- President, Chief Executive Officer and Director

No problem, Josh. Thank you.

Operator

[Operator Instructions] Your next question comes from Kerry Smith from Haywood Securities. Please go ahead.

Kerry Smith -- Haywood Securities -- Analyst

Thanks, operator. Sandeep, and just for Mentos, just to follow up on Josh's question, would it be reasonable to assume the full year 2023 would be at the 1.3 million ounce straight on the silver deliveries? And would that be what you're expecting, I guess, on the ramp up?

Sandeep Singh -- President, Chief Executive Officer and Director

Did you say 2023, Kerry?

Kerry Smith -- Haywood Securities -- Analyst

Yeah, yeah. Like a full -- basically nine months or 10 months to ramp it up to 2022 and then a full run rate in 2023 calendar year?

Sandeep Singh -- President, Chief Executive Officer and Director

Yeah. No, absolutely. I don't see why that wouldn't be the case. Obviously, a lot can happen between now and then, but it's been a fantastic performer for us. I think the expectation is frankly, hopefully, we can have a long way toward that mark even in 2022. I think it's just -- it'd be premature for me to say until they get the system booted up, but certainly we've been impressed with the operational capability of that group. They hit it out of the park every chance they get. So I think getting ahead of myself, but certainly we're expecting significantly increased year in 2022 and hopefully with that behind them, they'll be humming in '23.

Kerry Smith -- Haywood Securities -- Analyst

And on Back Forty, are you anticipating that the Gold Resource Corp will update that feasibility study looking at -- they're talking about a smaller footprint. I presume they're going to have to update feasibility to look at a smaller or trading in a bigger underground operation, but do you know what their plans are?

Sandeep Singh -- President, Chief Executive Officer and Director

Yes. So yes to all, Kerry. That is the path. There was a new feasibility in the works with Aquila on a stand-alone basis. Our technical team was providing some oversight to that process. We've been able to view for some time that smaller open pit and a bigger underground there makes more financial sense, frankly. And it certainly helps on the permitting side, potentially not meeting -- not impacting the wetlands that where the issue that last time around at all. So we think that makes sense in every way and we're happy to see Gold Resource Allen Palmiere and his team, they'll step-in and see it the same way as we all do. So, they're essentially picking up that feasibility in progress and tend to complete it obviously, and then use that as the backdrop to go back through the permitting cycle, hopefully a cycle that will be shorter this time round is what we're told. But that's the gating item there. But I think there is a really good project there and it's one that they are eager to push forward.

Kerry Smith -- Haywood Securities -- Analyst

And so are you thinking the feasibility -- are you expecting the feasibility would be complete by the end of next year then or earlier than that?

Sandeep Singh -- President, Chief Executive Officer and Director

You're testing my recall now, Kerry, but I think the answer is earlier than that. It's something that was underway as soon as kind of the permitting get a snag this year, frankly. A lot of the work and the thinking had already been done by the team there. So, yeah, I wouldn't expect it to take all next year. I just don't of the top of my head remember the exact timeline, but it's -- I had to guess I think we're thinking kind of certainly kind of middle of the year if not maybe even sooner.

Kerry Smith -- Haywood Securities -- Analyst

Okay. Because I -- would I be correct in my recollection that they need that update feasibility before they can go back into the permitting cycle, correct?

Sandeep Singh -- President, Chief Executive Officer and Director

Yeah. Look, I think that's absolutely fair. I mean, if you're going back to the permanent cycle, you need to kind of show them what the difference -- the new project looks like. That's why I think the timeline for that feasibility is actually quite a bit sooner, but I just don't have it at my fingertips right this second. But yes, they will need that feas if they go back to the permanent cycle.

Kerry Smith -- Haywood Securities -- Analyst

Okay. I got you. And then just last question quickly on Renard. Based on the quarterly average carat values that you are realizing -- that they are realizing, it would seem that that operation is looking significantly better and I'm just wondering when you're going to bring it back in, and start receiving the GEOs from that operation?

Sandeep Singh -- President, Chief Executive Officer and Director

Yeah, look, things are going well there from a diamond price perspective. We didn't put it in the press release, so if you didn't catch it in the MD&A, the last sale I believe was $104 [Phonetic] and change. Frankly, for a smaller set of diamonds, not as good quality, so [Indecipherable] result. The Company is building up some cash has been for a little while, so that's all positive. Renard is something we've been working to get back -- to get value back on for some time. Currently, as you've pointed out, I think, as you allude to, we're distributing our stream proceeds back until April of next year. So that's something we spend time on, Kerry, absolutely and we'll come back to you in the market when we have a better solution there for us. But as I said, really positive results. Things are looking better there than we'd expected and well, the purpose of us kind of sticking around and that private goal was to get back to our stream value and that's our objective.

Kerry Smith -- Haywood Securities -- Analyst

Okay. But that -- you are going to the April 2022 timetable of just keep reinvesting the cash, so I guess?

Sandeep Singh -- President, Chief Executive Officer and Director

Not necessarily. This is best of the mark that's there right now, and having those discussions all the time really. But obviously that -- every sale has continued to bolster the treasury, and so we're having those discussions all the time.

Kerry Smith -- Haywood Securities -- Analyst

Great. Okay, OK. That's great. Thank you very much.

Sandeep Singh -- President, Chief Executive Officer and Director

My pleasure, Kerry.

Operator

And your next question comes from Ross Cardon from Polygon. Please go ahead.

Ross Cardon -- Polygon -- Analyst

Hi, guys. Yeah, just one for me on the diamond price list. I saw the commentary in the MD&A. Is that more quality driven or market driven? Because it looked like a pretty healthy increase. I'm just trying to put it in context of what we see from other diamond producers, which have seen kind of smaller, but this looks like a pretty big jump-start. I know [Indecipherable], but if you have any color on that?

Sandeep Singh -- President, Chief Executive Officer and Director

Yes. Hi, Ross. It's -- the quality -- in fact, the quality of Renard diamond hasn't markedly changed. In fact, if anything, in that last sale, as I pointed out, maybe not well, it was a worse set, a worst batch, if you will. So it was nice to see the uplift even with that backdrop. So I think it is really a market impact in that scale of diamonds in that band of diamond quality and sizes. I think now we have formally seen the last of the Argyle batches hit, which is a set of diamonds that's very comparable. So I think there's a bit of that production in stock, but I think we're seeing the last batches hitting that, so promising that market is strengthening the way it is.

Ross Cardon -- Polygon -- Analyst

Yeah, no, that is interesting. Okay. Thank you. That was it.

Sandeep Singh -- President, Chief Executive Officer and Director

No problem, Ross.

Operator

And there are no further question at this time. I will turn the call back over to the presenters for closing remarks.

Sandeep Singh -- President, Chief Executive Officer and Director

Thank you, operator. And thanks everyone for taking the time. Again, our apologies if you missed out on the front bit. If there are any kind of further burning questions, you can reach out to us anytime. We're very proud of the status of the Company right now, proud of the quarter, proud of the asset base. Happy to talk to you about it at any point in time.

And with that, maybe just one small note. Obviously, tomorrow around this time, Remembrance Day. So on behalf of our whole team and obviously everyone listening, I'm sure we thank those who have fought and those continued to fight to defend our way of life. It's easy to get kind of bogged down into your own issues, but hopefully tomorrow, during that moment of silence, people take a second to focus on the bigger picture. So, stay healthy, be well and enjoy the positive gold day. Thanks, everyone.

Operator

[Operator Closing Remarks]

Duration: 39 minutes

Call participants:

Sandeep Singh -- President, Chief Executive Officer and Director

Frederic Ruel -- Chief Financial Officer and Vice President, Finance

Josh Wolfson -- RBC Capital Markets -- Analyst

Kerry Smith -- Haywood Securities -- Analyst

Ross Cardon -- Polygon -- Analyst

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