First Quantum Minerals Ltd. Q1 2023 Earnings Call

[music].

Speaker 1: First quarter.

First quarter.

Speaker 2: 2020-2023 results conference call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions.

2000, 22023 results conference call as a reminder, all participants are in listen only mode and the conference is being recorded after the presentation there'll be an opportunity to ask questions to join the question queue. You May Press Star then one on your telephone keypad.

Speaker 2: To join the question queue, you may press star, then one on your telephone keypad.

Speaker 2: Should you need assistance during the conference call, you may signal an operator by pressing star then zero. I would now like to turn the conference over to Benita Till, Director Investor Relations.

Should you need assistance during the conference call you May signal, an operator by pressing Star then zero.

I'd now like to turn the conference back over the conference over to Benita to director of Investor Relations. Please go ahead.

Speaker 3: Thank you, operator, and thank you everyone for joining us to discuss our first quarter results.

Thank you operator, and thank you everyone for joining us to discuss Oxford.

First quarter results.

Speaker 3: During the call, we will be making forward-looking statements. As such, I encourage you to read the cautionary notes that accompany this presentation, our MDNA and the related news.

During the call we will be making forward looking statements as such I encourage you to read the cautionary note that accompany this presentation, our MD&A and the related news release.

Speaker 3: As a reminder, the presentation is available on our website and that all dollar amounts are US dollars unless otherwise noted.

As a reminder, the presentation is available on our website and that all dollar amounts are in U S dollars unless otherwise noted.

Speaker 3: On today's call will be Tristan Pascom, our Chief Executive Officer, with opening remarks, followed by Rudy Battehorse, our Chief Operating Officer, who will provide an overview of our operation.

On today's call will be true impact from our Chief Executive Officer with opening remarks, followed by really bad horse, our Chief operating officer, who will provide an overview of our operations.

Speaker 3: Brian McWilliam, our Chief Financial Officer, will review our financial results, and Tristan will then wrap things up, after which we will open up the lines to Q&A. And with that, I will now turn it over to Tristan.

Brian Mcwilliam, our Chief Financial Officer will review, our financial results and should pools Engrafting dock after which we will open up the lines to Q&A and with that I will now turn it over to Jason.

Speaker 4: Thank you Benita and thank you everybody for joining us on our conference call

Thank you Vanessa and thank you everybody for joining us on our conference call today.

Speaker 4: On our call today we will discuss our first quarter results and provide an update on the business.

On our call today, we will discuss our first quarter results and provide an update on the business.

Speaker 4: In terms of production, 2023 did get off to a relatively slow start and was certainly lower than normal.

In terms of production 2023 did get off to a relatively slow start and was certainly lower than normal.

Speaker 4: really will provide more details on the challenges we face during the quarter. However, thus far in April , whilst it's still early days, we are back on track. The temporary shutdown of Cobra Panama was a one-off event and the operation was able to reach full capacity within two days of restarting.

Really we will provide more details on the challenges we faced during the quarter. However, thus far in April while it's still early days, we are back on track the temporary shutdown of Cobre, Panama was a one off event and the operation was able to reach full capacity within two days of restarting.

The rainy season in Zambia is substantially behind us.

Speaker 4: With the pumping capacity that was increased at Sentinel across the rainy season, we are already accessing higher grade ore in stage 1 and by mid-May we expect there will be water only in the sumps at the bottom of the pit.

With the pumping capacity that was increased at Sentinel across the rainy season, we already accessing high grade ore in stage, one and by mid May we expect there will be water R&M assumption at the bottom of the pit.

Speaker 4: Overall, despite the low first quarter production numbers across the three main operating sites, production will improve in the second quarter and over the course of the year, particularly in the second half, and we remain comfortable with the guidance provided in January .

Overall, despite the lower first quarter production numbers across the three main operating sites production will improve in the second quarter and over the course of the year, particularly in the second half and we remain comfortable with the guidance provided in January .

Yes.

Yes.

Speaker 4: Before we go on to the operations, there were several important achievements in the quarter that I don't want to be overlooked.

Before we go onto the operations there were several important achievements in the quarter that I don't want to be overlooked.

Speaker 4: I am pleased to update the market that commissioning work for the CP100 expansion was completed seven weeks ahead of schedule.

I am pleased to update the market the commissioning work for the CP 100 expansion was completed.

Seven weeks ahead of schedule.

Speaker 4: We achieved first all through the new facilities during the quarter and throughput benefits from Bournville 6 were realised within that week.

We achieved first ore through the new facilities during the quarter.

Throughput benefits from formal six were realized within that week.

Speaker 4: Similarly, the screening plant is achieving results ahead of plan. Although the optimisation to integrate this system into the overall plant will be ongoing over the year, I'm very confident we remain on track to achieve 100 million tonnes per annum run rate by the end of this year.

Similarly, the screening process is achieving results ahead of plan.

Although the optimization to integrate this system into the overall plant will be ongoing over the year I am very confident we remain on track to achieve 100 million tonnes per annum run rate by the end of this year.

Speaker 4: In Zambia, we fed first all through the Enterprise Nickel Plant and we are on track for first nickel production in the second quarter of this year.

In Zambia, we FID first ore through the enterprise nickel plant and we are on track for first nickel production in the second quarter of this year.

Speaker 4: This operation, along with our Raven's Thought Mine in Australia, will place first quantum as one of the top nickel producers in the world.

This operation along with our writing Salt mine in Australia will place first quantum is one of the top nickel producers in the world.

Speaker 4: which complements our position as a leading copper producer and further increases our exposure to energy transition metals.

Which complements our position as a leading copper producer and further increases our exposure to energy transition metals.

Yes.

Speaker 4: I'm also pleased that during the quarter we signed a new partnership with Rio Tinto to move forward the La Granja project, one of the world's largest undeveloped copper ore bodies.

I'm also pleased that during the quarter, we signed a new partnership with Rio Tinto to move forward. The ground project one of the world's largest undeveloped copper ore bodies.

Speaker 4: Adding this major project to our portfolio as the operator will give First Quantum one of the leading copper growth profiles in the industry.

Adding this major project to our portfolio as the operator will give first quantum one of the leading copper growth profiles in the industry.

Speaker 4: We look forward to working with Rio Tinto on this exciting development and also potentially on future base metal opportunities and sharing of know-how and technical knowledge.

We look forward to working with Rio Tinto on this exciting development and also potentially on future base metal opportunities and sharing of Knowhow and technical knowledge.

Speaker 4: We also formed a technology partnership with Itachi Construction Machinery for the development of Itachi's first battery mining trucks, which we expect to be deployed at the Consantia Mine by December this year.

Sure.

We also formed a technology partnership with Hitachi construction machinery for the development of Apache's first battery mining trucks, which we expect to be deployed at the consents you mined by December this year.

Speaker 4: As many of you aware, we have made a commitment to significantly expand the trolley assist network that our minds over the coming years.

As many of you are aware, we have made a commitment to significantly expand the trolley assist networks at our mines over the coming years.

Speaker 4: When our trucks are connected to the trolley system, powered by electricity, our diesel consumption is reduced by up to 90%, which reduces costs and emissions and at the same time delivers operational efficiency benefits.

We're now trucks are connected petroleum system powered by electricity, our diesel consumption has reduced by up to 90%, which reduces costs and emissions and at the same time delivers operational efficiency benefits.

Speaker 4: This initiative with the Tashi represents an important milestone towards the future commercialisation of battery technology and the ongoing decarbonisation of our mining operations.

This initiative with the test sheet represents an important milestone towards the future commercialization of battery technology and the ongoing decarbonization of our mining operations.

Speaker 4: We look forward to sharing similar initiatives with you at our virtual ESG Day on the 13th of June .

We look forward to sharing similar initiatives with you at our virtual ESG day on the 13th of June .

Yes.

Speaker 4: Last but not least, at Cobra Panama, after many years of negotiations, an agreement with the Government of Panama was reached in March.

Last but not least the cobre Panama after many years of negotiations and agreement with the government of Panama was reached in March in my meeting with the president while acknowledging that the negotiations with both rigorous intent intense we both agreed that the outcome in terms are mutually beneficial to both parties and provide.

Speaker 4: In my meeting with the President, while acknowledging that the negotiations were both rigorous and intense, we both agreed that the outcome and terms are mutually beneficial to both parties and provide clarity and stability to Cobra Panama, our stakeholders and the people of Panama for the next 20 to 40 years.

Clarity and stability to cobre, Panama, our stakeholders and the people of Panama for the next 20 to 40 years.

Speaker 4: It has been pleasing to see the collaborative efforts of the Cobra Panama team and the government's team working together since that announcement.

It has been pleasing to see the collaborative efforts of Cobre, Panama team and the government's team working together since that announcement.

Speaker 4: And with that, I will hand it over to Rudy to review the operations.

And with that I will hand, it over to Rudy to review the operations.

Okay.

Thank you Justin.

Speaker 5: Total copper production for first quarter was approximately 139,000 tons.

Total copper production for first quarter was approximately 139000 tons.

Speaker 5: down from 206,000 tons in the fourth quarter of last year.

Allen from 206000 tons in the fourth quarter of last year.

Speaker 5: As each of our three largest operations had negative production impact during the period.

As each of our three largest operations had negative production impact during the period.

Speaker 5: Copper production produced 65,000 tons in a first quarter at Copper Vanilla.

Copper production totaled 65000 tons in the first quarter at Cobre Panama.

Speaker 5: decrease of 24,000 tonnes from quarter four last year as reduction was interrupted for 15 days as a result of the export restrictions imposed by the American port to throat.

A decrease of 24000 tons from quarter four last year as production was interrupted for 15 days as a result of the export restrictions imposed by the Max on Sports Authority.

Speaker 5: During this temporary suspension, maintenance work that was planned for later in the year was moved to this period and following the assumption of exports, production of copper polymer returned to normal and achieved full three-foot rates within days.

During this temporary suspension maintenance work that was planned for later in the year.

It was moved to this period and following the resumption of exports production at Cobre, Panama returned to normal and achieved full throughput rates within days.

Speaker 5: As Tristan highlighted, we were also able to restart with much of the CP100 expansion project coming online and already bonemeal 6 and the process war upgrades are being felt in terms of added production capacity.

That's just highlighted.

We were also able to these thoughts with much of the <unk> one under the expansion project coming online and already ball mill six and approaches were upgrades are being felt in terms of added production capacity.

Speaker 5: Copper C1 cash cost at Copa Panama was $1.65 a pound, two cents higher than the previous quarter mainly attributed to lower production levels.

Copper cone cash cost at Cobre Panama.

It was $1 65, a pound Tuesday and tie it to the previous quarter, mainly attributable to lower production levels.

Speaker 5: At Kinsanshi, production continued to be impacted by mining from narrow-veined areas, particularly in the main 11 area. This area is at low eleva-

At <unk> production continued to be impacted by mining from narrow vein areas.

Typically in the mine in the 911 area.

This area is at low elevation that bank debt.

Speaker 5: and as such provides limited flexibility for adjusting our selective high-grade mine methodology with low mineralized veins high-income.

And as such provides limited flexibility for adjusting our selective high grade mining methodology when low memorialized claims are encountered.

Speaker 5: This meant that during the cold we did have a higher than expected reliance on using stockpiles to augment plant feed.

This means that during the quarter, we did have a higher than expected the reliance on using stockpiles to augment plant feed.

Speaker 5: Compared to the fourth quarter, there was also the seasonal impact of the rainy season.

Compared to the fourth quarter. It was also the seasonal impact of the rainy season.

Speaker 5: As such, consensus copy reduction in the first quarter was 29,000 tons approximately 9,000 tons lower than the fourth quarter. Well, copy P1 cash cost was $2.38 per pound, was $7.00 higher than quarter four, due to the lower product.

As such consensus a couple of production in the first quarter was 29000 tonnes approximately 9000 tons lower in the fourth quarter, while Q1 cash cost of $2 88 per pound.

Was 7% higher than quarter four.

Due to the lower production.

Speaker 5: The impact of rainy season was more intense at Sentinel.

The impact of rainy season was more intense at St Journal.

Speaker 5: the area around the operation receiving the highest rainfall in 25 years. This resulted in a water

So the area around the operation of the seeding the highest rainfall in 25 years.

This resulted in a water accumulation that parts of the pit.

Speaker 5: and challenging road conditions, both of which restrict access to certain mining areas in the puts and high and great war.

And challenging road conditions, both of which restricted access to sit in mining areas.

Hi, Greg.

Speaker 5: As a result, the mine time was re-sequenced and first quarter copper production at Sentinel totaled only 36,000 tons as lower grade parts of the pit were mined. The lower volumes impacted C1 cash costs, which rose to $2.70 for the quarter. Despite the challenges encountered for the start of the year, we are...

As a result, the main thing was re sequenced in first quarter of copper production at central totaled only 36000 tons.

Low grade parts of the <unk> mine.

The lower volumes impacted cone cash costs.

As to $2 70 for the quarter.

Despite the challenges encountered for the start of the year.

We are maintaining our production guidance for each of the operations to which Justin will provide more detail at the end of the call.

Speaker 5: With that, I will hand the call over to Ryan to review the financials.

With that I will hand, the call over to Ryan to review the financials.

Thank you Rudy.

Speaker 6: Starting with the market, the copper price rose 11% through the first quarter, and while data out of China continued to create volatility, global inventories remained very low.

With the market the copper price rise, 11% through the first quarter and while data out of China continues to create volatility globally.

Global inventories remained very low.

Speaker 6: Despite the near-term uncertainty, the impending medium-term structural deficits in the copper market continues to be a focus, as evidenced by recent M&A activity in the sector. Earth Quantum remains very well positioned to benefit from the medium-term outlook as one of the few large copper-focused mining companies.

Despite the near term uncertainty the impending medium term structural deficits in the copper market continues to be a focus as evidenced by recent M&A activity in the sector.

Quantum remains very well positioned.

<unk>.

That's one of the few large copper focused mining companies.

Speaker 6: During the first quarter, total revenue decreased 15%, driven by a reduction in copper sales of 49,000 tons.

During the first quarter total revenue decreased 15% driven by a reduction in copper sales of 49000 tons.

Speaker 6: This decline was the direct result of the lower production levels which Rudy described.

This decline was the direct result of the lower production levels, which were already described.

Speaker 6: That's going to be seen on the waterfall on slide 16. Copper C1 cash cost of $2.24 per pound. We're 20% higher than the previous quarter.

As can be seen on the waterfall on slide 16 capacity cone cash costs of $2 24 per pound were 20% higher than the previous quarter.

Speaker 6: This increase in cost on the unit basis was driven by the lower production in the quarter.

This increase in costs on a unit basis was driven by the lower production in the quarter.

Speaker 6: The slide also highlights that there was relief from inflation pressures as market prices for fuel, sulfur and freight continued to ease. As such, we remain confident in our progress.

The slide also highlight that there was relief from inflationary pressures as market prices for fuel sulfur and freight continue to ease.

As such we remain confident in our cost guidance for the year.

Speaker 6: Slide 18 shows that as a result of the low revenues, Q1 EBITDA decreased to $518 million, net earnings decreased to $75 million and adjusted earnings per share reduced to $0.11.

Slide 18 shows that as a result of the lower revenues Q1, EBITDA decreased to $518 million net earnings decreased to $75 million and adjusted earnings per share reduced to 11.

Moving on to slide 19, and our balance sheet.

Debt reduction continues to be a priority.

Speaker 6: In steep debt in the second quarter of 2020, the company has decreased net debt by $2 billion, and we continue to target an additional $1 billion in debt reduction in the medium term.

With <unk> in the second quarter of 2020, the company had decreased net debt by $2 billion.

And we continue to target an additional $1 billion in debt reduction in the medium term.

Speaker 6: We have also been clear that in order to reduce financial risk in the future, we will be open to partnerships and large projects in order to share the capital burden.

We have also been clear that in order to reduce financial risks in the future. We will be open to partnerships in large projects in order to share the capital burden.

Speaker 6: Our new 55%, 45% partnership with Rio Tinto La Granha is an example of this approach and we'll continue to explore similar structures going forward.

Our new 55%, 45% partnership with Rio Tinto Laguardia is an example of this approach and we will continue to explore similar structures going forward.

Speaker 6: Through the quarter, we redeemed $850 million of senior notes due in 2024, which now means we have no bonds due until 2025.

During the quarter, we redeemed $850 million of senior notes due in 2024, which now means we have no bonds due until 2025.

Speaker 6: Net debt marginally increased from the previous quarter to $5.8 billion due to the timing of working capital cash flows and higher capital expenditure incurred during the shutdown at Kobe Panama.

Net debt marginally increased from the previous quarter to $5 8 billion.

Due to the timing of working capital cash flows and higher capital expenditure and care during the shutdown at Cobre Panama.

Speaker 6: This capex was related to the re-authorization of waste stripping and major maintenance, which Rudy mentioned.

This capex was related to the re <unk> of waste stripping in major maintenance, which Rudy mentioned.

Speaker 6: Next, that has benefited from the agreement we reached with the Government of Zambia last year for repayment of the outstanding BAT based on offsets against income tax and receivables. Enroll.

Net debt has benefited from the agreement we reached with the government Zambia last year for repayment of the outstanding.

Based on offset against income tax receivables and royalties.

Speaker 6: This agreement continues to operate effectively, and as a result we have seen a steady decrease in the overall VAT receivable position over the last few quarters.

This agreement continues to operate effectively and as a result, we have seen a steady decrease in the overall receivable position over the last few quarters.

Speaker 6: During the first quarter we were granted offsets and refunds of $66 million.

During the first quarter, we will go onto the offsets in refunds of $66 million.

Speaker 6: And that brings the finance section to an end. I'll hand the call back to Tristan.

And that brings the finance section to an end so I'll hand, the call back to Christopher.

Thank you Ron.

Speaker 4: Before I move on to the progress of our brownfield projects, I would like to take this opportunity to discuss our guidance for the year.

Before I move on to the progress of our brownfield projects I would like to take this opportunity to discuss our guidance for the year.

Speaker 4: Despite the slow start, we remain comfortable with the guidance ranges provided in January . To provide the backdrop, 2022 was a difficult year and when we approached our guidance for 2023, it was through the lens that difficult is the new normal. And seeing the start of this year was prudent that...

Despite the slow start we remain comfortable with the guidance range as provided in January to provide the backdrop 2022 was a difficult year and when we approach to our guidance for 2023. It was through that lens that difficult is the new normal.

Seeing the start of this year. It was prudent that we took this approach.

Speaker 4: Cobra, Panama, while we had the 15-day stoppage, we also budgeted for a six-month ramp-up of the CP100 expansion facilities, particularly the screening plant.

At Cobre, Panama, while we had the 15 day stoppage. We also budgeted for six months ramp up of the CP 100 expansion facilities, particularly the screening plant.

Speaker 4: The expansion facilities are operating at or above expectations and have been handed over from the in-house projects team to the Cobra Panama operations team. And I would like to thank both those teams for this seamless transition.

The expansion facilities are operating at or above expectations and have been handed over from the in house projects team to the Cobre Panama operations team.

And I would like to thank both those teams for the seamless transition.

Speaker 4: The expansion is ramping up well and we remain on schedule to exit the year at the targeted 100 million tonnes per annum.

The expansion is ramping up well and we remain on schedule to exit the year at the targeted 100 million tonnes per annum.

Speaker 4: At Consangi, we have made additional steps to address narrow veined areas, such as those as we encountered in the Main 11 area in the first quarter. This includes drilling delineation beyond just our normal grade control holes with an extensive stab hole drilling in areas associated with vein mineralisation.

At <unk>, we have made additional steps to address narrow body areas such as those we encountered in the main 11 area in the first quarter.

This includes drilling delineation beyond just a normal grade control holes with an extensive step hole drilling.

Areas associated with find mineralization.

Speaker 4: Over the last five months we have built up capacity to now update our mine planning on a weekly basis, which we expect will allow for better planning going forward based on the most up to date information.

Over the last five months, we have built up capacity to now update our mine planning on a weekly basis, which we expect will allow for better planning going forward based on the most up to date information.

Speaker 4: Additionally, efforts have been made on opening up mining areas at high elevations such as Main 15 and Main 17 which have historically provided higher grades.

Additionally efforts have been made on opening up mining areas at high elevations, such as mine 15, and <unk> 17.

Which has historically provided high grades.

Speaker 4: Although there will continue to be some risk associated with consantia yeast production, the adjusted mine plan will reduce reliance on veined areas and lower grade stockpiles and so at this stage we remain comfortable with the guidance for the year.

Although they will continue to be some risk associated with <unk> production. The adjusted mine plan will reduce reliance on find areas and lower grade stockpiles and so at this stage, we remain comfortable with the guidance for the year.

Speaker 4: Moving on to Trident, and as noted by Rudy, rainfall was unusually high over the rainy season with sensual experiencing higher rainfall and consensualing some of its other neighbouring mines.

Moving on to Trident and as noted by Rudy rainfall was unusually high over the rainy season.

With Sentinel experiencing higher rainfall when consumption some of its other neighboring mines.

Speaker 4: Whilst the original mine plan called for more balanced production throughout the year, water in the bottom of the pit restricted access to higher grade zones, particularly in Phase 1 of the pit, throughout the first quarter. As a consequence, the mine plan has been rescheduled, and even if total volumes remain substantively the same, we will now dispatch those higher grade zoned areas across the remaining three quarters of the year.

Whilst the original mine plan called for more balanced production throughout the year water in the bottom of the pit restricted access to higher grade zones, particularly particularly in phase one of the pit throughout the first quarter.

As a consequence the mine plan, that's been rescheduled and even if total volumes remain substantially the same we will now dispatch.

Those higher grade zones areas across the remaining three quarters of the year.

Speaker 4: Whilst still early in the quarter, April has already seen an improvement in this regard and production is expected to continue to improve over the course of the year, albeit mostly waited to the second half.

While still early in the quarter April has already seen an improvement in this regard and production is expected to continue to improve over the course of the year, albeit mostly weighted to the second half.

Speaker 4: Onto our brownfield projects. At Cobra Panama during the quarter we started construction of the molybdenum plant. This project is progressing well with completion of construction and start of commissioning expected by the end of the year. First molybdenum production is expected in early 2024.

Onto our brownfield projects at Cobre, Panama during the quarter. We started construction the molybdenum plant. This project is progressing well with completion of construction and startup commissioning expected by the end of the year.

First molybdenum production is expected in early 2024.

Speaker 4: At S3, long lead items remain on track for delivery commencing the second half of this year. Overall project procurement is approximately 25% committed and we continue to expect first production in 2025.

It is three long lead items remain on track for delivery commencing in the second half of this year.

Overall project procurement is approximately 25% committed and we continue to expect first production in 2025.

Speaker 4: At Enterprise, despite a challenging rainy season, as I noted earlier, we achieved first all through the plant in the first quarter and expect first nickel production in the second quarter. And a ramp up towards full production next year, 2024.

At enterprise, despite a challenging rainy season as I noted earlier, we achieved first ore through the plant in the first quarter and expect first nickel production in the second quarter.

And our ramp up towards full production next year 2024.

Speaker 4: At Las Cruces, the remaining water concession licence was granted in March and all licences and permits are now in place for the approval of the process.

At Las Cruces, the remaining water concession license was granted in March and all licenses impairments and now in place for the approval of the project. However approval will be dependent on market conditions and our debt reduction objectives.

Speaker 4: However, approval will be dependent on market conditions and our debt reduction objectives.

Speaker 4: In the meantime, work will continue to upgrade the resources to reserves. There is an investor tour to Las Cruces in May and we look forward to highlighting the potential of this asset.

In the meantime, we will continue to upgrade the resources to reserves. There is an investor tour to Las Cruces in May and we look forward to highlighting the potential of this asset.

Speaker 4: As we approach the month of May, I will be coming up to my first year tenure as CEO of First Quantum. When I started this role, I had four primary strategic objectives.

As we approach to the month of May I will be coming up to one my first year tenure as CEO of first quantum when I started this role I had full primary strategic objectives.

Speaker 4: Firstly, to work with the Government of Zambia for solutions that would be conducive to further investment in the country.

Firstly to work with the government of Zambia for solutions that would be conducive to further investment in the country.

Speaker 4: This was achieved last year with a change in the royalty regime and agreements in respect of VAT refunds and the ease of losing business in the country.

This was achieved last year with the change in the royalty regime and agreements in respect of the refunds mdas of doing business in the country.

Speaker 4: This has allowed us to have comfort in sanctioning the SD and Enterprise projects.

This has allowed us to have comfort in sanctioning yesterday and enterprise projects.

Speaker 4: Secondly, to reach a new agreement with the government of Panama, which was achieved in early March.

Secondly to reach a new agreement with the government of Panama, which was achieved in early March.

Speaker 4: We expect that the refresh contract will be presented before the National Assembly in the legislative term that commences on the 1st of July .

We expect that the refreshed contract will be presented before the National Assembly in the legislature is to turn that commences on the first of July .

Speaker 4: Thirdly, to deliver on brownfield projects and in this regard it's been pleasing to see CP100 cross the finish line with Enterprise not far behind.

Thirdly to deliver on brownfield projects and in this regard it's been pleasing to see <unk> 100 across the finish line with enterprise not far behind.

Speaker 4: And lastly to improve the balance sheet and despite the macro challenges and inflation environment over the past year we have made progress and debt reduction will remain a successful.

And lastly to improve the balance sheet and despite the macro challenges in inflation environment over the past year. We have made progress in debt reduction will remain a focus.

Speaker 4: Before I open up the line for Q&A, I also wanted to mention that we have a video of the CP100 expansion facilities on our website, and I encourage everybody to watch it. It certainly demonstrates the in-house capabilities of First Quantum and the remarkable accomplishments of our team.

Before I open up the lines for Q&A I also wanted to mention that we have a video of the CP 100 expansion facilities on our website and I encourage everybody to watch it. It certainly demonstrates the in house capabilities of first quantum and the remarkable accomplishments of our teams.

Speaker 4: The market frequently discusses the need for more copper to achieve the global transition goals to clean energy, as well as the challenges of bringing on new supply due to a lack of shovel ready projects and new discoveries.

The market frequently discusses the need for more copper to achieve the global transition goals to clean energy as well as the challenges of bringing on new supply due to a lack of shovel ready projects and new discoveries.

Speaker 4: However, it is often overlooked that the human capabilities to build new projects will also be a challenge to bringing on new supply.

However, it is often overlooked at the human capabilities to build new projects will also be a challenge to bringing on new supply.

Speaker 4: For this reason and with our confidence in the strengthening long-term prospects for copper, I am excited about First Consumpt's future, as I firmly believe that we are uniquely positioned as a copper-focused producer.

For this reason and with our confidence in the strengthening long term prospects for copper I'm excited about first quantum's future as I firmly believe that we are uniquely positioned as a copper focused producer.

Speaker 4: not only with the optionality in our Greenfield projects, but also in the in-house capabilities of our teams to deliver these projects. I do hope you enjoy the video. Thank you and we will now be happy to take a quick.

Finally, with the Optionality now Greenfield projects, but also in the in house capabilities of our teams to deliver these projects.

I do hope you enjoyed the video.

Thank you and we will now be happy to take questions.

We will now begin the question and answer session.

Speaker 2: Analysts are permitted to ask one question and one follow-up question, and are welcome to rejoin the question queue if they have more.

Analysts are permitted to ask one question and one follow up question.

Welcome to rejoin the question queue, if they have more.

Speaker 2: To join the question queue, you may press star then 1 on your telephone keypad. You will hear a tone.

To join the question queue. You May Press Star then one on your telephone keypad, you will hear tone acknowledging your request.

Speaker 2: If you are using a speakerphone, please pick up your handset before pressing

Youre using a speakerphone please pick up your handset before pressing any Keith.

Speaker 2: To withdraw your question, please press star then...

To withdraw your question. Please press Star then two.

Speaker 2: The first question comes from Emily Zhang from Goldman Sachs.

The first question comes from Emily Yang from Goldman Sachs. Please go ahead.

Okay.

Speaker 7: My first is around the greenfield growth that you've outlined. You know, you've got Takataka, Akira now, you know La Grania in the portfolio. How should we think about the sequencing of those greenfield projects and how should they sit among sequencing of the brownfield expansions you've got currently underway and how does that compare to the comment that you make around the focus on inorganic growth and potentially pursuing other JV structures as well similar to the La Grania acquisition?

My first is around the greenfield growth that you've outlined you've got.

<unk>. Thank you you are now.

And the portfolio how do we how should we think about the sequencing of those greenfield projects and how should they sit among sequencing of brownfield expansions you've got currently underway and how does that compare to the comment that you make around the focus on inorganic growth and potentially pursuing other JV structures as well as similar to the cross luck Ron.

Acquisition.

Okay.

Hi, Amit Thanks for the question, yes. So we're very excited to have <unk> onboard we as I said, it's one of the.

Speaker 4: Yeah, so we're very excited to have Legrange on board. As I said, it's one of the largest undeveloped copper deposits.

Just undeveloped copper deposits in the world and certainly will require a lot of effort and so on to get up to speed Rio Tinto has done a fantastic job there in terms of preparing a platform.

Speaker 4: in the world and certainly will require a lot of effort and so on to get up to speed. Rio Tinto has done a fantastic job there in terms of preparing a platform and we believe we have the capabilities to now take it forward. But in terms of sequencing...

We believe we have the capabilities to now take it forward, but in terms of sequencing.

Speaker 4: In terms of the Greenfield projects, at this stage Argentina and the Tacka Tacka project will be ahead of that, just in terms of the knowledge that we already have around it and the processes for permitting and the main question now which is on the investment climate in Argentina. So at this stage we have that ahead.

In terms of the Greenfield projects at this stage, Argentina, and the <unk> project will be ahead of that just in terms of the knowledge that we already have around it and the processes for for permitting and the main question now which is on the investment climate in Argentina. So at this stage we have that ahead.

Speaker 4: Lagrange will take some time in terms of at least a couple years of studies into the right approach to tackle the project.

<unk> will take some time in terms of at least a couple of years of studies into the right approach to tackle the project.

Speaker 4: and then would be sequenced in that order after Taka Taka. And here at this stage, although we are making progress with the community, we would hold that after La Granca. In front of that, yes, we do continue to work on these.

And then would be sequenced.

In that order after <unk> and <unk> at this stage, although we are making progress with the community.

Would hold that.

After the Gras in front of that yes, we do continue to work on these brownfield development certainly has three fits neatly in in terms of delivery by 2025, and our ongoing work on some of the other opportunities that we have in the business.

Speaker 4: Brownfield development, certainly S3 fits neatly in terms of delivery by 2025, and our ongoing work on some of the other opportunities that we have in the business.

Speaker 4: for example Las Cruces, we will schedule accordingly and to see whether it can fit in and whether it fits with the balance sheet and the debt reduction.

For example, thus cruises.

We will schedule, accordingly, and to see where they're competing and whether it fits with.

With the balance sheet and the debt reduction profile of the business.

Speaker 6: Maybe Emily just answered then the build entrance comments on the second half of your question around focus on inorganic growth have to clarify the the illusion to further joint venture projects such as Lagrangian may also be within our import volos as we look at those green field projects its tristens mentioned given the focus on the balance sheet we're very happy to work with partners going forward either outside of our portfolio like we've now done with Lagrangian or within our portfolio

Maybe Emily just answer than that.

Build interest in his comments on the second half of your question around focus on inorganic growth after clarify the allusion to further joint venture projects such as Laconia may also be within our portfolios as we look at those greenfield projects that <unk> mentioned I think given the focus on the balance sheet, we're very happy to work with partners going forward either outside of our portfolio like we have.

Now done with Laconia or within our portfolio.

Speaker 7: Okay, that makes sense. Thanks, Brian . My second question, just around Sentinel-1, wanting to follow up on the comments around the de-watering there at the stage one pit. I guess it seems like you've made some access to those higher grades this year, but should we expect that to come more meaningfully in the latter part of the second quarter or how should we think about that access to the higher grades?

Okay that makes sense.

Brian My second question just around central one wanting to follow up on the comments around the de watering there at this stage one pit.

It sounds like you've made some access to those higher grades this year, but should we expect that to come more meaningfully in the latter part of the second quarter or how should we think about that access to the higher grades.

Speaker 4: Thanks Emily, yeah. So no surprises, the highest grades in the minor at the bottom of the pit. That's why we mined that area first. So when we do get these excessive rainy periods, those are the areas that challenge the most. And so we didn't have access. We had a blended approach. Obviously, within the mind plan, we tried to smooth that across the year. And so we've had restricted access.

Thanks Emily.

No surprises the highest grades in the minor at the bottom of the pit that's why we mind that area first.

When we do get these successive rainy periods those are the areas that are.

Challenged the most.

And so we didn't have access we had a blended approach obviously within the mine plan, we try and smooth that across the year and so we've had restricted access and so in the first quarter, we've been taking the lower grades that otherwise would've been blended across the year. So now as we empty water and we as we expect to have.

Speaker 4: So in the first quarter we've been taking the lower grades that otherwise would have been blended across the year. So now as we empty water and we expect to have all the water out down to the stumps by mid-May, that high grades will come through and be sequenced across the three remaining quarters. So I think it will be more weighted to the second half of the year, sort of trending up 70,000 tons or so per quarter and trending up.

The water out down to the subs by mid May that high grades will come through and be sequenced across the three remaining quarters. So I think it will be more weighted to the second half of the year.

Sort of trending up.

70000 tons or so per quarter and trending up.

Speaker 4: And certainly, the initial in April , we've already been able to access some of those higher grades lower down and that should continue to improve.

And.

And certainly the initial in April we've already been able to access some of those higher grades slowed down and that should continue to improve.

Speaker 2: The next question comes from Jackie Prisolowski from BMO Capital Markets.

The next question comes from Jackie <unk> from BMO capital markets. Please go ahead.

Speaker 8: Thanks very much, and I did enjoy that video on CP100, so thanks very much for sharing that. I guess I wanted to follow up on a comment, Tristan, that you made in the opening remarks. You said that you've got an investor tour going to Las Cruces in May, which is a bit of a surprise, because we haven't been hearing much from Las Cruces, and I'm assuming that's just...

Thanks very much.

I did enjoy that video on CPE 100, so thanks very much for sharing that.

Just I guess I wanted to follow up on the comment that you made in the opening remarks.

So that you've got an investor tour.

Going to lets cruises in May which is.

A bit of a surprise because we haven't been hearing much from let's cruises and I'm, assuming that's just.

Sure.

Speaker 8: convenient timing with with an upcoming conference, but can you maybe talk about what you're planning to show showcase there? I know you've recently received the licenses and permits you need, but it sounds like it still a ways away from making a decision. So can you talk a little bit about what you're planning to showcase on that tour?

Convenient timing with with an upcoming conference, but can you maybe talk about what Youre planning to show showcased there.

I know you've recently received.

Licenses and permits you need but it sounds like there's still a ways away from making a decision can you talk a little bit about what you're planning to showcase all mature.

Okay.

Speaker 4: Yes, thanks, Jackie. So, last cruises, yeah, we're not planning to sanction that decision and certainly...

Yes. Thanks.

Jackie.

Las Cruces, Yes, we are not planning to sanction that decision and certainly.

Speaker 4: the opportunity to provide a tour there was a coinciding with the conference in Barcelona and that works very well. But we will be showcasing in particular the technology development there that the in-house team of First Quantum has really delivered on, which is the polymetallic refinery technology. And we think can unlock a lot in the future in the pirate belt of Porto.

The opportunity to provide a tool there was I coinciding with the conference in Barcelona, and that works very well.

But we will be showcasing in particular, the technology development there that the in house team of first quantum has really delivered on which is the poly metallic refinery technology and we think can unlock a lot in the future.

The pyrite belt.

Portugal and Spain.

Speaker 4: But all of that is conditional on the project on a stand alone basis making good sense. And that's what we continue to work through. We will be explaining the underground mining methodology, our approach to dewatering there and the good relationship that we have with regulatory authorities and the government there and the need that Europe continues to express in terms of increasing its own domestic production of.

But all of that is conditional on the.

The project on a standalone basis, making good sense and that's what we continue to work through.

He will be explaining the underground mining methodology, our approach to dewatering.

And the good relationship that we have with regulatory authorities and the government there and the need that Europe continues to express in terms of increasing its own domestic production of renewed.

Speaker 4: renewable energy metals such as copper.

Renewable energy metals, such as copper.

Speaker 4: So we will be showcasing that and really to take the opportunity around the Barcelona comp.

So we will be showcasing that but and it's really to take the opportunity around the bottom line of conference.

Speaker 8: Thank you very much and maybe following up on the processing theme, you talked about LaGrania and just to follow up on Emily's question, maybe...

Perfect. Thank you very much and maybe following up on the processing theme.

You talked about Laguardia and just to follow up on Emily's question maybe.

Speaker 8: We've heard in the past that this is a high arsenic or body, and this may be been a bit of a challenge from that perspective to date. Can you talk about how you see the opportunities to process that or body and his technology evolved in a way that this makes more sense now or will make more sense in the next few years to process the or is there more work than used to be done on that?

Yes.

In the past this is a high arsenic ore body and.

And this may be Ben.

Bit of a challenge from that perspective to date can you talk about how you see.

The opportunities to process that ore body and his technology evolved in a way that.

It makes more sense now or will make more sense in the next few years.

To process the ore or is there more work that needs to be done on that.

Yes.

Speaker 4: Thanks Jackie, yeah we think Rio have done a fantastic job there in terms of understanding that but there's some more work to be done in terms of delineation and in particular on the zones where arsenic

Thanks, Jackie Yes, we think Rio have done a fantastic job there in terms of understanding that but there is some more work to be done in terms of delineation and in particular.

The zones, we asked Nick.

Speaker 4: comes into play. And John Gregory, you might just comment a little bit further on how we see the mine plan evolving over time, but at this stage we wouldn't be deploying any non-conventional processing technology, but we do believe that there's an approach we can take on the mining side to be able to overcome that. We've had that before at Guelmucrine and being able to cope with that high isonic, but John you might explain a little bit further.

Comes into play and John Gregory you might just comment a little bit further on how we see the mine plan evolving over time.

But at this stage, we wouldn't be deploying any nonconventional processing technology, we just we but we do believe that there is an approach we can take on the mining side too.

To be able to overcome that we've had that before at global <unk> and being able to cope with that high arsenic, but John you might explain to move it further.

Okay.

Speaker 9: Hi, thanks Tristan. Yes Jackie, we've had the opportunity to look at the geological database and some preliminary aspects of the geology and we're now embarking on the...

Hi.

Thanks, Tristan yes Jackie.

<unk> had the opportunity to look at the geological database and some preliminary aspects of the geology.

And we are now embarking on further.

Speaker 9: campaign to understand the domaining but one of the things that is clear is arsenic is clearly Constraint in a structural manner so therefore it is domain and that's well how we want to model it going forward

Pain to understand the domain name, but one of the things that is clear is lost Nick is clearly.

Constrained in a structural manner. So therefore Tuesday, and that's how we want to model it going forward.

Speaker 9: And in doing so, we will be able to optimize the initial mining process.

And in doing so we will be able to optimize.

The initial mining process.

Speaker 9: conventional open pet operations with a degree of selectivity, which will not inhibit production and just to confirm that we are looking at conventional sulfide floatation as the means of processing this material.

Through conventional open pit operations with a degree of selectivity, which will not inhibit production.

And just to confirm that we are looking at conventional.

Sulphide flotation.

Means of processing this material.

Okay.

Speaker 2: The next question comes from Aristroacadel from the Scotia Bank.

The next question comes from Rs <unk> from Scotiabank. Please go ahead.

Speaker 10: Wanted to come back to the guidance for the year. I mean, based on what you did in Q1, by mind that, you'd have to produce an average of 210,000 tons of copper in every quarter for the rest of the year just to make the molland of your copper production guidance. That seems like a stretch to me. Can you walk us through why you think that's a reasonable assumption at this point?

I wanted to come back to the guidance for the year.

I mean based on what you did in Q1.

Might that you'd have to produce an average of 210000 tonnes of copper and every quarter for the rest of the year just to make the low end of your copper production guidance.

That seems like a stretch to me.

Can you walk us through.

Why do you think thats a reasonable assumption at that at this point.

Speaker 4: Thanks, Horace. Yeah, so that's reasonable to say that, but looking at what we have, so just walking through the three main sites at Cobra Panema, bringing on the...

Thanks <unk>.

Yes.

That's reasonable to say that but looking at what we have so just walking through the three main thoughts at Cobre Panama.

Bringing on the.

Speaker 4: Boramil 6 in the process water plant upgrades has already been put in place.

The ball mill, six and the process water plant upgrades have already been put in place.

Speaker 4: We believe we can be north of sort of 90,000 tons a quarter.

We believe we can be north of 90000 tons.

Speaker 4: and that certainly the all-body and so on supports that, that doesn't result in any sort of change in sequencing or rescheduling of the mind plan. We did have some lower grades in Q1 as we went into the closure and that was really just around managing how much concentrate we had in the shed at that time. We didn't want to push too much through. So we actually reserved some high grade areas over that period.

<unk>.

And certainly the ore body and so on supports that that doesn't result in any sort of change in sequencing reshaped tooling of the mine plan. We did have some lower grades in Q1 as we went into the closure and that was really just around managing.

How much concentrate we had in the shared at that time, we didn't want to push too much through so we actually reserved some some high grade areas over that over that period.

Speaker 4: but no major rescheduling is required there and we're very confident in the ramp up of the CP100 expansion is going very well so far. There is some work to be done.

But no major rescheduling is required there and we're very confident in the ramp up of the CP 100 expansion its going very well. So far there is some work to be done in terms of the screening plant and its optimization and the wider plant.

Speaker 4: screening plant and its optimisation in the wider plant, but BOR-MIL 6 and the process of water upgrades are going very well.

But full mill six and the prices were upgrades are going very well.

Cobre, Panama at Sentinel.

It's really that all the grade that we had across the years remains available to us. If it was always there was just at the higher grades were under that water. So that is simply a rescheduling because we didnt have access it would've otherwise been blended across the year and now.

Speaker 4: All the grade that we had across the year is remains available to us. It was always there, it was just that the higher grades were under that water. So that just is simply a rescheduling because we didn't have access. It would have otherwise been blended across the year. And now, you know, we took lower grade areas by necessity in the first quarter. And over the next three quarters, those higher grades come through. So...

We took lower grade areas by necessity in the first quarter and over the next three quarters those high grades come through so the total for the year is the same and it's just that the higher grades come over the next three quarters rather than in the first quarter.

Speaker 4: The total for the year is the same and it's just that the higher grades come over the next three quarters rather than in the first quarter. And it continues.

And at Constancia.

Speaker 4: We were conservative on the assumptions around consenting. There is some work, the challenge has really been on geology and greater dilution. And as Rudy mentioned, we were focused in the main 11 area and now moving across into areas that have less of those planar structures.

We were conservative on the assumptions around <unk>.

There is some work the challenge is really paying on geology, and greater dilution and as Rudy mentioned, we will focus in the mine 11 area and now moving across into areas that have less of those finest structures and.

Speaker 4: and we had a high level of stockpile processing in the first quarter and we now expect to be taking more directly from mine feeds, particularly from main 15 and main 17 and it's the proportion of those we think consensual.

And we had a high level of stockpile processing in the first quarter and we now expect to be taking more directly from <unk>.

Mine feed, particularly from <unk>, 15, and <unk> 17 and.

And as the proportion of those we think consents you will be at or above through around 40000 tons of copper production for the quarter.

Speaker 4: adder above to around 40,000 tons of copper production per quarter.

Speaker 10: Okay, thank you. And just a quick follow up. Can you maybe give us a color on the grade at CobraPanama Q1? I mean, the 0.4% is a pretty low grade. Was that specific to just the operating challenges you're having with storage of concentrate or is there something else going on?

Okay. Thank you and just as a quick follow up can you maybe give us some color on the grade at Cobre, Panama Q1 zero, 4% is a pretty low grade was that specific to just the operating challenges you are having with storage of concentrate are or is there something else going on.

Speaker 4: No, it was very much related to that. We did take the opportunity to go and make sure that we were finishing off on final walls.

No that was very much related to that we did take the opportunity to go and make sure that we were finishing off.

On final walls.

Speaker 4: as the guys say, eating our vegetables and that sets up the mind really well for the rest of the year because we were in lower grades for the reason you mentioned because we'll stop, essentially concentrate constraint. We couldn't store it anywhere. So we went to did all of that background work, brought forward maintenance over that period of time and now we have the opportunity to go and take those, some of the higher grades that we're in.

As the guys say aiding our vegetables and that sets up the mine really well for the rest of the year.

Because we were in lower grades for the reason you mentioned because we will stop.

Essentially concentrate constrained we couldnt store it anywhere.

So we went to do that at all of that background work brought forward maintenance over that period of time.

And now we have the opportunity to go in.

Take those some of the high grades.

Speaker 4: put aside and so on over the course of the year remaining.

We'll put aside and so on over the course of the year remaining.

Speaker 2: The next question comes from Shane Nagel from National Bank Financial.

The next question comes from Shane Nagle from National Bank Financial. Please go ahead.

Speaker 11: Thanks, operator. Tristan, just wondering, you kind of outlined the mine sequencing for consumption and dealing with some of that great variability for 2023. As you've done some of the work, is there anything from the mine plan that may give you some hope or some potential upside over the next couple of years in terms of that variability or relying less on that or stockpiles? Or if it couldn't just kind of be a Q1 issue going forward as we're in the...

Thanks, operator.

Wondering.

Kind of outlined the the mine sequencing for Tuesday at Constancia and dealing with some of that great variability for 2023.

As you've done some of the work is there anything from the mine plan that May give you some hope or potential upside over the next couple of years in terms of that variability or relying less on that Delaware stockpiles or is it going to just kind of be a Q1 issue going forward as where you are in the rainy season.

Speaker 4: Shane, I think that's the reality. It's tough at consent. The moment reality is at main 11, we were sort of at the bottom of the pit, where things start to pinch out and...

Yes, Shane I think Thats a reality.

It's tougher consensus at the moment realities minor living we went through the bottom of the pit with things start to pinch out and.

Yeah.

Speaker 4: We're limited in flexibility because we are at the bottom of the pit and the mining methodology there remains selective. That's what we've been at Constanci for 20 years and we need to move across to the bulk mining methodology but that relies on S3.

So we limited and flexibility because we are at the bottom of the pit in the mining minister methodology they remain selective.

That's what we've been a consensus for 20 years, and we need to move across to the bulk mining methodology, but that relies on ace III. So next couple of years, we will be.

Speaker 4: So, you know, next couple of years we will be, you know, have these constraints over us on geology and the challenge on dilution. We've been conservative in our estimates, our guidance for that. And as we go back up in the all-body to higher positions, and that's main 15 and main 17, you know, we expect the impact to be less.

Have these constraints over us on geology and the challenge on dilution.

We've been conservative and now our estimates are guidance for that and as we go back up.

In the ore body to higher positions and Thats minus 15 and minus 17.

The impact to be less.

Speaker 4: but nonetheless we will have that challenge. Once we get to S3 and have that running, we can very much take an average approach on a large block size, putting large volume through the mill, and that takes away all of this sort of selective mining that we've been doing for 20 years and moves us to a different basis. But until then we will have this challenge.

But nonetheless, we will have that challenge once we get to a three and have that running we can very much take an average approach on large block size, putting large volume through the mill.

And that takes away all of this sort of selective mining that we've been doing for 20 years and moves us to a different basis, but until then we will have these challenges.

Speaker 11: And then just on the, maybe going into the costs at Cobra, Panama, cause you remind us again, I mean, I believe the higher, uh, coal prices of the hedges roll off next year are in the guidance. Um, but if you just remind me what, um, what assumption went into that in terms of the coal price, and then has there been any work on increasing potentially the amount of power that you draw from renewable sources, uh, in country to maybe help offset.

And then just on the maybe going into the costs at Cobre, Panama could you remind us again I believe the higher coal prices as the hedges roll off next year or in the guidance.

But you can just remind me what.

What assumptions went into that in terms of the coal price and then has there been any work on increasing potentially the amount of power that you draw from renewable sources in country to maybe help offset some of that increase next year. Thanks.

Speaker 4: Sure Shane, Ryan do you want to take that question? Yes, Shane, so I'll guidance for next year and the following year, it assumes $150 coal price based on consensus pricing. You've seen the coal prices come below 200, but if we see $200, tonne coal prices are covered Panama, that makes about a five cents increase and I'll see one cost.

Sure Shane Ron do you want to take that question, yes, Shane side, our guidance for next year and the following year assumes $150 coal price based on consensus pricing you've seen thermal coal prices come below 200, but if we see $200 tonne coal prices of cobre, Panama that makes about a <unk> <unk> increase in our <unk> cost.

Speaker 6: We would note if you see spot prices in general continue, what you'll also see is a higher money price, which is now spending, sitting around $30 per pound, more than double what we assumed in our buy products for next year. So if we assume the same, and that also has around the five cents per pound benefit. So coal would be coal stays where it is today. You'd see our costs go up by five cents per pound relative to guidance. If money stays where it is today, you'd see our costs go down by around five cents per pound relative to guidance.

We would note if you see spot prices in general continue what you'll also see is a higher multi priced which is now spreading setting around $30 per pound more than double what we assumed in our byproduct for next year. If we assume the same and that also has around five cents per pound benefits so call it would be.

Stays where it is today you would see our costs go up by five per pound relative to guidance.

<unk> stays where it is today you would see our cost go down by around five per pound relative to our guidance.

Speaker 2: The next question comes from Lawson Wender from Bank of America Securities.

The next question comes from Lawson Winder from Bank of America Securities.

Please go ahead.

Speaker 12: I get good morning everybody. Thank you for the update today and taking the question. I wanted to ask about the guidance as well. So I mean it makes sense what you're saying about the production. It does look like you've set out a clear plan to achieve that. And I just wanted to ask kind of a similar question about the cash cost that you've now guided to. I mean for example like moving the ramps and changing the mine plan, it's sensitive, might add some additional cost. I'd be curious if maybe the...

Hi, Good morning, everybody. Thank you for the update today and taking the question.

I wanted to ask about the guidance as well so I mean, it makes sense, what you're saying about the production. It does look like.

Like you've set out a clear plan to achieve that and I just wanted to ask kind of a similar question about the cash cost that you've guided to I mean for example, like moving the ramps and change in the mine plan et cetera might add some additional costs that would be curious if maybe the the cash cost guidance is where there's maybe a little bit more risks I'd love your thoughts on that thank you.

Speaker 12: the cash cost guidance is where there's maybe a little bit more risk. I'd love your thoughts on that. Thank you.

Speaker 4: Hi Lawson, yeah, Ron, you want to take that question as well? Yeah, Lawson, if you look at slide 16 of the presentation, what it shows that versus Q4 last year, our costs went up by 61 cents due to production, the lower production, which Friston really talked about. But if you look at what the impacts of costs are, we're due to changes in input costs, it was actually a 23 cents lower per pound impact. So while overall costs were quite substantially, that really was exclusively driven by the impacts on production.

Hi, Lawson, yet Brian you want to take that question as well, yes. It also and if you look at slide 16 of the presentation. What it shows that versus Q4 last year. Our costs went up by 61 due to production the lower production, which <unk> really talked about but if you look at what the impacts of costs.

Due to changes in input cost it was actually at 23.

Lower per pound impact so while overall costs are up quite substantially that really was exclusively driven by the impact on production.

Speaker 6: And what that's to some extent hides is that on things like fuel, things like grinding me, they're freight diesel prices. We have seen some tailwinds through this quarter. As an example, our guidance is based on $100 per barrel oil and you've seen the oil price be it's a circa $80 for almost a quarter. So certainly some benefits there that we'll expect to see through the balance of the year together with the improving production.

And what that some to some extent hides is that on things like fuel things like grinding media freights.

Diesel prices, we have seen some tailwind through this quarter and as an example, our guidance is based on $100 per barrel of oil and you've seen the oil price be it say circa $80 for most of the quarter.

So certainly some benefits there that we will expect to see through the balance of the year.

Together with the improving production that's expected.

Speaker 12: Okay, fantastic. And then just as sort of a second follow-up question, I wanted to kind of get your thoughts on the MOU with Rio Tinto and development opportunities. So you specifically mentioned assets, but I'd be curious to get your thoughts on whether not those assets could be assets that you justly acquire and then develop. Thanks very much.

Okay Fantastic and then just as sort of a second follow up question I wanted to kind of get your thoughts on the Mou with Rio Tinto and development opportunity. So you specifically mentioned assets, but I'd be curious to get your thoughts on.

Whether or not those assets could be.

Assets that you jointly acquire and then develop.

Thanks very much.

Okay.

Speaker 4: Yeah, hi, Lawson. So, yeah, we're very excited about LaGranha and the opportunity that that large project presents in our portfolio in terms of optionality and ability to really bring online something that in a major mining jurisdiction really will make a significant difference to our copper profile, but also in terms of delivery of copper that's very much needed in a market that structurally at the moment really looks like there's a big gaps opening up between supply and demand.

Yeah, Hi loss and so yes, we're very excited about <unk> and the opportunity that that large project presents in our portfolio in terms of Optionality.

<unk> ability to really bring on law on something.

A major mining jurisdiction really will make a significant difference to our corporate profile, but also in terms of delivery.

Copper thats very much needed in the market that structurally at the moment really looks like there's a big gap opening up between supply and demand. So we as Ron mentioned.

Speaker 4: So we, as Ryan mentioned, we're happy to take that model elsewhere, but depending on the asset and the location. So whether that's with RIO or with others, what we do see is...

We are happy to take that model elsewhere, but depending on the asset and the location. So.

Whether that's with Rio with others, what we do see is.

Speaker 4: There are opportunities out there and we probably won't see us in a big...

There are opportunities out there.

You probably won't see us in a big bidding war or so on but where we can bring our capabilities to bear we will certainly look at it the challenge will be to schedule those and to make sure that we don't overextend ourselves.

Speaker 4: bidding war or so on, but where we can bring our capabilities to bear, we'll certainly look at it. The challenge will be to schedule those and to make sure that we don't overextend and don't overexert ourselves.

Speaker 4: in terms of the human sort of things, and that is it, you know.

Sales in terms of the human side of things and that is it.

Speaker 4: more and more the industry has limited ability in terms of engineering firms, in terms of.

More and more of the industry has limited ability in terms of engineering firms in terms of the supply China and so on in order to develop these assets and so getting that right in terms of sequencing is a key consideration.

Speaker 4: supply chain and so on in order to develop these assets. So getting that right in terms of sequencing is...

Okay.

Speaker 2: The next question comes from Bryce Adams from CIBC Capital Markets. Please go ahead.

Yeah.

The next question comes from Bryce Adams from CIBC capital markets. Please go ahead.

Speaker 13: Hi all, thanks for taking my questions. On the watering capacity in Zambia, is that something that needs to increase every couple of years due to larger operations? Or when you increase capacity this year, should that then be right-sized for Zambia weather?

Yes.

Thanks for taking my questions on on dewatering capacity in Zambia.

That is something that needs to increase every couple of years.

Larger operations when.

When you increase capacity this year should that then be right sized.

For <unk> weather.

Speaker 4: Thanks, Price. Look, it's a very relevant question, and certainly through the rainy season, we dramatically increased our pumping capacity at Sentinel. But Rudy, could you just comment more there on our pumping volumes and where we're going to? We're certainly being upgrading those assets, as we've gone along.

Thanks, Bryce look it's a very relevant question and certainly through the rainy season, we dramatically increase increased our pumping capacity at Sentinel, but Rudy could you just comment more of their own pumping volumes and where we're going to we certainly think upgrading those assets as we've gone along.

Sure.

Sure.

Speaker 5: With appropriation for this year's wedged season, we already increased the company capacity at the same time, by a competitor of previous years. It certainly didn't.

Yeah.

In preparation for this year's with cheese, and we already increased funding capacity.

But compared to the previous years.

They didn't expect double the mindful.

Speaker 5: And that definitely caught us off guard. We have

Thats definitely caught us.

Okay.

We have.

Speaker 5: Increase the plumbing capacity from the beginning of this year from 65, negative, negative cubes a day to 82. And there's some additional plant lines of plumbing going in and again to take it up to about 85. And that should suffice. We also had the, in the recent months,

Increased our funding capacity from the beginning of this year from 65 megawatt.

Maybe it will negatively.

Good day to 82 and some additional bumps.

Pipelines are funding going in again to take it up.

<unk> 85 and that should suffice.

We also had in the recent months.

Speaker 5: make provision to pump back contact water to the plant rather than spinning a lot of cuffs on utilization with lime so that it can safely and within the limits of the regulations discharge that water.

Provision to come back.

Contact water to the plant rather than spending a lot of cost on music.

Utilization of lines, so that we can safely and within the limits of the regulations discharged that water.

Speaker 5: So that wood is now going back to the plant, which means that we can put...

So that will be is now going back to the plant, which means as we can.

Speaker 5: We're not just thinking about pumping water from the pit to our environmental treatment bonds for this job. So we've created more space now as well in our bond. So as far as the wet season is concerned, I'm quite confident that we weren't experienced experienced some of the event.

Okay.

Just sticking with pumping water from the from the <unk>.

Two.

Environmental strictly bonds for this job so we've created more space now as well.

<unk>.

So as far as the wheat season is concerned.

Im quite confident that we won't experience similarly.

The upcoming bid season, the end of this year.

Speaker 13: Okay, certainly sounds challenging. My second question might be for you as well, Rudy, but at Enterprise, first order the plant in February , but first production isn't expected until Q2. Does that mean the first order in February was just to crushing and grinding only, or have I got that wrong?

Okay, certainly kind of challenging.

My second question might be for you as well ready, but at enterprise first ore to the plant in February but first production isn't expected until Q2 does that mean, the first oil in February was just to crushing and grinding.

Or have I got that wrong.

Speaker 5: No it's pretty much great flavour Shanghai prayers. Too many reflections that I'm looking for in the Dynasty.

No it's pretty much.

Brian Sue opportunity.

Onto the condition.

Speaker 5: When the emotional state extensive belonging, the fundamental To really just commissioning

Our crushing facilities.

So those things are being demobilized.

The long term good level both divisions central so is it really just commissioning those things to make sure all of it is out otherwise.

Speaker 5: We've seen an obviously impacted enterprise as well, and we didn't mind as much as we wanted to, too. And we lovingly took a decision to open up the all body a lot more so that when we do get going on the enterprise rotation circuit, we know that we've got the required volume of all behind us in a show that we can...

The way season, obviously impacted enterprise as well and we didn't mind as much as we wanted to.

Deliberately took a decision to open up the ore body a lot more so that when they do get going on the enterprise flotation circuit.

Note that we've got the required volume or behind us.

So if we can.

Speaker 5: get the appropriate data as quickly as possible. So it provides a little additional opportunity for stripping about the oblock. We have recently started tracking 3,000 ton of data.

Get the.

Great.

So it provides additional opportunity for stripping.

Oh block.

We have recently started.

<unk> 3000 tonne a day.

Speaker 5: to the enterprise sector, the Neve. So that's going quite well now, but I'm...

To the enterprise they can deliver and so that's going quite well not all of it behind us.

Speaker 2: The next question comes from Jonas Masvullas from Morgan Stanley .

The next question comes from MS. Lewis from Morgan Stanley . Please go ahead.

Speaker 11: Hello, Tristan and team. Thanks for taking the questions. My first question is on the Cobre Panama Fiscal Agreement. As we're still getting questions from investors on this, can you give us a bit of color on how long will the Panamanian cabinet be paid?

Hello, Chris and team. Thanks for taking the questions. My first question is on the corporate finance fiscal agreement. Thus, we are still getting questions from investors and this can be.

Give us a bit of color on how long.

On a maintenance copyrights debated.

Speaker 11: Can they propose any further changes or are the terms finalized? And any indication on whether there are any residual risks or you're confident that as things stand, the proposed agreements go through. Thank you.

They propose.

Any any further changes or August terms finalized and.

Any indication on whether there are any residual risks or youre confident that as things stand.

The proposed agreement goes through thank you.

Thanks, Jonas Yes, certainly we were very happy through the quarter to.

Speaker 4: Yeah, certainly we were very happy through the quarter to resolve that in terms of contractual terms with the government of Panama and my meeting with the president was a great.

Resolve that in terms of contractual terms with the government of Panama in one meeting with the President was a great.

Speaker 4: Point in time to you know talk about the future and and going on with Cobra Panama Not only for the for the mind and for first quantum, but for the community around us and for the country as a whole with with a lot more clarity

Point in time too.

About the future and going on with Cobre, Panama not only for the for the mine them for first quantum but for the community around us and for the country as a whole with a lot more clarity.

Speaker 4: So the process now is very clear. We've been going through this public consultation period and the last public hearing was on the 24th of April . So that's behind us and we expect that to close out very imminently. And then yes, it will go into a cabinet decision and really that's around the need for the end of the government.

So the process now is very clear we've been going through this public consultation period and the last public hearing was on the 24th of April So that's behind us and we expect that to close yet very imminently.

And then yes, it will go into a cabinet.

Decision and really thats around.

The need for within the government to sign.

Speaker 4: You know, that's a very straightforward process as far as we understand. And then from there, it would go into the National Assembly. And as we said in the MDNA, that's likely to be in the legislative term in July . And that would then be the...

That's a very straightforward process as far as we understand and then from there. It would go into the National Assembly and as we as we said in the MD&A, that's likely to be in the legislative term in July .

And that would then be the final approval and then we go forward from that point in time in terms of any changes in the interim whether that comes back from public consultation will just have to see we wouldn't expect on our side any major changes.

Speaker 4: and then we go forward from that point in time. In terms of any changes in the interim, whether that comes back from public consultation, we'll just have to see. We wouldn't expect on our side any major changes of major consequence.

Major consequence.

Speaker 4: but we'll see how that goes and that's part of our consultation with the government.

But we'll see how that goes and thats part of our consultation with the government.

Speaker 11: Thank you so much for that. And just a second question. We did cover the major copper assets in detail, but if we can talk about Ravenstork for a moment. I was looking at nickel payability and continues to come down. It's 73% I think in...

Perfect. Thank you so much for that.

Second question I mean, we do cover the major.

Copper assets in detail, but if we can talk about ravensthorpe for a moment.

I was looking at.

Nickel Playability and continues to come down.

73% I think.

Speaker 11: Q1, it's probably the lowest in the asset history. And since you restarted the mine, profitability, and cash generation has been probably worse than you hadn't dissipated. Can you talk about any potential, the additional turnaround initiatives you're considering at the mine and how you're thinking about potential downstream investment or integration to improve the economics of the asset.

Q1 is probably the lowest in the assets history and since since you're just starting to mine.

And cash generation has been.

Probably worse than you had anticipated can you talk about any potential additional turnaround initiatives your.

Considering the Austin mine, and how youre thinking about potential downstream investment or integration two to improve the economics of the assets. Thank you.

Speaker 4: Thanks Jonas. Yeah, certainly the nickel market has been challenging since the disruptions to the LME in March last year and certainly what we have seen is...

Thanks, Jonas, yes, certainly the nickel market as being challenging since the disruptions to the LMA in March last year, and certainly what we have seen is.

Speaker 4: In recent times, LME coming back as a benchmark, we are happy with the level of nickel prices that currently stands on the LME, but it is the combination of the nickel price and the pay abilities that impact on our revenues. So both.

In recent times LMA coming back as a benchmark we are happy with the level of of nickel prices are currently stands on the Ann Let me, but it is the combination of the nickel price and the pie abilities.

The impact on our revenues so both the <unk> abilities have been moving more than the nickel price I would say and certainly volatile it requires a lot of customer to customer.

Speaker 4: you know the pay abilities have been moving more than the nickel price I would say and certainly volatile it requires a lot of customer to customer conversation you know whilst the LME was less of a benchmark but starting to improve and it has been going up

Compensation.

Whilst the <unk> was less of a benchmark, but starting to improve and has been going up and down.

Speaker 4: In terms of improving that situation going forward, we're doing a lot of work in terms of the supply chain and we'll continue to do that through the course of the year. But in terms of what we can do and what we can control in the operations, there's a solid work plan ahead of us. And that is we'd really like to get.

In terms of improving that situation going forward, we're doing a lot of work in terms of the supply chain and will continue to do that through the course of the year, but in terms of what we can do and what we can control in the operations.

Our solid work plan ahead of us and that is we'd really like to get.

Speaker 4: The full Ravens salt plant up and running per design, and there's a couple of areas that we've been working on that in regards to that, a beneficiation circuit, particularly from the Benipons and then the rejects area, and then also in terms of...

The full ravensthorpe plant up and running per design and there's a couple of areas that we've been working on that in regards to that beneficiary.

Particularly from the Penny ponds, and then the <unk> area and then also in terms of <unk>.

Speaker 4: bring material in from shoemaker levy we've had some we've been mining off stockpiles and so on and that

Bringing material in from Shoemaker Levy, we've had some.

<unk>.

We've been mining of stockpiles and so on in that.

Speaker 4: has meant that at times we didn't have full picture on the feed and how much magnesium, how much the content or that always going to the plant. So those changes to both mining, but also in the plant itself, will have a big impact in terms of the cost that we're able to deliver out. And that then, a lot of...

Has meant that at times.

We didn't have full picture on the feed in hand, how much magnesium how much.

Continental that always going to the plant so those changes to both mining but also in.

In the plant itself will have a big impact in terms of the cost that we're able to deliver at.

And that then.

Speaker 4: The pricing in the market really impacts the profitability at Ravensford.

Alongside.

The pricing in the market really impacts our profitability.

Ryan It's Paul.

This concludes the question and answer session I would like to turn the conference back over to Kristin Pascal for any closing remarks.

Speaker 2: I would like to turn the conference back over to Tristan Pascal for any closing remarks.

Speaker 4: Thanks, operator. Thank everybody for joining us today. We look forward to seeing you at our upcoming Investor and Events in Toronto and London. And we do hope you will join our virtual ESG event on June 13th. Thank you again and have a good day.

Thanks. Thank.

Thank you everybody for joining us today.

We look forward to seeing you at our upcoming investor events in Toronto and London.

And we do hope you will join our virtual ESG event on June 13, Thank you again and have a good day.

Okay.

Speaker 2: This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a present day.

This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.