Q1 2024 First Quantum Minerals Ltd Earnings Call

Operator: Thank you for standing by. This is the conference operator. Welcome to the First Quantum Minerals Limited first quarter 2024 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. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then 0. I would now like to turn the conference over to Bonita To, Director of Investor Relations. Please go ahead.

Thank you for standing by this is the conference operator welcome to the first quantum minerals limited first quarter 'twenty 'twenty four 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. The joined the question queue. You May Press Star then one on your telephone keypad 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 to director of Investor Relations. Please go ahead.

Good.

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

Bonita To: Thank you, operator, and thank you, everyone, for joining us today to discuss our first quarter results. During the call, we will be making forward-looking statements, and as such, I encourage you to read the cautionary notes that accompany this presentation, RMDNA, and the related news release. As a reminder, the presentation is available on our website and that all dollar references are in U.S. dollars unless otherwise noted. On today's call are Tristan Pascall, our Chief Executive Officer, Ryan MacWilliam, our Chief Financial Officer, and Rudi Badenhorst, our Chief Operating Officer. And with that, I will turn the call over to Tristan for his opening remarks.

Benita: During the call we will be making forward looking statements such I encourage you to read the cautionary notes that accompany this presentation are N DNA and the related news release.

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

Benita: On today's call are Tristan Castle, our Chief Executive Officer, Blind Mcwilliam, our Chief Financial Officer, and really got any horse, our chief operating officer.

Tristan Pascall: And with that I will turn the call over to Tristan for opening remarks.

Tristan Pascall: Thank you Anita and thank everybody for joining us for our first quarter update Tonight.

Tristan Pascall: Thank you, Bonita, and thank you everybody for joining us for our first quarter update today. Shortly following our fourth-quarter results, we announced our comprehensive refinancing package that involved an amendment and extension of our corporate loan facility, a $1.6 billion second lien bond offering, and a $1.15 billion equity bought deal offering.

Tristan Pascall: Shortly following our fourth quarter results, we announced a comprehensive refinancing package that involved an amendment and extension of our corporate line facilities of $1 6 billion dollar second lien bond offering and a 1.15 billion dollar equity bought deal offering.

Tristan Pascall: These transactions combined with L 500 million dollar copper prepay agreement with our long standing customer Shaanxi Copel.

Tristan Pascall: These transactions, combined with our $500 million copper prepay agreement with our long-standing customer, Shaanxi Copper, have strengthened the company's balance sheet significantly, to which Ryan will speak more later, and provide the company with the necessary time and space to deliver the Consange S3 expansion whilst we work towards a resolution for Cogepanema. With the closing of these transactions in the first quarter, the focus is for both Consantia and Sentinel and Enterprise to deliver operationally. During the quarter, Zambia declared a state of national emergency due to drought conditions that have brought about challenges in food security and electricity generation across the country.

Tristan Pascall: Strengthened the company's balance sheet significantly to withdraw and speak more on later.

Tristan Pascall: It provides the company with the necessary time and space to deliver the Constancia is three expansion.

Tristan Pascall: Whilst we work towards the resolution for Cobre Panama.

Tristan Pascall: With the closing of the transactions in the first quarter. The focus is for both convention and then price to deliver operationally.

Tristan Pascall: During the quarter that Zambia declared a state of national emergency due to drought conditions with the board about challenges and food security and electricity generation across the country.

Tristan Pascall: We have seen that the country is adopting a proactive and organized response to these national challenges. We also note that at the end of the first quarter, Zambia successfully completed its debt restructuring with both official and private sector creditors, which is a solid step forward for the country. Due to the drought conditions, the State Electricity Utility, ZESCO, announced a comprehensive electricity management plan that includes power reductions to the mining sector. Based on our bilateral discussions with ESCO, it is expected that their capacity to deliver power to our Zambian operations will be curtailed by approximately 20%, equivalent to around 60 to 80 megawatts on the current forecast from May 1st to the end of this year.

Tristan Pascall: We have seen that the countries are adopting proactive and organized response to these national challenges.

Tristan Pascall: Also note that during the first quarter, Zambia successfully completed its debt restructuring.

Tristan Pascall: Official and private sector creditors, which is a solid step forward for the country.

Tristan Pascall: Due to the drought conditions.

Tristan Pascall: Electricity utility Cisco announced a comprehensive electricity management plan that include power reductions to the mining sector.

Tristan Pascall: Based on our bilateral discussions with this guy it is expected that the capacity to deliver power to our Zambian operations will be quote could tie up by approximately 20% equivalent to around 60 to 80 megawatts on the current forecast from my first to the end of this year.

Tristan Pascall: In anticipation of these challenges the company's primary objective is to prioritize production, particularly at today's copper prices.

Tristan Pascall: In anticipation of these challenges, the company's primary objective is to prioritise production, particularly at today's copper prices. With that in mind, in working with ZESCO and by proactively engaging with alternative power providers, I'm pleased to share that we are in the process of finalizing binding agreements for power from Mozambique and Namibia that will cover the reductions requested from ZESCO. Related to this, on April 11, First Quantum received a force majeure notice from ZESCO to formalize the request for power reductions, thereby allowing First Quantum to independently contract power from these alternative sources.

Tristan Pascall: With that in mind, and working with Jessica and by proactively engaging with alternative power for all of US I'm pleased to share that we are in the process of finalizing binding agreements for Powell from Bison peak in Namibia that will cover the reductions requested from Jessica.

Tristan Pascall: Related to these on April 11, first quantum received the force majeure notice from best go to formalize the request for power reductions, thereby allowing first quantum to independently contract Powell from these alternative sources.

Tristan Pascall: As such, we anticipate that we will be able to substitute the power curtailed by ZESCO with imports and avoid any major interruptions to our Zambian operations based on current forecasts. The imported power will come at a higher cost, to which Ryan will provide more details later, but will allow us to maintain our production as planned without a large impact on our overall cost base.

Tristan Pascall: As such we anticipate that we will be able to substitute the Pal could tayo by this guy with imports and avoid any major interruptions to our Zambian operations based on current forecast.

Tristan Pascall: The imported Pal will come at a higher cost to which Ron will provide more details later.

Tristan Pascall: But will allow us to maintain that production as planned without a large impact on our overall cost base.

Tristan Pascall: I got to cover Panama, where the mine remains in a state of preservation and safe country with Trudi will review some of the work that they see titles with respect to the plant and equipment.

Tristan Pascall: Over to Cobra Panama, where the mine remains in a state of preservation and safe management, Rudi will review some of the work that this entails with respect to the plants and equipment. The mine remains clear of blockades, allowing the delivery of necessary supplies for the P&SM program. As I noted on our last conference call, at the request of MISI, the Ministry of Commerce, we submitted a preliminary draft to formalize the P&SM plan and its associated costs, estimated at around $15 to $20 million per month.

The mine remains clear blockade, allowing the delivery of necessary supplies for the P. M. S N program.

Tristan Pascall: And as I noted on their last conference call at the request of <unk> administered Commerce Ministry of Commerce, We submitted a preliminary draft to formalize the Pea and ethane plan and its associated costs estimated at around $15 million to $20 million per month.

Tristan Pascall: In March, MECI requested some clarifications and additional information, and in response, Cobra Panama submitted an updated and expanded PNSM plan. We also submitted a request to the National Authority of Public Services to extend the auto generator license to restart the power plant, which is critical to the ongoing implementation of the P&SM plan.

Tristan Pascall: In March May see requested some clarifications and additional information and in response Cobre, Panama has submitted updated and expanded pay anything planned.

Tristan Pascall: We also submitted a request to the National authority of public services to extend the auto generated license to restart the Powerpoint, which is critical to long guns implementation P. M. S N plant.

Tristan Pascall: Early this month government delegations, including representation from various ministries undertook site inspection and verification visits as part of their processes to evaluate <unk> in the same plan.

Tristan Pascall: Earlier this month, government delegations, including representation from various ministries, undertook site inspection and verification visits as part of their process to evaluate the P&SM plan. In regards to the environmental standing of the mine, we recently received the findings of Neander Mente, the Ministry of the Environment's compliance audit for the period from June to October 2023, undertaken by the government's independent auditors, CADESA. Their report found that Cobra Panama was 100% compliant with its environmental commitments and legislative obligations.

In regards to the environmental standing of the mine. We recently received the finding of me in the meantime, Windstream bonds compliance audits for the period from June to October 2023 undertaken by the government independent Auditor's ADESA.

Tristan Pascall: They report finds that Cobre, Panama was 100% compliant when its environmental commitments and legislative obligations.

Tristan Pascall: On health and safety, there were five instances of non-compliance relating to three commitments of the total 371 commitments under the ESIA, which at the time were being actively addressed. The summary report will be published shortly on the COBRA Panama Transparency website. As well, approximately 121,000 dry metric tons of copper concentrate remain on site. The company was advised on January 29 by the Attorney General of Panama that minerals extracted through mining concessions granted in accordance with the mining code belong to the concessionaire. The shipment of the concentrates is included as part of the PMSN plan.

Tristan Pascall: On health and safety day, with five instances of noncompliance related to three commitments of the total 371 commitments under the Sinai, which at the time would be actively addressed.

Tristan Pascall: The summary report will be published shortly on the Cobra, Panama transparency website.

Tristan Pascall: Well approximately 121000 dry metric tons of copper concentrate remains on salt.

Tristan Pascall: The company was advised on January 29 by the Attorney General of Panama that minerals extracted through mining concessions granted in accordance with the money belongs to the concessionaire.

Tristan Pascall: The shipment of the concentrate is included as part of the PMA same plan.

Tristan Pascall: And protecting our investment in Panama, we continue to move forward without to arbitration proceedings that paying the Canada, Panama free trade agreement and the second one is for the arbitration clause of the refresh concession contract.

Tristan Pascall: In protecting our investment in Panama, we continue to move forward with our two arbitration proceedings, that being the Canada-Panama Free Trade Agreement and the second one as per the arbitration clause of the refreshed concession contract. However, as we have consistently stated, arbitration is not our preferred outcome, and we remain committed to Panama and being part of a long-term solution that delivers the best outcome for the country and the people of Panama.

Tristan Pascall: However, as we've consistently stated arbitration is know that preferred outcome and we remain committed to Panama and being part of a long term solution that delivers the best outcome from the country and the people of Panama.

Tristan Pascall: The next few months will be a period of change for the country.

Tristan Pascall: The next few months will be a period of change for the country, with elections to be held on May 5th and a new president to officially take office in early July. In the meantime, we will continue to engage constructively with the current administration to ensure the environmental stability and asset integrity of Cobra Panama. We also continue to seek to listen to and learn from the people of Panama. With that, I will conclude my opening remarks and pass the call to Rudi to review our operational results.

Tristan Pascall: With elections to be held on may 5th and a new president to officially take office in early July.

Tristan Pascall: In the meantime, we will continue to engage constructively with the current administration to ensure the environmental stability and asset integrity of Cobra Panama.

Tristan Pascall: We also continue to seek to listen and learn from the people with Panama.

Tristan Pascall: With that I will conclude the opening remarks and pass the call to Rudy to review our operational results.

Tristan Pascall: Yes.

Rudy: Thank you Justin.

Rudi Badenhorst: Thank you, Tristan, and thank everybody for joining our call today. As Tristan mentioned, the Copper Panama Mine remains in a phase of preservation and safe management, and with the absence of production from Panama, total copper production for the first quarter was approximately 101,000 tons, a decrease of 37% from the fourth quarter as a result of the lower production volume. Group-wide copper C1 cash costs were $0.20 higher than the preceding quarter, averaging $2.02 a pound. However, looking at the business excluding Copathanoma, however,

Rudy: Thank you everybody for joining our call today.

Rudy: That's just mentioned the cover put them online remains in a phase of preservation and.

Rudy: So with management and with the absence of production from Panama total copper production for the first quarter was approximately 101000 tonnes a.

Rudy: A decrease of 37% from the fourth quarter.

Rudy: As a result of the lower production volumes group wide Capa C. One cash costs were 20 cents higher than the preceding quarter, averaging $2 two things about.

Rudy: Looking at the business, excluding Cobre, Panama, Oh, I have a couple.

Rudi Badenhorst: Copper production was 3,021 tonnes higher, quarter over quarter, resulting from improving production at Sentinel, while Copper C1 cash costs were 6 cents lower, which Ryan will speak about in his financial overview. At Cobre Panama, preservation and safe management work during the quarter involved a 14-day preservation and maintenance cycle at the process plant, with equipment being run and monitored for periods to help maintain the integrity of the plant. With the major ultra-class mobile equipment, the maintenance cycle involved daily inspections and weekly startup in order to keep the fleet in good working condition. Oh, it's Kinshenshi.

Rudy: Copper production was 3021 tons higher quarter over quarter.

Rudy: <unk> from improving production at Sentinel.

Rudy: Well a couple of C. One cash costs were 6% lower two which Ron will speak to in his financial overview.

Rudy: That's probably a Panama.

Rudy: Preservation and safe management lift during the quarter involved a 14 day preservation and maintenance cycle at the breakfast club.

Rudy: With equipment being run and monitored for periods to help maintain the integrity of the plant.

Rudy: With a major also cross class mobile equipment, the maintenance cycle involved daily inspections and weekly starts up in order to keep the fleet and good looking foundation.

Rudy: Oh it is concerned she.

Rudi Badenhorst: Copper production totaled 31,000 tons in the first quarter. However, production was down slightly in the quarter due to low acid stock availability to treat the higher grade oxide material as a result of an unplanned smelter shutdown. Despite lower production volumes, Copper C1 cash costs were down quarter and quarter to $2.34 per pound. However, as quarter 4 costs were impacted by a one-time catch-up charge on new electricity rates from a new 10-year power supply agreement with ZESCO that we entered into at the end of 2026.

Rudy: Copper production totaled 31000 tons in the first quarter.

Rudy: Production was down slightly in the quarter due to low acid stuck availability to treat the high grade oxide material.

Rudy: As a result of an unplanned smelter shutdown.

Rudy: Despite lower production volumes.

Rudy: Let's see one cash cost were down quarter on quarter to $2 34 per pound.

Rudy: That's quite a full costs were impacted by a one time catch up charge.

Rudy: New electricity rates from a new 10 year power supply agreement with Cisco because we.

Entered into at the end of 2023.

Rudy: We have maintained consensus production guidance for this year at 130 to 150000 tons of copper.

Rudi Badenhorst: We have maintained Conscienti's production guidance for this year at 130,000 to 150,000 tons of copper, with copper grades expected to improve over the course of the year as mining progresses at higher elevation areas with higher grade material emanating from the Main 15 and Main 17 cutbacks. Saint-Anne-en-El had a strong core.

Rudy: Copper grades are expected to improve over the course of the as mining progresses at high elevation areas with higher grade material emanating from the 915 and 917 cutbacks.

Rudy: <unk> had a strong quarter.

Rudi Badenhorst: Producing just over 62,000 tons of copper, which was a 4% improvement from the fourth quarter. This was driven mainly by grade as mining activity was able to progress as planned to high-grade areas in Stage 1 and the saddle zone between Stage 1 and Stage 2 pits. Throughput, however, was lower than the fourth quarter due to a planned shutdown that was deferred from the preceding year.

Rudy: I think just over 62000 tonnes of copper, which was a 4% improvement from the fourth quarter.

Rudy: This was driven mainly by grade as mining activity was able to progress as planned to high grade areas in stage, one and the saddle zones between stage, one and stage two but.

Rudy: Throughput, however was lower than the fourth quarter due to a plant shutdown that was deferred from the preceding year.

Rudi Badenhorst: Copper C1 cash cost of $1.85 per pound is unchanged from the preceding quarter as the benefit of higher volumes was offset by higher electricity rates from the new power supply agreement with ZESCO and Hia Fred Corp, associated with concentrate that was shipped to third-party smelters during the smelter shutdown at Consange. Copper production guidance for Sentinel has been maintained at 220 to 250,000 tons. Copper grades were higher in the first quarter and are expected to normalize for the remainder of the year, while throughput is expected to improve over the course of the year, as development of the Stage 3 Western Cutback and the relocation of Input Crusher 3 continues to progress well, and will enable improved mining productivity and increased availability of softer materials at Enterprise. Mining operations continue to ramp up, with the operation producing 4,000 tonnes of nickel in the first quarter. During the quarter, there was a noticeable improvement in recoveries with the expansion of the flotation cleaner circuit.

Rudy: Couple of C. One cash cost of $1 85 per pound is unchanged from the preceding quarter as the benefit of higher volumes was offset by higher electricity rates from the new pellet supply agreement with Tesco.

Rudy: And higher freight costs.

Rudy: Weighted with concentrate that was shipped to third party smelters.

Rudy: The smelter shutdown at convention.

Rudy: Copper production guidance for St. Joe has been maintained at 220 to 250000 tons.

Rudy: Couple of grades were higher in the first quarter and I expect it to normalize for the remainder of the year.

Rudy: Well throughput is expected to improve over the course of the AR that's.

Rudy: Development of the stage three western cutback and the relocation of infrastructure Gotcha, three continues to progress well and.

Rudy: And will enable improved mining productivity and increase availability of softer material.

Rudy: At enterprise.

Mining operations continued to ramp up the operation producing 4000 tonnes of nickel in the first quarter.

Rudy: During the quarter there wasn't a noticeable improvement in recoveries for the expansion of the flotation cleaner sick.

Rudi Badenhorst: Work continues towards commercial production and full ramp-up later in this year with additional equipment mobilized to increase mining volumes and the final ramp-up of the process plant to full capacity. Production guidance for 2024 for Enterprise remains to be 10,000 to 20,000 tons of contained nickel. Continuing Nickel Production, Draven Snow produced approximately 3,700 tons of contained nickel during the quarter. In February of this year, the operation implemented a new strategy with a focus on improving margins by suspending mining at Shoemaker Levee and bypassing the high-pressure acid leach unit.

Rudy: Work continues towards commercial production and full ramp up likely to them. This year with additional equipment mobilized to increase mining volumes and the final ramp up of our purchase plant to full capacity.

Rudy: Production guidance in 2020 for enterprise continues to be 10 to 20000 tons of contained nickel.

Rudy: Continuing with nickel production.

Rudy: They've installed produced approximately 3700 tons of contained nickel during the quarter.

Rudy: In February of this year.

Rudy: Corporation implemented a new strategy with a focus on improving margins, but.

Rudy: But the spending mining at Shoemaker Levy and bypassing the Hyatt place.

Rudy: <unk> <unk> units.

Rudi Badenhorst: While margins did improve in the first quarter, operating costs nonetheless remained high, combined with maintenance challenges, weak nickel prices, and low payability, continuing to result in significant margin pressure at the operation. Thank you, and I will now hand the call over to Ryan to review the financial...

While margins did improve in the first quarter.

Rudy: Trading costs Nonetheless.

Rudy: Hi.

Rudy: This.

Rudy: Combined with maintenance challenges week nickel prices and low pay abilities.

Rudy: <unk> to result in significant margin pressure at the operation.

Rudy: Thank you and I'll now hand, the call over to Ryan to review the financials.

Ryan: Thank you Rudy.

Ryan L. MacWilliam: Starting with the market, copper prices broke out in March from recent ranges and traded to the highest level since April 2023. Copper is now at around $4.40 per pound, albeit much of this increase only occurred after the quarter end, so this is not reflected in these financials. This price increase has been partly driven by the collapse in copper treatment charges, which is to some extent the result of the situation at Kobe Panama and the resulting potential smelt production cuts in China. This copper price increase since the cessation of operations at Cabo Panama will contribute to making the green energy transition more expensive. And as a result, extend the time that it will take the world to decarbonize.

Ryan: Starting with the market copper prices breakouts in March from recent ranges and trade it to the highest level since April 2023.

Ryan: Copper is not around $4.40 per pound.

Ryan: Albeit much of this increase are you incurred after the quarter end. So this is not reflected in these financials.

Ryan: This price increase has been partly driven by the collapsing copper treatment charges, which is to some extent. The result of the situation of club in Panama, and the resulting potential smelter production cuts in China.

Ryan: There's a couple of price increase sensitization of operations that cobre, Panama will contribute to making the green energy transition more expensive.

Ryan: And as a result extend the time that it will take the world Decarbonize.

Ryan: Moving on to our financials, where it was a noisy quarter. Despite the solid operational performance that really described.

Ryan L. MacWilliam: Moving on to our financials, where it was a noisy quarter despite the solid operational performance that Rudy described. This was due to it being the first full quarter without Cobra Panama production. Revenue and EBITDA both declined quarter over quarter as Cobra Panama remained in the phase of P&SM.

Ryan: This was due to it being the first full quarter without cobre, Panama production.

Ryan: Revenue and EBITDA, both declined quarter over quarter as club in Panama remained in the phase of P. M. S M.

Excluding cobre, Panama revenue and EBITDA increased by 11% and 17% respectively, mainly on the back of improved operational performance and higher metal prices.

Ryan L. MacWilliam: Excluding Carbon Panama, revenue in EBITDA increased by 11% and 70%, respectively, mainly on the back of improved operational performance and higher metal prices. However, impacting EBITDA were P&SM costs at COBE Panama of $63 million due to a larger workforce than budgeted at the start of the quarter. Workforce reductions have now been completed, and as such, going forward, we expect these costs to normalize to the $15 to $20 million per month rate. Our Q1 net loss attributable to shareholders improved to $159 million this quarter, as Q4 last year was impacted by both the impairment at Ravensthorpe and the tax expense at Cobre Panama.

Ryan: Impacting EBITDA with P. M S N cost of Cobre, Panama $63 million due to a larger workforce and budgeted at the start of the quarter.

Ryan: Workforce reductions have now been completed and as such going forward. We expect these costs to normalize to the $15 million to $20 million per month rate.

Ryan: Our Q1 net loss attributable to shareholders improved to $159 million. This quarter as Q4 last year was impacted by both the impairments at Ravensthorpe and the tax expense at Cobre Panama.

Ryan: Yeah.

Ryan L. MacWilliam: Moving on to costs, excluding Cobra Panama, Copper's C1 cash costs were reduced 3% to $2.01 per pound. This was attributable to improved production, lower fuel costs, and the absence of a once-off catch-up charge on new electricity rates in Zambia last quarter. However, this was partially offset by the impact of asset purchases and higher freight costs, as Rudi mentioned. As Tristan described, as a result of the power shortages in Zambia, our operations will procure approximately 20% of their power from outside the country. The contracts in this respect are currently being finalized, with key terms agreed upon. The imported power will predominantly be a mix of hydro, solar, and natural gas from Mozambique and Namibia.

Ryan: Moving onto costs, excluding cobre, Panama copper cone cash costs reduced 3% to $2.01 per pound.

Ryan: This was attributable to improved production.

Ryan: Lower fuel costs and the absence of a one one sort of catch up charge on your electricity rates in Zambia, It last quarter.

Ryan: This was partially offset by the impact of asset purchases and higher freight costs as already mentioned.

Ryan: As just described as a result of the power shortages in Zambia, our operations will procure approximately 20% of their power from outside the country.

Ryan: The contracts in this respect are currently being finalized with key terms agreed.

The imported PA will predominantly be a mix of hydro solar and natural gas from Mozambique Namibia.

Ryan L. MacWilliam: While the imported power will be more expensive than the rates that we have with ESCO, the impact on the overall cost structure will be modest, given power represents about 7% of our cost. We expect an incremental cost of approximately $25 million for the remainder of the year, which is equivalent to a 3 cents impact on our C1 cash curve. In other areas, inflationary pressures have stabilized, and prices are tracking favorably to the assumptions we're using for our cost guidance.

Ryan: While the important part imported pilot will be more expensive than the rates that we have with that Scott.

Ryan: The impacts the overall cost structure will be modest given power represents about 7% of our costs.

Ryan: We expect an incremental cost of approximately $25 million for the remainder of the year.

Ryan: Which is equivalent to a three impacts, but I'll see one cash cost.

Ryan: In other areas inflationary pressures have stabilized and prices are tracking favorably to the assumptions, we're using for our cost guidance.

Ryan L. MacWilliam: As an example, our guidance is based on an oil price of $90 per barrel, while spot prices have averaged in the low 80s year to date. Additionally, the gold price is averaged well above $2,000 per ounce, while our cost guidance assumes a gold price of $1,900.

Ryan: As an example, our guidance is based on an oil price of $90 per barrel, while spot prices have averaged in the low <unk> year to date.

Additionally, the gold prices averaged well above $2000 comps at all cost guidance assumes that oil price of $9800.

Ryan L. MacWilliam: Taking all this into account, we remain comfortable with our C1 cash cost guidance range for the year, $1.80 to $2.05 per pound. (Inaudible) During the quarter, we took a proactive approach to address our liquidity position and near-term bond maturities through a number of capital markets actions and a $500 million copper prepayment. These actions included amending and extending our corporate loan facility, a $1.15 billion equity issue, and a $1.6 billion second lien secured bond. We appreciate the support that we received from our shareholders, our bondholders, and our banks as part of this transaction.

Ryan: Taking all this into account we remain comfortable with our cash cost guidance range for the year of $1 80 to $2.05 per pound.

Ryan: Onshore balance sheets.

Ryan: During the quarter, we took a proactive approach to address our liquidity position and near term bond maturities through a number of capital markets actions and a $500 million copper prepayments.

Ryan: These actions included amending and extending our corporate loan facility.

1.15 billion on the equity issuance and a $1 $6 billion second lien secured bond.

Speaker Change: We appreciate the support that we receive from our shareholders bondholders and all banks as part of this transaction, but both the bond and equity offerings of subscribed and 100 per se of consent from our banking group.

Ryan L. MacWilliam: It's both in the bond and the equity offerings over subscribed, and 100% consent from our bank. Changes in our corporate facility include revising our leverage covenants, deferring our debt amortization until June next year, and pushing out the facility maturity to April 2027. Proceeds from the equity and debt offerings allowed us to redeem our 2025 and 2026 bonds in full and repay a sizable portion of our revolving credit facility. This materially de-risks our liquidity positions through 2025 to support the delivery of the S3 project in Zambia and resolution in Panama.

Speaker Change: Changes in our corporate facility and crude revising our leverage covenants.

Speaker Change: Ferring of debt amortization until June next year, and pushing out the facility maturity to April 2027.

Speaker Change: Proceeds from the equity and debt offerings allowed us to redeem our 2025 and 2026 bonds info and repay a sizeable portion of our revolving credit facility.

Speaker Change: That's materially Derisked, our liquidity position through 2025 to support the delivery of the <unk> III project in Zambia and resolution in Panama.

Speaker Change: Net debt decreased by $1, one 4 billion during the quarter to $5 3 billion. As a result of these financings, partially offset by the impact of working capital movements in Zambia and payments to suppliers of Cobre, Panama related to orders placed before the Halton operations last year.

Ryan L. MacWilliam: Net debt decreased by $1.14 billion during the quarter to $5.3 billion as a result of these finances. Partially offset by the impact of working capital movements in Zambia and payments to suppliers at Kobe, Panama related to orders placed before the Halton operations last night. The quantity improved to $1.8 billion at the end of the quarter, comprised of approximately $700 million in cash and $1.05 billion of undrawn revolver.

Speaker Change: Liquidity improved to $1 $8 billion at the end of the quarter comprised of approximately $700 million in cash and $1 <unk> 5 billion of Undrawn revolver.

Speaker Change: I would say accounting standards, the prepayments have been recognized as a liability and a deferred revenue.

Speaker Change: Revenue will be recognized in line with deliveries in the prepaid amounts will reduce over the second and third years in accordance with deliveries.

Ryan L. MacWilliam: As per accounting standards, the prepayment has been recognized as a liability under Deferred Revenue. Revenue will be recognized in line with deliveries, and the prepaid amount will reduce over the second and third years in accordance with delivery. From an accounting perspective, the prepay is not recognized as debt and is included within reported net debt. However, the pre-payments will be treated as debt by our lenders in Covenant Calculation.

Speaker Change: From an accounting perspective, the prepay is not recognized as debt and is included within reported net debt and is not included within reported net debt. However, the prepayments will be treated or deaths by our lenders and covenant calculations.

Speaker Change: We continue to manage our balance sheet with discipline by focusing on initiatives underway, such as further working capital optimization and reductions in operating and capital expenditures through driving improved efficiencies.

Speaker Change: Previously announced measures optionality and flexibility to continue.

Speaker Change: Such as the sales prices for the less creative mine in Spain, as well as potential minority investments in the company's ambient business.

Ryan L. MacWilliam: We continue to manage our balance sheet with discipline by focusing on initiatives underway such as further working capital optimization and reductions in operating capital expenditures through driving improved efficiency. As previously announced, measures for optionality and flexibility continue, such as the sales process for the Las Cruces mine in Spain, as well as potential minority investments in the company's Zambian business. And that brings the finance section to an end. I'll now hand the call back to Tristan.

Speaker Change: And that brings the finance section to it and I'll now hand, the call back to Justin.

Justin: Thank you Ron.

Justin: We continued to make good progress on the consensus is three expansion project, which remains on track for construction completion in mid 2025.

Justin: Focuses on project cost control, whilst ensuring the quality of construction execution.

Justin: We continue to receive deliveries during the quarter and late deliveries of major long lead items will continue through the remainder of the year.

Justin: During the quarter. The primary crusher excavation was completed and we received first deliveries of Sag mill components. This is the 6 million. The same size of the project team is installed and we are pleased so far with progressive rate against the schedule.

Tristan Pascall: We continue to make good progress on the CONSTANTI S3 expansion project, which remains on track for construction completion in mid-2025. Our focus is on project cost control whilst ensuring the quality of construction execution. We continue to receive deliveries during the quarter, and these deliveries of major long-lead items will continue through the remainder of the year. During the quarter, the primary crusher excavation was completed, and we received the first deliveries of sagnal components. This is a 6mm of the same size that the project team has installed, and we are pleased so far with progress against the schedule.

Justin: The consensus smelter expansion to one 6 million tonnes Brendan feed capacity remains on track for first production in 2025.

Before I hand over the call to take questions I would like to circle back to a comprehensive financing transactions that I open today's call with <unk>.

There was a lot of complexity and putting together this package with respect to the inter dependency of each transaction and the short timeframe to put together and execute the transactions.

Justin: There were a lot of teams within first quantum to work tirelessly on this and I want to thank them all for their hard work.

Justin: I would also like to thank our shareholders banking partners and bondholders for their confidence in strong support of the company.

Tristan Pascall: Similarly, the Consange Smeltzer expansion to 1.6 million tonnes per annum feed capacity remains on track for first production in 2025. Before I hand over the call to take questions, I would like to circle back to the comprehensive financing transactions that I opened today's call with. There was a lot of complexity in putting together this package with respect to the interdependence of each transaction and the short time frame to put it together and execute the transactions.

Justin: Sure.

Justin: That being said, however, I want to reassure our investors that the hard work does not stop there.

Justin: We will continue our work to prudently manage the balance sheet at the mines, we remain laser focused on operational delivery and our data flowing through the operational efficiencies and.

And finally at the Constancia three expansion as I noted earlier the focus of the focus is on cost control quality and timely execution.

This project will be key to restoring first content strong cash flow generation.

Tristan Pascall: There were a lot of teams within First Quantum that worked tirelessly on this, and I want to thank them all for their hard work. I would also like to thank our shareholders, banking partners, and bondholders for their confidence and strong support of the company. That being said, however, I want to reassure our investors that the hard work does not stop there. We will continue our work to prudently manage the balance sheets.

Thank you for your attention and I will now pass the call to the operator to open the lines for questions.

Speaker Change: Thank you.

Speaker Change: I'll now begin the analyst question and answer session analysts are permitted to ask one question and one follow up and you're welcome to rejoin the queue. If they have more.

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

Tristan Pascall: At the mines, we remain laser-focused on operational delivery and identifying further operational efficiency. And finally, at the Consantia S3 expansion, as I noted earlier, the focus is on cost control, quality, and timely execution. This project will be key to restoring First Quantum's strong cash flow generation. Thank you for your attention, and I will now pass the call to the operator to open the line for questions.

Operator: If youre using a speakerphone please pick up your handset before pressing any keys does Italia question. Please press Star then two.

Operator: Okay.

Operator: The first question comes from Greg Barnes.

Greg Barnes: With TD Securities. Please go ahead.

Greg Barnes: Good morning, everyone, just a couple of questions.

Greg Barnes: First off the application to restart the power plants that just solely to support the care and maintenance plan or the broader implications behind that and the second question is just around the delays there.

Operator: Thank you. We will now begin the analyst question and answer session. Analysts are permitted to ask one question and one follow-up and are welcome to rejoin the queue if they have more. To join the question queue, you may press star, then 1 on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys.

Greg Barnes: I actually selling that to concentrate the stores in the quarter Cobre Panama.

Greg Barnes: Okay.

Speaker Change: Sure, Greg and Greg Thanks, before I answer your question I heard that you are retiring and I believe you are longing longest covering analyst.

Greg Barnes: I want to thank you for your many years of support we will Miss your coverage and I wish you a happy retirement, but.

Operator: To withdraw your question, please press star, then two. The first question comes from Greg Barnes with TD Securities. Please go ahead. Good morning, everyone. Just a couple of questions, Tristan. First off, the application to respond to

Speaker Change: To your questions look firstly on the power plant, what we put forward was a rejuvenation of the order generated license, which is for the full 300 megawatts.

Tristan Pascall: Sure, Greg. And Greg, thanks. Before I answer your question, I heard that you are retiring, and I believe you are our longest-serving analyst. So, Greg, I want to thank you for your many years of support. We'll miss your coverage and wish you a happy retirement.

Speaker Change: We wont need all of that powerful the P. N S. In plan, but we note that power prices for retail customers in Panama. It remained very high and we think that that power.

Speaker Change: Into the market, we will do a lot to bring down the cost for ordinary Panama citizens in terms of their energy costs.

Tristan Pascall: To your questions, firstly on the power plant, what we put forward was the renewal of the auto generator license, which is for the full 300 megawatts. We won't need all of that power for the PNSM plan, but we note that power prices for retail customers in Panama remain very high, and we think that putting that power into the market will do a lot to bring down the cost for ordinary Panamanian citizens in terms of their energy costs.

Speaker Change: That really that decision will be up to the regulator as to whether we just look at one units will both units are running.

Speaker Change: Secondly in regards to the concentrate the 121000 tons sitting at the port Yeah, I intend to timetable for when that will get at I think we know the ministry of Commerce is recent.

Tristan Pascall: However, really, that decision will be up to the regulator as to whether they look at one unit or both units running. Secondly, in regards to the concentrate, the 121,000 tonnes sitting at the port, yeah, in terms of timetable for when that will get out, I think we note the Minister of Commerce's recent comments that they are looking closely at the PNSM plan, and he made a comment that he would like to see that approved before the election.

Speaker Change: Comments that they are looking closely at the P. S implant and he might comment that he would like to see that approved before the election.

Speaker Change: Obviously, the it's in the context of of election politics, and the strong debates ran bet, so balancing probability it probably spills either after the election.

Speaker Change: Just have to wait and see as to what the timing of these things.

Tristan Pascall: Obviously, it's in the context of election politics and the strong debates around that, so, in balance and probability, it probably spills over after the election. We'll just have to wait and see as to what the timing is.

Speaker Change: Alright, Thanks for that Kristen I think it's been 23 years and it's been a hell of a ride them honestly never a dull moment.

So thanks a lot.

Speaker Change: Okay.

Operator: The next question comes from Orest Wowkodaw with Scotiabank. Please go ahead. Hi, good morning.

Speaker Change: The next question comes from RSV Codell with Scotiabank. Please go ahead.

RSV Codell: Hi, Good morning, my question's around Cobre, Panama, as well and with the election and Panama now I guess within two weeks is it your expectation that there will be a window to re engage with the new administration when they come to power in July in terms of negotiating some kind of restarted agreement.

Orest Wowkodaw: Hi, good morning. My question is around Cobra Panama as well. I mean, with the election in Panama now, I guess within two weeks, is it your expectation that there will be a window to re-engage with the new administration when they come to power in July in terms of negotiating some kind of restart agreement?

Speaker Change: Thanks, Chris Yeah, So Sidney.

Tristan Pascall: Thanks Orest. Yeah, certainly, our job at the moment in Panama is to be listening, to understand the voices that speak about the mine and the future of mining in Panama. With regard to the election, we want to see a strong democratic process. We will work with whichever party is successful and whoever the successful presidential candidate is, and the context around that will be to meet the challenges around the mine but the challenges for the country as well.

Speaker Change: Our job at the moment in Panama is to be listening to understand.

Speaker Change: The voices that speak.

Speaker Change: On the mine and the future mining in Panama with regard to the election.

Speaker Change: We certainly we want to see a strong democratic process, we will work with whichever party is successful and whoever the successful presidential candidates is and you know the context around that will be to meet knew.

Speaker Change: The challenges around the mine, but the challenges for the country as well.

Tristan Pascall: And certainly, we would be seeking to approach those conversations with humility, listening, understanding what's going on, and working forward on a path forward that resolves the situation to the benefit of the people of Panama and working with whoever is successful in the election.

And certainly we would be seeking to approach those conversations with humility listening understanding what's going on.

Speaker Change: And to work forward on the path forward to resolve the situation to the benefit of the people of Panama.

Speaker Change: And and working with whoever is successful in the election.

Speaker Change: Okay.

Tristan Pascall: Okay, as a follow-up, the 15 to 20 million in sort of care and maintenance costs per month right now with Cobra Panama shut down. If there isn't an imminent restart of the mine, how long is the company prepared to fund that from its corporate balance sheet? Yes, thank you.

Speaker Change: Follow up to.

Speaker Change: 15 to 20 million sort of a care and maintenance costs per month, right now with Cobre, Panama shut down.

Speaker Change: If if there isn't any eminent restart of the mine how long is the company prepared to fund that from its corporate balance sheet.

Yeah. Thanks, <unk>, so that the $15 million to $20 million per month is based on the current level of 1400 people on thoughts.

Tristan Pascall: Thanks Orest. So the $15-$20 million per month is based on the current level of 1,400 people on site, and as Ryan alluded to, we brought that down during the quarter to that level. We will evaluate that continuously and monitor it continuously, and it will be based on our ability to meet the environmental compliance standards there. But certainly, without clear pathways in the P&SM plan and so on, we will need to manage those costs each month through the course of the year.

Speaker Change: Ron alluded to we brought that down during the quarter to that level.

Speaker Change: We will evaluate that continuously and monitor it continuously.

Speaker Change: And it will be based on our ability to meet the environmental compliance standards there.

Speaker Change: But certainly.

Speaker Change: Without clear pathway from the penis implant and so on we will need to manage those costs each month through the course of the year.

Operator: The next question comes from Jackie Przybylowski with BMO Capital Markets. Please go ahead.

The next question comes from Jackie breast biopsy with BMO capital markets. Please go ahead.

Jackie Przybylowski: Thanks very much. I guess my first question I'll ask is, can you talk a little bit about Zambia and the power situation there, and maybe what activities are being done by DESCO to improve that power situation? And I know you guys had some mention in your MD&A, so maybe can you talk a little bit about how you're supporting those activities?

Jackie: Alright, Thanks, very much I guess my first question I'll ask can you talk a little bit about Zambia in the power situation, there and maybe what activities are being done.

Jackie: That's going to improve that power situation and I know you guys have mentioned in your MD&A. So maybe can you talk a little bit about how you're supporting those activities.

Jackie: Yes.

Yes, sure Jackie I'd respond been really can kick in with some detail.

Tristan Pascall: Yeah, sure. Jackie, I'd respond, and Rudi can kick in with some detail. Yeah, so we, you know, firstly to say we see the Zambian government is managing the challenges of power and food security arising from the drought in a proactive manner, which is very positive given the level of challenge. We, similarly, have been very proactive in reaching out to other alternatives, and in terms of the arrangements with ESCO, we can do that under force majeure.

Yeah. So we.

Speaker Change: Firstly to say, we'd see the Zambian government is managing the challenges on power and food security arising from the drought.

In a proactive manner, which is very positive given the level of challenge. We we similarly, we've been very proactive in reaching out to our other alternatives in terms of the arrangements with Cisco, we can do that under the force majeure.

Tristan Pascall: Rudi can comment on the level of power and the origination, but our intent is that we will be able to subsidise the reduction of power forecast by ESCO with alternate suppliers until we don't see any impact to production at this stage based on current forecasts. Rudi? Thanks, Jason.

Speaker Change: Rudy can comment on the level of pound the origination.

Rudy: Our intent is that.

Rudy: We will be able to subsidized.

Rudy: Subsidize the reduction of power forecast by this guy with alternate suppliers and so we don't see any impact to production at this stage by some current forecasts Rudy.

Rudy: Hi, Jackie.

Rudy: Well said.

Tristan Pascall: Thanks, Tristan. Bye, Jackie.

Rudy: The.

Rudy: And as part of the.

Rudi Badenhorst: That's just insane, and as part of the MD&I. The request was for a 20% reduction across both sites, which includes enterprise, and that equates to... 80, 60 to 80 megawatts from the 1st of May. So we were quite proactive with Zesco when the emergency situation was called by the President and engaged with power providers across the Southern African Power Pool and have managed to come to an agreement with two providers without mainly being brought in via the utility provider in Mozambique, EDM, and also through NAMPOWER.

In DNI.

Rudy: The other question was about 20% reduction across both site, which includes enterprise.

Rudy: This equates to.

Rudy: 60 to 80 megawatts.

Rudy: From the first of my so we were quite proactive with Cisco.

Rudy: When the emergency situation was caused by the president and engaged with providers across the southern African power pool.

Rudy:

Rudy: Okay.

Rudy: And has managed to.

Rudy: To come to an agreement with to provide us with.

Rudy: Namely being voting via the <unk>.

Rudy: Utility provider in Mozambique.

Rudy: And also to redeem them manpower.

Rudi Badenhorst: This will be effective on the 1st of May. Indications are that, you know, because of the proactive nature that the government has taken, it's unlikely it will only run until the end of this year, as we move into another wet season. Everybody's talking about drugs. But we are being proactive and engaging other entities outside that South African Power Pool for potential supply going forward.

Rudy: This will be effective on the first of mind.

Rudy: Indications are that because.

Rudy: Because of the attractive nature of that.

Rudy: Government mistaken thats in all likelihood will only run up until.

Rudy: The end of this year has been moving to the Internet another wait season.

Rudy:

Rudy: Everybody is talking about the drought.

Rudy: Hum.

Speaker Change: But we are being proactive in engaging the other entities.

Speaker Change: Outside of the South African power pole for potential supply going forward.

Speaker Change: Okay.

Jackie Przybylowski: So I guess what I was hoping you could mention a little bit more about the longer-term power supply and how Zambia may sort of prevent this situation from happening again. I think in the MD&A, you had mentioned that you guys are looking at contributing to some wind and solar and some other projects. So just wondering how you might see the grid evolve over time to prevent this from happening in the future.

Speaker Change: So I guess I guess, what I was hoping if you could mention a little bit more about like the longer term power supply and like how.

Speaker Change: Zambia Mei.

Speaker Change: Sort of prevent this situation from happening again I think in the MD&A. You had mentioned that you guys are looking at what's your basis.

Speaker Change: Another project I'm, just wondering like how you might see them evolve over time.

Speaker Change: Just to just to prevent this from happening in the future.

Rudy: Rudy Yeah sure.

Rudy: Yes.

Rudy: As you know we are in the process of finalizing.

Rudi Badenhorst: As you know, we're in the process of finalizing the installation of solar and wind with Total Energy. We're also actively discussing additional hydro generation with other players in the Zambian power market, including Invesco. Invesco themselves are actively engaged with EDM to secure an additional 200 megawatts of power from the 1st of January next year. That is quite far down the road as far as their discussions are concerned. And the opening up of... [inaudible] Participants in the electricity market in Zambia certainly generated a lot of interest, and there are quite a lot of companies keen on developing additional hydro and solar operations in Zambia.

Rudy: Installation of soda and.

Rudy: And wind.

Rudy: Total energy.

Rudy: We are also actively discussing additional hydro generation with other players in the Zambian power market, including viscose.

Rudy: And this could themselves are actively engaged with EDM to secure an additional 200 megawatts of power from the first of January next year.

Rudy: That is quite far down the down the road as far as these discussions are concerned.

Rudy:

Rudy: And the opening up of <unk>.

Rudy: But I have it.

Rudy: Participants in the electricity market in Zambia sits in the agenda that there's a lot of interest and there's quite a lot of companies.

Rudy: Keen on developing additional hydro.

Rudy: And so theyre all collections with Ambev.

Tristan Pascall: Yeah, Jackie, I'll just add, the last time we saw the effects of El Nino in Zambia, sort of during the 2014 period, was really for a period no more than around 12 months. We've seen the rainfall in the northwest has largely been unaffected, though certainly the impact on southern and central province has been marked, but for example, in this last month we've had around more than 100, 150 millimeters of rain at the sites, and so potentially, we will see inundation coming from Angola and so on into Kariba, but that's not what we're planning for; we're planning for the worst

Speaker Change: Yeah, Jackie I'll, just add last time, we saw they fix they'll Nino.

In Zambia through 2014 period was really for no more than around 12 months.

Speaker Change: We've seen the rainfall in northwest has largely been unaffected I certainly the impact on southern and Central Province has been marked.

Speaker Change: But for example in this last month, we've had around more than 100 150 millimeters of rain.

Speaker Change: At the thoughts and so potentially we will see inundation coming from Angola, and so on into kariba, but that's not what we're planning for with planning for the worst perspective there.

Tristan Pascall: And then, as Rudi says, if it does prolong, working with ZESCO and others, we believe we will have enough power in place for the S3 expansion next year, although the indications are that in El Nino, it's really just a one-year impact.

Speaker Change: And then as Rudy says.

Speaker Change: If it does prolong working with Cisco and others. We believe we will have enough power in place for the <unk> III expansion next year, although the indications.

Rudy: So it's really just a one year impact.

Operator: The next question comes from Chris LaFemina with Jeffries. Please go ahead.

Okay.

Rudy: Okay.

Speaker Change: The next question comes from Chris Lewis Seminar.

Speaker Change: Jefferies. Please go ahead.

Christopher LaFemina: Thanks, operator. Hey guys, thanks for taking my question.

Speaker Change: Thanks, Operator, Hey, guys. Thanks for taking my question and congrats on all the initiatives to strengthen the balance sheet I just wanted to kind of understand the progression of net debt and there are covenants going forward. So if you look at the first quarter EBITDA run rate, which was obviously a period of a much smaller appetites enrolling right now.

Christopher LaFemina: Congratulations on all the initiatives to strengthen the balance sheet. I just wanted to kind of understand the progression of net debt and your covenants going forward. So if you look at the first quarter EBITDA run rate, which was obviously a period of a much slower capital price than we're in right now, you'd be below the required EBITDA to not breach the covenants. And I mean, strengthening spot prices since then, that clearly helps.

Speaker Change: You'd be below.

But that should not can you just the covenants.

Speaker Change: Thank you spot prices since then that clearly helps and.

Speaker Change: That's going to be generating positive free cash flow, but I'm wondering what else you can do any of that.

Christopher LaFemina: I'm wondering what else you can do in the event that the copper price or commodities in general weaken again, what you can do to strengthen the balance sheet between, say, now and the near end, in addition to considering asset sales that could protect you against breaching those covenants. And kind of one specific question is really around the working capital bills. For example, if you had a $280 million working capital bill in the first quarter, would you see that reversed over the course of the year?

Speaker Change: Net debt a copper price of commodities in general we can again, what you can do to strengthen the balance sheet between now and year end.

Speaker Change: In addition to considering asset sales.

Speaker Change: Protect you against each of those have been kind of one specific question is really around the working capital builds for example, I think you had a 280 million working capital build in the first quarter, we see that reverse over the course of the year and what sort of flexibility you have around capex reduce your spending again in the event that commodity prices weakening and you have to take a little bit more aggressive measures to.

Christopher LaFemina: What sort of flexibility do you have around CapEx to reduce your spending, again, in the event of commodity prices weakening, and you have to take a little bit more aggressive measures to strengthen the balance sheet further? Thanks.

Speaker Change: The strength of the balance sheet Britta. Thanks.

Tristan Pascall: Thank you. Ryan, do you want to take that one?

Britta: Thank you Ron do you want to take that one sure Hi, Chris.

Ryan L. MacWilliam: Thank you for your comments. First, I wouldn't take Q1 as a proxy for the rest of the EBITDA, and that's for a few reasons. As you note, the run-up in copper prices has predominantly happened in Q2. Secondly, there were a number of one-offs in Q1.

Britta: Couple of comments.

Britta: The first is I wouldn't take Q1 as a proxy for the rest of their EBITDA and that's for a few reasons as you know the run up in copper prices is predominantly only happened in Q2. Secondly, there were a number of one offs. In Q1. This included the fact that some of the lagging costs from the shutdown I'll cover Panama only flowed through this quarter.

Ryan L. MacWilliam: This included the fact that some of the lagging costs from the shutdown of Cobra Panama only flowed through this quarter, together with the fact that, as we noted earlier in the discussion, we only brought down the number of employees at Cobra Panama during the course of the quarter. So we're now going to move to a higher run rate level at Cobra Panama, together with the fact that you should see us see some strengthening on the cost side through our Zambian business through the balance of the year.

Britta: Together with the fact that as we noted earlier in the discussion that we only brought down the numbers of employees at Cobre, Panama through the course of the quarter. So we're not going to move to a more run rate level.

Britta: Cobre, Panama together with the fact that you should see some strengthening on the cost side.

Britta: Business through the balance of the yet, but certainly beyond that if we do see a weaker copper price environment. We do see other headwinds come up we will be very closely monitoring capital spend as you know and we also continue to other balance sheet strengthening initiatives, mainly the rest creates a sale process of being open to a minority investment in Zambia, we disk.

Ryan L. MacWilliam: But certainly beyond that, if we do see a weaker copper price environment or we do see other headwinds come up, we'll be very closely monitoring capital spend, as you note. And we also continue the other balance sheet strengthening initiatives, namely the Las Cruces sale process and being open to a minority investment in Zambia that we discussed earlier in the call.

Britta: Just the idea of Nicole.

Christopher LaFemina: And then, what about the working capital buildup in the first quarter? Is that seasonal? Should we see that reverse as the year progresses?

Britta: And then what about the working capital build in the first quarter is that seasonal we should see that reverse as we get progressive.

Ryan L. MacWilliam: Yeah, so there are two drivers there. One was some of the payments for the kind of lagging payments that came associated with the shutdown of Cobra Panama. That flowed through; those payments flowed through in Q1, so I'd say that wouldn't necessarily reduce. But certainly on the Zambian side, we did drive our working capital down to lower levels in Q4, that came back a bit in Q1, and you may see some of that reverse out through the balance of this year.

Britta: Yes, so the two two drivers there one was some of the payments for kind of lagging payments that came associated with the shutdown of cobre Panama.

Britta: It flowed through those payments flow through in Q1, so I would say that wouldn't necessarily reduce.

Britta: But certainly on the Zambian side, we did drive our working capital down to lower levels in Q4 that came back a bit from Q1 and you may see some of that reverse out through the balance of this year. So certainly you wouldnt expect the change in working capital that we had in Q1.

Ryan L. MacWilliam: So certainly, you wouldn't expect the change in working capital that we had in Q1 was unusual for us. It obviously impacted net debt somewhat, and that wouldn't continue to play out through the balance of the year.

Britta: It was unusual for us that obviously impacted net debt somewhat and that will continue to play out through the balance of the year.

Britta: Yeah.

Yeah.

Operator: The next question comes from Ralph Profiti with eight capital. Please go ahead.

The next question comes from Ralph <unk> with eight capital. Please go ahead.

Ralph M. Profiti: Thanks, Operator. Good morning, everyone.

Britta: Yeah.

Ralph: Thanks, operator, good morning, everyone.

Ralph M. Profiti: So firstly, on S3, Tristan and Ryan, it looks like cost controls have been kept in check, and you're doing a good job there. I'm just wondering if you have a number or just risk inflationary pressures at S3. How much of the CapEx is committed and locked in at this point?

Ralph: So firstly on the S. Three.

Ralph: And Ryan it looks like cost controls have been kept in check and youre doing a good job. There I'm. Just wondering if you have a number or just some risk of inflationary pressures that have three how much of the capex.

Ralph: Is committed and locked in at this point.

Ryan: Yeah, Hi, Ralph.

Tristan Pascall: Yeah, hi Ralph. So at the end of March, we were at the end of Q1, and we had around $600 million committed, and of that, $385 million incurred. So that gives you an idea. In terms of the run rate to finish, most of that turns now to the construction activities that are in the country in Zambia, the logistics chain of getting equipment to Zambia, and at the moment, you know, the cost of that transport. We don't see any alarm bells there.

Ryan: The end of March we were at the end of Q1, we went through around 600 million committed.

Ralph: And of that 395, you mean and could see.

Ralph: So that gives you an idea in terms of.

Ralph: A good run rate to finish most of that to ins and outs of the construction activities that is in country in Zambia, the logistics chain of getting equipment, two to Zambia and at the moment.

Ralph: Cost of that transport, we don't see any alarm bells, there and then in country.

Tristan Pascall: And then in the country, the construction erection, and so on. And all that's really around labor and equipment. And so at this stage, we feel comfortable on that as well. So, all the long leads being procured, the final engineering closing out on the instrumentation and control side of things, we don't really see any alarm bells. We haven't been really impacted by the situation in the Red Sea and the Suez Canal, one month here or one month there on small components, but overall, it doesn't affect schedule or cost.

Ralph: Construction direction and so on.

Ralph: And all of that is really around labor and equipment and so at this stage, we feel comfortable on that as well so we don't.

Ralph: All the long leads being procured the final engineering closing out on instrumentation and control sort of things, we don't really see any alarm bells, we havent been really impacted by the situation in the Red Sea and the Suez Canal, one month here or one month, there on small components.

Ralph: Overall effect.

Ralph: Schedule or.

Ralph: Cost.

Tristan Pascall: That's excellent to hear. Secondly, what is the scalability of outsourcing power in Zambia over and above 80 megawatts if needed? Is this a feature that's being put in place in these contracts, and is it likely that anything incremental if needed would be done at the contracted rate?

Ralph: Okay.

Speaker Change: Excellent to hear.

Speaker Change: Secondly, what is the scalability of outsourcing powered Zambia over and above 80 megawatts. If needed is this a feature that's going has been put in place in these contracts and is it likely that anything incremental if needed.

Speaker Change: Would be done at the contracted rates.

Speaker Change: Yeah, Ralph Yes. The answer is yes, we have some flexibility there to to ratchet up if the situation deteriorates.

Tristan Pascall: Yeah, Ralph, the answer is yes, we have some flexibility there to ratchet up if the situation deteriorates. At this stage, we think VSCO's been very proactive about addressing the situation, and the forecasts look pretty reasonable to us, but we have that flexibility.

Speaker Change: At this stage, we see viscose.

Ralph: You're very proactive about addressing the situation.

Speaker Change: And the forecast look pretty reasonable to us, but we have that flexibility.

Speaker Change: Okay.

Operator: The next question comes from Gordon Lawson with Paradigm Capital. Please go ahead.

Speaker Change: The next question comes from Gordon Lawson with paradigm capital. Please go ahead.

Gordon Lawson: Hey, good morning. A simple accounting question for you here on the enterprise project. So we briefly saw some cash cost guidance provided in the $4 to $6 range with your 2022 production results, but now that we're treating the asset as part of Sentinel and Trident, how should we think of these costs in terms of operating and by product credits once it's commercial?

Gordon Lawson: Hey, good morning.

Gordon Lawson: Simple accounting question for you here on the Enterprise project.

Gordon Lawson: So we briefly saw some cash cost guidance provided in the four to $6 range.

Gordon Lawson: With your 2022 production results, but now that we're treating the outset as part of Sentinel and Trident.

Gordon Lawson: How should we think of these costs in terms of operating in by product credits once it is commercial.

Ryan L. MacWilliam: Sure. So what we're going to do is we're going to report on copper and nickel separately. Enterprise Nickel revenues won't go against the Sentinel Copper revenues. And similarly, we'll report Enterprise C1 costs when that comes into commercial production, which we expect in Q2, Q3. So that'll start around $6 per pound C1 and ramp down from there as Enterprise continues to ramp up production.

Speaker Change: Sure. So what we're going to do is we're gonna reports on copper and nickel separately. So those.

Speaker Change: Enterprise Nicole revenues, one go against the Sentinel copper revenues, we expect.

Speaker Change: We've disclosed the Sentinel copper seaborne costs and somebody will report enterprise C. One costs when that comes into commercial production, which we expect Q2 Q3, so that'll start around $6 per pound.

Speaker Change: <unk>, one and ramped down from there.

Speaker Change: <unk> continues to ramp up production.

Speaker Change: Okay.

Gordon Lawson: Okay, I figured out as much as I had to check. And still on enterprise. You've got the first column for the Jameson cell providing better recoveries. I'm just curious if the second column is expected to include more flexibility in terms of ore characteristics.

Speaker Change: Sure. It is much about the check.

Speaker Change: And still on enterprise.

Speaker Change: You've got the first column for the gentlemen, Jameson cell, providing better recoveries. Some of them just curious if the second column is expected to.

Speaker Change: Include more flexibility in terms of ore characteristics.

Rudi Badenhorst: Yeah, Rudi, do you want to comment on that at Enterprise? Yeah, Gordon.

Speaker Change: Yeah, Rudi do you want to comment on that and then front.

Speaker Change: Gordon.

Rudi Badenhorst: Gordon The, Also included the additional talc float cells, which are working pretty well. You know, we are seeing some really incredible recoveries at Enterprise at this moment in time, way above the 70-75% mark with very good concentrate grades and clean concentrate, which our customers are very appreciative of.

Speaker Change: He.

Speaker Change: Also included the additional.

<unk> flotel switch working pretty well yeah, we are.

Speaker Change: Seeing some really incredible recoveries at enterprise at this moment in time.

Speaker Change: Of the 70% to 75% Mark with very good concentrate grades and clean concentrate which our customers are very appreciative.

Operator: The next question comes from Ioannis Masvoulas with Morgan Stanley. Please go ahead.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: The next question comes from Anna <unk> with Morgan Stanley. Please go ahead.

Anna: Yes, Hello, Thank you very much for the presentation.

Ioannis Masvoulas: Yes, hello. Thank you very much for the presentation. Question on Panama: in a scenario that you're allowed to restart Cobra Panama operations in the second half of this year, how long would it take to fully ramp up as you would need to rehire people, repower equipment, etc.?

Anna: Oh, a question with Panama in a scenario that you're a law.

Anna: Now to restart Cobre, Panama operations in the second half of this year.

Anna: So long would it take to fully ramp up as you would need to be harder people repower equipment et cetera.

Tristan Pascall: Thanks Ioannis, I appreciate the question. I don't know that we're at a phase now where we're talking about restarting or what that could look like. I mean, on a theoretical basis, I think the closer it does happen, the easier it is, as you said, and that's really around people and suppliers and so on. But I think there's a lot to come in terms of discussion leading up to the election and then working with whoever comes through in the election about solving the challenges for the country, solving the challenges around the mine and working that through, and listening to the people of Panama to resolve the situation

Speaker Change: Yeah. Thanks for your honesty I appreciate the question I don't know that weird to phase now where we.

Speaker Change: Talking about reached out or what that could look like I mean on a theoretical basis I think it's.

Speaker Change: The close as it does happen the easier. It is do you see it and that's really a land.

Speaker Change: People and supplies and so on but I think there's a lot to come in terms of discussion.

Speaker Change: Up leading up to the election, and then working with whoever comes through in the election about solving the challenges for the country solving the challenges around the mine.

Speaker Change: Working that through listening to the people of Panama to resolve the situation.

Speaker Change: Okay.

Ioannis Masvoulas: Okay, very clear. Thank you for that. And just to follow up, in terms of the concentrate that you have stored... How long can you keep that material in the warehouse until there is a degradation in quality that might impair your ability to monetize the amount you're expecting?

Speaker Change: Okay very clear. Thanks for that then just a follow up in terms of the concentrate that you have stored.

Speaker Change:

How long can you keep that material in the warehouse until there is a degradation in quality that might impair your ability to monetize.

Speaker Change: Monetize the amount you were expecting.

Tristan Pascall: Thanks, Ioannis.

Tristan Pascall: Thanks Ioannis. Yeah, look, our main concerns there are the environmental and the quality of the concentrate. So it's largely chalcopyrite, so that is C, U, S, and F, E, and it's the S, you know. So we see some heating because of the sulfur in there, and then you get gas coming off, SO2 and so on, and that's not good for the environment, and it might heat up to sort of 60 or 70 degrees centigrade, and so that's the degradation we worry about.

Speaker Change: Thanks, Yeah I'll look at main concerns there are environmental on the quality of the concentrate so largely chocolate pyrite. So that is C. U S and S. A and it's the S. So we see some heating because of.

Speaker Change: The sulfur in there and then you get gas coming off so two and so on and that's not good for the environment and as you might hate up to sort of 60 or 70 degree centigrade.

Speaker Change: And so that's the degradation, we worry about let's say you complain until that.

Tristan Pascall: The C, U component of that doesn't degrade, so in terms of the pyrometallurgical process that follows in the treatment of the chalcopyrite in the smelter, you still get all of those C, U units through. So we don't see issues with the production of copper afterwards; it's more on the environmental side, and that's why it's critical that that material does move. The next question comes from Dalton Baretto with Canaccord Genuity.

Speaker Change: Doesn't the great. So.

Speaker Change: In terms of the metallurgical process that follows in the treatment of the chocolate pyrite in the smelter.

Speaker Change: You still get all of those say units through so.

Speaker Change: We don't see issues on on <unk>.

Speaker Change: On the production of copper afterwards, it's more on the environmental saw them. That's why it's critical that that material does move.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: The next question comes from Dalton Barreto with Canaccord Genuity. Please go ahead.

Dalton Baretto: Thank you good morning, everybody.

Tristan and.

Dalton Baretto: In regard to Panama, I think you've used the term listening to the people three or four times and.

Operator: The next question comes from Dalton Baretto with Canaccord Genuity. Please go ahead. Thank you. Good morning, everybody. Tristan, in regard to

Dalton Baretto: In today's call.

Dalton Baretto: Just wondering based on this lessening or what have you guys learned so far and what's your current assessment of the gap towards acceptance of the mind restarting. Thank you.

Dalton Baretto: Yeah, Dalton, I think Panama is understanding the impact that the mine has had on the broader economy and understanding, you know, the role that Panama can play as a responsible producer of copper in a global market that requires these metals for the energy transition and to continue to uplift developing countries. You know, the standards that have been applied to Cobra Panama are amongst the highest in the world, and we see that in terms of, as we're speaking about the CADESA report that came back, that is the government independent auditor inspecting the site in the run-up to when the closure, the cessation of operations came through from June to October and found 100% compliance.

Dalton Baretto: Delta and I think.

Dalton Baretto: Panama is understanding the impact that the mine has had on the broader economy.

Dalton Baretto: And understanding the role that Panama can play as a responsible producer of.

Speaker Change: Of copper in the global market that requires these metals for the energy transition and to continue to uplift developing countries.

Speaker Change: The standards that have been applied to cobre, Panama amongst the highest in the world and we see that in terms of as we are speaking about the cadets a report that came back that as the government.

Speaker Change: Our government independent auditor inspecting the thought in the run up to when the closure of the <unk>.

Speaker Change: As you know operations came through from June to October and found 100% compliance so.

Dalton Baretto: So, you know, mines of this size and status are needed to supply those critical materials. On our side, I think very definitely listening to people about the issues of sovereignty, the issues around Panamanianization, and really approaching those conversations with humility so that we can learn as much as we can from them. Do you think your message is actually getting through to the average person on the street? Dalton, it's a time now when the country is focused on the political process around the election, and there's a lot of conversation around these issues, a lot of conversation around the change in politics and the change coming up with a new president must happen. That's a requirement of the constitution that the president will change whichever party goes forward. In that context, these conversations in the country are important.

Mind there'll be size and status are needed to supply critical materials on the outside I think very differently listening to people.

Speaker Change: The issues of sovereign TV issues around Panamanian monetization.

Speaker Change: And really approaching those conversations with humility. So that we can learn as much as we can from them.

Speaker Change: Okay.

Speaker Change: Do you think your message is actually getting food to the average person on the street there.

Speaker Change: Yeah, the Delta and it says it's a time now where the country is focused on the political process around the election.

Speaker Change: And you know there's a lot of conversation around these issues a lot of conversation around in the change in politics.

Speaker Change: And the change coming up with the new.

Speaker Change: A new prison that must happen that through refinement of the constitution that the president will change whichever party goes forward.

Speaker Change: And in that context.

Speaker Change: These conversations in the country are important.

Speaker Change: Okay.

Speaker Change: The next question comes from Lawson Winder with Bank of America Securities. Please go ahead.

Operator: The next question comes from Lawson Winder with Bank of America Securities. Please go ahead.

Lawson Winder: Good morning. Thank you very much, Operator, both Tristan and Ralph. Thank you for the update today. One question on Panama. To what extent, if at all, have you pursued a direct challenge to the Supreme Court ruling at the local Panama level, in addition to the two arbitrations, and just your thoughts on whether that would be a reasonable path to pursue, particularly post-election?

Speaker Change: Okay.

Lawson Winder: Good morning, Thank you very much operator focused and Rob thanks for the update.

Lawson Winder: Today.

Lawson Winder: One question on Panama to what extent if at all have you pursued a direct challenge to the Supreme Court ruling at the local Panama level. In addition to the two arbitration and just your thoughts on whether that would be a reasonable path to pursue particularly post the election.

Tristan Pascall: Thanks Larson. Yeah, look, we acknowledge the decision of the Supreme Court. The Supreme Court, you know; there is no route to appeal. That is the basis by which Supreme Court decisions are made. And so, you know, in terms of the legal argument, again, it's not our preferred route, but, you know, the route, there is arbitration around that to understand it more fully, but there is no route to appeal. There is no way to appeal to a Supreme Court decision in Panama.

Lawson Winder: Okay.

Speaker Change: Thanks, Les and Yeah look we acknowledge the decision of the Supreme Court. The Supreme Court. There is no route to appeal.

Speaker Change: If that is the basis by which the Supreme Court decisions are made.

Speaker Change: And so you know.

Speaker Change: In terms of the legal argument again, it's no doubt a preferred route but.

Speaker Change:

Speaker Change: The root there is arbitration around that too.

Speaker Change: Understand it more fully.

Speaker Change: Okay. Thanks for clearing that up and then just my follow up would be on the Zambian potential Zambian minority asset sale.

Lawson Winder: Okay, yeah, thanks.

Tristan Pascall: Thanks for clearing that up. My follow-up would be on the potential Zambian minority asset sale. It is still being considered, but your language suggests that the bar might be quite high in terms of what would be acceptable from First Quantum's point of view. Does it really just come down to value for First Quantum, or are there other considerations, such as maybe structure or the ability to combine with other assets that might also be important?

Speaker Change: It is still being considered but your language suggests that the bar might be quite high in terms of what would be acceptable from first one's point of view does it really just come down to value for first quantum or are there other considerations such as such as maybe structure or the ability to combine with other assets that might also be.

Ryan L. MacWilliam: Ryan, do you want to take a...

Speaker Change: Yes.

Speaker Change: Brian do you want to play that one sure Lawson.

Lawson Winder: Lawson, we've been pretty consistent over the last three to four years that as a company, we'll look for opportunities to partner. It's the reason we sold a stake in Ravensdorf to Posco, it's the reason we partnered with Rio Tinto at LaGranja, and, similarly, at Zambia. If there's an opportunity to partner that makes sense for us, for our shareholders, and for Zambia, we'll evaluate The recent financing transaction we put in place through Q1 means we don't have to enter into a transaction in Zambia, so really, we're about, is there a new partnership from a value, from a long-term workability and relationship perspective that works for all parties, including the country, and that'll be something we keep thinking about through the course of this year. The next question comes from Bryce Adams with CIBC Capital Markets. Please go ahead.

Brian: And we've been pretty consistent over the last three to four years that as the company will look for opportunities to partner. The reason we sold a stake in Ravensthorpe to Posco. It's the reason we've partnered with Rio Tinto the ground, yet and similarly, Zambia, if there's an opportunity to partner that makes sense for us for our shareholders and for Zambia, We will evaluate at the recent.

Brian: Financing transaction, we put in place through Q1 means we don't have to enter into a transaction in Zambia. So really weigh about holistically is there a new partnership from a value from a long term workability and relationship perspective that works for all parties, including the country.

Brian: And that'll be something we keep thinking about through the course of this year.

Brian: Yes.

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

Bryce Adams: Thank you operator, and thanks for calling for the presentation. My question is a follow on to some of the early ones. So Tristan with regards to the upcoming Panama elections are there any parties that you think would be more favorable for cobre Panama resolution.

Operator: Thank you, Operator, and thanks, First Quantum, for the presentation.

Bryce Adams: Yeah, thanks, Bryce. Look, we, you know, First Quantum, we support strong democratic processes. And, and, and, you know, Bryce, we work from the basis that we would seek to work with any of the parties that got through, whoever the final successful candidate would be.

Tristan: Yeah. Thanks, Brian look we first quantum we support strong democratic processes and.

Tristan: <unk>.

Tristan: But we we went from the basis that we would seek to work with.

Tristan: Any of the parties that got through whoever the final successful candidates would be.

Tristan: Yeah.

Speaker Change: All right I'll leave it at that thanks.

Tristan Pascall: This concludes the question and answer session. I would like to turn the conference back over to Tristan Pascall for any closing remarks. Please go ahead.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: This concludes the question and answer session I would like to turn the conference back over to Tristan Pascal for any closing remarks. Please go ahead.

Tristan Pascall: Thank you everyone for your attention on today's call, and we look forward to speaking to you again soon at our second quarter update. Thank you.

Tristan Pascall: Thank you everyone for your attention on todays call and we look forward to speaking to you again soon and now second quarter update thank you.

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

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

Okay.

Speaker Change: [music].