Q3 2024 McEwen Mining Inc Earnings Call
Thank you.
Speaker Change: Hello, ladies and gentlemen. Welcome to McEwen Mining Q3 2024 Operating and Financial Results Conference Call.
Speaker Change: Present from the company today are Rob McEwen, Chairman and Chief Owner, William Shaver, Chief Operating Officer, Perry Ing, Chief Financial Officer, Jeff Chan, Vice President, Finance.
Stephan Spears, Vice President, Corporate Development.
Vice President and General Manager at McEwen Copper.
Carmen Díaz: Carmen Diaz
Carmen Díaz: General Counsel and Security.
Carmen Díaz: After the speaker's presentation, there will be a question and answer session.
Speaker Change: If you would like to withdraw your question, press star followed by the number 1 again.
Operator: I will now turn today's call over to Rob McEwen, Chief Owner. Please go ahead, sir. Thank you, operator.
Rob McEwen: Good morning fellow shareholders and interested investors. You heard who is with me today on the call and they're available to answer your questions when we move into that period.
Carmen Díaz: During the third quarter and the first nine months of this year, we have made significant progress reporting double and triple digit improvements in key performance metrics.
Rob McEwen: As you can read in our press release,
Carmen Díaz: The third quarter of 24 was stellar compared to the third quarter of 23.
Carmen Díaz: revenue up 36%, gross profit up 268%, adjusted EBITDA up 586%, operating cash flow up
Carmen Díaz: at $23 million from a negative $2.3 million back in 2023.
Carmen Díaz: Our safety record is also stellar. We are pleased to post
Carmen Díaz: Our records at Gold Bar, 54 months without a lost time accident. At the Fox Complex, 33 months without a lost time. And McEwen Copper, Los Azules, an amazing 1.3 million man hours without a lost time accident.
Carmen Díaz: Robert McEwen, Michael Meding
Carmen Díaz: During the quarter, we continued to push our exploration, spending $5.3 million at the Fox and Gold Bar.
Carmen Díaz: Mines, $6.1 million at Los Azulis, the McEwen Copper Project. And these expenditures we view as strategic investments and that have successfully extended the lives of our mines.
Carmen Díaz: And they're currently treated as expenses and largely contributed to the net loss re-recorded of 2.1 million, or four cents a share.
Carmen Díaz: We will be providing updated resource estimates to be released early next year.
Carmen Díaz: For McEwen Copper, we have raised privately over the
Carmen Díaz: our funds and over the in the last quarter we closed on 56 million and that'll be used to complete the bankable feasibility study for Los Azules.
Carmen Díaz: We expect the feasibility study to be completed in the first half of next year, and we're also expecting to receive our environmental permit to construct the mine.
Carmen Díaz: during that same period.
Carmen Díaz: Once we have both the feasibility study and the environmental permit in hand, we're planning to IPO McEwen Copper.
Carmen Díaz: I think it's worth noting that we have raised privately
Carmen Díaz: over 470 million dollars to go towards the development of Los Azules and based on the last financing that we completed at $30 a share
Carmen Díaz: It gives an implied market value to McEwen Mining of $984 million.
Carmen Díaz: I expect this value will soon reach the unicorn status that I predicted several years ago.
Carmen Díaz: During the quarter we made some investments. In Nevada, we completed the acquisition of timberline resources.
Carmen Díaz: It has properties.
Carmen Díaz: three properties, but one close to our gold bar mine has Patented land claims with over half a million ounces outlined on there that we will
Carmen Díaz: be using to extend the life of our gold bar mine. We are starting to drill on some of the exploration targets we've identified, and that's starting this week and will continue through the year.
Carmen Díaz: At Fox, work is underway expanding our tailings facility to accommodate increased production from our Fox complex.
Carmen Díaz: And we will be driving a ramp to connect the...
Carmen Díaz: to connect Stock East, Stock Main, and Stock West.
Carmen Díaz: In Ontario, we bought a...
Carmen Díaz: position in a company called Inventus Mining. It has a very interesting paleoplacer gold deposit. These deposits are
Carmen Díaz: quite common in South Africa and contributed to South Africa's large gold production. It's a shallow deposit. We think it could be easily mined and find it a very interesting property. We also invested $14 million in
Carmen Díaz: McEwen Copper
Carmen Díaz: We looked at our property and said it's lower altitude, a larger resource, it's closer to infrastructure.
Carmen Díaz: We can see a higher value for our Los Azules property.
Carmen Díaz: At this point, I'd like to open the session for questions.
Carmen Díaz: Robert McEwen, Robert McEwen, Michael Meding
Carmen Díaz: I can say we have two questions that came in online.
Carmen Díaz: Well, two people came in online, each asking two questions.
Carmen Díaz: One was how much capital the company is planning to raise for Los Azules.
Carmen Díaz: and a related question, the anticipated IPO in 2025, can we provide preliminary details?
Carmen Díaz: on the expected offering price and size of the offering.
Speaker Change: I'm sorry to say we can't say provide comments on either of those if you considered pre-marketing and we haven't completed the feasibility so we are not we don't have a hard number to say how much going to raise but once we have a feasibility study out we can answer those questions
Speaker Change: The second...
Speaker Change: questions came in and it was outlining what studies have been completed at Los Azules for the feasibility and what are outstanding.
Speaker Change: And also, Exploration News, what are we going to be doing on the newly discovered porphyry system that's three kilometers away? And I'll ask Mike Meding, our VP and General Manager of Los Azules, to answer those questions.
Speaker Change: Those two questions.
Mike Meding: Thank you so much, Rob. So our record-breaking drilling campaign last season with 23 rigs at site provided most of the technical data needed for the feasibility study.
Mike Meding: We plan to drill an additional approximately 7,700 meters this season to complement existing data, using rigs operated mainly by local contractors we've developed in South One.
Mike Meding: We're planning nearly 4,000 meters of condemnation drilling using diamond drills in the area designated for future project infrastructure, along with about 1,400 meters of geotechnical sonic drilling, 1,500 meters of geotechnical diamond drilling, and 800 meters of hydrogeological wells to support our study conclusion.
Mike Meding: In Q3, we updated the mineral resource model, optimized pit resources, and conducted initial reserve calculations.
Mike Meding: with results being likely close to the Preliminary Economic Assessment, the PEA. We also completed hydrological models, process instrumentation diagrams, the P&IDs.
Mike Meding: and initiated third-party reviews for resource modeling, geotechnics, hydrology, and metallurgy. Metallurgical recoveries are trending at expected levels with recoveries of around 76%, in line with the prior press release we put out.
Mike Meding: We've signed a second Memorandum of Understanding with YPF to ensure feasibility study level of engineering aligns with our feasibility goals.
Mike Meding: YPS committed to options to provide renewable energy for the project to wind, solar, and hydro sources.
Mike Meding: Our team conducted benchmark visits in Chile and the U.S. and engaged with major equipment suppliers on electric and autonomous fleet options.
Mike Meding: Now, what are the remaining steps?
Mike Meding: Engineering, Logistics Planning, Equipment Specification, Capital and Operating Cost Confirmation, and finally the write-up of the feasibility study itself.
Mike Meding: which we already started. We aim to include the Newton Upset as potential in the NA43-101 report.
Mike Meding: With regards to Tango, depending on funds availability, we have a comprehensive
Mike Meding: program in place to test the mineralization in Tango. You remember that we discovered a porphyry about three kilometers east of Los Azules. This will not be included in the feasibility studies on top of what what we think is that we have a porphyry system.
Mike Meding: We have seen moly on surface, we have seen quartz veining, we have seen copper.
Mike Meding: reining, we have seen geophysical anomalies and we have drilled at the last
Mike Meding: at the end of the last season to a relatively shallow depth, but we saw 106 meters with about 0.11% of copper.
Mike Meding: While this is borderline, it shows that the system is mineralized. So we're going to go more to the center of where we see the anomaly to confirm the presence of higher rates.
Mike Meding: That's what we have on top of mind for Tango going forward.
Mike Meding: report.
Speaker Change: Thank you, Mike.
Speaker Change: Operator, are there other questions?
Speaker Change: As a reminder to ask a question, you will need to press star followed by the number one on your telephone keypad. To withdraw your question, press star followed by the number one again.
Speaker Change: Your first question is from the line of Jay Sekilsky with Alliance Global Partners.
Jay Sekilsky: Hey Robert
Jay Sekilsky: So just looking at that gold bar, turned in another strong quarter from a production perspective. I'm just curious, are the higher production levels we saw over the last two quarters something we should expect to continue heading into 2025?
Mike Meding: Robert McEwen, Michael Meding
Speaker Change: Maybe I'd answer that question for you. We have increased
Speaker Change: The amount of material we're moving at Gold Bar, but a lot of that material is actually waste that we're
Speaker Change: moving off of
Mike Meding: a part of the pit that's called PIC-3, so it's basically a stripping operation.
Mike Meding: So, although we are moving more, significantly more material, the expectation is that production of gold in 2025 will be in line with what we've done, you know, this year.
Mike Meding: So, we'll have...
Mike Meding: with more tons being mined because of the amount of stripping and that, you know, we're aggressively pursuing the stripping now because of the high coal price.
Speaker Change: Okay, that's helpful. Switching to the timberline acquisition, Rob, you touched on this a bit. Can you just give us some color on what the permitting process and timeline might look like at Eureka? I'm just curious how quickly some of this material could potentially be brought into the Gold Bar mine plan.
Speaker Change: Sure, a last step in spheres too.
Mike Meding: address that question.
Mike Meding: No problem, Rob. Hi, Jake.
Mike Meding: So, we're looking, I mean, we're working already on the permitting process. We've got our permit to conduct exploration, and as Rob said in his remarks, exploration has started on part of the property.
Mike Meding: There's kind of two segments to the property. One area where we have patented mining claims that are not BLM grounds.
Mike Meding: So we're dealing with the state only on permitting there, and that has a kind of a quicker timeline of around two years for permitting. BLM permitting is a slight unknown, but it's expected to be longer, and that would affect the Lookout Mountain resource.
Mike Meding: And so the way the team is looking at it is, you know, it will be permitted in several phases, with the earliest possible production projected for around 2027, and then layering on from there.
Speaker Change: And then just lastly, at Fox, any color on the development work that's being done and still needs to be done there over the next quarter or so in order to improve slope access?
Speaker Change: Bill, would you care to address that?
Bill: Yes, well, we are in the final throes of getting our permit to start the ramp excavation to get down into the main ore body at Stock and also into Stock East.
Mike Meding: At the same time, we are doing some shaft rehabilitation.
Mike Meding: And this work is being done principally to make sure we have a proper egress from the mine and also to help in the eventual ventilation system for the operation.
Mike Meding: So, I guess we're hoping to have the stock, some parts of the stock operation in operation in kind of Q3, Q4 of next year.
Mike Meding: And that will overlap nicely with ore coming out of froom so that we don't end up with a gap in between the two operations.
Mike Meding: And, you know, this year we've had, I would say, a very successful drilling program where we've extended the ore to stock east and extended ore, you know, down as deep as 600 meters. So
Mike Meding: You know, I think the future looks pretty good there and, of course, with today's prices, you know, even looks a little bit better. So, yeah, we're pretty optimistic about what we'll be able to do.
Mike Meding: with our assets in Timmins and, you know, we're now working diligently on a plan that gets us kind of around 100,000 ounces per year by 2028.
Mike Meding: Robert McEwen, Michael Meding
Mike Meding: and some of that planning will be fleshed out in our
Mike Meding: That's all for me. Thanks again and congrats on the quarter. Thank you, Jay.
Carmen Díaz: Your next question is from the line of Joseph Rager with Roth Capital Partners.
Joseph Rager: Thank you.
Joseph Rager: Hey Rob and team, thanks for taking the questions.
Joseph Rager: I guess the first one is kind of a follow-up to Jake's question about Gold Bar, but more so about just this year.
Joseph Rager: The current guide...
Speaker Change: You know, you're almost there already.
Speaker Change: Should we read into that that Q4 is going to be a lower production quarter because there's less ore stacked in Q3? Or is there just, you know,
Speaker Change: And no incentive to raise the guide ahead of the quarter. Which way should we read that?
Speaker Change: Well, actually, the plan for Q4 was that it was going to be a low-production
Speaker Change: period of time, and that's in part due to some of the stripping we are we are doing on the PIC-3. And so I can't remember exactly what that number is, but it seems to me it's around
Speaker Change: for the quarter.
Speaker Change: And that was always part of the plan. So we're basically on track to meet guidance with...
Speaker Change: You know the better quarter that we just had and you know the and we're working hard to try and make make the last quarter a little bit better and you know, we're pushing the our our fellows to do that and
Speaker Change: A few of us are headed down there next week to spend some time trying to figure out, you know, how to do that. So, yeah, I don't think we're going to see a significant change in the overall guidance for the year.
Speaker Change: You know, it's kind of steady as she goes.
Speaker Change: Okay. Fair enough. And then, for Los Azules, post the equity issuance a couple weeks ago, what's the cash balance roughly right now in the subsidiary?
Speaker Change: Jeff, do you want...
Jeff Chan: Sure, let me just pull that up, but it would just be north of $40 million at the moment.
Jeff Chan: You get that, Joe?
Joe: Yep. All right. And then, um...
Joe: One final thing.
Speaker Change: As you guys work towards adding in the Timberline acquisition to Gold Bar, will you guys be treating it as a separate mine or you guys be treating it as kind of like a separate pit but still all through Gold Bar from like an accounting standpoint?
Speaker Change: From an accounting standpoint, it would be unitized under Gold Bar.
Speaker Change: Most likely, yeah.
Speaker Change: Yeah, and that's in part because operationally...
Speaker Change: Eventually we may have a leach pad at Timberline, but the final finished product, the gold bar, will be still produced at Gold Bar. So we'll transport carbon back to...
Speaker Change: back the gold bar and then remove the gold.
Speaker Change: Okay, that's helpful. All right. I'll turn it over. Thanks guys. Thank you
Speaker Change: Your next question is from the line of Heiko Isle with H.C. Wainwright.
Speaker Change: Hello Heiko. Hey Rob, how are you? Excellent, thank you.
Heiko Isle: Hey, you had somewhat lower than expected grades at San Jose, can you just provide a bit of color on what happened, I assume the mind plane is still intact, and also most importantly, probably what you've seen in Q4 thus far, and then building on all of that, how should we think of our longer term estimates for the site? I assume that this is more of a one-time thing, right?
Speaker Change: Yes, Perry will answer that question. Good morning, Heiko. Thanks for your question. So, yeah, we have regular dialogue with the team from Hosschild and management at San Jose.
Perry Ing: advised that the lower grades were temporary, again mostly reconciliation versus resource model, but that seems to have been rectified in October or by October so
Perry Ing: Q4 is trending well so far and we believe the operation is on track.
Perry Ing: to meet guidance.
Perry Ing: Overall, I think they're quite bullish on San Jose as an operation, obviously silver prices having ticked up.
Perry Ing: over the past quarter has helped significantly and you know there has been some modest exploration success which has continued to extend mine life.
Speaker Change: Thank you. Thank you.
Speaker Change: Fair enough. And then something completely different, and frankly I'm actually shocked that this hasn't come up yet. It's a bit more philosophical, I mean you're based in Canada, you operate Gold Bar in Nevada.
Speaker Change: Obviously, big news out of the States today, we're going to get a new president in January. I wanted to see if you have internally thought of the impacts of all of that, positive or negative, from the election results from last night.
Speaker Change: even just like minor things, you know, whatever, cash moving across borders, you know, staff travel, that kind of stuff.
Speaker Change: Well, McEwen Mining is a Colorado incorporated company. Gold Bar is in Nevada and
Speaker Change: And I think it can only be positive. He wants to streamline the regulations and create more employment in the country.
Speaker Change: And he's pro-mining, obviously. Yes, so I think that's good for Gold Bar and our other properties there.
Speaker Change: Fair enough. I figured you'd say something along those lines, but you don't have any little like internal checklist of things that you're focusing on.
Speaker Change: It's too early at this point. The outcome of the election was up in the air and we just thought we'd let the dust settle before trying to look at that.
Speaker Change: I appreciate it. Thank you very much. Thank you, Heiko.
Speaker Change: Robert McEwen, Michael Meding
Speaker Change: As a reminder, to ask a question, press star 1 on your telephone keypad. Your next question is from the line of Chris White with Paz Ventures.
Speaker Change: Hello, Chris.
Chris White: Good morning, Robin team. Congratulations on the sales price of $2,499 an ounce. That's great.
Chris White: I got two quick questions. I think they might be for Bill, but you let me know.
Chris White: So with you and the release
Chris White: I'm struggling with, on slide 28 of the corporate deck, it said that our all-in sustained costs were going to be going down to like $1,650 to $1,750 at gold bar.
Speaker Change: But the press release said Gold Bar's actuals was 1822. And then same thing at Fox. The slide 28 says 1450 to 1550 for Fox.
Speaker Change: But the actual was $1,953 or $400 to $500 more than slide 28 suggested.
Chris White: Could you maybe provide more details here for all of us on the line?
Chris White: Maybe answer also, what would it take to get under 1,500 in Q4? Is that even possible?
Chris White: Robert McEwen, Michael Meding
Speaker Change: Do you want to answer part of that, Jeff? Yeah, I would say the chances of us getting under $1,500 is probably very low. In the case of Gold Bar, it's in part because
Chris White: were on a very aggressive stripping.
Chris White: program right now to take advantage of the high gold price.
Chris White: to do stripping at PICC-3. PICC-3 is, you know, a lower, a little bit lower grade than the average at...
Chris White: at Gold Bar, and you know, at these prices, it is very valuable ore.
Chris White: But if the price of gold, say, fell back to $1,500, you know, that material might not even be ore. So we're, in part, we may be seeing some higher
Chris White: I guess, cost per ounce numbers, but, you know, those are based on doing proper work in order to put us in a better position for next year.
Speaker Change: Sure, so just in clarifying the slide 28 in your corporate deck, you guys are...
Speaker Change: going after different parts of the mine than you what what the all-encompassing cost of 1650 and 1750 was Reflecting is that right because the price of gold is higher
Speaker Change: That's right and also I mean this stripping that we're doing now is going to expose ore for next year.
Speaker Change: You got it.
Speaker Change: Any comment on Fox, why Fox came in so high?
Speaker Change: Well, Fox is primarily high because of the low production in Q3. That's basically, you know, it has to do with the divisor.
Speaker Change: and you know it also I guess is some of it is attributed to you know all of the money we're spending at this point on on getting stock going as well.
Speaker Change: And that just wasn't factored in on the slide 28 piece? Like what's the delta between what you guys have in the corporate deck and what actually happened in Q3?
Speaker Change: So this is Jeff Chan here.
Speaker Change: To speak to slide 28 on this deck, you know, I think we need to keep in mind that the guidance figures here are provided on an annual basis.
Speaker Change: And so just speaking to Gold Bar specifically, we still do expect...
Speaker Change: to meet or exceed, by exceed I mean come in below our cost guidance on an annual basis. I think as Bill mentioned in his earlier remarks,
Speaker Change: given the planned declining production of Gold Bar quarter over quarter, it would be natural to see increasing quarterly unit costs go up, but on an annual basis, you know, I would expect to still come in, you know, again, within or below cost guidance. At Fox, it's exactly as Bill mentioned.
Speaker Change: You know, due to the lower than planned production and the production that we've advised the markets, we are expecting higher than expected unit costs in our guidance.
Speaker Change: You know, looking at our financial base, it's not a result of overspend. I think on a total basis, we're expecting to be within exactly our planned spend, but it is a production issue.
Speaker Change: And at Fox there was an unexpected failure of one of the stopes that affected a larger area underground and that reduced our production and as Bill said, when you reduce the production the cost per ounce goes up.
Speaker Change: I also remember that the Froome mine is kind of in its last year of mine life, and so that's always a bit more challenging, I would say, but we're handling that well.
Speaker Change: That's helpful. So it sounds like that if we were to put a bow on this answer...
Speaker Change: You guys are sticking with the estimates on slide 28 and that Q3 was just an outlier. Is that a fair articulation?
Speaker Change: maybe Jeff I'd say you know I guess just to maybe add some caution there I would expect that what we're going to see is a slightly higher cost per ounce that go at Fox
Speaker Change: You know, and it'll depend on exactly what the production is in the last quarter.
Jeff Chan: Got it.
Speaker Change: So then, my last question here just kind of spring rolls or springboards Rob off what you said.
Jeff Chan: In the release, you know, it says 15 to 20% fewer ounces compared to the annual guidance on FOX for the reason that you highlighted. If that hadn't happened...
Jeff Chan: And I guess, if that's correct, how do we make sure that this type of thing doesn't happen again? Because, boy, this stock would be ripping if you guys could just be breaking even.
Speaker Change: I don't know, am I interpreting that correctly, that that's what's stopping us from being breakeven and then this question of how do we make sure this doesn't happen again?
Speaker Change: You're totally correct.
Jeff Chan: Chris, and this is Perry, the CFO. So definitely, had we produced a bit more ounces, we would have had a positive quarter. And as well, as Rob mentioned, going back to Los Azules, you know, once we finish the feasibility study and have our permits in hand, we can actually capitalize our exploration costs that McEwen cut.
Jeff Chan: Copper is incurring. So if you look at our year-to-date spend, you know, our year-to-date proportional loss is $37 million. You know, that would have been nullified as a loss and we would have had, you know, be quite profitable for the year and for the quarter, so.
Jeff Chan: Yeah.
Jeff Chan: So when, what quarter do you think that that comes together? I mean, and I ask this, I've been on the ride with you, Rob, since 2016, and I've been an investor, not a speculator, and it's been rough, and so I'm ready for it to come. It'd be interesting to hear...
Speaker Change: The feasibility will be in the first half of next year
Jeff Chan: I guess the feasibility, as Michael talked about, is well underway. The timelines for that are fairly definite. The permits, obviously, were subject to the timelines from the appropriate ministries in Argentina.
Jeff Chan: Great, so first half of 25, we should be printing positive quarters.
Jeff Chan: Claire?
Jeff Chan: Well, we'll have the feasibility, we expect to have the permit, and we have to get the IPO out. We don't need to have the IPO? Alright, so the end of the first half, we should be moving into positive grounds.
Jeff Chan: Assuming we don't buy something else.
Jeff Chan: which prices could be good. All right, thank you guys.
Speaker Change: Thank you, Chris.
Jeff Chan: Thank you for your loyalty.
Speaker Change: Your next question is from the line of John Morin.
John Morin: Hi, I have two questions.
John Morin: The first.
John Morin: I've been an individual investor for over 12 years, now having over 40,000 shares.
John Morin: When people ask me why I invested in the company, I told them, I said, the company is really unique.
John Morin: You founded and were chairman of the Gold Corp. And then you started this company.
John Morin: You have a large, you know, stake in it, and plus, originally, you had no debt. So I said, you know, it's one of a kind.
Jeff Chan: The thing that puzzles me, though, is that back in the day, like, you know, about 12 years ago, the stock was, or at least peaked, substantially higher.
Jeff Chan: Now, from what I can see, the company is in much, much better shape now.
Jeff Chan: You finished that road for the copper, and you mentioned that the copper, if I understood you correctly, is worth more than the stock price, not even counting the gold and silver. So,
Jeff Chan: What puzzles me is nothing to do with you, but why the market isn't reflecting this, you know, to a much larger degree, where you would estimate the stock should be in the 20s or 30s.
Jeff Chan: And then my second comment, I heard what you said about Trump, but...
Speaker Change: Thank you.
Speaker Change: Just, you know, today the gold is down about $80 a share, almost, and the silver $1.50. And I was wondering, you know, if it's a positive reflection, at least with the Colorado-Nevada or the Nevada mine, why do you think it dropped so substantially?
Jeff Chan: Thank you.
Jeff Chan: Shit.
Speaker Change: And I agree, we are in better shape than we were back then. We have production coming from a number of areas. Unfortunately, there was a period.
Jeff Chan: three to four years, 2018 to 22, where operations were not delivering on guidance. They missed it by a wide margin.
Jeff Chan: And as a result, our revenue is low. And I think people looked at our copper project and said, how are you going to finance that? This is a big project and it's going to be very cash hungry.
Jeff Chan: So, we separated the copper and said let's raise the money privately there rather than diluting McEwen Mining to raise the funds.
Jeff Chan: And we've had the benefit of our operations, our precious metal operations, coming back on stream.
Jeff Chan: performing much better. There's still, I think, an issue of consistency in the production across all of the operations. One's up, the other one's down.
Jeff Chan: That's being addressed, and we see room to expand our production.
Jeff Chan: considerably so over the next three to four years through organic growth so
Jeff Chan: And we're looking at a bigger price. When we do our own internal estimates of value, it's sort of the sum of the parts we have.
Jeff Chan: the copper holdings, we have a portfolio of five.
Jeff Chan: Royalties, none of them producing at the moment, but the largest one is
Jeff Chan: on Los Azules, one and a quarter percent,
Jeff Chan: production forecast, that would generate over a 27-year life better than $400 million. And then we get down to the end of the year.
Jeff Chan: into the gold shares and when you compare it to a peer group,
Jeff Chan: We're trading at a large discount at the moment, and these results and what we can see going forward should start addressing concerns about the life of these assets and the costs of them.
Jeff Chan: It's a timing issue that will resolve itself as we move forward. But it's been a painful process. With respect to Trump and the gold price, I was looking at it and saw Bitcoin was up and gold was down.
Jeff Chan: That's odd.
Jeff Chan: saying they don't expect the Trump government to be
Jeff Chan: spending being as profligate a spender as would the Harris government and that's
Jeff Chan: Stronger. Resulting in a stronger dollar.
Jeff Chan: or a perception of a stronger dollar.
Jeff Chan: and you saw it wasn't only gold, it was silver, it was a number of the base metals. The only one that wasn't down at one point this morning was lead and that's probably because of the wars.
Jeff Chan: Ah.
Speaker Change: Can I just ask one other thing? The institutional investors,
Jeff Chan: That has grown over the years, right?
Speaker Change: It has been. We have good volume. We trade average daily volume, about 500,000 shares on New York. So good liquidity and with an improving balance sheet and operational performance.
Speaker Change: I think we'll win the attention of more institutions and retail investors.
Speaker Change: And I'm 68, I know you're 74. How much longer do you think, I'm retired, how much longer do you think you're going to go at this?
Jeff Chan: Well, let me share a story. A number of years ago, I was meeting with an executive coach and his first question was, asked me how long I was going to live.
Jeff Chan: And I said, well, ever since I've been about 20, I figured I'd live to 100.
Jeff Chan: And he said, well, tell me what you think you're going to be like when you're 99. And I said, well, I'd like to have a clear head and be mobile.
Jeff Chan: So I said, he said, well, how long are you going to live? And I said, 120.
Jeff Chan: And he said, OK, at the time I was 60, he said, if you're going to live to 120, you have your whole life in front of you again.
Jeff Chan: What are you going to do with it?
Jeff Chan: And I said, well, what could I do with it? And he said, well, you could do ten times what you've already done.
Jeff Chan: I said, 10 times more love, 10 times more travel, 10 times more philanthropy, 10 times more wealth, and he said, all of the above. And I said, well, that sounds pretty good.
Jeff Chan: You have, and I said, you have 240 quarters in front of you.
Jeff Chan: So you can lay out a plan. So I'm in no rush. I think we have in McEwen Copper, the Los Azulis property, I believe has the potential to be much bigger than Goldcorp ever was.
Jeff Chan: It is, if you look at it and put it on a gold equivalent,
Jeff Chan: It's bigger than a 60 million ounce gold deposit. And on the projected cost to be coming in at just over $600 cash, all in under $1,000.
Jeff Chan: 27-year life and producing gold equivalent of better than 600,000 ounces a year.
Jeff Chan: In my book, that's an extremely big gold deposit. It's almost equal to all the gold that's produced in the last hundred years out of the Timmins District, the most prolific mining area, one of the most prolific gold areas in Canada.
Jeff Chan: I think there's a lot of room. We've got copper is in large demand. You look at the deficits that are being projected for a number of reasons. The electrification of energy.
Jeff Chan: the extremely high use of electricity by big data farms and servers, and then the growth of the world's population and the use of copper in the infrastructure. So there's that and gold.
Jeff Chan: I think we've got the right mix of assets.
Jeff Chan: To me, that's always been, that's money, and our governments are good at debasing fiat currency. And so gold is, in my mind, heading higher, despite this little drop today. When you have 36 trillion...
Jeff Chan: and National Depth.
Jeff Chan: The service costs on that are high and America is not alone. I look to Canada, I look to Europe, I look to China. Everybody has printed a lot of money and they've taken on a lot of debt and at one point have to pay back the debt.
Jeff Chan: And gold is one of those hard assets you want to have in your pocket because it doesn't depreciate like fiat currency.
Speaker Change: Oh, good.
Speaker Change: Well thank you very much for sharing all that. I really appreciate it and you know someday I'm gonna, I'm in Hershey, near Hershey, Pennsylvania. Someday I'll come up to Toronto and meet all of you. Thank you. Maybe we'll get down to see you down in Hershey.
Speaker Change: Okay, that'd be great. Thank you. Bye.
Jeff Chan: Okay.
Speaker Change: Your next question is from the line of Mike Kozak with Cantor Fitzgerald.
Mike Kozak: Good morning Rob and team, congrats on the solid quarter. I joined the call a little bit late, so if any of this was already mentioned, I apologize. But one question I've had in the back of my mind the last couple of months, just with what silver prices have done.
Mike Kozak: over the last few months, kind of catching up with gold strength, notwithstanding the one-day move down today. But in the current silver price environment,
Mike Kozak: and, you know, both McEwen Mining and McEwen Copper looking increasingly more focused on Las Azules. Would McEwen Mining potentially look at monetizing either the Project Phoenix or your interest in the San Jose mine?
Speaker Change: at the right price, sure.
Mike Kozak: Okay.
Mike Kozak: at the right price. I mean there has there has been rumor that Hochschild's thinking of possibly selling San Jose and we've been approached by one potential buyer that asked if we'd be amenable to thinking about selling.
Mike Kozak: Okay.
Mike Kozak: nothing
Speaker Change: Okay, I did hear something, a rumor to that effect. That's why I was just asking this question. But okay, that's all I had. Thanks.
Speaker Change: All right. Thank you, Mike.
Speaker Change: At this time, there are no further questions. I will now hand the call back over to Rob McEwen for any closing remarks.
Rob McEwen: Okay, before we close off...
Speaker Change: Perry just wanted to make a comment on it. Yeah, we did receive an email from Howie Flinter just regarding page 4 of our news release, so we can't confirm yet. There is a typo on one of the columns on the gross margin percentage, so we'll update that on our website version, but the correct percentage should be 17.6%.
Rob McEwen: rather than 35.1% gross margin at the San Jose mine in the third quarter. Thank you, Rob. Thank you. Well, thank you everyone for joining the call today.
Jeff Chan: I hope you share the same thoughts, that this was a great quarter and what we want to do, our goal is to keep repeating these.
Jeff Chan: Thank you and successful investing.
Speaker Change: This concludes today's call. Thank you for joining. You may now disconnect.
Jeff Chan: Thank you.
Jeff Chan: Reporting for Liberty Television, I'm Robert McEwen. Thank you for watching. For more information for Liberty Television, visit Liberty.ca