Q2 2025 Teck Resources Ltd Earnings Call

Operator: Second Quarter 2025 Earnings Release Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session. To join the question queue, you may press star, then 1 on your touchtone phone. Should anyone need assistance during the conference call, they may signal an operator by pressing star, then 0 on the telephone.

Operator: This conference call is being recorded on Thursday, July 24, 2025.

Ladies and gentlemen, thank you for standing by. Welcome to text second quarter 2025 earnings release conference. Call at this time, all participants are in listen. Only mode later, we will conduct a question and answer session to join the question queue. You may press star then 1 on your touchtone phone. Should anyone need assistance during the conference call they may signal an operator by pressing star. The zero on the telephone

Emma Chapman: I would now like to turn the conference over to Emma Chapman, Vice President, Investment Relations. Please go ahead. Thank you, Operator.

This conference call is being recorded on Thursday, July 24th 2025.

Speaker Change: I would now like to turn the conference over to Emma Chapman, vice president West relations. Please go ahead.

Emma Chapman: Good morning, everyone, and thank you for joining us for Teck's second quarter 2025 conference. This quote contains forward-looking slides. Actual results may vary due to various risks and uncertainties.

Emma Chapman: Thank you, operator. Good morning, everyone. And thank you for joining us for text second quarter 2025 conference call

Emma Chapman: Today's call contains forward-looking statements.

Emma Chapman: Actual results may vary due to various risks and uncertainties.

Emma Chapman: Teck does not assume the obligation to update any photo of the space. Please refer to slide 2 for the assumptions underlying our forward-looking plan. We will reference long gap measures throughout this presentation. Explanations and reconciliations are in our MD&A and the latest press release on our website.

Emma Chapman: Factors not assume the obligation to update any forwarding statements.

Emma Chapman: Please refer to slide 2 for the assumptions. Underlying our forward-looking statements.

Emma Chapman: Your reference non-gaap measures throughout this presentation.

Emma Chapman: Explanations and reconciliations are in our mdna and the latest press release on our website.

Emma Chapman: On today's call, Jonathan Price, our CEO, will start with highlights from our second quarter.

Emma Chapman: On today's call Jonathan Pryce. Our CEO will start with highlights from our second quarter.

Emma Chapman: Crystal Prystai, our CFO, will follow with a financial and operational review of the quarter.

Crystal: Crystal press die, our CFO will follow with a financial and operational review of the quarter.

Jonathan Price: Jonathan will then wrap up with closing remarks and a Q&A. And with that, over to you, Jonathan.

Crystal: Jonathan will then wrap up with closing remarks and a Q&A session.

Jonathan Price: Okay, thank you, Emma, and good morning, everyone.

Speaker Change: With that over to you, Jonathan.

Jonathan Price: Now, before we get into the quarter, I would like to take a moment to acknowledge the incidents earlier on Tuesday at one of our peers' operations in the northwest of our home province of British Columbia. Our thoughts are with the three workers that remain in the underground work area, as well as their families, friends, and colleagues, and the emergency response teams, and we hope for their safe and speedy rescue.

Crystal: Okay, thank you. Emma, and good morning, everyone.

Crystal: Our thoughts are with the 3 workers that remain in the underground work area as well as their families friends and colleagues, and the emergency response teams, and we hope for their safe and Speedy rescue.

Jonathan Price: So turning to our second quarter 2025 results, starting with highlights on slide four. Overall, we are advancing our strategy, copper growth, while returning cash-to-shareholdings. Our profitability improved compared to the same period last year to $722 million of adjusted EBITDA. We had strong performance in our Zinc segment, with Red Dog sales above our guidance range and a significant improvement in our Zinc net cash unit costs, as well as another quarter of profitability and cash generation at trail. Across our established operations, production is on track to meet our annual guidance. At QB, we had previously noted that we would be at the lower end of our guidance of around 230,000 tonnes for the year.

Crystal: So turning to our second quarter, 2025 results, starting with highlights on slide 4.

Crystal: Overall, we are advancing our strategy of copper growth while returning cash to shareholders.

Crystal: Our profitability improved compared to the same period last year to 722 million of adjusted. Ebit d.

Crystal: we had strong performance in our zinc, segment with red dog sales above our guidance range, and a significant improvement in our zinc, net cache unit costs,

Crystal: As well as another quarter of profitability and cash generation at Trail.

Crystal: Across our established operations production is on track to meet our annual guidance.

Jonathan Price: Whilst the team is working hard to achieve this, we acknowledge that there could be risk from possible external factors or, of course, any delay from the TMF development work.

Crystal: At QB, we had previously noted that we would be at the lower end of our guidance of around. 230,000 tons for the year.

Jonathan Price: As a result, we've revised our outlook for QB to 210,000 to 230,000 tonnes for the year, but continue to target design rates by year end.

Crystal: While the team is working hard to achieve this. We acknowledge that there could be risk from possible, external factors, or, of course, any delay from the TMF development work

Crystal: As a result, we've revised our outlook for QB to 210 to 230,000 tons for the year, but continue to Target design rates by year end.

Jonathan Price: Earlier today, we announced that the board has sanctioned the Highland Valley Copper My Life Extension project in British Columbia for construction. This is foundational to our strategy to double copper production by the end of the decade. Given the strong demand for copper as an energy transition metal, the project will generate compelling returns, with an IRR far surpassing our cost of capital and secure access to this critical mineral for the next two decades. The project extends a core asset to 2046, with average annual copper production of 132,000 tonnes over the life of mine. We are continuing to return significant cash to shareholders with elevated daily share buying levels in the quarter resulting in a total of $487 million or 9.8 million Class B shares.

Crystal: earlier today, we announced that the board has sanctioned the Highland Valley copper, my life extension project in British, Columbia for construction,

Crystal: This is foundational to our strategy to double copper production by the end of the decade.

Crystal: Given the strong demand for copper as an energy transition. Metal, the project will generate compelling returns with an irr far surpassing our cost of capital and secure access to this critical mineral for the next 2 decades.

Crystal: The project extends a core asset to 2046 with average annual copper production of 132,000, tons over the life of mine.

Crystal: We are continuing to return significant cash to shareholders with elevated. Daily share buying levels. In the quarter. Resulting in a total of 487 million or 9.8 million Class B shares.

Jonathan Price: Year-to-date, we have returned a total of $1.1 billion to our shareholders through dividends and share buybacks, and we have completed approximately 70% of our authorized $3.25 billion buyback, which is the equivalent of $2.2 billion.

Crystal: Year to date. We have returned a total of 1.1 billion dollars to our shareholders, through dividends and share BuyBacks. And we have completed, approximately 70% of our authorized 3.25 billion buyback, uh, which is the equivalent of 2.2 billion dollars.

Jonathan Price: Finally, we are maintaining the resilience of the business, including through our strong balance sheet, which enables us to navigate uncertainty and continue to create value. We currently have $8.9 billion in liquidity, including $4.8 billion in cash.

Crystal: Finally, we are maintaining our the resilience of the business, including through our strong balance sheet, which enables us to navigate uncertainty and continue to create value. We currently have 8.9 billion dollars in liquidity including 4.8 billion dollars in cash.

Jonathan Price: Turning to slide five, we continue to be committed to safety and sustainability. Across the operations that we control, our high potential incident frequency rate remained low in the first half of the year at 0.09, below our 2024 performance of 0.12.

Crystal: Turning to slide 5, we continue to be committed to safety and sustainability.

Crystal: Across the operations that we control are high potential incident frequency rate. Remained low in the first half of the year. It's 0.09 below our 2024 performance of 0.12.

Jonathan Price: I would like to take a moment to acknowledge that a fatality occurred on April 22nd at Antimena in which Teck holds a non-controlling interest. We are deeply saddened by this event and offer our condolences to the family, friends and colleagues. Teck fully participated in the investigation, which was led by the team at Antimena, and learnings will be shared across our company and across the sector.

Crystal: I would like to take a moment to acknowledge that the fatality occurred on April 22nd at antamina in which Tech holds and non-controlling interests.

Crystal: We are deeply saddened by this event and offer our condolences to the family friends and colleagues at the deceased.

Crystal: Tech fully participated in the investigation which was led by the team at antamina and learning will be shared across our company and across the sector.

Jonathan Price: We were honoured to be named as one of Corporate Nights 2025 Best 50 Corporate Citizens in Canada. It's the 19th consecutive year that we've received this recognition, which is based on an evaluation of up to 25 sustainability indicators, including board diversity, resource efficiency, financial management, sustainable revenue and sustainable investment.

Crystal: We were honored to be named as 1 of corporate Knights 2025 best 50 corporate citizens in Canada.

Crystal: It's the 19th consecutive year that we've received this recognition which is based on an evaluation of up to 25 sustainability. Indicators, including, for diversity resource, efficiency financial management, sustainable revenue and sustainable Investments.

Jonathan Price: So now turning to QB on slide six. QB's second quarter performance was impacted by the ongoing TMF development. We're advancing multiple TMF development initiatives to improve sand drainage rates and accelerate mechanical movement of sand to achieve steady state operation. This work impacted Mill on line time in the quarter as previously disclosed.

Crystal: so, now turning to QB on slide 6,

Crystal: QB, second quarter performance was impacted by the ongoing TMF development work.

Crystal: we're advising multiple TMF development initiatives to improve sand, drainage rates and accelerate mechanical movement of sand to achieve steady state operation,

Crystal: This work impacted Mill online time in the quarter as previously disclosed.

Jonathan Price: The plan post-QB2 construction pace of TMF development was based on design assumptions for sand drainage rates that have subsequently proven unachievable. Modifications to cyclones alone, while showing an improvement in sand drainage rates, were not sufficient to allow us to fully catch up on TMF development work in the quarter. As a result, we're implementing a range of additional measures to improve sand drainage rates and accelerate the mechanical movement of sand, including enhanced sand placement techniques and optimization of the grind size of the concentrates.

Crystal: The plan, post qb2, construction pace of TMF development was based on design assumptions for sandria rates that have subsequently proven unachievable.

Crystal: Modifications to Cyclones alone while showing an improvement in sand, drainage rates were not sufficient to allow us to fully catch up on TMF development, work in the quarter.

Crystal: As a result, we're implementing a range of additional measures to improve sand drainage rates. And accelerate, the mechanical movement of sand including enhanced sand placement techniques, and optimization of the grind size of the concentrator.

Jonathan Price: Importantly, the TMS development work and the transition from starter down to regular, ongoing sand lifts, is a one-time milestone related to the ramp-up of the operation. When it is completed, the TMS development work will be behind us for the life of the While the TMF development work will continue in Q3, we continue to target design rates by the end of the year. Throughput increased from the prior quarter and we expect to see consistent grades of approximately 0.61% in the second half of the year. Work is ongoing to improve recoveries by year end, which will also be helped by more consistent mill run times.

Crystal: From started down to regular ongoing sound lists is a 1-time milestone related to the ramp up of the operation.

Crystal: When it is completed, the TMF development work will be behind us for the life of the facility.

Crystal: While the TMF development work will continue in. Q3, we continue to Target to design rates by the end of the year.

Crystal: Throughput increased from the prior quarter. And we expect to see consistent grades of approximately 0.61% in the second half of the year.

Crystal: Work is ongoing to improve recovery by year end, which will also be helped by more consistent mill run time.

Jonathan Price: The outing of the shiploader at QB's port facility announced on June 2nd is expected to be extended into the first half of 2026. We have been successfully shipping Concentrate through our alternative port arrangements and have maximized shipments to local customers so there has been no production impact. Alternative sales logistics have had some incremental impact on our net cash unit costs, which is expected to be approximately 10 US cents per pound. We had a good step up in molybdenum production as a result of some key process improvement initiatives implemented during the quarter. We expect to continue to see molybdenum production improvements and we continue to target design throughput and recoveries of the moly plants by year end.

Crystal: The outage of the ship loader at QB's. Port facility announced on June 2nd, is expected to be extended into the first half of 2026.

We have been successfully shipping, concentrate through our alternative Port arrangements and have maximized shipments to local customers. So there has been no production impact.

Crystal: Alternative sales logistics have had some incremental impact on our net cash unit costs, which is expected to be approximately 10 US cents per pound.

Crystal: We had a good step up in maliban and production as a result of some key process improvements initiatives implemented during the quarter.

Crystal: We expect to continue to see maliban in production improvements and we continue to Target design throughput and recoveries of the Molly plant by year end.

Jonathan Price: Once we have completed the TMF development work, QB will be able to run at steady state, showcasing it as a Tier 1 asset that will be a cornerstone of Teck's portfolio for generations. We continue to work on defining the most capital-efficient and value-accretive path to future growth of QB through optimization of the mill and low-capital de-bottlenecking opportunities that could collectively increase throughput by a further 50% to 25%. The foundation of QB is its large, long-life deposit that can support multiple expansions, and it offers multiple potential paths to create value for our shareholders, including assessing adjacencies or synergies with Coyoacan.

Crystal: Once we have completed the TMF development work QB, will be able to run. Its steady state showcase, showcasing it as a tier 1 asset. That will be a Cornerstone of tech portfolio for Generations.

Crystal: We continue to work on defining the most Capital efficient, and value accretive path to Future growth of QB, through optimization of the mill and low capital, de bottle necking opportunities. That could collectively increase throughput by a third of 50 to 25%.

Crystal: The foundation of QB is its large long life deposit that can support multiple expansions and it offers multiple potential paths to create value for our shareholders, including assessing adjacencies or synergies with coyotes.

Jonathan Price: The operation also has the advantage of a very low strip ratio which enables competitive all-in sustaining costs.

Crystal: The operation also has the advantage of a very low strip ratio which enables competitive all-in sustaining costs.

Jonathan Price: We successfully achieved completion testing requirement under QB's $2.5 billion U.S. dollar project finance facility earlier this year, which provides independent verification, confirming the robustness of the design, construction, and operational capacity. And we have a tax stability agreement in place through 2037. Taking all these factors into account, we are well positioned to generate significant future cash flows from this Tier 1 asset for decades to come.

We successfully achieved completion. Testing requirement under QB's 2.5 billion. US dollar project Finance facility earlier this year, which provides independent verification confirming the robustness of the design construction and operational capacity.

Crystal: And we have a taxability agreement in place through 2037.

Taking all these factors into account, we are well positioned to generate significant future cash flows from this Tier 1 asset for decades to come.

Jonathan Price: Turning to the My Life extension at Highland Valley on slide 7. Highland Valley is Canada's largest copper mine and a core asset in our portfolio, and we are excited to announce the sanction of the Highland Valley Copper Mine Life Extension, or HBCMLE, project. This is a lower risk and lower complexity brownfield project that is 100% owned by Teck. The MLE is an extension of the operation to 2046, and is expected to produce 132,000 tons of copper per annum on average over the life of mine. Based on additional technical and engineering work, we have optimized the project.

Crystal: Returning to the my life extension at Highland Valley on slide 7.

Crystal: Highland Valley is Canada's largest copper mine and a core asset in our portfolio. And we are excited to announce the sanction of the Highland Valley copper, my life extension, our HBC mle project,

This is a lower risk and lower complexity Brownfield project that is 100% owned by Tech.

Crystal: The mle is an extension of the operation to 2046 and is expected to produce 132,000, tons of copper per Anum, on average over the life of mine.

Jonathan Price: As a result, the project capital estimate for the sanction is $2.1 to $2.4 billion Canadian dollars in nominal terms. Compared with our prior estimate of 1.8 to 2 billion Canadian dollars, this now includes project-level contingencies, accounts for inflation, input cost escalation, and the impact of potential tariffs on construction materials, and reflects the accelerated procurement of mobile equipment originally planned for later project phases. It also incorporates additional scope and indirect contract requirements identified through ongoing project refinement. The MLE project consists of development of site infrastructure and facilities, grinding circuit upgrades, increased tailing storage capacity, and enhancements to power and water systems, as well as the mine pushback that requires additional waste stripping to access high quality resources within the valley pit.

Crystal: Based on additional Technical and Engineering work. We have optimized, the scope of the project. As a result, the capital estimate of sanction is 2.1 to 2.4 billion Canadian dollars in nominal terms.

Crystal: Compared with our prior, estimates of 1.8 to 2 billion, Canadian dollars is now includes project level contingencies accounts for inflation input cost escalation and the impact of potential tariffs on construction, materials, and reflects the accelerated procurement of mobile equipment's. Originally planned for later project phases.

Crystal: It also incorporates additional scope and indirect contractor requirements identified through ongoing project refinement.

Jonathan Price: The project economics are attractive, including generating a robust internal rate of return that is significantly above our cost of capital and a project net present value using an 8% sorry, a positive net present value using an 8% discount. The capital intensity of the project is expected to be low at US$11,500 to US$13,200 per ton of copper on an annualized basis. Overall, we expect to generate significant EBITDA and cash flows over the life of mine. We have operated Highland Valley for decades and have successfully executed several mine life extensions there.

Crystal: The MLA project consists of development of site infrastructure and Facilities, grinding circuit upgrades increased tailing storage capacity, and enhancements to Power and Water Systems, as well as a mind push back that requires additional waste stripping to access high-quality resources within the valley pit.

Crystal: The project economics are attractive including generating a robust internal rate of return. That is significantly above our cost of capital and a project, Net Present Value, using an 8%. Sorry, a positive Net, Present Value using an 8% discount rate.

Crystal: The capital intensity of the project is expected to be low at 11,500 to 13,200 US dollars per ton of copper on an annualized basis.

Crystal: Overall, we expect to generate significant ebit, and cash flows over the life of mine.

Jonathan Price: And importantly, project readiness for construction has been confirmed through independent assurance activities, including an external construction readiness assessment and a review of the technical scope, capital cost estimate and execution strategy and planning. We are well-positioned for solid project execution of the Highland Valley Mine Life Extension with a strong and experienced team in place, all major permitting complete, engineering nearly 70% complete, and all contracting and permitting well advanced. Construction mobilization is underway. We plan to start construction in a few weeks, and we look forward to delivering on this value-accreted project.

Crystal: We have operated Highland value for decades and have successfully executed several, My Life Extensions there.

Crystal: I've been confirmed through Independent Insurance activities including an external construction Readiness assessment and a review of the technical scope Capital cost estimate and execution strategy and planning.

Crystal: We are well positioned for solid project. Execution of the Highland value. My life extension with a strong and experienced team in place.

Crystal: All major permitting complete, engineering nearly 70% complete and all Contracting infirmity. Well advanced

Crystal: Construction Mobile is underway. We plan to start construction in a few weeks and we look forward to delivering on this value. Recruited project.

Jonathan Price: We have summarised the changes to our guidance on slide 8. Production changes are driven by the revised Outlooks QB based on the TMS development. We had previously noted that we would be at the lower end of our guidance of around 230,000 tonnes for the year.

Crystal: We have summarized the changes to our guidance on slide 8.

Crystal: Production changes are driven by the revised outlook for Cuvee based on the TMF development work.

Jonathan Price: While this is still possible, we acknowledge that there could be risk from possible external factors or from any delay to the TMF development work. As a result, we have revised our outlook for QB to 210 to 230,000 tonnes for the year, but continue to target design rates by year end.

Crystal: We had previously noted that we would be at the lower end of our guidance of around, 230,000 tons for the year, what this is still possible. We acknowledge that there could be risk from possible external factors or from any delay to the TMF development work.

As a result, we have revised our outlook for QB to 210 to 230 tons, for the year, but continue to Target design rates by year end.

Jonathan Price: Production guidance for all other operations is maintained. As such, the impact of the revised QB outlook is the only driver of flow through changes to total copper production, moly production, and therefore net unit cash costs. We have also incorporated the increase in copper production in 2028 and the start of the growth capital investment associated with the sanction of the Highland Valley Copper My Life Extension Project.

Production guidance for all other operations is maintained as such the impact of the revised. QB Outlook is the only driver of flow through changes to Total copper production, Molly production, and therefore net unit cache costs.

Jonathan Price: Please refer to the MD&A for further details.

Crystal: We have also Incorporated the increase in Copper production in 2028. And the start of the growth capital investment associated. With the sanction of the Highland Valley copper my life extension project,

Crystal: Please refer to the mdna for further details.

Jonathan Price: Turning to the Neotium growth on slide nine, our ongoing growth trajectory is underpinned by our established portfolio of operating mines.

Crystal: Turning to the near term growth on slide 9.

Jonathan Price: The sanction of the HBCMLE project is foundational to our copper growth strategy and a significant milestone in the growth of Teck's copper production into the future. A high-returning greenfield project with Zafranal in Peru and San Nicolas in Mexico are progressing as planned and we are targeting sanctioned readiness by year-end. So, for now, we initiated advanced early works in May, following receipt of the advanced works permit in April. This will enable construction to start immediately following project sanction. We are targeting receipt of the construction permit of Stage 8 approval, first of two approvals required in Q3, and the earliest date for a potential sanction decision is late in 2025.

Crystal: Our ongoing growth trajectory is underpinned by our established portfolio of operating Minds.

A sanction of the hvc mle project is foundational to our copper growth strategy and a significant milestone in the growth of text copper production into the future.

Crystal: Our high returning, Greenfield project at zapran Allen, Peru, and Saint Nicholas in Mexico are progressing as planned. And we are targeting sanctioned Readiness by year end.

Zap for now, we initiated Advanced early Works in May following a receipt of the advanced Works permit in April. This will enable construction to start immediately following project sanctions.

Jonathan Price: San Nicolas, engagement with government authorities and other stakeholders is ongoing to support our permit applications. We plan to complete the feasibility study in the fourth quarter, which is the earliest date the project could be positioned for a potential sanctioned decision following the receipt of necessary permits. These projects are significantly less complex and smaller in scope than QB with lower capital intensities, attractive project economics, and well-balanced risk-return profiles. In addition, we are working to define the most capital efficient and value accretive path for further growth of QB through optimization of the mill and low capital V bottlenecking opportunities that could increase throughput by 15 to 25 percent.

Crystal: We are targeting receipt of the construction permit of stage, a approval. First of 2, approvals required in Q3 and the earliest date for a potential sanction decision is late in 2025

Crystal: Stop Nicholas engagement with government authorities and other stakeholders is ongoing to support our permit applications.

Crystal: We plan to complete the feasibility study in the fourth quarter, which is the earliest date of project, be positioned for a potential sanctioned decision following the receipts necessary permits.

Crystal: These projects are significantly less complex and smaller in scope than QB, with lower Capital, intensities, attractive project economics, and well-balanced risk return profiles.

Crystal: In addition, we are working to define the most, Capital efficient and value accretive path, for further, growth of QB to optimization of the mill and low Capital will be bottlenecking opportunities that could increase throughput by 15 to 25%.

Jonathan Price: Our priority at QB remains completing the ramp-up, but optimization plans are also progressing, detailed planning for de-bottlenecking is underway.

Jonathan Price: This should enable us to submit the Declaration of Environmental Impact or DEA permit application in the second half of All of our growth projects must meet stringent criteria, delivering attractive risk-adjusted returns and competing for capital in alignment with our capital allocation framework. Overall, we expect to be able to double copper production by the end of the decade, with a path to annual copper production of up to 800,000 tonnes through these near-term projects.

Crystal: Our priority at QB remains completing the ramp up but optimization plans are also progressing detailed planning for debottlenecking is underway.

This should enable us to submit the Declaration of environmental impact or deer permit application in the second half of the year.

Crystal Prystai: With that, I will now hand the call over to... Thanks, Jonathan.

Crystal: All of our growth projects must meet stringent criteria, delivering attractive, risk, adjusted returns and competing for capital in alignment with our Capital allocation framework overall. We expect to be able to double copper production. By the end, of the decade, with a path, to annual copper production of up to 800,000 tons through these near-term projects.

Crystal: With that, I will now hand the call over to Crystal.

Crystal Prystai: Good morning, everyone. I will start with our second quarter 2025 financial performance on slide 11. Our adjusted EBITDA increased by 3% in the quarter compared to a year ago to $722 million, primarily due to another profitable quarter from trail operations, lower smelter processing charges and reductions in corporate overhead costs, partially offset by lower copper and zinc prices and higher operating costs at Highland Valley due to increased production and at The improved performance from trail operations reflects the implementation of initiatives to improve profitability and cash flows, including increasing by-product revenue. While the current low smelter processing charges are a headwind for trail, Teck overall has a net benefit from them.

Thanks Jonathan. Good morning, everyone.

Crystal: I will start with our second quarter, 2025 financial performance on slide 11.

Crystal: Our adjusted evaa increased by 3% in the quarter compared to a year ago to 722 million. Primarily due to another profitable quarter from Trail operations, lower smelter processing charges and reductions in corporate overhead costs, partially offset by lower, copper and zinc, prices and higher operating costs at Highland Valley, due to increase production. And at QB,

Crystal: The improved performance from Trail operations, reflects the implementation of initiatives to improve profitability, and cash, flows including increasing byproduct Revenue.

Crystal: While the current low smelter processing charges are a headwind for Trails Tech overall has a net benefit from them.

Crystal Prystai: We successfully reduced our corporate overhead costs by 21%, reflecting our ongoing efforts to reduce costs across our business. continue to expect lower annual corporate overhead costs compared with 2024. Importantly, we continue to return cash to shareholders, with $548 million returned in the second quarter. This includes $61 million of base dividends and $487 million of share buybacks, which equates to 9.8 million shares and reflects elevated daily share buying levels through the quarter. Year-to-date, we have returned over $1.1 billion to our shareholders.

Crystal: We continue to expect lower annual corporate overhead cost compared with 2024.

Crystal: Importantly, we continue to return cash to shareholders with 548 million returned in the second quarter.

Crystal: This includes 61 million of Base dividends and 487 million of share BuyBacks, which equates to 9.8 million shares, and reflects elevated. Daily, share buying levels, through the quarter.

Crystal: Year to date. We have returned over 1.1 billion to our shareholders.

Crystal Prystai: Turning to slide 12, which summarizes the key drivers of our financial performance in the second quarter compared to the same period in 2024. Our adjusted EBITDA increased by $19 million to $722 million, driven by another profitable quarter from trail operations, lower smelter processing charges, reductions in corporate overhead costs, and lower royalties. It also reflects higher sales volumes and an increase in commodity prices for our byproducts and positive foreign exchange impact. Trailed improved results reflect higher by-product production volumes such as silver, germanium, and indium, and higher refined lead production as compared with the year ago. These factors were partially offset by a $91 million reduction in settlement pricing adjustments and higher operating costs at Highland Valley due to increased production and at...

Crystal: Turning to slide 12 which summarizes the key drivers of our financial performance in the second quarter compared to the same period in 2024.

Crystal: Our adjusted ibida increased by 19 million to 722 million driven by another profitable quarter from Trail operations, lower to smelter processing, charges reductions in corporate overhead costs and lower royalties.

Crystal: It also reflects higher sales, volume and an increase in commodity prices for our byproducts and positive foreign exchange impacts.

Crystal: Trails improved results, reflect higher, byproduct production volumes, such as silver germanium and indium, and higher refined lead production as compared with the year ago.

These factors were partially offset by a 91 million dollar reduction in settlement pricing adjustments and higher operating costs at Highland Valley due to increased production. And at QB

Crystal Prystai: Now looking at each of our recording segments in greater detail, starting with Copper on slide 13. In the second quarter, gross profit before depreciation and amortization from our copper segment declined by 3% to $673 million compared to the same period last year, primarily due to lower copper prices and higher operating costs, partially offset by increased co-product and by-product revenues from zinc and molybdenum and lower smelter processing charges. Copper production remains similar to the same period last year at 109,000 tons.

Crystal: now, looking at each of our reporting segments in Greater detail and starting with copper on slide 13,

In the second quarter gross profit before depreciation and amortization from our copper segment declined by 3% to 673 million compared to the same period last year.

Crystal: Primarily due to lower copper prices and higher operating costs. Partially offset by increased co-product and byproduct revenues, from zinc and malip and lower smelter processing charges.

Crystal Prystai: At QB, no online time was impacted by the TMS development work required to complete the wrap-up of the operation as expected. Our established operations are performing in line with guidance and our outlook remains on track for the balance of the year. Production improved significantly at Highland Valley, driven by higher grades and mill throughput as we advanced mining in the Lornax Pit. Production at Antimino is lower, reflecting a shutdown of approximately one week due to the fatality. as well as the processing of a lower proportion of copper only ore as expected in the mine.

Crystal: Copper production remains similar to the same period last year at 109 thousand tons.

Crystal: At QB mil online time with impacted by the TMS development work, required to complete the wrap-up of the operation as expected.

Crystal: Our established operations are performing in line with guidance and our Outlook remains on track for the balance of the year.

Production improved significantly at Highland, Valley driven by higher grades and they'll throughput as we Advanced mining. In the Lorex pit.

Crystal: Production at antamina, with lower reflecting, a shutdown of approximately 1 week due to the fatalities.

Crystal Prystai: The site returned to full production. Carmen Dando-Coyo had higher production in the quarter, driven by higher grades and recoveries, as water availability improved compared with the same period last year, which was impacted by drought. The improved performance in Q2 2025 was despite maintenance at the SAG mill for approximately one month for repair. The operation has been running at full rate since it successfully restarted at the end Our net cash unit costs improved by 14 cents U.S. per pound to $2.02 U.S. per pound. While cost of sales increased, particularly at QB and Highland Valley, this was more than offset by increased by-product credit.

Crystal: As well as the processing of a lower proportion of copper only ore as expected in the mine plans.

Crystal: The sight returned to full production in June.

Crystal: Hermen down to Koyo had higher production in the quarter driven by higher, grades, and recoveries as water availability, improved compared with the same period last year, which was impacted by drought positions.

Crystal: The improved performance in Q2 20225 was, despite maintenance at the SAG Mill for approximately 1 month, for repairs.

Crystal: The operation has been running at full rates since it successfully restarted at the end of June.

Crystal: Our net cash unit costs, improved by 14 cents, us per pound to $2.22 US per pound.

Crystal Prystai: significantly higher zinc revenue from Attamina, and additional molybdenum revenue from Highland Valley. as well as much lower smelter processing costs.

Crystal: While cost of sales increased particularly at QB and Highland Valley. This was more than offset by increased byproduct credit, including significantly higher zinc revenue from antima and additional maliban revenue from Highland Valley and QB as well as much lower smelter processing cost.

Crystal Prystai: In the quarter, we see labor agreements at QB and Carmen de Andecoyo. QB's third labor union by the new three-year collective bargaining agreement in early April, completing all labor negotiations for QB's workforce and ensuring that labor agreements are now in place through 2028 across our QB operations. At CDA, both union contracts were ratified in June and July, with each covering a three-year period. Looking forward, we continue to target design rates at QB by the end of this year. We also continue to expect higher quarterly copper production at Highland Valley through the balance of this year as we process increasing proportions of higher grade Glorinex ore.

Crystal: in the quarter, we saw labor agreements at QB and Carmen and to coil

Crystal: TV's third, labor union. Fight a new 3-year collective bargaining agreement, in early April. Completing all labor negotiations for QB's Workforce and ensuring that labor Agreements are now in place through 2028 across our QB operations,

Crystal: At CDA both Union contracts were ratified in June and July with each covering a 3-year period.

Crystal: Looking forward. We continue to Target design rates at QB, by the end of this year.

Crystal: We also continue to expect higher quarterly, copper production at Highland Valley through the balance of this year. As we process, increasing proportions of higher grade, Lorex or

Crystal Prystai: As mentioned earlier, we've updated our annual production and unit cost guidance based on our revised QB operational outlook. Copper production has been revised to 470 to 525,000 tons, and copper net cash unit costs have been revised to $1.90 to $2.05 U.S. per pound.

Crystal: As mentioned earlier, we've updated our annual production and unit cost guidance based on our revised QB operational Outlook.

Proper production has been revised to 470 to 525,000 tons.

Crystal: And copper net cash unit costs have been revised to 1.90 to $2.05 us per pound.

Crystal Prystai: Turning now to our Zinc segment on slide 14. Performance in our zinc segment was very strong in the second quarter. Our profitability in zinc improved substantially, with a 137% increase in gross profit before depreciation and amortization compared with the same period last year to $159 million. This improvement was driven by higher by-product revenues as a result of our updated operating strategy at trail and lower operating costs. Red Dog performed well despite lower grades that we expected in the mine plan. Red Dog sales of 35.1 thousand tons were higher than our guidance range of 25 to 35 thousand tons due to the timing of sales.

Crystal: Turning now to our thanks segment. On slide 14.

Crystal: Performance in our zinc segment was very strong in the second quarter.

Crystal: Compared with the same period last year to 159 million.

Crystal: This Improvement was driven by higher byproduct revenues, as a result of our updated operating strategy at Trail and lower operating costs.

Red Dog performed well despite lower grades that we expected in the mine plans.

Crystal: Red Dog sales of 35.1 thousand. Tons were higher than our guidance range of 25 to 35,000 tons due to the timing of sales.

Crystal Prystai: Our net cash unit cost for zinc improved significantly, decreasing by $0.20 U.S. per pound to U.S. $0.49 per pound, primarily due to lower smelter processing charges and higher byproduct credit. At Trail Operations, profitability was strong in the quarter, reflecting our updated operating plan to improve profitability and cash flow generation in challenging smelter market conditions. We have curtailed our refined zinc production and increased production of byproducts such as silver, germanium, and other critical metals compared with the same period last year.

our next cache unit cost for zinc, improved significantly, decreasing by 20 cents us per pound to US 49 cents, per pound, primarily due to lower, smelter processing charges and higher byproduct credits

Crystal: At Trail operations, profitability with strong, in the quarter, reflecting our updated, operating plan to improve profitability and cash flow generation. In challenging, smelter market conditions.

Crystal Prystai: We also implemented cost reductions in Q4 of 2024, the benefit of which Overall, this strong performance led to a 13% improvement in our gross profit margin before depreciation and amortization for our zinc segment to 28% compared to the same period last year. Looking forward to the third quarter, we expect zinc and concentrate sales from Red Dog of 200,000 to 250,000 tons, and with Red Dog shipping season commencing on July 11th, we expect reductions in Red Dog inventory in the third quarter, reflecting the normal seasonality of sales. Our annual production and unit cost guidance for our zinc segment is...

Crystal: We have curtailed, our refined think production and increased production of byproducts, such as silver germanium, and other critical Metals, compared with the same period last year.

We also implemented cost reactions in Q4 of 2024, the benefit of which continued into Q2.

Crystal: Overall, this strong performance led to a 13% improvement in our gross profit margin before depreciation and amortization for our zinc segment. 28% compared to the same period last year.

Crystal: Looking forward to the third quarter. We expect zinc and concentrate sales from Red Dog of 200 to 250,000 tons, and with red, dog shipping season. Commencing on July 11th. We expect reductions in Red, Dog, inventory in the third quarter reflecting the normal season.

Crystal Prystai: Zinc and concentrate production of 525,000 to 575,000 tons, refined zinc production of 190,000 to 230,000 tons, and net cash unit cost of US $0.45 to $0.55 per pound.

Crystal: Our annual production and unit cost guidance for our zinc segment is unchanged. But they can concentrate production at 525 to 575,000 tons for fine, zinc production of 190 to 230,000 tons.

Crystal: And net cash unit costs of us 45 to 555 cents per pound.

Crystal Prystai: Looking at our cash returns to shareholders on slide. We continue to build on our strong history of cash returns to shareholders. We have returned a total of approximately $6 billion since 2020. This includes over $1.1 billion year-to-date, reflecting elevated daily share buyback levels in the second quarter.

Crystal: Looking at our cash returns to shareholders on slide 50.

Crystal: We continue to build on our strong history of cash returns to shareholders. We have returned a total of approximately 6 billion since 2020.

Crystal Prystai: We have now completed $2.2 billion, or approximately 70% of our $3.25 billion authorized buyback, leaving approximately $1 billion remaining. And with the strong cash flow generation potential of our business, we could see further cash returns to shareholders in line with our capital allocation framework. We remain committed to returning between 30% and 100% of future available cash flows to our shareholders.

Crystal: This includes over 1.1 billion, year-to-date reflecting elevated daily share buyback levels in the second quarter.

We have now completed 2.2 billion or approximately 70% of our 3.25 billion. Authorized buyback leaving approximately 1 billion, remaining.

And with the strong cash flow generation potential of our business. We could see further cash returns to shareholders in line with our Capital allocation Frameworks.

We remain committed to returning between 30 and 100% of future available, cash flows to our shareholders.

Crystal Prystai: Looking now at our balance sheet on slide. We remain focused on maintaining the resilience of our business, including the strength of our balance. As of yesterday, our cash balance remains significant at $4.8 billion, and our liquidity is strong at $8.9 billion. We also continue to maintain investment grade credit rates.

Crystal: looking now, at our balance sheet on slide 16,

Crystal: we remain focused on maintaining the resilience of our business, including the strength of our balance sheet,

Crystal: As of yesterday, our cash balance remains significant at 4.8 billion and our liquidity is strong at 8.9 billion.

Crystal Prystai: We have moved into a small net debt position in the quarter as we've continued to deploy the proceeds from the sale of the steelmaking coal business to shareholder return. But we do expect a release of working capital bills of Red Dog Inventory to unwind in the third quarter, reflecting the normal shift. Since 2024, we have reduced our debt by $2 billion U.S. and our $1 billion U.S. outstanding term notes are long dated. We made a semi-annual repayment of $147 million U.S. on the QB Project Finance Facility in the quarter. And through these payments, we are further deleveraging our balance sheet on an ongoing basis.

Crystal: We also continue to maintain investment grade credit ratings.

Crystal: We have moved into a small net debt position in the quarter as we've continued to deploy the proceeds from the sale of the steel making coal business to shareholder returns.

Crystal: But we do expect a release of working capital builds of Red, Dog. Inventory to unwind in the third quarter. Reflecting the normal shipping season.

Crystal: Since 2024, we have reduced our debt by 2 billion dollars us. And our 1 billion dollar US outstanding term. Notes are long dated

Crystal Prystai: Our near-term growth projects, including the HVC MLE project, remain well-funded and we are strongly positioned for continued value creation as we execute on our strategy.

Crystal: We made a semi annual repayment of 147 million us on the QB project, Finance facility in the quarter. And through these payments, we are further deleveraging our balance sheet on an ongoing basis.

Jonathan Price: With that, I'll turn it back to Jonathan. Thanks, Crystal. On slide 18, we remain focused on our priorities to create value for our shareholders. Completing the TMS development work at QB and ramping up the operation, targeting design rates by year end. Driving operational excellence, including growing our copper production, reducing our unit costs and improving our margins. Continuing to return cash to our shareholders through execution of our authorised share buyback programme and through our base dividend, and progressing our value-accretive near-term copper projects to create options for our next phase of copper growth. and maintaining the resilience of our business, including our strong balance.

Our near-term growth projects, including the hvc mle project remain, well funded, and we are strongly positioned for continued value creation as we execute on our strategy.

With that. I'll turn it back to Jonathan.

Jonathan Pryce: Thanks Crystal uh on the flight 18. Uh, we remain focused on our priorities to create value for our shareholders.

Completing the TMF development work at QB and ramping up the operation. Targeting design rates by year end.

Jonathan Pryce: Driving operational excellence including growing our copper production, reducing our unit costs and improving our margins.

Continuing to return cash to our shareholders. Through execution of our authorized share buyback program and through our base dividend

Jonathan Pryce: And progressing, our value recruitive near-term, corporate projects to create options for our next phase of copper growth.

Jonathan Price: We are committed to continuing to balance investment and growth in copper with cash returns to shareholders.

Jonathan Pryce: And maintaining the resilience of our business, including our strong, balance sheet.

Jonathan Pryce: We are committed to continuing to balance investment in growth. In Copper with cash returns to shareholders.

Jonathan Price: Turning to slide 90, we can continue to significantly impact the accretive growth potential of our metrics on a per share basis. Last year, with the ramp up of QB and with a significant portion of our $3.25 billion share buyback completed, we increased our copper production per share by 54% compared to the prior year. By 2026, our copper production per share could increase by a further 33% to 50% as we stabilize QB at full production while completing the remaining authorized share buyback. And our corporate production per share could increase substantially beyond that as we bring on near-term value-accreted growth projects.

Jonathan Pryce: Significantly impact the accretive growth potential of our metrics on a per share basis.

Jonathan Pryce: Last year was a ramp up of QB and with a significant portion of our 3.25 billion. Share buyback. Completed we increased our copper production per share by 54% compared to the prior year.

Jonathan Pryce: By 2026, our corporate production per share could increase by a further 33 to 50% as we stabilize QB at full production while completing the remaining authorized share buyback.

Jonathan Price: And this does not consider the impact of any further share buybacks that could be authorized under our capital allocation framework, given the strong cash flow generation potential of our business. Our copper production has the potential to increase rapidly long-term on a per-share basis.

Jonathan Pryce: And our corporate production per share, could increase substantially beyond that as we bring on near-term value, recruitive growth projects. And this does not consider the impact of any further share. BuyBacks that could be authorized under our Capital allocation framework, given the strong cash flow generation potential of our business.

Operator: So thank you, and with that operator, please open the line for questions. Certainly. To join the question queue, please press star then 1 on your touchtone phone. You will hear a tone acknowledging your request.

Our copper production has the potential to increase rapidly long term on a per share basis.

Jonathan Pryce: So, thank you. Uh, and with that operator, please open the line for questions.

Certainly to join the question queue. Please press star then 1 on your touchtone phone.

Operator: We ask that you please limit yourself to one question and one follow-up. If you're using a speakerphone, please ensure you lift the handset before pressing any keys. If you wish to remove yourself from the queue, you may press star, then two.

You will hear a tone acknowledging, your request. We ask that, you please limit yourself to 1 question and 1 follow-up. If you're using a speaker-phone, please ensure you lift, the handset before pressing any keys,

If you wish to remove yourself from the queue, you may press star then 2.

Orest Wowkodaw: The first question comes from Orest Wowkodaw with Scotiabank. Please go ahead. Hi, good morning. Some questions on QB2, please. Firstly, the tailings issue that's limiting throughput and then the new investment required here. Is there any knock on impact to 2026? I mean, will tailings still be a constraint next year?

The first question comes from RSO with Scotia Bank, please go ahead.

Speaker Change: Hi good morning uh some questions on qb2 please. Um, firstly the tailings issue, that's limiting throughput. And then the the new investment required here. Is there any knock-on impact to 2026? I mean, well tailings. Still be a constraint next year.

Jonathan Price: Hi, Orest. Thank you for that question. Yes, as you point out, in the current quarter and to some extent as well expected in Q3, the TMS development work has been limiting online time for QB. Actually, throughput at the plant and the recoveries of the plant have been good considering these constraints, but online time is an issue. Our expectation here, Orest, is that we can work through the TMS development issue and put that behind us so that it won't deconstrain operations on an ongoing basis. On that basis and based on what we see in terms of throughput and recoveries and grade, of course, the operation, we have maintained our guidance for 2026.

Jonathan Pryce: uh, hi or

Speaker Change: Thank you for that. Um, question. Um yes as you

Jonathan Price: But of course, as we noted, we'll continue to monitor the progress of the TMS development work through the balance sheet.

Jonathan Price: Is there potentially more investment required in the tailings next? At this point, we've guided to the capital, incremental capital spend for this year. We don't expect additional investment next year. We expect normal operating conditions around the CMF and its ongoing development, but we don't expect to signal additional capital, essentially, as we have done in the current Okay.

Speaker Change: Point out, uh, in the, in the current quarter and, and to some extent as well, expected in, in Q3, uh, the, the TMS development work has been limiting online time, um, for QB, um, actually throughput, um, at the plant and, and recoveries of the plants have been good considering these constraints. But, but online time is, is an issue. Our expectation here is, is that we can work through, um, the the TMF development issue and put that behind us. Uh, so that it won't deconstruct, um, operations on an ongoing basis, uh, on that basis. And, and based on what we see in terms of throughput and recoveries and grade, of course, uh, the operation we have maintained, um, our guidance for for 2026. But of course, you know, as we noted, we'll continue to monitor the progress of the TMF development work through the balance of this year.

Speaker Change: Is there a potentially more investment required in the tailings next year?

Speaker Change: Uh, at this point, we've guided to the, uh, you know, to, to the Capitol incremental Capital spend for for this year, we don't expect, uh, additional investment next year, we expect normal, um, normal operating conditions, uh, around the the TMF and its ongoing development. But we don't expect to uh, to to Signal additional Capital essentially as we have done in the current quarter.

Jonathan Price: And just, I mean, given the state of the ramp up, I mean, at this point, I'm having trouble understanding how realistic it is for QB to even reach the low end of its guidance for 26. I mean, that would imply monthly production required of 23,000 tons a month. The operation hasn't done that in a single month to date. What, at this point, what gives you confidence that you can exit the year anywhere close to that kind of run rate? Yeah, so our view, Orest, is that when we can put the TMF issue behind us, and we can therefore improve the online time at the plant, that we see from a throughputs, recoveries and grade perspective, the potential to deliver on the guidance for 2026.

Okay and just I mean given the state of the ramp up I mean at this point I'm having trouble understanding how realistic it is for QB to even reach the low end of its guidance for 26. I mean that would imply monthly production required of 23,000 tons a month. The operation hasn't done that in a single month to date. What at this point? What gives you confidence that you can exit the year anywhere close to that kind of run rate

Jonathan Price: So these are assumptions that we are able to underpin by operating parameters that we have experienced and delivered at the plant. Of course, it requires us to run the operation consistently through the year to achieve those numbers. They're consistent with design, of course, and at the low end of the range, you know, we have seen operating results already that give us confidence that those numbers are achieved. As you can imagine, we continue to interrogate both the operational parameters at QB and we continue to interrogate the forward guidance for QB. But at this point in time, we don't see any changes to 2026 and believe with a period of consistent operation without the constraints of TMF development that we can move forward and deliver.

Speaker Change: Yeah. So so I'll view rst is that when we can put the TMF issue behind us, uh, and we can, therefore improve the online time. Uh, the plant, uh, that we see from a throughputs recoveries and grade perspective. Um, the potential further on the guidance for for 2026. So these are, um, assumptions that we are able to, to underpin, um, by, uh, by operating parameters that we have experienced and delivered at the plant. Um, of course, it requires us to run the operation consistently through the

Speaker Change: Year to achieve those numbers. Um, they're consistent with design, of course. Um, and at the low end of the range, you know, we we have seen operating results already that that give us confidence of those numbers are achievable, you know, as you can imagine we we continue to interrogate uh, both the, the operational parameters at QB and we continue to interrogate the forward guidance for QB. Uh, but at this point in time, we, we don't see any changes to to 2026 and believe with a period of consistent operation without the constraint of TMF development that we can move forward and deliver.

Orest Wowkodaw: Okay, thank you.

Speaker Change: Okay, thank you.

Matthew Murphy: The next question comes from Matthew Murphy with BMO Capital Markets, please go ahead. Hi, I have a question just on the pace of CapEx this year. So first half of the year, you've done almost 700 million CapEx, that's growth and sustaining, not including capitalized stripping. And then your guidance is around 2.4 billion, if I'm not mistaken. So you have to spend 1.6 to 1.8, call it, back half of the year. Am I thinking about that right?

The next question comes from Matthew Murphy with BMO Capital markets, please go ahead.

Matthew Murphy: Hi. Um, I have a question, just on the uh, pace of capex this year. So first half of the year, you've done almost 700 million, uh, capex, that's gross and sustaining not including capitalized, stripping. And then

Your guidance is around 2.4 billion.

If I'm not mistaken, so you have to spend 1.6 to 1.8, call it. Um, back half of the Year. Am I thinking about that, right?

Jonathan Price: Yeah, I'll let Crystal speak to the details behind that. Of course, you know, we have increased our capital guidance for the second half of the year, in large part based on the sanctioning of HVC MLE, which goes to both capitalized stripping, but it also, of course, goes directly to the growth capital, as well as some of the additional capital that we've just discussed for TMF development at the QB, but Crystal, over to you. Yeah, thanks, Matt, for the question. You're right, so this year, today, we've spent $700 million on capital expenditures, excluding capitalized stripping, and our total for the year is, at the low end, $2.3 billion, so that's a reasonable run rate in terms of what you're thinking.

Crystal Prystai: That would put us around $1.6 billion over the second half of the year. Again, a large portion of that is in relation to growth, and that number, again, has increased because it previously didn't include the sanctioned capital associated with HVC MLE over the balance of year, so we have now embedded that spending for the second half of the year, and that's why I think you're seeing that increase in the run rate. Of course, we also have embedded the TMF expected cost associated with that work in the plan, and you'll see some of that coming through in the third quarter, as well.

Matthew Murphy: Yeah, I'll let Crystal, um, speak to to the details behind that, of course, you know, we have increased our Capital guidance, uh, for the second half of the year, um, in in large part based on the, uh, sanctioning of of HBC mle, um, which goes to both capitalized. Stripping, but it also, of course, goes directly to the to the growth Capital, as well as some of the additional Capital that we've just discussed for TMF, developments at the QB, but with with Crystal, uh, over to you. Yeah, thanks Matt for the question. You're right. So the year to date, we've spent 700 million on on Capital expenditures, excluding, uh, capitalized, stripping, and, and our total for the year is at the low end to 2.3 billion so that, you know, that's a reasonable run rate. Um, in terms of what you're thinking that that would put us around 1.6 billion over the second half of the year.

Crystal: Um, again a large portion of that is in relation to, to growth. And that number again, is increased because it previously didn't include the sanctioned Capital, uh, associated with the HBC mle over the balance of the year. So we have now embedded that, uh, that spending for the second half of the year. And that's why I think you're seeing that increase in the Run rate. Of course, we also have embedded. The TMS, uh, expected cost associated with that work, it's the plan. And, and you'll see, you know, some of that coming through in the in the third quarter as well.

Matthew Murphy: Okay, yeah, it's just the magnitude of the step up. I mean, do you worry about being able to get that done this year? Or are there some big ticket items in there that you're confident you'll see that that spend and it is a lot of the tailing spend therefore, you know, you have to come in the back half of the year? Yeah, I think the run rate is reasonable. We've done a detailed scrub through the projects to understand exactly what, you know, what is remaining ongoing. We do have a few larger projects in the sustaining side that we expect to kick off, including, you know, the Antimina tailings lift associated with the Mine Life extension.

Okay. Um, yeah. It's just the, the magnitude of the Step Up. Um, I mean, do you worry about being able to get that done this year, or are there some big ticket items in there that you're confident? Uh, you'll see that that spend? And it is a lot of the tailing spend. Therefore, um, you know, you have to come in the back half of the year.

Crystal: yeah, I think that

right is reasonable. We've done a detailed.

Crystal: scrub, through the

Crystal Prystai: We have the QB truck shop that we're continuing construction on. We also have some demobilization of QB facilities as we move into the next phase of mining there. So that, in addition to HVC MLE, which of course we have, you know, a rigorous schedule associated with the project and the CapEx that we've articulated is in line with that schedule. And then in the context of TMS, we have spent half to date. We haven't disclosed what that figure is, but we can get that out to folks as required, but do expect that spending.

Uh, a few larger projects in the sustaining side that we expect to kick off including, you know, the antamina, uh, tailings left associated with the mine life extension. We have the QB truck shop that we're continuing construction on. Uh, we also have some demobilization of uh, QB facilities as we move into the next phase of of mining there. So that in addition to HBC Emily, which of course we have a, you know, a rigorous schedule associate with the project and the capex.

Crystal: That we've articulated is uh is in line with that schedule. Uh, and then in the context of TMF, we have uh, we have spent passed today. We haven't disclosed what that figure is but we can we can get that. Um,

Unknown Executive: Transcripts provided by Transcription Outsourcing, LLC.

Crystal: Out to folks, as required. But do you expect that spending to continue through the second half of the year? Uh, and really, you know, maybe to articulate a bit more about why uh, why that number is the number that it is. Um, we did have to spend associated with TMF embedded in our in our sustaining Capital guidance, for the year. Uh but the amount uh and distance of mechanical movement of sand uh related to the TMF and the related cost of that work has increased that expected cost. And hence, we didn't keep our guidance, uh, in relation to us.

Unknown Executive: Okay, thank you.

Crystal: Okay, thank you.

Unknown Executive: Thanks Matt.

Thanks man.

Carlos de Alba: The next question comes from Carlos de Alba with Morgan Stanley. Please go ahead. Yeah, thank you. Good morning, everyone. Just on QB, maybe could you please provide a little bit more comments around the ship loader repairs? How long would it take? you have already started, and also if there is any, maybe you mentioned this, but I might have missed it, if there is any impact on CAPEX that are material because of the repair.

Speaker Change: The next question comes from Carlos. De Alba with Morgan Stanley. Please go ahead.

Jonathan Price: Yeah, Carlos, thank you.

Yeah, thank you. Good morning everyone. Um, just so, um, on on, uh, QB. Um, maybe could you please provide a little bit more comments around the Sheep loader? Um, repairs. How long would it take? Um, if you have already started and, and also, if there is any, maybe you mentioned this, but I I had missed it, if there is any impact on capex, uh, that are material because of the, um, of the repairs.

Jonathan Price: Thank you for that question. As you know, we disclosed the challenge with the shiploader back in June of last year. Essentially, the cause for that was a brake failure on the shuttle, which caused an overextension of the shiploader and, of course, some damage associated with that. It took some time to be able to access the shiploader to even assess the repair work, and that was because we were required to apply for and obtain some marine permits. The assessment of that damage is ongoing, and the repair plans are being finalized associated with that work as well.

Jonathan Price: As we've said, we do think that's going to be an extended shutdown now that will extend into the first half of 2026. We haven't got a finalized capital number for that repair at this point in time, because that assessment is ongoing. You know, the downtime of the shiploader is not impacting our production here. As you'll recall, previously, we had in place trucking arrangements while we were awaiting the completion of the shiploader originally that was allowing us to move material to either smelters in Chile or to other ports in Chile. We've just reactivated that, and we have that truck and fleet operating daily.

Jonathan Price: So, no production constraints, and that's allowed us to minimize any buildup in inventory.

Carlos de Alba: All right, fair enough.

Speaker Change: Um, and the repair plans are being finalized associated with that work as well. Um, as we've said, we do think that's going to be an extended shutdown. Now, that will extend to the first half of 2026. Uh, we haven't got, um, a finalized, uh, Capital number for that, uh, repair at this point in time because that assessment is is ongoing, you know, importantly as we've said, uh, the work on the ship loader and the downtime of the ship loader is not impacting. Um, our production here, um, as you'll recall, previously we had in place Trucking Arrangements. While we were awaiting, the completion of the ship loader originally, it was allowing us to move material to either smelters, uh, in Chile or through other ports in Chile. We've just reactivated that, uh, and we have that Trucking Fleet operating daily so so no production, constraints and that allowed us to, um, uh, to to minimize any buildup and inventory of the port.

Carlos de Alba: And then just, if I may, a second question just on the on the sequence of the projects for For Saffronel and San Nicolás, while both are likely to be sanctioned or may be sanctioned by the end of this year, the earliest, is it fair to think that Saffronel probably is ahead and maybe will be developed earlier? I mean, I think it's fair to say that Zafranal is more advanced in terms of its in terms of the permitting status, in terms of the construction readiness of that team, for example. However, you know, we consider both of those to be options.

Speaker Change: All right, fair enough. And then just, um, uh, if I met a second question, just on the, on the sequence of the projects for, um,

Speaker Change: For saffron now and and Saint Nicholas. Um, you know, while both, um, are likely to be sanctioned or maybe sanctioned, uh, by the end of this year at the earliest, uh, is it fair to think that saffron now probably is, uh, ahead and maybe we'll be developed earlier.

Jonathan Price: While we're saying we would like to get them ready for sanction by the end of the year, of course, those are decisions that are yet to be taken. And there's a, you know, a range of factors that will play into those decisions. So, you know, I wouldn't give any particular guidance now on the sequencing of those projects. Think of them as options that we have in the portfolio as we look to de-risk and progress those options to the point that we could take sanction decisions when ready.

No, I mean, I think it's fair to say that zaffron Ali is more advanced. Um, in terms of its uh, in terms of the permitting status in terms of the, uh, construction Readiness, um, of that team, for example. However, you know, we consider both of those to be options. Um, while we're saying we would like to get them ready for sanction by the end of the year. Of course, those are decisions that are are yet to be taken and, and there's a, you know, a range of factors that that will play into to those decisions. So, you know, I wouldn't give any particular guidance now on on the sequencing of those projects. Uh think of them as options that we have in the portfolio as we look to de-risk and protect, um, um, progress, those options to the point that we could take sanction decisions, when ready?

Carlos de Alba: Thank you very much. Thanks, Scott.

Speaker Change: All right. Thank you very much. You're done. Bye thanks. Carlos.

Craig Hutchison: Our next question comes from Craig Hutchison with TD Cohen. Please go ahead. Hi, good morning, guys.

Speaker Change: The next question comes from Craig. Hutchinson with TD coin, please go ahead.

Craig Hutchison: Just on the Highland Valley extension, now that you guys have made a final investment decision, is there a plan to file a technical report? And just maybe as an interim, can you give me a sense of what throughput you're looking at to achieve that annual production rate of 132,000 tons a year? Yeah, so we will, we will publish a technical report. We expect that to happen in August of this year. And of course, you'll get all the detail associated with that. The throughput throughout the life of the future mine will be variable, of course, it's going to be a product of the ore we're mining, you'll see in our disclosure that we go through various phases here, where we're mining different pits, of course, there's different ore hardnesses associated with the ore coming from those pits.

Craig Hutchinson: Hi, good morning, guys.

Craig Hutchinson: Um, just on the Highland Valley extension, now that you guys have made a final investment decision, is there a plan to file a technical Port? Uh, and just maybe as an interim? Can you give me a sense of what throughput you're looking at to achieve that annual production rate of 132,000? Tons a day, tons of years. Sorry.

Jonathan Price: So there'll be variable throughput is the answer and variable grade, of course, that goes with that. And Craig, we did disclose in our investor day in November, what a production profile would look like for HVC MLEs, so I just encourage you to go back and look at that as you think about it. It shows the variables. Which is I guess to get to the 132,000 tons per year, you know, I would assume the throughput has to be materially higher just based on your reserve grade unless I'm I mean, I think we are adding capacity to the circuit, we're adding mills there to increase the throughput of material and also to improve recoveries of material, I should say.

Craig Hutchinson: Uh, yeah, so we, we will, um, we will publish a technical report. We expect that to happen in August of this year, and of course, you'll get all the detail associated with that, uh, the throughput throughout the, the life of the, uh, the future mine, uh, will be variable. Of course, it's going to be a product of your we're mining. You'll you'll see in our disclosure that we go through various phases here where we're mining different pits, of course, there's different or hardnesses, um, associated with the, The Ore coming from those pits. Uh, so they'll be variable throughput. Uh, is the, is the answer and, and variable grade, of course, that goes with that.

Craig Hutchinson: And Craig, we did.

Well, would look like for HC Emily. So just encourage you to go back and, and look at that, as you, as you think about it, it shows the variability.

Speaker Change: Which is, I guess, I guess the, the 132,000 times per year, you know, I would assume the throughput has to be materially higher. Just based on your reserve grade, unless I'm missing something.

Jonathan Price: I mean, you know, last year, you saw our production at HBC come in, you know, just below 100,000 tons. This year, of course, that production guidance is materially higher, you know, in the sort of 140, 150 range. So you see variability year on year currently through the operations at HBC, and that's been driven this year by the processing of additional Lawn-X ore, and I think that's what you should expect going forward is variability depending on the ore type that's dominating mill feed at any point in time.

I mean, I think we are adding, uh, capacity to to the Circuit where we're adding Mills there, um, to increase the throughput, uh, of of material and also, to improve recoveries of material. Um, I should say, I mean, you know, last year, you saw our production at HBC, come in, you know, just below 100,000 tons. Uh, this year, of course, that production guidance is, is materially higher, you know, in in these sort of 140150 range. Um, so you see,

Speaker Change: Year on year currently through the operations at um uh HBC and that's been driven this year, the processing of additional law next door and I I think that's what you should expect going forward. Is is variability, depending on the your type. That's uh dominating mil fees at any point in time.

Jonathan Price: And then just on QB, how are the recoveries progressing, and are you guys... Do you feel like you'll be through the transitional or this quarter or is that still kind of lagging?

Speaker Change: Okay. And then just on on QB how are the recoveries progressing? And are you guys?

Shehzad Bharmal: Yeah, look, I'll just ask Shehzad to talk about that in terms of the transition or where we are on recoveries and the work we're doing there to continue to drive those higher. Thanks, Craig. Craig, as we had noted last year that we did expect lower recoveries in the first half as we were dealing with more transition ores, and our recovery performance was just slightly below what we had expected due to the inconsistency in the first half of the down days.

You feel like you'll be through the transitional or this quarter or is that still kind of you know into 4?

Speaker Change: In terms of the transition or where we are on recoveries and and the work we're doing there to continue to drive those higher.

Craig Hutchison: We do expect to have better quality ore in the second half with a higher grade and higher recoveries, and the transition ores will be variable, but yes, we expect a lot less transition ore in the second half and in 2020. All right, thanks, guys. Thanks, Craig.

Speaker Change: First half as we were dealing with more uh uh, transition orders. And, uh, our recovery performance was just a, you know, slightly below. What? What we had expected due to the, uh, uh, inconsistency. In the first half of the down days, we do expect to have better quality or in the second half, uh, with the higher grade and higher recoveries.

Speaker Change: And uh, the transition ores will uh, be variable. Uh but yes, we expect lot less uh transition or in the second half and in 2026.

Speaker Change: All right. Thanks guys.

Thanks Craig.

Myles Allsop: The next question comes from Myles Allsop with UBS. Please go ahead. Yeah, just a couple of questions. Maybe first on QB and Koyawase, you mentioned it in your presentation. It sounds like discussions are not happening at the moment. Is that right? Or is there any progress in terms of looking at that option seriously? Look, there are discussions regarding QB Koyawase. I'm not going to go into those because of course, they are confidential in nature. But as we've said before, we recognize the potential of the opportunity there for synergies. We will always do what's in the best interest of our shareholders in that regard.

The next question comes from Mi. Also with UBS, please go ahead.

Yeah just um a couple of questions. Um maybe first on uh QB and and colossi was mentioned in your presentation. It sounds like discussions are not happening at the moment, is that right? Or is there any progress in terms of looking at that option? Uh, seriously.

Jonathan Price: As you can see, right now, we have our hands full with ramping QB up to a steady state, which has to be our priority here to ensure we get stable production there and the cash generation that this app is capable of delivering. But as I mentioned, in parallel, we continue to think about and continue to discuss the potential synergies there.

Of course they are. Um, you know, they're they're confidential in nature, but as we've said before we we recognize the the potential uh of the opportunities there for for synergies. Uh we will always do what's in the best interest of our shareholders in that regard. Um, you know, as you can see uh, right now we, you know, we have our hands full with with ramping QB up to the steady state which which

Jonathan Price: But I won't unpack those discussions given their content.

Speaker Change: Has to be, um, our priority here uh, to to ensure we get uh, stable production there. And and the cash generation that this app is capable of of delivering. But, you know, as I as I mentioned, um, you know, in parallel, we we continue to, uh, to think about continue to discuss, uh, the potential percentages there. But but I I once unpacked those discussions given their given their confidential.

Jonathan Price: And then just going back to the two issues at QB, why is it taking a year to fix the shiploader if it's overextended, it's a new shiploader, seems an awful long time and obviously there is a meaningful OPEX impact. And with the tailings, when will, when are you hoping to get that complete? Is it right to assume that that will be sorted largely by the end of this year or is that going to drag? So, I'll hand the ship over to Ian Anderson in a moment. I'm just going to talk about tailings. I mean, of course, given the fact that we have maintained our guidance for 2026, our expectation is that we put the TMS issues behind us this year.

Speaker Change: Um and then just going back to to issues um at QB, why is it taking a year to fix the ship loader? If it it's overextended, it's a new ship loader, seems an awful long time and obviously there is a meaningful Opex impact and with the the the tailings, um,

When when will, when are you hoping to get that complete is is it right to assume that that will be sorted largely by the end of this year? Or is that going to drag?

Jonathan Price: And that's what we're providing for in our guidance. So, as I mentioned, it's sort of a one-time event associated with ramp-up. And when we get through that phase of work, we move into a steady-state operation. So, it's not something, you know, we expect to be plaguing this operation indefinitely at all. It's something we expect is a, you know, it's a discrete piece of work. We'll get that resolved and move past it. And then we'll be able to, you know, secure the online time essentially that we need from this operation unimpeded.

Speaker Change: Talk about tailings. I mean, of course, given the fact that we, uh, have maintained our guidance for 2026. Um, our expectation is that that we put the TMF, um, issues behind us this year. Uh, and, you know, that's what we're we're providing for, in our, in our guidance. Um, so as I mentioned, you know, it's sort of a 1-time event associated with ramp up and when we get through, uh, that phase of work, we

Ian Anderson: Ian, would you like to make some comments just on the timeline? Sure. Thank you very much, Miles, for the question.

Ian Anderson: So, despite the fact that we said it would conclude in the first half of 2026, that's not saying that it will, in fact, At this point, we're really carefully defining the nature of that work. So as a result of the break failure, of course, we have to assess all of the structural elements, make sure that that ship loader is returned safely. And similarly, that we complete all the work to get it back into the right. And so we'll progress that project as we go. Of course, you are dealing with maritime authority. That can cause permit delays, and you certainly wanna be cautious about how we deal with.

Move into a steady state, uh, operation. So it's not something, you know, we expect to be plaguing this operation, uh indefinitely uh at all it's something we expect is a, you know, it's a discrete piece of work. Uh, we'll get that resolved and move past it, uh, and then we'll be able to, um, you know, secure the online time. Essentially that we need from this uh operation unimpeded. Uh, Ian, would you like to make some comments? Just on the on the ship loader Outlook, please? Sure. Thank you very much miles for uh, for the question. So despite the fact that we said it would conclude in the first half of 2026, that's not saying that it will in fact take a year. And at this point we're really carefully defining the nature of that work. So as a result of the brake failure, of course, we have to assess all of the structural elements, make sure that that uh ship loader is returned safely and similarly that we complete all the work to get it back into the right condition.

Speaker Change: So we'll progress that project as we go. Of course, you are dealing with the maritime authorities that can cause permit delays and we certainly want to be cautious about how we

Ian Anderson: I want to make sure that that continues at pace, but at the same time, the nature of the incident demands it to take that long to recover.

Speaker Change: want to make sure that that continues to

be the case. But at the same time, the nature of the incident demands and

Speaker Change: okay, thank you.

Bill Peterson: The next question comes from Bill Peterson with JP Morgan. Please go ahead. Yeah, hi, good morning, everyone, and thanks for taking the questions. On the higher CapEx guide for Highland Valley Mine Life Extension relative to last year's strategy day, it looks at around 15 to 20 percent higher. Can you provide additional color or breakdown between materials inflation, contingencies you mentioned, or any other factors? And then, is there any read-through for project sanctioning for ZAP or NAL or San Nicolas, for example? Should we expect some more sort of double-digit increase at this stage, just to be prudent, or any read-through at all?

Speaker Change: The next question comes from, Bill Peterson with JP Morgan. Please go ahead.

Jonathan Price: Thanks.

Jonathan Price: Yeah, look, so on the HVC piece, I mean, I won't specifically, you know, give that breakdown, but as I mentioned, there's a range of things in there. I mean, it's project level contingency, it's inflation, it's cost escalation, it's the potential for tariffs on construction materials, which we think is a real driver, of course, particularly between the US and Canada. So that is something that we've reflected here. Importantly, as I mentioned, it's also the acceleration of the procurement of mobile equipment that we've brought forward from later project phases, and that materially de-risks the project and the rate at which we'll be able to essentially access the valley pit for the long term.

Crystal Prystai: So, you know, those are important de-risking elements in our view.

Crystal Prystai: I'll also ask Crystal just to comment on, you know, some of the process by which we looked at this capital spend through the, you know, through the investment approach here that we've taken and, you know, our determination to ensure that we give robust capital numbers that can be delivered. Sure, no problem.

Speaker Change: Yeah, like so so on the HPC piece, I mean, I want specifically uh, you know, give that breakdown. But but as I mentioned, there's a range of things in there. I mean it's project level contingency its inflation, its cost escalation. It's the potential for tariffs on construction materials, which we think is a real driver, of course, particularly between the US and Canada. So, so that is something that we've reflected here. Importantly, as I mentioned, it's also the acceleration of the procurement of of mobile equipment, um, that we've brought forward from later project phases and and that materially de-risks the project and and the rate at which we'll be able to uh, essentially assess the, the value pit, um, for the long term. So, you know those those are important de-risking elements in in our view and I'll also ask Crystal just to comment on, you know, some of the process by which we we looked at this Capital spend through the, you know, through the Investments uh approach here that we've taken and you know are are determination to ensure that we give Ree.

Speaker Change: Um, Capital numbers that can be delivered.

Crystal Prystai: Thank you, Phil. We've advanced this project through the final stages of our project delivery framework, as well as through our governance processes, including through our investment committee. Those processes embed the final project requirements, the construction readiness, probabilistic modeling around various facets of the estimates involved. And as well, we had detailed independent assurance provided on many areas of the business plan, as well as in the context of construction readiness.

Crystal: Sure, no problem. Thank you Bill. Um,

Speaker Change: and we've advanced,

Speaker Change: Subject delivery framework, uh, as well as through our governance processes, including through our investment committee. Uh, those processes embed, the final project refinements, the construction Readiness, uh, probabilistic modeling around various facets. Uh, of the estimates involved, uh, as as well. We had, um, detailed independent Assurance provided, uh, on many areas of the

Crystal Prystai: So, all of those are learnings that we took. project that we've committed to embedding as we go forward into future projects, including an HBCMLE. And the conclusion of that work ahead of sanction has led to the capital range that we're disclosing. Of course, in addition to the factors that John has noted in the context of what's embedded into that.

Jonathan Pryce: Business plan, as well, as, in the context of construction Readiness. So all of those are learnings that we took from the QB project that we've committed to embedding as we go forward and into future projects, including in HBC mle, and the conclusion of that work ahead of sanction has led the the capital range that we're we're disclosing, of course, in addition to the the factors that Jonathan noted in the context of what's embedded into that range,

Jonathan Price: So I think, Bill, do you have any read through for future? Yeah, I was just gonna pick up on that. Look, you know, every project has its own characteristics. We will take the same approach with future projects that Crystal just outlined in terms of, you know, using independent assurance, taking probabilistic modeling to ensure the full range of, obviously, economic outcomes associated with the project, but also the full range of potential input assumptions here, which go to capital, because we need to ensure that we're reflecting uncertainties or known unknowns in the project as we're setting forth the assumptions here.

Jonathan Price: But again, as I mentioned, each project has its own unique characteristics. So I don't think you should take a direct read through from that. But what I can say is we will apply the same rigorous approach to Zafranau and Sandvik that we've applied to HMAS.

Speaker Change: So I think, read through for future? Yeah, yeah, I was just gonna just gonna pick up on that look, you know, every every project has its own characteristics. We will take the same approach with future projects that Crystal just outlined in terms of, you know, using Independent Insurance, uh, taking, uh, probabilistic modeling to ensure the full range of obviously economic outcomes associated with the project. But also the full range of potential input assumptions here uh which which goes into Capital because we need to ensure that we're reflecting um uncertainties or or known unknowns um in the project as we're as we're setting forth the assumptions here but again as I mentioned these projects have its own unique characteristics so I don't think you should take a a direct read through from that. But but what I can say is we will apply the same rigorous approach to zapran Island, Saint Nick, that we've applied to HBC.

Bill Peterson: Well understood, thanks for that.

Bill Peterson: My next question is not something the team's talked about recently, but as new range, the potential project in the U.S., is there any update on where that project stands in terms of permitting, community engagement, and I guess an opportunity to potentially move faster than what appears to be a pretty strong support within the U.S. in terms of permitting and promoting domestic production? Yeah, look, I mean, you know, that remains an interesting option for us. It's clearly further out than the, you know, than Zafranal or San Nicolas here in the schedule. I think the key for us there is to define what is the right project, what is the configuration that will deliver the greatest value in the event that project's developed.

Speaker Change: Well, understood, thanks for that. My my next question is not something that the teams talked about recently but uh as new Range, the potential project in the US, um, there's any update on where that project stands in terms of Permitting Community engagement and I guess I have an opportunity to potentially move faster even than what appears to be. A, a pretty strong support within the US in terms of Permitting and promoting domestic production.

Bill Peterson: And that's the work that we're doing now. And of course, you have to define that before you can start to approach the permitting process in any detail.

Bill Peterson: So I think that's a conversation for later. Bill, we have our hands full with other things right now, but we do continue to work that in parallel. Well understood.

Speaker Change: Yeah, look. I mean you know that that remains an interesting option for us, it's it's clearly further out than the uh, you know than zero or or Saint Nicholas here in the schedule. Like, I think the key for us there is is to Define. What is the right project? What is the configuration that will deliver the uh the greatest value in the event that project uh, developed and and that's the work that we're doing now. And of course, you have to Define that before you can start to approach the permitting process in in, in any detail. So I think that's a conversation for later. Uh Bill we have our hands full with other things right now, but we do continue to work that in work that in parallel.

Bill Peterson: Thanks for your insights.

Bill Peterson: Well, understood thanks for your insights.

Speaker Change: Thank you.

Chris LaFemina: The next question comes from Chris LaFemina with Jeffries. Please go ahead. Hi, thanks for taking my question.

Crystal Prystai: I just wanted to ask about first on the incremental CapEx for QB for the TMF, how do you decide whether you're going to include CapEx in the project CapEx or in sustaining? Because I would think if you're spending money to ramp the project to full capacity for whatever reason, that would have been part of the project CapEx. I understand it's really just a question of semantics, but when we think about the capital intensity of the project, why wouldn't that be part of the project CapEx rather than sustaining?

The next question comes from Chris Leah with Jeffrey. Please go ahead. Hi, thanks for taking my question. I just wanted to ask about first, on the incremental, capex for QB for the TMF. What, how do you how do you decide? Whether you're going to include capex in the project capex or in sustaining because I would think

If you're spending money to ramp the project to full capacity for whatever reason that would have been part of the project capex. I understand it's really just a question of semantics. But when we think about the capital intensity of the project, why wouldn't that be part of the project capex rather than sustaining?

Crystal Prystai: I will hand the semantics question over to Crystal. Hi Chris, thanks for the question. In the context of PMF, when we thought about the gross capital for the project, of course there was construction costs associated with that, built in to the project capital that we reported against in our results over a number of years. I think the pieces that I add to why it's now sustaining, I mean, firstly, we're running the operation and we're producing copper, so I think these things are no longer growth capital. We did expect to spend on the TMF, but that amount, as I mentioned, is more significant than we expected as we are now moving significantly more sand further distances than we expected for mechanical movement, and a related cost to that is increased expected cost, and I think at this point it doesn't make sense to include that in growth capital and it becomes part of the sustaining capital as a result.

Speaker Change: Uh, I the semantics question over to Crystal. Hi Chris

Speaker Change: For running the operation and we're producing copper. So I think it, you know, these things are no longer, uh growth Capital, uh, we did expect to spend on the TMF. Um, but that amount as I mentioned is more significant than we expected as we are now, you know, moving significantly more sand uh further distances than we expected uh for mechanical movement uh and a related cost to that is increasingly expected cost. And

um, I think

Speaker Change: At this point, it see that that makes sense to include that in growth capital and and it becomes part of the sustaining capital and difficult.

Ian Anderson: Okay, that's fair enough.

Ian Anderson: And then secondly, just on the shiploader, do you have any insurance related to the issues there? Or is it all on you? Thank you.

Okay, that's fair enough and then secondly just on the ship loader. Do you have any insurance related to the issues there or is it all on you? Thank you.

Ian Anderson: Ian, do you want to comment on that as well? Yes, certainly we are investigating the root cause and we'll understand based on that what the next steps will be. Yes, we do have insurance coverage, and that includes interruption, so we're going to continue to address that. Thank you, Chris. Thank you.

Yeah, do you want to comment on that as well?

Yes, certainly, we are investigating the root cause and uh and we'll understand based on that, what the next steps will be.

Speaker Change: so, yes, we do have insurance coverage and that includes interruptions so,

Speaker Change: Okay, great. Thanks.

Speaker Change: Thank you, Chris.

Operator: We are out of time for further questions.

Jonathan Price: I will now hand the call back over to Jonathan Price for closing remarks. Please go ahead. Thank you, Operator, and thanks again to everyone for joining us today.

Thank you, we are out of time for further questions. Uh I will now hand the call back over to Jonathan price for closing tomorrow. Please go ahead.

Jonathan Price: We look forward to welcoming many of you to our QB site visit on November 3rd and 4th of this year. Please reach out to Emma Chapman and our IR team for further information on the site visit, or, of course, if you have any follow-up questions on the quarter.

Operator: So, thank you, and enjoy the rest of your day.

Jonathan Pryce: Uh, thank you, operator. And thanks again to everyone for joining us today. Uh, we look forward to welcoming many of you to our QB site. Visit on the November 3rd and 4th of this year, please reach out to Emma Chapman and our IR team for further information on the site visit or, of course if you have any follow-up questions on the quarter. So thank you and enjoy the rest of your day.

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

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