Q2 2025 First Quantum Minerals Ltd Earnings Call
Is being recorded.
After the Speakers' remarks, there will be a question and answer session and if you would like to ask a question. During this time. Please press star one on your telephone keypad.
I would now like to turn the conference over to Benita tell director of Investor Relations you may begin.
Benita Tell: Thank you operator, and thank you everyone for joining us today to discuss our second quarter results. During the call we will be making forward looking statements and as such I encourage you to read the cautionary notes that accompany this presentation, our MD&A and the related news release.
Benita Tell: As a reminder, the presentation is available on our website and that all dollar references are in U S dollars unless otherwise noted.
Speaker Change: On today's call are interest in Pascal, our Chief Executive Officer, Ryan Mcwilliams, Our Chief Financial Officer, and Rudy Van Horn, our Chief operating officer, and with that I will turn the call over to Tricia for opening remarks.
Hello and welcome to the first Quantum minerals Q2 2025 results conference call all lines have been placed on mute to prevent any background noise.
Tricia: Thank you Vanessa.
Today's conference is being recorded.
Tricia: And thank you everybody for joining us today for our quarterly earnings update.
Tricia: At the beginning of the year, we set forth our key priorities for 2025.
After the speakers remarks, there will be a question and answer session. And if you would like to ask a question during this time, please press star 1 on your telephone keypad,
Tricia: Moving towards resolution and Panama ongoing proactive management of our balance sheet and liquidity position safe and productive operational performance and the delivery of <unk> III expansion project with consensus.
Speaker Change: I would now like to turn the conference over to Bonita toe director of investor relations. You may begin.
Tricia: I am pleased that we have made meaningful progress on these priorities during the second quarter.
Tricia: Yeah.
Tricia: That cobre, Panama, the government of Panama approved the preservation and Safe management program, which is an important step forward in our ongoing responsible environmental stewardship of the mine.
Bonita Toe: Thank you, operator. And thank you everyone for joining us today to discuss our second quarter results. During the call. We will be making forward-looking statements and as such I encourage you to read the cautionary notes that accompany this presentation, our mdna and the related news release.
Bonita Toe: As a reminder, the presentation is available on our website and that all dollar references are in US Dollars. Unless otherwise noted
Tricia: At the Constancia is three expansion project, we said first oil into the combination circuit at the end of the second quarter and the project remains on budget and on schedule.
Speaker Change: on today's call or Tristan Pascal, our chief executive officer Ryan, megill our Chief Financial Officer and Rudy Bannon horse, our chief operating officer. And with that, I will turn the call over to Tristan for opening remarks.
Tricia: As we near completion test spending is expected to decline as we have now passed the peak of capital expenditure on a story.
Thank you, Bonita.
Tristan Pascal: And thank you everybody, for joining us today for our quarterly earnings update.
Tricia: Whilst our copper production was lower quarter over quarter in our Zambian operations production is expected to be stronger in the second half of the year and we remain on track to achieve our 2025 guidance.
Tristan Pascal: At the beginning of the year, we set forth our key priorities for 2025.
Tristan Pascal: Moving towards resolution in Panama ongoing ProActive Management of our balance sheet and liquidity position.
Speaker Change: Which really will review in more detail during his operational overview.
Tristan Pascal: Safe and productive operational performance. And the delivery of the S3 Expansion Project at consanti
Speaker Change: During the quarter. The company took further steps to strengthen our near term liquidity through the initiation of new gold hedges.
Tristan Pascal: I'm pleased that we have made meaningful progress in these priorities during the second quarter.
Speaker Change: This move takes advantage of strong providing market prices for a portion of our gold production.
Speaker Change: <unk> added protection for the balance sheet as the Constancia three expansion projects ramped up to design capacity.
Tristan Pascal: At Cobra Panama the government of Panama approved. The preservation and Safety Management program which is an important step forward in our ongoing, responsible environmental stewardship for the mine.
Speaker Change: We continue to evaluate additional initiatives to enhance our financial flexibility and further reinforce our balance sheet, which Ron will address in more detail during his financial overview.
Tristan Pascal: At the consanti S3. Expansion Project we fed first or into the combination circuit, at the end of the second quarter and the project remains on budget and on schedule
Speaker Change: Additionally, we have identified a new exploration opportunity in near surface gold during the currencies at Constancia and our test work to date, albeit preliminary is yielding promising results.
Tristan Pascal: As we near completion test spending, is expected to decline as we have now passed the peak of capital expenditure on S3.
Speaker Change: Which I'll speak more later on in the call.
Speaker Change: Yeah.
Speaker Change: During the quarter after constructive discussions with the government of Panama. It was pleasing to receive formal approval of the preservation stacked management program for the Cobre Panama mind.
Tristan Pascal: Whilst our copper production was lower quarter over quarter at our Zambian operations production is expected to be stronger in the second half of the year and we remain on track to achieve our 2025 guidance which really will review in more detail during this operational overview.
Speaker Change: The implementation of the PMA same plan is now underway under the oversight of a multi disciplinary team of regulatory officials.
Tristan Pascal: During the quarter, The company took further steps to strengthen its near-term. Liquidity through the initiation of new gold hedges.
Speaker Change: As part of the program. The first shipment of concentrate was completed in late June and subsequently vessel number two and three shifts earlier this month of July.
Tristan Pascal: This move takes advantage of strong prevailing market prices for a portion of our gold production, providing added protection for the balance sheet as the consanti S3 Expansion Project. Ramped up. The design capacity,
Speaker Change: We expect to complete the fourth and final vessel shipments in the coming days.
Speaker Change: During the export prices, we've worked in close collaboration with government representatives as well as many of our communities in order to enhance transparency and communication and the concentrate was loaded and exported safely without incident.
Tristan Pascal: We continue to evaluate additional initiatives to enhance our financial flexibility and further reinforce our balance sheet which Ryan will address in more detail during his financial overviews.
Speaker Change: The proceeds generated from the sale of the concentrate are earmarked to fund procurement with a local suppliers and local employment in Panama as part of the P&L implant implementation and the ongoing environmental stewardship of the mine.
Tristan Pascal: Additionally, we have identified a new expiration opportunity in near surface, gold Zone occurrences at cannae and our test work. Today will be at Prix. Preliminary is yielding promising results.
Tristan Pascal: Which I will speak more uh, later on in the call.
Speaker Change: The pianist and plan approved.
Tristan Pascal: During the quarter, after constructive discussions with the government of Panama, it was pleasing to receive formal approval of the preservation, sake Management program for the Cobra Panama mine.
Speaker Change: Approval also authorizes the reactivation of Cobre Panama's power plant.
Tristan Pascal: The implementation of the pns and plan is now underway under the oversight of a multidisciplinary team of regulatory officials.
Speaker Change: All necessary licenses and permits are in place and we've commenced the preparation work for the restart including pre commissioning inspections the.
Speaker Change: The restart of the power plant is anticipated for the fourth quarter of this year.
Tristan Pascal: As part of the program, the first shipment of concentrate was completed in late June and subsequently vessels. Number 2 and 3 shipped. Earlier this month July
Speaker Change: Separate to the pianist and plan the 10th external environmental order was completed in March and a final report was submitted to the government in April.
Tristan Pascal: We expect to complete the the fourth and final vessel shipment in coming days.
Speaker Change: These audits conducted by the regulator in local consultants in Panama with the support of international experts.
Speaker Change: Additionally, community members participated as observers during field phase reinforcing transparency and stakeholder engagement.
Tristan Pascal: During the export process, we have worked in close collaboration with government Representatives as well as nearby communities in order to enhance, transparency and communication and the concentrate was loaded and exported safely without incident.
Speaker Change: I am pleased to share that the import it sounds euro environmental noncompliance.
Speaker Change: The 11th external environment.
Speaker Change: Began in June and the final reported expected in the coming months.
Tristan Pascal: The pnsn plan approves.
Speaker Change: Additionally, the company conducted a comprehensive sidebars corrosion inspection audits of all my destruction with an external team of international experts and we are also awaiting the final report from this work.
Tristan Pascal: Approval. Also authorizes the reactivation of Cobra Panama's power plant.
Tristan Pascal: All necessary licenses and permits are in place and we have commenced preparation work for the restart including pre-commissioning. Inspections.
Speaker Change: Onto power in Zambia, and Wolf Lake Kariba levels, a recovery following a stronger riding season power restrictions remain in effect in Zambia.
Tristan Pascal: The restart of the power plant is anticipated for the fourth quarter of this year.
Speaker Change: Our operations have a did not experience any power disruptions due to our import contracts.
Tristan Pascal: Separate to the pmsm plan, the 10th external environmental audit was completed in March and a final report was submitted to government in April.
Speaker Change: Nevertheless, we continue to work on medium and long term power security for our Zambian operations and to support electricity availability in the country.
Tristan Pascal: These audits are conducted by the regulator and local consultants in Panama with the support of international experts.
Tristan Pascal: additionally community members participated as observers during the field phase reinforcing, transparency, and stakeholder engagement
Speaker Change: During the quarter the company entered into a 10 year agreement with Africa Green coffee for the supply of solar power from the <unk> Solar PV project, which will provide a minimum of 25 megawatts of base load power for the company, while the remainder will be made available to others and in customers.
Speaker Change: I am pleased to share that the audit found zero Environmental. Non-compliances
Speaker Change: The 11th, external environmental order, began in June and the final report is expected in the coming months.
Speaker Change: The project was inaugurated by the President of Zambia on June 32025, and represents a key milestone in expanding countries renewable power generation capacity.
Speaker Change: Additionally the company conducted a comprehensive site wise corrosion inspection, order of all major structures with an external team of international experts. And we are also waiting the final report from this work.
Speaker Change: Additionally, the company continues to advance grid stability work streams in partnership with Vickery.
Speaker Change: To support growing industrial demand in the northwest problems.
Speaker Change: On to power in Zambia. And whilst Lake Kariba levels are recovering following a stronger rainy season power restrictions do remain in effect in Zambia.
Speaker Change: These efforts are critical to enabling large scale integration of new renewable power sources and ensuring long term good resilience.
Speaker Change: Our operations have a did not experience any power of disruptions due to our import contracts.
Rudy: With that I will now turn the call over to Rudy for his operational review.
Speaker Change: Nevertheless, we continue to work on medium and long-term power security for our Zaman operations, and to support electricity availability in the country.
Thank you Justin.
Rudy: Before I review, our second quarter operational results.
Rudy: I would like to pay my respects and condolences to the family and if things develop colleague at the drive in the operation.
Rudy: We aggressively during the quarter LDC totally passed away following and exited with the seasonal pickup.
Speaker Change: During the quarter, the company entered into a 10-year agreement with Africa, green code, for the supply of solar power. From the chamber solar PV project, which will provide a minimum of 25 megawatts of Base load power for the company. Whilst the remainder will be made available to other Zambian customers.
Rudy: This was a tragic incident and I would like to reiterate the company's commitment to the health and safety of our workforce.
Speaker Change: The project was inaugurated by the president of Zambia on June 30th 2025 and represents a key. Milestone expanding countries renewable power, generation capacity.
Rudy: The continuous improvement of our safety culture at all of our operations is a priority for this content.
Rudy: During the quarter.
Rudy: We produced 91000 tons of copper down 9% from the first quarter.
Speaker Change: Additionally, the company continues to advance grid stability. Work streams in partnership with zesco to support, growing industrial demand in the Northwest province.
Rudy: Mainly due to lower production and consumption.
Rudy: Reflecting the lower production volumes copper cone cash costs were five seems high at $2 a pound.
Speaker Change: These efforts are critical to enabling large-scale. Integration of new Renewable Power resources and ensuring long-term good resilience.
Rudy Bannon: With that, I will now turn the call over to Rudy for his operational review.
Rudy: Our concern sheet sulfide grades for the quarter was lower mainly as a result of the reclassification of sulphide ore So new store and the line 15 complex and at the same time a portion of the volume mind was downgraded from high to low rate.
Rudy Bannon: Thank you, Justin.
Rudy Bannon: Before I review, our second quarter, operational results.
Rudy Bannon: I would like to pay my respect and condolences to the family and friends of our colleague at the drive and operation.
Rudy: However, the most on each and the issue sulfide circuit increased by approximately 6000 Z on the tons per day, when compared to the first quarter.
Rudy Bannon: Regrettably during the quarter Eldridge entirely passed away, following an accident at the Sentinel pit.
Rudy: Based on continuous improvement of blasting practices and ore fragmentation.
Rudy Bannon: This was a tragic incident and I would like to reiterate the company's commitment to the health and safety of our Workforce.
Rudy: The quarter was further impacted by a planned 40 day shutdown at the smelter.
Rudy Bannon: The Continuous Improvement of the safety culture and all of our operations is a priority for this content.
Rudy Bannon: During the quarter.
Rudy: Which commenced on the <unk> in June.
Rudy: As part of the preparation work for the shutdown.
Rudy: Planned asset restrictions, which limited achieved flexibility sooner circuits.
Rudy Bannon: We produced 911,000 tons of copper down 9% from the first quarter, mainly due to lower production and concerns.
Rudy: It resulted in the oxide circuit processing missile for the entire month of June.
Rudy Bannon: Reflecting the lower production volumes copper C1 cash costs were 5 cents. Higher at $2. A pound.
Rudy: This noted a little feed grades compared to the previous quarter and assess gen. Thank you reported copper production of 40000 tonnes in Q T V.
Rudy: The decrease slightly over 6000 tons.
Rudy: Probably Q1 cash cost of $1 47, a pound was 13 seems higher quarter over quarter.
Rudy Bannon: A kansi sulfide grade for the quarter was lower, mainly as a result of the reclassification of sulfite or to mix or in the main 15 cut back and at the same time, the forcing, the volume of Mind was John graded from high to low grade.
Rudy: As a result of the move reduction. However, this was partially offset by meaningful gold byproduct sales as gold production continues to be strong at 28000 ounces.
Speaker Change: Oh, yeah, that the mold tonnage and the S2 sulfide circuit increased by approximately 3,300 tons per day when compared to the first quarter.
Speaker Change: Based on continuous Improvement of blasting practices and all fragmentation.
Rudy: Given by the upgrade of existing revenue constant sciences amines.
Rudy: And the installation of the new reality constant center.
Speaker Change: The quarter was further impacted by a planned, 40-day shutdown, at the smelter.
Rudy: As conditions late in the first quarter of <unk> clients.
Speaker Change: Which commenced on the 1st of June.
Speaker Change: As part of the preparation work for the shutdown.
Rudy: The smelter return to operation in early July.
Rudy: This along with the commissioning of the HD expansion you will set up the second half of the year for solar production essentially.
Speaker Change: we will plan asset restrictions which limited feeds flexibility through the circuits and resulted in the oxide circuit processing mixed or for the entire month of June,
Rudy: And we remain confident with our 2025 guidance of 160 to 190000 tons of copper.
Rudy: Mm 120, 19000 ounces of gold.
Speaker Change: this lowered overall feed rate compared to the previous quarter and as such can change, your reported copper production of 40,000 tons in Q2
Speaker Change: And decrease slightly over 6,000 tons.
Rudy: And seasonal copper production totaled 46000 tons in the second quarter.
Rudy: Down approximately 3000 tonnes from Q1 due to the mining of lower rates from stage three.
Rudy: While the quarter was impacted by a four day planned shutdown.
Rudy: And Saint <unk> Board will continue to experience lunch both T J.
Speaker Change: as gold production continued to be strong at 28,000 Oz driven by the upgrade of 3 existing gravity concentrators
Rudy: <unk> improved quarter over quarter.
Rudy: The downtime related to the bolt replacements was additional efficiency.
Speaker Change: and the installation of a new reality concentrator, which has commissioned light in the first quarter of 2025,
Rudy: With the lower production copper cone cash cost of $2 77, a pound.
Speaker Change: the smelter returned to operation in early July.
Rudy: It was <unk> higher than the preceding quarter.
Rudy: With respect to the ball mill through two key issues.
Speaker Change: This along with the commissioning of the S3 expansion will set up the second half of the year for stronger, production and consenti.
Rudy: As identified in the first quarter. The company is working closely with the regional OEM.
Rudy: And we are in the process of finalizing predicted procedures.
Speaker Change: And we remain confident with our 2 2025 guidance of 16290000 copper.
Speaker Change: And 100 to 110,000 oz of gold.
Rudy: As such change any thoughts couple of production of these items remains unchanged.
Rudy: 200 to 230000 comes with it.
Speaker Change: At Sentinel copper production totaled. 43,000 tons in the second quarter.
Rudy: We expect it to be stronger mistaken office money as a basis to debottleneck sites one bit.
Rudy: So some development ahead of the wave season.
Speaker Change: Down approximately 3,000 tons from q1 due to the mining of lower grades from stage 3.
Rudy: Then finally sulfide ore is exposed in stage three.
Speaker Change: While the quarter was impacted by a 4-day plan shardan
Rudy: We changed the bonds.
Rudy: Nickel production of 4000 tons were down 14% from the first quarter.
Speaker Change: And train 2 bone will continue to experience flange both team.
Speaker Change: Triples improved, quarter of a quarter.
Rudy: Due to lower throughput and grades as a result of a higher proportion of some regional oil due to the change in the mining sequence.
Speaker Change: As a downtime related to the ball Replacements, was replaced more efficiently.
Rudy: On the deployment of terminal exempts to widen our footprint.
Speaker Change: With another production copper C1 cash cost of 2.77 pound worth 22 cents higher than the preceding quarter.
Rudy: <unk> cash cost increased to $5 83 per pound.
Speaker Change: With respect to the ball more fatigue issues.
Rudy: Due to lower production volumes and higher mining contractor costs.
Rudy: In response to the challenging conditions for the nuclear market.
Speaker Change: That were identified in the first quarter. The company is working closely with the original OEM and is in the process of finalizing collected procedures.
Rudy: <unk> signed an enterprise has been revised to minimize waste stripping in long term contracts.
Speaker Change: As such 2025, copper production guidance remains unchanged at 200 to 230,000 pounds.
Rudy: So we're not compromising on order availability.
We maintained production within the guidance range of 15 to 20 months ago with thousands of nickel.
Speaker Change: For the great expected to be stronger than the second half. That's mining. The greatest at the bottom of stage 1 bit for some development ahead of the Way season.
Rudy: In Panama, we continue with the mid city, we look to maintain and preserve the info.
Speaker Change: And primary self by all is exposed into Stage 3.
Speaker Change: Over the Enterprise.
Rudy: As such and equipment on site presence.
Rudy: Preservation and safe money lead costs at least $15 million per month during the quarter.
Speaker Change: Nickel production of 4,000. Tons, or a down 14% from the previous quarter.
Rudy: These monthly costs increased from the first quarter of June booked additional costs.
Rudy: Likely to contemplate shippers on the decommissioning activities for the power plants.
Speaker Change: Due to lower throughput and grades. As a result of a higher proportion of tanzine, or all due to the change, in the mining sequence, under the deployment of permanent ramps to widen the footprint.
Rudy: But he thought of the telephone during the fourth quarter with statements increased <unk> costs.
Speaker Change: We could see 1 Cache cost increased to 5.83 per pound.
Rudy: Range of $17 million to $18 million per month.
Speaker Change: Production volumes, and higher. Mining contract across
Rudy: Thank you and with that I will hand, the call over to Ron for the fiscal regime.
Speaker Change: In response to the challenging conditions, for the nickel Market.
Speaker Change: Thank you Rudy.
Starting with the market.
Speaker Change: Copper prices fell sharply early in the quarter following the Trump administration's liberation day tariff proposals.
Speaker Change: The mining plan at Enterprise has been revised to minimize waste shipping in long-term cutbacks.
Speaker Change: Therefore not compromising on all availability.
Speaker Change: However prices quickly rebounded as the tariffs were suspended in the concentrate market remained tight due to the resilient Chinese demand.
Speaker Change: We maintain production within the guidance range of 15 to 25,000 tons of nickel.
Speaker Change: The Chinese stimulus to offset the impact of trade tensions on their economy has provided a strong demand hedge for the copper price through much of this year.
Speaker Change: At Panama, we continue with the necessary work to maintain and preserve the infrastructure and equipment on site.
Speaker Change: Prices have softened slightly subsequent to the end of the quarter due to renewed trade uncertainty, but the physical market remained strong.
Speaker Change: Preservation and take money and costs average 15 million dollars per month during the quarter.
Speaker Change: More recently the Trump administration has suggested that there will be a 50% tariff on copper imports into the U S.
Speaker Change: These monthly costs increase from the previous quarter as June booked additional costs related to cost of their shipments under pre commissioning activities for the power plant.
Speaker Change: We note that we do not currently have any copper sales into the U S. And therefore do not expect any direct impact on our revenues should these tariffs come into effect.
Speaker Change: The restart of the power plant. And the fourth quarter is expected to increase PM costs to the range of 17 to 18 million dollars per month.
Ryan Megill: Thank you. And with that, I will hand the call over to Ryan for a physical review.
Ryan Megill: Thank you, Rudy.
Speaker Change: Moving on to our second quarter results.
Speaker Change: Starting with the market.
Speaker Change: Revenue grew by 3% quarter over quarter, driven by higher gold sales volume along with improved metal prices.
Speaker Change: Copper prices. Fell sharply early in the quarter, following the Trump administration's Liberation day tariff proposals.
Speaker Change: This contributed to a 6% uplift in EBITDA and a $41 million improvement in net earnings.
Speaker Change: However, prices quickly rebounded, as the tariffs were suspended and the concentrate Market remained tight due to resilient Chinese demand.
Speaker Change: Copper costs were up 3% to $2 per pound.
Speaker Change: This was predominantly driven by lower production that was partially offset by strong gold prices and the resulting byproduct credits.
Speaker Change: The Chinese stimulus to offset the impact of trade tensions, on their economy, has provided a strong demand Hedge for the copper price through much of this year.
Speaker Change: Okay.
Speaker Change: Remaining input prices and Zambian pyrites was stable again.
Speaker Change: Prices have softened slightly subsequent to the end of the quarter, due to renewed trade uncertainty, but the physical Market remains strong.
Speaker Change: Yes.
Speaker Change: More broadly we're maintaining a disciplined focus on cost with regular cost reviews and proactive contract negotiations.
Speaker Change: More recently, the Trump Administration has suggested that there will be a 50% tariff on copper Imports into the US.
Speaker Change: On the balance sheet, we continue to take proactive steps during the quarter to further strengthen our liquidity position and enhance our financial resilience.
Speaker Change: We note that we do not currently have any copper sales until the US and therefore do not expect any direct impact. On our revenues. Should these tariffs come into effect?
Speaker Change: During the quarter, we entered into a supplemental three year $500 million copper prepayment, which further reinforced our liquidity.
Speaker Change: Moving on to our second quarter results.
Speaker Change: Revenue grew by 3%, quarter over quarter driven by higher gold sales volumes along with improved metal prices.
Speaker Change: Additionally, we initiated the gold hedging program using zero cost collars established at a time of record high gold prices.
Speaker Change: This contributed to a 6% uplift in EBA and a 41 million Improvement in net earnings,
Speaker Change: We have hedged approximately 78000 ounces of gold at the end of June next year at average floor in cap strike that roughly 3% and $4000 per ounce respectively.
Speaker Change: Copper C1 Cuts were up 3% to $2 per pound.
Speaker Change: This was predominantly driven by lower production, that was partially offset by strong gold prices and the resulting byproduct credits.
Speaker Change: These gold hedges complement our copper hedging program, which continues to provide valuable protection against price volatility.
Speaker Change: Remaining input prices, and Zambian power rates were stable during the quarter.
Speaker Change: We now have coverage of approximately 60% of our panel copper production through the end of 2025.
Speaker Change: And 40% through the end of the first half of 2026.
Speaker Change: More broadly by disciplined focus on costs with regular cost reviews and proactive contract negotiations.
Speaker Change: While our long term strategy is to be unhedged, we do selective hedging as a valuable tool to support our financial resilience and safeguard the balance sheet during the construction and ramp up of the <unk> expansion.
On the balance sheet, we continue to take proactive steps during the quarter to further. Strengthen our liquidity position and enhance our financial resilience
Speaker Change: During the quarter net debt improved by $334 million to $5 5 billion driven by the proceeds from the second copper prepayments strong EBITDA and favorable working capital movements.
Speaker Change: during the quarter, we entered into a supplemental 3 year 500 million copper prepayment which further reinforced our liquidity
Speaker Change: Additionally, we initiated the gold hedging program using zero cost collars established at a time of record high gold prices.
Speaker Change: Liquidity remained strong at $1 7 billion comprising.
Speaker Change: Comprising of $737 million in cash.
Speaker Change: We've hedged approximately 78,000 ounces of gold to the end of June next year at average floor and cap. Strikes of roughly 3 and 4 thousand dollars per ounce respectively.
Speaker Change: $930 million of Undrawn revolver.
Speaker Change: As of yesterday expansion approaches completion, our capital intensity will be winding down and the company will be transitioning to a phase of free cash generation that will be directed towards debt reduction.
Speaker Change: These gold Hedges complements, our copper hedging program which continues to provide valuable protection against price volatility.
Speaker Change: We also continue to work on initiatives to further strengthen our balance sheet.
Speaker Change: We now have coverage of approximately 60% of our plan, copper production, through the end of 2025 and 40% through the end of through the first half of 2026.
Speaker Change: The initiatives that we have explored and create a minority stake sale and that was ambient business among other options.
Speaker Change: However, with the new Goldstone identified at <unk> and a constructive call price. We're also considering other instruments such as golf prepaid in streams together with the gold hedges that we action during the quarter.
Speaker Change: Well, a long-term strategy is to be unhedged. We've used selectively hedging as a valuable tool to support our financial resilience and Safeguard the balance sheet during the construction and ramp up of the S3 expansion.
Speaker Change: All financial initiatives will continue to be reviewed side by side to thoroughly assess what makes the most strategic and financial sense.
Speaker Change: During the quarter, net debt. Improved by 334 million to 5.5 billion driven by the proceeds from the second copper prepayment.
Speaker Change: Strong ebita and favorable working capital movements.
Speaker Change: In summary, we remained.
Speaker Change: The liquidity remains strong at 1.7 billion.
Speaker Change: Disciplined cost and capital management.
Speaker Change: We continue to maintain a strong liquidity position with.
Speaker Change: Comprising of 737 million in cash.
Speaker Change: 930 million of undrawn revolver.
Speaker Change: Which underpins our financial resilience provide.
Speaker Change: Provides a solid foundation for navigating volatile market conditions.
Justin: With that I'll hand, the call back to Justin.
Speaker Change: Okay.
Speaker Change: As the S3 expansion approaches completion, our Capital intensity will be winding down and the company will be transitioning to a phase of free cash generation. That will be directed towards debt reduction.
Justin: Thanks, Ron.
Speaker Change: At Constancia, we have two important updates to highlight this quarter.
Speaker Change: We also continue to work on initiatives to further, strengthen our balance sheet.
Speaker Change: First on the new surface gold during the currencies that we that have been identified in the southeastern area and secondly on the Constancia three expansion projects.
Speaker Change: The initiatives that we have explored include a minority stake sale in our Zambian business among other options.
Speaker Change: As part of the consent.
Speaker Change: The extension project the company began pre stripping of the southeastern deposit to provide additional sulfide ore feed for the new 25 million tonnes sulfide concentrate there.
Speaker Change: However, with the new gold Zone, identified, a Caniac.
Speaker Change: During these stripping activities new surface Goldstone occurrences overlying a copper gold deposit.
Speaker Change: All Financial initiatives will continue to be reviewed side by side, to thoroughly assess what makes the most strategic and financial sense.
Speaker Change: In summary.
Speaker Change: We're up in Florida, and these have emerged as an exciting new exploration opportunity for the Constancia mine.
Speaker Change: We remain disciplined in our cost and Capital Management.
Speaker Change: We continue to make em maintain a strong liquidity position.
Speaker Change: From our sampling and analysis to date, we see that the gold mineralization is generally very fond Brian.
Speaker Change: Which underpins our financial resilience.
Speaker Change: Provides a solid foundation for navigating volatile market conditions.
Speaker Change: Some associated coarser particles, which presents in a nugget effect.
Tristan Pascal: With that, I'll hand the call back to Tristan.
Speaker Change: These presentations of mineralization require larger than normal sample sizes in order to appropriately understand and address both the nugget effect of the cough cold and also the foreign golf content.
Thanks Ryan.
Speaker Change: That consents you we have 2, important updates to highlight this quarter.
Speaker Change: Due to the nugget effect the size and grade of the new surface Goldson occurrences currently uncertain and our efforts are focused on better understanding both of these ethics.
First on the new Surface gold Zone occurrences that we that have been identified in the Southeast Dome area. And secondly on the consensus 3 Expansion Project
Speaker Change: Initial test the gold mineralization has been conducted using the existing gold facilities thoughts and also a record installation of a small scale pilot plant.
Speaker Change: As part of the consent, you S3 Expansion Project. The company began pre- stripping in the Southeast Dome deposit to provide additional sulfide or feed for the new 25 million tons sulfide concentrator.
Speaker Change: We have been encouraged by the preliminary results, which provides a clear lesson for further upcoming work.
Speaker Change: During the stripping activities, new Surface, gold Zone occurrences overlying, the copper gold deposit.
Speaker Change: As a result, we have initiated work on a pilot plant with an estimated completion later this year, which is intended to support understanding of processing to dawn for the gravity gold mineralization.
Speaker Change: We're identified and these have emerged as an exciting new expiration opportunity for the consent, you mind.
Speaker Change: Our exploration test work is ongoing and our intent is to work towards defining a resource for the new surface Goldstone occurrences.
Speaker Change: From our sampling and Analysis today. We see that the gold mineralization is generally very fine grains, but with some Associated coarser particles which present in a nugget effect.
Speaker Change: We will provide additional updates as appropriate.
Speaker Change: As a reminder, consensus current mine plan guidance and mineral resource and reserve estimates do not include this goal during the current exploration opportunities.
Speaker Change: These presentations are minimization require larger than normal sample sizes in order to properly understand and address both the Nugget effect of the coarse gold and also the fine gold content.
Speaker Change: Over to the Constancia is three expansion project during.
Speaker Change: Due to the Nugget affect the size and greater the new Surface gold Zone. Occurrences are currently uncertain and our efforts are focused on better understanding both of these aspects.
Speaker Change: During the quarter first always fit from the primary crusher three to the crushed ore stockpile ahead of schedule in the second quarter and we are now in the final stages of commissioning.
Speaker Change: In the last few days or with fade through the Sag mill, the rougher flotation circuit and through to the timings thickener.
Speaker Change: Initial test, the gold mineralization has been conducted using the existing gold facilities at site and also rapid installation of a small Scale Pilot plant, we have been encouraged by the Prix preliminary results, which have provided clear lessons for further upcoming work.
Speaker Change: First ore to the Sag mill marks an important milestone in the commissioning process for a three as it establishes full lloyd's of meaningful plants and equipment and to date the commissioning performance okay.
Speaker Change: As a result, we have initiated work on a pilot plant with an estimated completion. Later this year, which is intended to support, understanding of processing design for the gravity, gold mineralization.
Speaker Change: Planner.
Speaker Change: All major work streams are nearing completion, and we remain on budget and on schedule for first production in the second half of this year.
Speaker Change: Construction is above 91% depletion with configuration of the plant control system at 92% for operational readiness is at 93%.
Speaker Change: Our expiration test work is ongoing and our intent is to work towards defining a resource. For the new Surface, gold Zone occurrences, we will provide additional updates as appropriate.
Speaker Change: The remaining construction work is related to non process infrastructure and reading the select for ongoing operations.
Speaker Change: Sometimes his current mind plan, guidance and mineral resource and Reserve estimates, do not include this new gold Zone occurrence, expiration opportunity.
Speaker Change: Over to the consanti S3 Expansion Project.
Speaker Change: Oil employment requirements have been successfully field and the transition from a readiness team to the opposite.
Speaker Change: <unk> has begun.
Speaker Change: Operators and maintenance personnel have commenced controlled plant runs.
Speaker Change: During the quarter first, all was fed from the primary Crusher, through to the crust, or stock, pole ahead of schedule in the second quarter. And we are now in the final stages of commissioning,
Speaker Change: We look forward to hosting the prisoner Zambian August will be inaugurating the constancia three expansion.
Speaker Change: in the last few days all was fed through the SAG Mill, the rougher flotation circuit and through to the tailing sticker.
Speaker Change: Yeah.
Speaker Change: Also during the second quarter Sentinel, beginning to license of an innovative low LNG consumption biotechnology utilizing wildcard in replacement of traditional arduous.
Speaker Change: First order to the Sagal marks an important milestone in the commissioning process for S3 as it establishes. Full loads on the install plant and equipment. And to date, the commissioning performance is according to plan.
Speaker Change: The $1 six meter wide <unk> system since noble transport or three kilometers from the new crusher to reposition to the Pip topping and is expected to be completed in late 2025, when the crusher itself has relocated.
Speaker Change: All major work streams are nearing completion and we remain on budget and on schedule for first production in the second half of this year.
Speaker Change: Construction is above 91% completion with configuration of the plant control system. At 92% while operational Readiness is at 93%.
Speaker Change: Due to low attention and lower friction in the system. The <unk> is expected to draw potentially 50% to 70% less power than traditional combined.
Speaker Change: The remaining construction, work is related to non-processed infrastructure and reading the site for ongoing operations.
Speaker Change: In addition, maintenance of the railcar and index at one location with cockpit parts can be sequentially maintained as opposed to maintaining idlers along the full length of a traditional combined system.
Speaker Change: All employment requirements have been successfully filled and the transition from a Readiness team to the operational team has begun.
Speaker Change: Operators and maintenance Personnel. Have commenced controlled plant runs.
Speaker Change: The low energy rival run conveyor system installation that central represents yet another first mover innovation by first quantum and provides potential for substantial capital and operating efficiencies in our future projects.
Speaker Change: We look forward to hosting the president of Zambian August when he inaugurates the consensus 3 expansion.
Speaker Change: Has the consents yesterday expansion. These completion this will mark the first quantum's not made yourself through project in the last two decades, which has allowed the company to grow from 40000 tons of copper production in 2000 and fall into one of the leading global corporate produces batteries today.
Speaker Change: Also, during the second quarter, Sentinel began installation of an Innovative low energy consumption, conveyor technology, utilizing rail, carts, in replacing of traditional idlers.
Speaker Change: Since 2003 first quantum has successfully delivered over $50 billion in capital projects and achievement Bill from consistency innovation and an entrepreneurial culture.
The 1.6 M wide railroad conveyor system at sense nor will transport all 3 km from the new crush at 2 B position to the pit stop bin and is expected to be completed in late 2025, when the crusher itself is relocated due to lower attention and lower friction in the system, the railroad run conveyor is expected to draw potentially 50 to 70% less power than traditional conveying.
Speaker Change: Rebuild projects across many different continents, and each project has been alluding to.
Speaker Change: <unk>.
Speaker Change: Our in house expertise and transfer it from one project to the next ensuring that every lesson learned strengthens the next building.
Speaker Change: In addition maintenance of the rail carts is indexed at 1 location. Where car carts can be sequentially maintained as opposed to maintaining idlers along the full length of a traditional conveying system.
Speaker Change: Our execution approach refined over the years is now a unique advantage and distinguishes our company from our peers.
Speaker Change: The second half of 2025 promises to be a busy but exciting time for the company Zambia, we will be advancing exploration work on the newly identified new surface gold during the currency consenting for simultaneous simultaneously ramping up activities on the Yesterdays expansion project.
Speaker Change: The low energy rail run conveyor system installation at Sentinel represents yet another first mover Innovation by first Quantum and provides potential for a substantial capital on operating efficiencies in our future projects.
Speaker Change: We look forward to showing showcasing both of these projects and the innovative <unk> Sentinel during upcoming thoughts of analysts investors in September.
Speaker Change: As the consent yesterday, expansion used completion, this will Mark the first quantum's. Ninth major self-built projects in the last 2 decades, which is allowed the company to grow from 40,000 tons of copper production and 2004 into 1 of the leading Global copper producers that it is today.
Speaker Change: Thank you operator, I'm happy to open the call for Q&A.
Speaker Change: Thank you we will now begin the question and answer session. If you would like to ask a question. Please press star one on your telephone keypad, if you wish.
Speaker Change: Since 2003, first Quantum is successfully delivered over 13 billion dollars in capital projects and consistency Innovation and an entrepreneurial culture.
We have built projects across many different continents, and each project has been a learning opportunity.
Speaker Change: To withdraw your question simply press Star one again.
Speaker Change: We ask that you please limit yourself to one question and one follow up.
Speaker Change: Sure Youre not on speakerphone and that your phone is not on mute when called upon thank you.
Speaker Change: Our in-house expertise has been transferred from 1 Project to the next ensuring that every lesson learned strengthens the next build. Our execution approach refined over the years is, now a unique advantage and distinguishes, our company from our peers.
Speaker Change: Your first question comes from Rs Wildcatter of Scotiabank. Your line is open.
Rs Wildcatter: Hi, Good morning, I was wondering if you could please give us an update on the situation in Panama and I'm, just wondering specifically weather.
Speaker Change: You can comment on whether negotiations have begun with the government.
Speaker Change: The second half of 2025 Pro promises to be a busy but exciting time for the company in Zambia. We will be advancing exploration work on the newly identified near surface gold Zone occurrences at constanti while simultane simultaneously ramping up activities on the Esther Expansion Project.
Speaker Change: He started agreement or if they have not yet begun just when we could anticipate them to be done.
Speaker Change: We look forward to showing showcasing both of these projects and the Innovative railroad conveyor Sentinel during our upcoming site tool for analysts investors in September.
Speaker Change: Hi, Thanks.
Speaker Change: Thanks for the question Yeah look I think we saw great progress in the quarter in terms of now.
Speaker Change: Thank you, operator. I'm happy to open the call for Q&A.
Speaker Change: The approval of the preservation and Safe management plan, which provides the construct around ongoing proper environmental stewardship of the asset and maintaining asset integrity, but then also for the export of copper concentrate and the restart of the power plants. So we see that as an important first step.
Speaker Change: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad, if you would like to withdraw your questions simply press star 1. Again, we ask that you please limit yourself to 1 question and 1 follow up.
Speaker Change: Please ensure you are not on speakerphone and that your phone is not on mute when called upon thank you.
Speaker Change: But we're going step by step we continue to work on public perception.
Speaker Change: Certainly the Pms and plan was well received publicly.
Unknown Moderator: Your first question comes from Aurora of Scotia Bank, your line is open.
Speaker Change: And it's important to continue to build on that momentum.
Speaker Change: We will follow the government's guidance in respect of negotiations.
Speaker Change: Towards resolution and resolving.
Speaker Change: The long term issues that the mine, but we as I said, we will be working through that step by step.
Aurora: Hi, good morning. Um, I was wondering if you could, please give us an update on the situation in Panama, and I'm just wondering specifically whether, um, you can comment on whether negotiations have begun with the government on a restart agreement, or if they have not, yet begun, just when we could anticipate them to be done.
Speaker Change: Okay as a follow up.
Speaker Change: As part of the environmental Preservation plan, it's great that you can ship that concentrate.
Speaker Change: I'm wondering if you could comment on the ore stockpiles on site.
Speaker Change: Specifically on whether you think those.
Speaker Change: Are going to be processed at the mill trade.
Speaker Change: I'm curious on what the contained copper is in those ore stockpiles.
Speaker Change: Yes sure.
Speaker Change: Yes look the preservation and safe mentioned pen approval as you said allows for the export of the concentrate and operation of the power plants and the ongoing maintenance activities and environmental stewardship of the select.
Speaker Change: It doesn't at this stage.
Speaker Change: Okay.
Speaker Change: <unk> approval for the stockpile processing that needs to be agreed with the government of Panama, but we do think it's an important step because it provide feed that is necessary for the <unk> plant on the tiny Stan and so it is an important addition that we can keep up with erosion in selling on the timing Sam.
Aurora: Uh, the approval of the preservation and safe management plan, which provides the construct around. Ongoing proper environmental stewardship of the asset and, and maintaining asset Integrity. But then also for the export of the copper concentrate and the restart of the power plants. So we see that as an important First Step, um, but we're going to step by step, we continue to work on public perception. Um, certainly the the pns and plan was well received publicly, um, and it's important to continue to build on that momentum. Um we will follow the government's guidance in respect of negotiations or uh towards resolution and resolving. Um the the long-term issues there at the mine. Um but we as I said we'll be working through that um step by step.
Aurora: Okay, as a follow-up um as part of the environmental preservation plan. Um it's great that you can ship the concentrate.
Speaker Change: Otherwise.
Speaker Change: As I say that means the government approval in terms of the copper content there.
Speaker Change: The numbers around 40 million tons at about <unk>, 5% copper is what we believe is in Stockholm.
Speaker Change: I'm wondering if you can comment on the orto piles on site. Um specifically on whether you think those uh are going to be processed VIA mail trade and and I'm curious on what the contained copper is in those or stock piles.
Speaker Change: Yeah.
Speaker Change: The next question comes from Matthew Murphy with BMO capital markets. Your line is open.
Speaker Change: Hi.
Speaker Change: You are asking about physical or opportunity Yadkin Sanjay.
Speaker Change: I think in the past, it's been a little tough to understand how much gold does that constancia and it tends to.
Speaker Change: To give more than what you think is there. So like how are you thinking about this target do you have a exploration goal in terms of number of ounces you want to get to in a timeline do you Wanna get there off.
Speaker Change: Okay.
Beth: Hi, Beth.
Speaker Change: The first thing to say this is very separate from the.
Speaker Change: Yeah, sure. Um, yeah. Look the preservation safe management plan approval. As you said, um, allows for the export of the concentrate and operation of the power plants and the ongoing maintenance activities and environmental stewardship of the site. Um, it doesn't at this stage, uh, uh, include approval for the stockpile processing. That needs to be agreed with the government of Panama, but we do think it's an important step because it provides feeds that is necessary through the Cyclone plant uh on the tailings dam. And so is an important uh, addition that we can keep up with erosion. And so on, on the timing stamp, um,
Speaker Change: The gold resource. That's included for example in the 43 101, our reserves and resources statement. So this is very different.
Speaker Change: Surface and as we said kind of that as we were going through the pre strip at South East starting.
Speaker Change: Uh otherwise as I said, it needs the government approval in terms of the copper content there. Um, the the numbers around 14 million tons at about 0.25% copper is is what we believe is in the stock golf.
Speaker Change: Thoughts about that opportunity, but it is still early days and it's important to sites very much an exploration opportunity.
Matthew Murphy: The next question comes from Matthew Murphy with BML Capital markets. Your line is open.
Speaker Change: As I said the key elements of the ramp of the nugget effect the east distributed.
Matthew Murphy: Hi. Um, I'd like to uh, ask about this gold opportunity at cannae. Um,
Speaker Change: Falling gold and that boils down to the deposition mode that we believe has occurred.
Speaker Change: I could see a primary care physician, which relates to.
Speaker Change: As we see them consenting big vein structures and as those have arrived at the way we've seen that primary deposit available, but then some secondary disposition as that moves and being transported so voice.
Matthew Murphy: I think in the past it's been a little tough to understand how much gold does that can sanchi and it tends to, uh, to give more than what you think is there. So like how are you thinking about, um, this target, do you have a exploration goal in terms of number of answers? You want to get to and a timeline you want to get there on?
Speaker Change: Deposition happened, yet and that's very separate from what is in the in situ.
Speaker Change: Resource area, so, but because of the nugget effect of what we see is we need to work through that steadily we need to take large bulk samples to come through we're reliable.
Speaker Change: Statistical definition of the resource requirements as such it's difficult to.
Speaker Change: To put a timetable alright.
Speaker Change: Sure.
Speaker Change: Towards building that resorts that we would hope that we can get it in place next year subject to that statistic statistical work around the new location.
Speaker Change: But it would be very exciting it does have a strike length of some seven and a half kilometers.
Speaker Change: Yeah. Hi been. Um, so the first thing to say, this is very separate from the, um, the gold resources included, for example, in the 4311, our visitors and resources statements. So this is very different. Um, it's new Surface. And as we said, uh, came about as we were going through the, the pre-trip at Southeast Dome. Um, we're excited about that opportunity, but it is still early days and it's important to say it's very much an expiration opportunity. Um, as I said, the key elements is around the the Nugget effect. There is distributed uh fine gold and that boils down to the deposition mode that we believe has, uh, occurred here a primary deposition, which relates to
Speaker Change: But we're still learning about geology, and we're still in the process.
Speaker Change: Okay understood.
Speaker Change: And so when you think about options like gold Prepays on streams shall we think about that as being a constraint to the constancia open pit operations.
Speaker Change: Because this would be sort of two long dated to monetize or could it all be part of the same thing.
Speaker Change: You know, as we see in consanti the big vein, the structures, and then as those have eroded away, we've seen that primary deposit available, but then some secondary death position as that, uh, moved and been transported. So, both, uh, acts of deposition Happening Here. Uh, and that's very separate from what is in the in situ, uh, resource, uh, earlier. So, but look because of the Nugget effect. Uh, what we see is we we need to work through that status.
Speaker Change: Yeah, I think it provides further upside, but Ron you might just comment on streams and how we think about that sort of thing from titanfall.
Speaker Change: Yeah, sure Hi, Matt I mean, what changed really in the last year is we've already seen seen record high gold prices that means the gold prepay market is strong I mean, it's obviously, an active market and streams and what that does for US is give us a variety of options from a finance and balance sheet perspective. In addition to <unk>.
Speaker Change: One of those that we've previously talked about such as the minority stake sale has always focus on the existing goal that's in the resource separate to this new gold.
Speaker Change: We need to take large bulk samples to come to a reliable stat statistical definition of the resource, that's the requirements as such. It's it's difficult, um, to put a timetable or a, um, uh, towards, you know, that building that resource, but we would hope that we can get it in place next year, subject to, you know, that statistic statistical work around the minimization it, but it it's very exciting. It's over a strike length of some 7 and a half kilometers. Um, and but we still learning about geology, uh, and we're still learning about the process.
Speaker Change: Discovery, but obviously any incremental go just adds to the further financial robustness of Constancia, which means any option you look at it is overall more attractive.
Speaker Change: Okay.
Anita Soni: The next question comes from Anita Soni with CIBC World Michael Your line is open.
Speaker Change: Okay, understood and so, when you think about options like gold prepays and streams, um, should we think about that as being uh, constrained to the, like consanti open pit operations? Um, because this would be sort of too long dated to monetize. Or could it all be part of the same thing?
Anita Soni: Hi, good morning, Jason and team and I'm going to follow up on <unk> question about <unk> could you just remind us of I guess remind me of the timelines.
Ryan Megill: Provides further upside. But Ryan you might just comment on on on streams and how we we think about uh, that side of things, pretty pathing song.
Anita Soni: In terms of like the next steps that are getting close to a startup so you've got a duty get the government to negotiate them.
Anita Soni: Are there any other things and then it's got a pass through Parliament can you give us sort of a you know the steps again and to get the the restart happening.
Anita Soni: Okay.
Anita Soni: Hi, Anita yes sure.
Anita Soni: Look those timelines are uncertain.
Speaker Change: We can point to as the President's public statements and we'd be encouraged alongside the political side is also on the public perception in terms of the platform to engage around resolution in Panama.
Ryan Megill: Yeah, sure. Hi, Matt. I mean, what changed really in the last year is we've obviously seen record high gold prices. That means the gold prepare Market is strong. It means there's obviously an active market and streams. And what that does for us is give us, you know, a variety of options from the financial and balance sheet perspective. In addition to some of those that we've previously talked about such as the minority stake sale. You know, those focus on the existing goal that's in the resource separate to this new gold, um, Discovery. But obviously, any incremental goal just adds to the further Financial robustness of cannae. Which means any option you look at is is, is overall more attractive.
Speaker Change: The next question.
Speaker Change: The president of the public statements.
Speaker Change: That he would like to see dilution this year before the end of the year.
Speaker Change: Is open.
Speaker Change: And that the.
Speaker Change: The table is open now for dialogue subsequent to the suspension of price and most recently the suspension boyfriend and Nevada.
Speaker Change: But in terms of that conversation, we white from pro formal feedback from government.
Speaker Change: And it's important that we go through that step in.
Speaker Change: In the meantime, as I said payments and plan. This is an important first step in terms of the milestones through that to your question.
Speaker Change: Hi, good morning. Uh, Tristan and uh Team. Um I'm going to follow up with on orus question about Cobra. Uh, could you just remind us of? Um, I guess remind me of the timelines. Um in terms of like the next steps that uh getting Incorporated started. So you've got to do the get the government to negotiate. Um, are there any other things, uh, you know, then it's got to pass through Parliament? Can you give us sort of a you know the the steps again and to get the the restart happening.
Speaker Change: I think we just need to wait and see we're not putting any constraints around that.
Speaker Change: We would like to see for example.
Speaker Change: The stockpiles because of the impact they have in terms of being able to insurance.
Speaker Change: Ensure environmental stewardship on timing, but as I said, we'll move through those milestone step by step.
Speaker Change: Hum.
Speaker Change: More broadly.
Speaker Change: On the public perception side, what we see.
Speaker Change: The economic situation in Panama had effect alongside the work we've been doing in terms of.
Speaker Change: Craig and engagements in listening to Panama about.
Speaker Change: The perceptions around the mine, but certainly we've seen.
Speaker Change: Focus on the economy or focus on jobs and employment.
Speaker Change: Importance of where the Mohan can add to panama's future growth.
Speaker Change: And we've seen the polling 70% of respondents believe that the closure of the mine has had a negative impact on those areas of the economy and jobs. So the mine has an opportunity to grow employment to strengthen the economy.
Anita: Hi, Anita. Yeah, sure. We look those timelines are uncertain. Uh, we can point to is the president's public statements and, you know, we've been encouraged. Alongside the political side is also on the public perception in terms of the platform to engage, uh, around resolution in Panama on, you know, the the president's public statements are that he would like to see, uh, Revolution this year, um, before, uh, the end of the year. Uh, and that, um, the table, uh, is open now for dialogue, uh, subsequent to the suspension of most recently, the suspension by Franklin Nevada. Um, but in terms of that conversation, we wait from for formal feedback from government. Uh, and it's important that we go through that step by step in the meantime, as I said, the payment plan is is an important first step in terms of the Milestones through that to your question. Um, I think we'll just need to wait and see. We're not putting any constraints around that um, you know.
Speaker Change: And I think that's the more poorly understood, but the outreach needs to continue.
Speaker Change: And we wait to see what the milestones and the engagement process with government.
Speaker Change: Okay and my follow up the two parts. If I may 1st is C and I'll tell you what they are but the first is that where does the environmental audit fit into that do you need to environmental audits done completed signed off before you can negotiate with the government and secondly, once you get a sign off just I was just wanted to confirm its six to nine months before I sign off.
Anita: We would like to see, for example, the the, the stock files because of the impact, they have, uh, in terms of being able to uh, ensure environmental stewardship on, on the tailing stand. But, as I said, we, we'll move through those Milestones step by step. Um, you know, more broadly, uh, on the public perception side. What we do see is, um, you know, the, the economic situation in Panama has had affect alongside the work we've been doing in terms of uh,
Speaker Change: Through Parliament six to nine months before you could restart operations is that correct.
Speaker Change: Okay.
Speaker Change: Sure. It makes it so yes, the environmental audits.
Speaker Change: The.
Speaker Change: Public review process was over the terms of reference are being finalized as we understand the current work.
Speaker Change: With government and as far as I understand it on the mechanics of how that work.
Speaker Change: Pete.
Anita: Creating engagement and and listening to Panama about, um, the perceptions around the mind. But certainly, you know, we've seen uh, a focus on the economy, a focus on jobs and employment, uh, importance of of, where the mind can add to Panama's, uh, future growth. Uh, and you know, we see in the polling, 70% of respondents believe that the closure of the mind has had a negative impact on those areas of the economy and jobs. So, you know, the mind is an opportunity to to grow employment to strengthen the economy. Um, and I think that's
Speaker Change: It requires coordination between multiple ministries.
Speaker Change: Sitting with the Ministry of environment.
Speaker Change: The key stakeholder there just waiting for formal notification, but we had nice feedback on exact timing or schedule. It can our understanding is it could run in parallel.
Anita: Be more, broadly understood. But the Outreach needs to continue. Uh and we'll wait to see what the Milestones uh and the engagement process with government is
Speaker Change: But we like to see that clarity in terms of.
Speaker Change: You've been following along.
Speaker Change: From any negotiate or arrangements will conversation subject.
Speaker Change: The government and the people of Panama.
Speaker Change: <unk> been comfortable with that.
Speaker Change: As we say to startup with tight yeah, we think sort of six to nine months, that's really around understanding the condition of the asset we've been taking good care of might be critical elements. For example in the middle of the rope shovel.
Speaker Change: Electric drills, and so on a big mining equipment, but it's a difficult environment and Sydney. These big degradation, We did commission.
Speaker Change: And in order to enter the corrosion and not really related to.
Speaker Change: So the rate that it was more preemptive.
Speaker Change: Just understand exactly where we are active product preservation.
Speaker Change: And we just need to understand we think most of that will be some small pumps and small ball parking.
Speaker Change: And hence.
Speaker Change: But.
Speaker Change: There will be some degradation at the power plant, we're working through that on a more immediate basis and as I said, we'd like to see start up at the power plant in October.
Ralph <unk>: The next question comes from Ralph <unk> with Stifel. Your line is open.
Ralph <unk>: Thanks, operator.
Speaker Change: Our interest and at this point is the pilot plant gravity only plant is there the opportunity to introduce flotation and leach to deal with some of the green and nugget effect and I'm wondering if there was any notable changes to gold recoveries are residents time, when you're when you introduce some of these new gold occurrences into the existing processing circuit.
Ralph <unk>: Okay.
Speaker Change: Hi, Ralph Yeah look all of that with sorting through at the moment I think what we were excited about the exploration opportunity as part of that exploration analysis.
Speaker Change: So we've invested capital into the exploration that is in terms of sampling, it's not big PQ drilling or diamond core drilling. This is around August and bulk sampling because its new surface, but it is.
Speaker Change: Not on surface at steep.
Speaker Change: New surface and you guys part of that exploration analysis work is gone out to the independent laboratory Offsite and onsite. We've also had being able to deploy pilot plants.
Speaker Change: And really in that pilot plant, we are able to move things around change. These deploy seek design in order to understand the best way to.
Speaker Change: Firstly to sample and they've really that's the focus at the moment to understand.
Speaker Change: Awards, the resource statement around understanding of grade and so on along with the seven and a half kilometers strike zone, but then yes, we put it into the existing plant we don't see it currently as part of <unk>.
Speaker Change: Additional gold in.
Speaker Change: For example in that 'twenty diffuse guidance, we don't see that impacting now but this is much more about understanding the opportunity as soon as we have more available and towards the resorts segment will be able to provide that update.
Speaker Change: Okay, Okay, great great and if I can switch to a quick question for Ryan.
Speaker Change: How much of an offset can we expect to the increase in the PNM costs that comes from selling power into the grid.
Speaker Change: Brian.
Speaker Change: Sure.
Speaker Change: So Ralph the opportunity with running the power plant is very much about providing power to Panama more broadly, it's an opportunity to make sure. The client is where it can give ourselves time to make sure. The plant is working appropriately it doesn't provide significant financial benefits. What we've seen is the par price in Panama has fallen through the course of this year is that.
Speaker Change: As a running strongly which is generating good hydro part I think current prices around $50 per megawatt hour.
Speaker Change: Goodbye.
Speaker Change: Current expectation is running it will be broadly breakeven, but it certainly is a benefit to Panama and it also said he is a benefit to the main maintenance of the power station.
Speaker Change: Okay.
Speaker Change: The next question comes from Dalton Barreto with Canaccord Genuity. Your line is open.
Speaker Change: Hey, Thanks, operator, good morning question I Trust with that team.
Speaker Change: I wanted to ask a question on the audit process, Panama you mentioned the 11th the audit that's almost done now or is that are you waiting for the report will these audits count towards the official sharp environmental audits that the government wants to see.
Speaker Change: Okay.
Dalton Barreto: Hi, Dalton yeah.
Dalton Barreto: Those orders the 10th ordered.
Dalton Barreto: And then now that you live in Florida that was enjoying are just the regular order.
Dalton Barreto: That was part and parcel of the east <unk> commitment to Cobre, Panama and <unk>.
Dalton Barreto: Those are done by the regulator with the local.
Dalton Barreto: Consultants environmental control them, but also with input from national expert consultants.
Dalton Barreto: The as to how those relate to.
Dalton Barreto: To the broader environment to order that was.
Dalton Barreto: And that's by governments as part of understanding the current status quo at the mine as a as a baseline for understanding.
Dalton Barreto: We get to have a form of feedback on that in terms of the terms of reference.
Dalton Barreto: Or so how that overall environment.
Dalton Barreto: So that's information we wait to hear back from governmental.
Dalton Barreto: Okay, great. Thanks for that and then just maybe switching gears to talk a talk up we're less than a year away from that what he gave deadline now.
Dalton Barreto: And I assume you're going to submit the.
Dalton Barreto: The project for <unk> approval, if it does get approval does that sort of automatically assume a final investment decision I understand that you're going to go forward and can you just remind us what the quantum of spend will be up the first couple of years post approval.
Dalton Barreto: Sure.
Dalton Barreto: Yeah, we like Tech attacker, it's a great project in terms of the opportunity there to produce some averaging 250000 tonnes of copper a year for the first 10 years, and then potentially up to beyond 32 years of mine life.
Dalton Barreto: Yes, Rudy is due in the first.
Dalton Barreto: Hum.
Dalton Barreto: First base.
Dalton Barreto: But to the July next year the reason.
Dalton Barreto: Tangible that it might be extended but we certainly working on the basis that review would be to next year in July.
Dalton Barreto: Really three key elements to our.
Speaker Change: Our approach to attack attack number one the rig application secondly towards securing the environmental and water permits.
Speaker Change: Approvals and those all have been well underway.
Speaker Change: And we see momentum on those areas and then thirdly wishes.
Speaker Change: Which is to your question around financing for that that is the approach that we will go through.
Speaker Change: I think we'd be able to provide further updates as we go through this we don't see it as the.
Speaker Change: Something that we.
Speaker Change: We're sitting here to say, we will definitely make a.
Speaker Change: Our investment or sanction decision in July of next year, but I think we want to get the project is far advanced so that we're able to make that decision and have a basis a solid basis in engineering design.
Speaker Change: Understanding the early pre strip, which is a key component of the project the electrical infrastructure that needs to plug in all of those elements.
Speaker Change: Have those already for that timetable.
Speaker Change: In terms of funding.
Speaker Change: We look we will go through a process of updating the previous 43 101, the number in that in that 43, one along with $73 6 billion or thereabouts.
Speaker Change: And then the spend over the first two years, but will mainly be on commencing the pre strip.
Speaker Change: Go to take these ran through use of that pre strip and the FERC would definitely be mainly pre strip and then we would see.
Speaker Change: The plan would be to start.
Speaker Change: Construction of the process plant in the second year, but I think that's the level of detail.
Speaker Change: Really the first step is to build everything towards.
Speaker Change: Investment ready decision, but we're not standing he decided we will be making that decision in July next year.
Yannis: The next question comes from Yannis.
Speaker Change: With Morgan Stanley Your line is open.
Speaker Change: Yes, thanks very much for the presentation. A first question from my side regarding the environmental altogether Cobre, Panama can you comment if there are any changes to the scope of the old data and what's really the stumbling block here because I guess you have the public consultation process concluding bucket.
Speaker Change: January were here six months later in the post hasn't started how did you go to any feedback from the government on what's.
Speaker Change: Driving the delay in do you have any visibility on where when Facebook starts moving thank you.
Speaker Change: Hi, and thanks for that.
Speaker Change: Yeah, so the environmental audits.
Speaker Change: As I said.
Speaker Change: Yes. The terms of reference are currently being finalized as far as I understand it it's really around mechanics thoughts.
Speaker Change: The government on the industry environment, the public consultation period was closed.
Speaker Change: We like to hear the feedback on that.
Speaker Change: Aware of any specific impediments.
Speaker Change: Wait to hear back from government.
Speaker Change: We do see that solid progress has been made and we measure that in terms of outcomes on the ground and the preservation and safe management plan approval. During the quarter was an important milestone in terms of providing a construct.
Speaker Change: Legal construct for the continuing environmental stewardship and asset integrity work at the mine, but also to ship out the concentrate as I said, we've already shipped.
Speaker Change: Three vessels in the fourth vessel loading as we speak I think that's very solid progress we.
Speaker Change: We would like to see continued progress.
Speaker Change: But we like to hear back from the government of Panama in regards to environment order 10 feet and the other elements.
Speaker Change: Towards long term resolution of this issue.
Speaker Change: Okay.
Speaker Change: That's very clear thank you for that and the follow up is on a clarification on the startup time is up you mentioned I will be around six to nine months after you get.
Speaker Change: Restart agreement in place does it assume getting to a 100% of our throughput.
Speaker Change: Throughput capacity and if not what would be the additional time to get there.
Speaker Change: Thanks.
Speaker Change: No I don't think we'll get to 100% at 100 million tons from six to nine months look we we would also need to go through.
Speaker Change: Very important to say, we've taking the step by step and we await government feedback for example, the president's messages at the table with now open for dialogue.
Speaker Change: But we're working through that step by step.
Speaker Change: Looking forward, if we were to get into a startup mode.
Speaker Change: What comes is.
Speaker Change: You need to conduct in our view a lot of inspection work to really get to grips and understand.
Speaker Change: The situation there.
Speaker Change: Related to the asset yes, we've been maintaining a large critical infrastructure very well I was on site just a few weeks ago and we walk down for example to convey as full reloading of the.
Speaker Change: The shifts and that was in very good condition and the main mill.
Speaker Change:
Speaker Change: Wrote Shoveled electric drills, one fleet, one very good condition, but there are elements where.
Speaker Change: Some work needs to be done that will go through that in an inspection regime and that will ultimately tell us.
Speaker Change: The timeframe for restart and ramp up.
Speaker Change: Ultimately, we would hope that sort of six to nine months in duration, but then the optimization to get to a 100% throughput will take longer.
Speaker Change: An incremental effort you need every system every person on saw it all running.
Speaker Change: <unk> team and our findings machine in order to get to that optimize output and that will take longer.
Matthew Murphy: The next question comes from Matthew <unk> with Goldman Sachs. Your line is open.
Speaker Change: Hey, good morning through someone theme, there's obviously a lot of expectations for I tried it until the second half of the year. We understand there was a lot of my tenants don't times and they should switch the ball mill fatigue as well can you just talk a little bit about the work that has been done so far and your confidence for getting to the targets for the full year.
Matthew Murphy: Into the second half with <unk>.
Matthew Murphy: Sure.
Speaker Change: Hi, Mark Yeah, Yeah. Thanks for the question Ravi do you want to take that one.
Speaker Change: Thanks.
Speaker Change: Hello.
Speaker Change: D J.
Speaker Change: During the last quarter, we finalized phase of intervention.
Speaker Change: Foldable mall.
Speaker Change: Putting back primarily.
Speaker Change: He just got personal.
Speaker Change: Those major submission cycle, so we will.
Speaker Change: The trying to go more down in quarter, one next year amazingly denying that has two line.
Speaker Change: The downtime that you see for <unk> to be done into the mall.
Speaker Change: With a total.
Speaker Change: Planned total long shot.
Speaker Change: And also with the upgrade to the signing of <unk> disease.
Speaker Change: <unk> earlier.
Speaker Change: Yeah, that's it.
Speaker Change: Each to be upgraded in order to.
Speaker Change: Accommodate the additional tonnage.
Speaker Change: That same kind of is producing.
Speaker Change: Quarter over quarter increased throughput and they're getting very close to the 62 million tonnes per annum seafood price much.
Speaker Change: Much higher than the original design.
Speaker Change: So it will just take advantage in Q1 next year with the upgrades on the sightings, it's less to do them all at the same time and therefore, the use any sort of production impact.
Speaker Change: We possibly.
Speaker Change: At that time.
Speaker Change: That obviously means that we can mine any maintenance on the Moe. This second half of the year or don't expect any real impact on the guidance that you've already provided.
Speaker Change: Okay, that's great and maybe a follow up to Ryan Ryan probably.
Speaker Change: Lastly, the prepayments in the second half and the second quarter, Martha Goldberg with my finger corporates has been worked quite well anything else sort of doing the bullshit move into into next year results needed to come from Cobre, Panama restarting.
Speaker Change: Yeah, Hi.
Speaker Change: Yeah go ahead Ron.
Speaker Change: Hi, Anna.
Speaker Change: So the short answer is there's nothing else, we have to date and we've put ourselves in a position because of the strong initiatives around hedging around the prepays around access to the bond market. It isn't it yeah.
Speaker Change: Nothing we need to do through the balance of the year, but that's not to say, we're sitting idle in a way working hard to make sure. We assess what the different options are ahead of US we've mentioned additional gold prepays at maintenance streams. You know, we've historically talked about minority stake sales and the golf glasses to advance all of those to a point at which we have optionality when you have that.
Speaker Change: Optionality, it's ready by putting each of them side by side and say what makes the most financial sense. What makes the most strategic sense and we'll continue to do that through the balance of this year and if any of them gets to the point, where we think they really helped us in our balance sheet forward, we'll execute on those but certainly we're not in a position where we have to do any of them through through 2025.
Speaker Change: Okay.
Speaker Change: The next question comes from Chris less seminar with Jefferies. Your line is open thank.
Speaker Change: Thank you Hi, Tristan Ryan and team. Thanks for taking my questions. So I wanted to ask about kind of scenarios for for Panama.
Speaker Change: In the downside scenario, where you can come to an agreement with the government and potentially would renew.
Speaker Change: The arbitration proceedings, how would that work and where the arbitration timeline and go back to the beginning and does it kind of pushback I get when would you when would the hearings take place will just be a multi year process before you would be able to make progress, but obviously, it's not your goal.
Speaker Change: Coal to go down that path again, but if that were the case, how would that would that process proceeding.
Speaker Change: Okay.
Speaker Change: Yeah, Hi, Chris.
Speaker Change: Thanks for that question, Yeah look it's important to say arbitration is not our preferred outcome here, we want to be constructive and we want to see resolution on this matter how do we think it's very important for the country of Panama and.
Speaker Change: Our employees and local suppliers in country and for the.
Speaker Change: The border kind of mining population and I think that that's well understood within the country at least that's what we're seeing in terms of Poland.
Speaker Change: But look all L. L. A rought remain protected in the long term in terms of the suspension. The arbitration is just the suspension.
Speaker Change: And that we would have resort back to the FTAA process and we would just follow that process.
Speaker Change: Okay. So what if things are just pick up where they left off basically.
Speaker Change: Yeah, It would just.
Speaker Change: Suspended and then it would just be honest has ended and we pick up that okay, and then in the scenario where.
Speaker Change: Comes back online in Middle of next year, Let's say as an example.
Speaker Change: With the balance sheet, you've been playing defense very effectively in terms of maintaining or reducing net debt.
Speaker Change: But you know when demand comes back online. Obviously, you can start playing offense again and you obviously have a pretty substantial organic growth pipeline. There's only so much you can do to accelerate that but how would you manage the balance sheet in the event that cobre Panama is back online is it about continuing to delever or do you start to look for opportunities in the market that you start to potentially buy back stock at the current <unk>.
Speaker Change: How would the financial kind of capital allocation strategy change after the when it comes online. Thank you.
Speaker Change: Sure Chris Ryan do you want to take that question.
Ryan McWilliams: Hi, Chris we really move back to where we were before cobre, Panama slows down and that was we said our principal goal will be around deleveraging. So we're at three three times net debt to EBITDA at the moment and what we said we Wanna be before building. The next project is there a price at two one times net debt to EBITDA. So we have made progress clearly.
Anita: With the balance sheet, you've been playing defense very effectively in terms of maintaining or reducing net debt.
Ryan McWilliams: And we started cobre, Panama would result in significant further progress nurturing systems caution that we've got to take it one step at a time.
Anita: But when the mine comes back online obviously, you can start playing offense again, and obviously have a pretty substantial organic growth pipeline. There's only so much you can do to accelerate that but how would you manage the balance sheet in the event that cobre Panama is back online is it about continuing to delever or do you start to look for opportunities in the market do you start to potentially buy back stock at the current price.
Ryan McWilliams: But if we find ourselves in that position the goal is not to get carried away.
Ryan McWilliams: Do what we said, we would do which is focus on deleveraging reducing debt.
Ryan McWilliams: Clearly the best way to reduce debt as from strong operational cash flows and the inflection point at Constancia with Ace <unk> three coming online presents already strong opportunity there and if we do make progress in Panama that would be another potential real tailwind in that respect.
Anita: How would the financial kind of capital allocation strategy change after the wind comes online. Thank you.
Speaker Change: Sure Chris Ryan do you want to take that question.
Ryan Megill: Hi, Chris will really move back to where we were before cobre, Panama closed down and that was we said our principal goal will be around deleveraging. So we're at three three times net debt to EBITDA at the moment and what we said we want to be before building. The next project is closer to one times net debt to EBITDA. So we have made progress.
Ryan McWilliams: Yeah.
Speaker Change: The next question comes from Myles Allsop with UBS. Your line is open.
Myles Allsop: Great Hey, guys. Just a couple of quick questions, maybe one for Brian on the hedging should we assume that it's done now unless there is a delay to the ramp up of the best three year poorly.
Ryan Megill: Clearly and restart of Cobre, Panama would result in significant further progress, noting <unk> caution that we got to take it one step at a time.
Speaker Change: 50% hedged, whether you look at copper or gold out to mid 2026.
Ryan Megill: But if we find ourselves in that position the goal is not to get carried away.
Myles Allsop: Okay.
Speaker Change: Thanks, Mark do you want to have that wrong.
Myles Allsop: Oh, Hi mouse.
Ryan Megill: Do what we said, we would do which is focus on deleveraging reducing debt and clearly the best way to reduce debt as from strong operational cash flow is in the inflection point at Constancia with <unk> three coming online presents already strong opportunity there and if we do make progress in Panama that would be another potential.
Speaker Change: Pleased with the hedge book, we have in place both in terms of the volumes, noting close to 60% copper this year dropping down to 40% next year similar fold both of those hedges are being put in it at good prices.
Speaker Change: We will evaluate as we go quarter to quarter. So as we sit here today, we're not putting in additional hedges beyond H, one next year, but that decision whether or not you.
Ryan Megill: Tailwind in that respect.
Speaker Change: The next question comes from Myles Allsop with UBS. Your line is open.
Speaker Change: And he is gonna be us evaluating where to cut price goes to and therefore, our balance sheet to be watching as we ramp up and it'll be saying, how we progressed in Panama. So no intent as we currently sit here today. That's also not to say that hedging program in and of itself is has ended a long term goal is to be unhedged.
Ryan Megill: Great.
Myles Allsop: A couple of quick questions, maybe one for Brian on the hedging should we assume that it's done now unless there is a delay to the ramp up for that three year poorly 50% hedged whether you look at copper or gold out to mid 2026.
Speaker Change: But as I noted to Chris's earlier question, we still have a way to go on deleveraging, which is why we continue to think of hedging as a valuable tool will continue to consider that through through the balance of this year.
Ryan Megill: Okay.
Ryan Megill: Small to untie that Ron.
Ryan Megill: Hi, Myles.
Speaker Change: We're pleased with the hedge book, we have in place both in terms of the volumes, noting close to 60% copper this year dropping down to 40% next year similar fold both of those hedges have been put in it at good prices.
Speaker Change: Yeah.
Speaker Change: Maybe on the Zambian stake sale should we.
Speaker Change: Take that off the table until you find this Gulf coast.
Speaker Change: Is that the right way of thinking.
Speaker Change: We will evaluate as we go quarter to quarter as we sit here today, we're not putting in additional hedges beyond H, one next year, but that decision whether or not do it.
Speaker Change: Okay.
Speaker Change: Brian to follow up on that.
Speaker Change: Yeah, Hi, mouse, yes, certainly.
Speaker Change: It's just to say, we're excited about the new gold opportunity, but he also caution that it's early and whenever you have an exciting but early opportunity that can make it challenging to agree valuations Robyn asset because it takes time to quantify what the size of the opportunity is there for what the value of the opportunity is and therefore, how that gets priced into the transaction.
Speaker Change: Extended hedges is going to be us evaluating where the price goes to and therefore, our balance sheet will be watching as three ramp up and we'll be seeing how we progress in Panama no intent as we currently sit here today that is also not to say the hedging program in and of itself is has ended a long term goal is to be unhedged.
Speaker Change: So that certainly does plant how thinking around options for the Zambian business from balance sheet perspective, and we're fortunate that has that is developed so the gold prices remained strong which means we've got multiple options that we can now consider whether that'd be prepays streams.
Speaker Change: And as I noted to Chris's earlier question, we still have a way to go on deleveraging, which is why we continue to think of hedging as a valuable tool will continue to consider that through through the balance of this year.
Speaker Change: Maybe on the Zambian stake sale should we.
Speaker Change: Or are they instrument say something we're continuing to think hard about but where that both the market and the development of concern. She has got to send it gives us strong opportunities.
Speaker Change: Thanks for the taking that off the table until you find this you've got polls.
Speaker Change: The right way of thinking.
Speaker Change: Balance of this year.
Speaker Change: Okay.
Speaker Change: Brian to follow up on that.
Speaker Change: Yeah, maybe one very last question on Pac attack kind of just following up from the previous question.
Speaker Change: Yes, yes, certainly as Tristan said, we're excited about the new gold opportunity, but he also caution that it is early and whenever you have an exciting but early opportunity that can make it challenging to agree valuations rather than asset because it takes time to quantify what the size of the opportunity is therefore the value of the opportunity is.
Speaker Change: Should we assume that will only get approved with a.
Speaker Change: A different ownership structure that you would kind of syndicated down the risk for that project given recent news and challenges.
Speaker Change: Hi Mall, we look tech attack.
Speaker Change: And therefore, how that gets priced into the transaction. So that certainly does planned how thinking around options for the Zambian business from balance sheet perspective and with.
Speaker Change: Three main work streams I said they were on the Ricky on the environmental and water.
Speaker Change: Water permitting and then on that financing side of things. We've said previously that we were open to to navigate that financing pathway.
Speaker Change: As that has developed so the gold prices remained strong which means we've got multiple options that we can now consider whether it be prepays streams.
Speaker Change: You need to bring in partners. We think the partnership is a good model and for example, we have been looking at it to your previous question Zambia partnership is how we're looking at Mcgraw Hill in Peru, with Rio Tinto, Great project to develop with another very capable.
Speaker Change: All other instruments say something we're continuing to think hard about but where that both the market and the development of concern. She has got to send it gives us strong options.
Speaker Change: Added to this year.
Speaker Change: Yeah, maybe one very last question on Patkotak.
Speaker Change: Following up from the previous question should we assume that will only get approved with a.
Speaker Change: <unk> mining company.
Speaker Change: And indeed, cobre, Panama had partners in terms of ownership out of Korea.
Speaker Change: A different ownership structure that you would kind of syndicated down the risk for that project given recent news and challenges you've had.
Speaker Change: Hum.
Speaker Change: So we see that as a good model for Argentina.
Speaker Change: But you know exactly how that looks like it will be structured will just work that through over the course of the coming period.
Hi, Myles, we look tech attack.
Speaker Change: So the three main work streams I said they were on the <unk> on the environmental and water.
Speaker Change: Operator, we're coming off the hour so let's take one more question. Thank you.
Speaker Change: The water permitting and then on that financing side of things. We've said previously that we are open to to navigate that financing pathway.
Speaker Change: Thank you. Your last question comes from Ian Rossouw with Barclays. Your line is open.
Speaker Change: You need to bring in partners. We think the partnership is a good model.
Speaker Change: Thanks.
Speaker Change: Just a follow up on the balance sheet I'm, Brian just you mentioned.
Speaker Change: And for example, we have been looking at it to your previous question. Zambia partnership is is how we're looking at Mcgraw Hill in Peru, with Rio Tinto, It's a great project to develop with another very capable mining company.
Speaker Change: Around the options on the gold prepay or streams.
Speaker Change: And how that fits into tech attack on the balance sheet.
Speaker Change: <unk>.
Speaker Change: Extremes in Prepays doesn't really address the balance sheet leverage is just.
Speaker Change: And indeed, cobre, Panama had partners in terms of ownership out of Korea.
Speaker Change: Increases liquidity. So do you then think.
Speaker Change: A minority stake sale or potentially bringing in partners for funding for Taco Taco is then required.
Speaker Change:
Speaker Change: So we see that as a good model for Argentina.
Speaker Change: But exactly how that looks like it.
Speaker Change: Well.
Speaker Change: To get into the timelines for the Ricky.
Speaker Change: We'll be structured will just work that through.
Speaker Change: As Tim mentioned.
Speaker Change: Over the course of the coming periods.
Speaker Change: And then secondly, just a quick one on on Panama I see the K P. M. C. Ste course diluted could you maybe just provide a bit of color there.
Speaker Change: Operator, we're coming onto the Atlas So let's take one more question. Thank you.
Speaker Change: Thank you. Your last question comes from Ian Rossouw with Barclays. Your line is open.
Speaker Change: Thank you.
Ron: Ron could you take both of those.
Ron: Oh, Hi, let's say.
Speaker Change: Thanks.
Ron: <unk> interest in mentioned, we're going to explore a variety of options, we're not gonna be as definitive to say for sure. The ownership structure is going to change before we moved forward with tokotoko, but we can be definitive in saying, we'll explore partnership we will explore streams, we will explore project finances, and the fact that it's a tremendous asset means it will we will.
Ian Rossouw: Just a follow up on the balance sheet, Brian just you mentioned.
Ian Rossouw: Around the options on the gold prepay or streams.
Ian Rossouw: And how that fits into <unk> and <unk>.
Ian Rossouw: Balance sheet.
Ian Rossouw: <unk>.
Ian Rossouw: Extremes in Prepays doesn't really address the balance sheet leverage is just.
Ian Rossouw: Increases liquidity. So do you then think.
Ron: Have good options there, but it's too early to say, where they explore those options will lead to in terms of what the ultimate structure is for.
Ian Rossouw: Minority Stakes Halo potentially bringing in partners for funding for Taco Taco is then required.
Speaker Change: For Osaka Tucker.
Speaker Change: The way <unk> structured as Tricia noted you've got till June next year to apply and in the subsequent two years you need to meet the 40% of the $10 million to qualify for Ricky So theres, an $80 million, which you need to spend back to above and the subsequent two years.
Ian Rossouw: Sure.
Ian Rossouw: To get into the timelines for the Ricky.
Ian Rossouw: As Tim mentioned.
Ian Rossouw: And then secondly, just a quick one on on Panama.
Speaker Change: PMT stay close diluted could you maybe just provide a bit of color there.
Speaker Change: So we think there are a variety of options to fund that on the basis that we apply for Ricky before mid next year that said, it's early days and we're now we're in the exploring options space from a financial perspective.
Ian Rossouw: Thank you.
Speaker Change: Ron could you take both of those.
Speaker Change: Hi, Ian.
Ian Rossouw: On Taco Taco Tristan mentioned, we're going to explore a variety of options, we're not going to be as definitive to say for sure. The ownership structure is going to change before we move forward the tokotoko, but we can be definitive in saying, we'll explore partnership we will.
Speaker Change: On K P M C.
Speaker Change: As you know, we hold a 90% stake in <unk>.
Speaker Change: Panama, 80% of that is direct and 10% of that is indirect through a vehicle called K P. M. C. The other one okay P M C.
Speaker Change: <unk> streams, we will explore project finances, and the fact that it's a tremendous asset means we will have good options there, but it's too early to say where they exploring all of those options will lead to in terms of what the ultimate structure is.
Speaker Change: Yeah Korean government parastatal, so they hold a 10% stake in Cobre Panama.
Speaker Change: For Tokotoko the way <unk> structured as Tricia noted you've got till June next year to apply and in the subsequent two years you need to meet the 40% of the <unk>.
Speaker Change: They the Korean government has said, they're not in a position wildcard that Panama is offline to fund the PSE and program. So as a result, we've been self funding that.
Speaker Change: $200 million to.
Speaker Change: To qualify for Ricky so theres, an $80 million, which you need to spend that to above and the subsequent two years.
Speaker Change: Of that that sandwich resulted in a dilution of their stakes. So we've moved from a 90% stake to a 91% stake.
Speaker Change: So we think there are a variety of options to fund that on the basis that we apply for Ricky before mid next year that said it's early days.
Speaker Change: I would note that hasn't prevented very constructive engagement between us and them.
Speaker Change: So they've been good partners as we work through this challenging time in Panama, and I think what they like US really look for a good resolution in Panama.
Speaker Change: And we're now in exploring options face from a financial perspective.
Speaker Change: But also particularly nickel Panama more broadly, but in terms of the financing and dilution mechanics, that's how it's played out in.
Speaker Change: On <unk>. So as you know, we hold a 90% stake in <unk>.
Speaker Change: Cobre, Panama, 80% of that is direct and 10% of that is indirect through vehicle Cole K PMC. The other owner of KPMG as <unk> Korean government parastatal, so they hold a 10% stake in Cobre Panama.
Speaker Change: That is all the time, we have for questions I will now turn the call cause Cheskin, Tristan Pascoe for closing remarks.
Speaker Change: Thanks, operator.
Speaker Change: I'd like to thank everybody for joining the call today and for your interest and time.
Speaker Change: The Korean government has said, they're not in the position while Cobra Panama is offline to fund the ph and program. So as a result, we've been self funding that because of that that sandwich resulted in a dilution of their stakes. So we've moved from a 90% stake to a 91% stake.
Speaker Change: I look forward to seeing some of you for our Zambian analyst and Investor Tour in September. Thanks.
Speaker Change: Everyone.
Speaker Change: Yeah.
Speaker Change: This concludes today's conference call. Thank you for joining you may now disconnect.
Speaker Change: I would note that hasn't prevented very constructive engagement between us and then will that be.
Speaker Change: Good partners as we work through this challenging time in Panama, and I think what they like US really look for a good resolution in Panama for ourselves, but also particularly for Panama more broadly, but in terms of the financing the financing and dilution mechanics. That's how it's played out in <unk>.
Speaker Change: Yes.
Speaker Change: That is all the time, we have for questions I will now turn the call to your chicken Tristan Pascal for closing remarks.
Tristan Pascal: Thanks, operator.
Tristan Pascal: To thank everybody for joining the call today and for your interest and time.
Tristan Pascal: I look forward to seeing some of you for our Zambian analysts and Investor Tour in September. Thanks.
Tristan Pascal: Everyone.
Tristan Pascal: Yes.
Tristan Pascal: This concludes today's conference call. Thank you for joining you may now disconnect.
Tristan Pascal: [music].
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Tristan Pascal: Sure.
Tristan Pascal: [music].
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Tristan Pascal: Sure.
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Tristan Pascal: [music].
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Tristan Pascal: Sure.
Tristan Pascal: [music].
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Tristan Pascal: Okay.
Yes.